6th Parliament · 1st Session
The President took the chair at 3 p.m., and read prayers.
– Is the Minister of Defence aware that arrangements’ are being’ made by the Military authorities for the removal of the Camp from Newcastle to Sydney! In view of the large number of men affected thereby, and in the interests of the Newcastle district, will he cause the arrangements to be suspended pending an inquiry into such drastic action?
– This matter was brought under my notice by Senator Watson and Mr. Watkins, and yesterday I despatched to the QuartermasterGeneral (Colonel Stanley), who is in Sydney, a telegram instructing him to make a full inquiry into the reasons for the closing of the Camp, and to thoroughly satisfy himself that such action was justified. I have not yet received a reply, and I do not feel that I should interfere without due cause being shown. My policy has been to give the Commandant of each military district a free hand as regards the distribution of camps within the district, asI understand that he is better able to judge of the district than is the Military
Board or myself sitting in Melbourne. The main Camp in New South Wales is at Liverpool, and the policy in regard to the other camps in the State has been that they should be treated as recruiting camps in which men go through their elementary work. When they reach an advanced stage they are transferred to the main Camp, and it is just possible that that stage has been reached as regards the Newcastle Camp. There may not be a sufficient number of recruits to justify its retention. If I get a reply from the QuartermasterGeneral I will let the honorable senator know its terms.
Report (No. 5) presented by Senator Ready, on behalf of Senator Barker.
Motion (by Senator Newland) proposed -
That a return be prepared and laid upon the table of the Senate snowing the regimental number of each man now in Military Camp in each State, who has been in camp for a longer period than six months. Also the reasons (in groups) why such men have not gone to the front with the units to which they were origin ally attached.
– In the case of a formal motion there can be no discussion and no amendment.
– Cannot an amendment be made by consent, sir?
– An amendment can be made by consent or leave, but there can be no discussion.
– The motion is very different from what was shown to me yesterday.
– If I may be allowed to explain,- sir, my idea is to find out whether it is a fact-
– Order I
– May I be allowed to make an explanation, sir?
– A personal explanation.
– Senator Newland showed me a copy, of the motion, but it did not then refer to the regimental number of each man. What he desires to as certain is the number of men who have been in camp for six months.
– But you cannot trace the men without the regimental numbers.
– We can. I suggest that the honorable senator should ask leave to amend his motion so as to get a return showing the number of men in camp.
– Does he not want to identify each man ?
– Had I understood that to be the purpose I would have opposed the. motion.
– Is the motion seconded ?
– I second it.
– Can I move an amendment, sir?
– No. The motion was allowed to go as formal, and there , are only two courses open to the Senate, namely, either to accept it or to reject it.
– It would be impossible to comply with such an order.
Question put. The Senate divided.
Majority . . . . 5
Question so resolved in the negative.
Report of Public Works Committee., together with minutes of evidence, relating to the proposed alterations and additions to the Customs House, Sydney, presented by Senator Story.
Bill received from the House of Representatives.
Standing and Sessional Orders suspended, and Bill read a first time.
– I move -
That this Bill be now read a second time.
This is a Supply Bill to provide £647,696 for the services of the current year. It will provide sufficient money to carry on the public works of the Commonwealth until the 28th February next. Part of the sum authorized by the Bill to be expended will be drawn from revenue, and part will be charged to loan. Part of the defence expenditure authorized by the Bill will be charged against revenue, and that which may be regarded as war expenditure will be charged against the war loan. The expenditure proposed at YassCanberra and for the Kalgoorlie to Port Augusta railway will be charged against the loan from the Bank Notes Trust Account.
– The Minister might indicate the items under defence expenditure which will be charged to loan.
– I shall try to do so when the Bill is in Committee.
– I wish to refer only to the point to which I directed the attention of the Minister by way of interjection. I should like to know, and I feel that honorable senators generally would like to know, if there is to be a departure in the method of meeting expenditure, in what direction the departure is developing. The Minister of Defence has undertaken, when the Bill is being considered in Committee, to try to let us have that information. He will recognise that before honorable senators are asked to sanction a departure in policy in regard to the expenditure of money they should have full information before them.
– What I wish to impress on the Government and members of the Senate is the necessity for great economy of expenditure at the present juncture in the history of the Commonwealth. We know that we are engaged at present in a war the end of which, from the point of view either of time or result, no man can forecast accurately. Of course, we all hope that Australia and the Allies will come out on top, but whether they do or not it is evident to every one that Australia will come out very much at the bottom financially because of the expenditure which will have been incurred. I do not see any evidence of a disposition to effect savings in these Estimates. At a time of stress and difficulty like the present, all expenditure should be limited to that which is absolutely necessary. Not a single farthing should be spent which can be saved and used for the purposes of defence. To-day we are building up a huge debt in Australia. A few years ago we were in the happy position of having no creditors - of having no interest to pay. But we are piling up an unproductive debt - a debt which may involve us in the payment of anything up to £10,000,000 . per annum in the form of interest. We are rapidly approaching the £100,000,000 mark of indebtedness, and before the war is over our indebtedness may be £200,000,000. That fact in itself ought to have a restraining influence upon the expenditure of the Commonwealth. T know it will be urged that there is a large number of men in every portion of the Commonwealth who are lacking employment. That may be very true. But why are those men out of employment? And if they are out of employment, will this indiscriminate expenditure provide them with permanent employment ? I say that this kind of policy has been adopted in Australia from the very beginning. It has been adversely criticised by every financial authority. Yet it is in fuller blast to-day than it has ever been in our history. I repeat that this policy cannot continue. If it be permitted to continue, Australia will be practically in the hands of the receiver. That is the only outlook so far as I can see.
– What will he receive - the debt?
– He will receive the soil and the natural wealth of Australia, together with its estimable citizens. He will have the whole lot in pawn, and one of his assets will undoubtedly be Senator Bakhap.
– The honorable senator is in a pessimistic frame of mind today.
– I am not pessimistic. I am merely pointing out the inevitable condition of Australia within a few years. There is no escape from it. It will not be time for us to shorten sail when the whirlwind is upon us.
– Wherein can we shorten sail ?
– Unfortunately, at the present moment it may be difficult to shorten sail. But the great mistake which has been made in the past is that too little inducement has been offered to people to go upon the lands of the country, and too much inducement to crowd our cities. Now is the time to take stock of the situation. Who are the men who are unemployed to-day? Are they those who earn their living on the lands of Australia, or are they the men who have drifted into our cities? Undoubtedly, it is the cities of the Commonwealth which are responsible for our unemployed. I have said before, and I shall continue to say it, that the present condition of Australia, which prompts more than half our population to live in the cities, is a condition which is wholly unhealthy, and which, if permitted to continue, must result in serious disaster.
-What does the honorable senator propose to do in the matter ?
-I have been offering proposals in the Senate for many years, and the honorable senator has listened to them. The remedy is obvious to anybody who cares to look for it. But a great many persons are born mentally, if not physically, blind. To them it is idle to speak. A number of others have their weather eye on the constituencies. They know that there is a large voting power in our cities, and that power is cultivated with the greatest care by many of our politicians. They never trouble about the welfare of the country. They do not concern themselves with whether the policy which is being adopted is for the ultimate good of the people. All that they care about is that they, individually, shall get back to Parliament, and that the party with which they are associated shall be in power.
-The honorable senator is referring to the Liberal party.
-I am referring to every party in this Parliament. The party with which the honorable senator and myself are associated is no less blameworthy in this matter than is the other political party.
– The members of the Labour party are great place hunters, I believe ?
– I am dealing with this matter as it affects the welfare of the Commonwealth. The position is sufficiently serious to demand careful attention at the hands of every honorable senator. We have before us a probable interest payment, for which there will not be a single farthing returned, of £10,000,000 per annum, or £2 per head of the population. This will be an entirely new payment.
– Does the honorable senator’s estimate of an interest bill of £10,000,000 annually relate to the Commonwealth debt only? Does it include interest on the States indebtedness?
– It does not include interest on any indebtedness by the States. I say that a war indebtedness of £200,000,000 by the Commonwealth is very probable. It may even amount to more, and if it reaches £300,000,000, God help Australia!
– Why not have said that at the beginning ?
– We shall have very much harder times in Australia than we have ever experienced before, and it is time that we attempted to do something to stem the tide of misfortune that will inevitably set in upon us within a very short period. I have already pointed out on many occasions that settlement on the land is the remedy for this state of affairs.
– Order ! I cannot allow the honorable gentleman to pursue that line of argument on this Works and Buildings Bill.
– Of course, I know that the Standing Orders prevent discussion of this character, and that you, sir, are compelled to carry out the Standing Orders; but with reference to the Standing Orders themselves, it seems to me that the men who framed them-
-Order ! I cannot allow the honorable senator to reflect on the Standing Orders.
-They deserve to be reflected upon.
– I would point out to the honorable senator that the Standing Orders do not deprive him of a full opportunity of giving utterance to any remarks he may desire to make. I understand that later on in this sitting a Supply Bill will be presented, on the first reading of which the honorable gentleman can talk on every subject from Dan to Beersheeba. Therefore, to say that the Standing Orders prevent him from speaking on any matter is saying something which is not correct.
– With all deference to you, sir, I did not say anything of the kind. What I suggested was that it was impossible to discuss a financial measure of this character without taking a large and comprehensive view of the general financial position; and if the Standing Orders prevent that, then I think they ought to be altered. In this Bill, we have a sum of £58,000 for the Federal Capital, and I want to know if it is really necessary, at the present juncture, to go on with that expenditure.
– The sooner we get away from Melbourne the better.
– Of course, I know that the honorable gentleman desires that the Commonwealth should be established in its own house, so to speak, but we ought to be sure that the house is ours. We are not sure, at present, to whom the house may belong.
– You want the house, but not a mortgage on it.
– Who will be the bailiff ?
– The honorable gentleman can name the bailiff for himself. The thing is a possibility, though it may not be a probability. It is a contingency that every man ought to ke well in view, that Australia may not, at the end of the war, be master of her own destinies. I hope she will be. but we h”- - no assurance to the effect, and I think that whatever resources we have ought to be expended in making such an assurance doubly sure. Instead of building up the Federal Capital, we ought to be getting out munitions of war, and spending our money in sending more and more men to the front, so as to enable us to prosecute this war with greater efficiency. These remarks may be applied to a number of other items which are included in the Bill. I have no intention of continuing the debate, but I want to say I think it was extremely necessary, in the present circumstances, to make the few remarks 1 have uttered ; and when the next Bill cornea along, perhaps I may embrace the occasion to amplify them.
– I do not wish to take up very much time in discussing this Bill, but I regret that honorable senators have not more information about the various items of expenditure outlined in it. It is quite impossible for honorable senators, in the absence of that information, to say whether the Government are extravagant or not, because we do not know for what purpose this money is required.
For all we know to the contrary, every penny might be needed for absolutely necessary works. My honorable friend, Senator Stewart, has criticised the measure rather severely, and he has told us that the Government should curtail their expenditure. That is very good advice, but, as I have already said, we are not aware of the details of this expenditure, large as the amounts may be, and I really think we ought to be furnished with more information. Senator Stewart said that the expenditure on the Federal Capital ought to be abandoned; but I affirm unhesitatingly that that expenditure should not only not be abandoned, but, if necessary, very much’ larger sums should be expended on that work.’
– Then, we will take that million we are going to give to the Murray waters scheme, and spend it on the Federal Capital.
– That is another matter altogether. When the Murray River Agreement Bill comes along, I will endeavour to show the honorable senator that Australia is not going to advance one step by the adoption of the policy that he is endeavouring to persuade the Senate to accept. How is development to proceed if we do not spend money on such necessary works? I am pleased to say that I spent a week in the Federal Territory recently, and I regret that more honorable senators do not take advantage of an opportunity to visit that area.
– I have been there.
– It is a very fine place, and my only regret is that the Federal Capital works are not sufficiently advanced to enable the Commonwealth Parliament to conduct its deliberations there. . Personally, I would be prepared to go to the Federal City, and sit in the Federal Parliament, even if it were held in a tent, in order to get away from Melbourne and its pernicious newspaper influence.
– I hope that when we do meet in the Federal Capital we shall not have such long sessions.
– You would not then be able to run home for the week end.
– I would be prepared to live in the Territory, where the Parliament was sitting, during the whole of the session, and give all my time and whatever ability I possessed to the work which the electors of the State I represent sent me here to do. I find fault with the manner in which our work is attended to in Melbourne, and I feel confident that, had we been meeting in the Federal Capital, a measure of this kind would not have been brought forward on practically the last day of the sitting. I hope the Government will not curtail by one penny the expenditure they consider necessary on the Capital site. They ought to hurry up and finish the building of the city, so that the Federal Parliament may be housed there, and the land values of the Territory may help to pay the interest bill of which Senator Stewart makes such a bogy. I look forward to the time when the rents derived from the enhanced value of property there will go a great way toward reducing Commonwealth taxation. It will be absolutely wrong for the Government to discontinue public works because we are living in a time of financial stress. Panic should be avoided, and public works must go on, not so much for the sake of those employed on them, although that is an importantconsideration, but because the Federal Government must incur all expenditure essential for the development of the Commonwealth.
Senator Lt.Colonel Sir ALBERT GOULD (New South Wales) [3.43].- It is unfortunate that no financial statement has been submitted to us before we are called upon to deal further with the finances. It looks as if we will never get away from the difficulty of being called upon to deal with Supply Bills without knowing the true financial position. The new Treasurer has promised to deliver an interim Budget statement; but in the circumstances we cannot expect from him a very exhaustive or detailed account of the finances. Still it would have been much better if we could have had even that incomplete statement before we were called upon to consider this measure. All the information we have consists of totals. For example, we are asked to vote £90,000 for post-office buildings, with no particulars beyond the fact that so many thousands are to be voted for each State. There is very little information in that. We are told also that some of the money is to come from loan account, and some from current revenue; but the Minister asks us to wait until we get into Com mittee to learn which is which, and even then, I dare say, the details will be very meagre. Some of the expenditure is certain to be for items that should be dealt with in the schedule of a Loan Bill. I agree with Senator Stewart, that we must be careful about our financial position, as ordinary expenditure, unless closely watched, has a habit of jumping up year by year. It would be suicidal at a time like the present to waste our resources only to find that we had not enough money to put into the struggle for the integrity of the Empire. To spend money freely and bring ourselves into difficulties over Defence matters would be to live in a fool’s paradise. It is of no use to help to develop a country if we are to lose control of it through sheer inability to bear our fair share of the enormous expenditure that must be incurred to bring the war to a successful conclusion. Senator Stewart spoke of our debt being £100,000,000.
– It is more like £350,000,000.
– The Commonwealth debt is practically over£100,000,000.
– I was referring to the State debts also. We are all one people.
.- New South Wales has already piled up a bigger debt than the Commonwealth.
– How do you make out that the Commonwealth debt is over £100,000,000?
.- Although £100,000,000 is not due by the Commonwealth at this moment, the steps already taken mean that ultimately our debt will be well over that figure, in this way -
– From the note issue you must deduct the gold reserve.
– The gold held in reserve amounts to from £10,000,000 to £14,000,000; but if we are to deduct our assets we must remember that we have the whole of the taxing power of the Commonwealth as an asset behind our debt.
– Does the honorable senator consider that a general discussion on the loan, policy should be initiated on this Bill ?
– I was using the fact of our large loan indebtedness to show how careful we must be in voting money for ordinary supply. We do not know how much more war expenditure we shall have to provide for. At 4 per cent., the total given above means an annual interest payment of nearly £4,500.000. I recognise that from time to time loans must be raised because we need money. At any rate, these are matters of considerable moment which ought to engage the mind of every honorable senator. The obligations will have to be met regularly by the Government wherever the money may have to come from. We have, necessarily, additional expenditure on war pensions. It is a legitimate provision. The amount will, of course, depend upon the duration of the war and the number of casualties. I think that Senator Stewart is to be commended for calling attention to the danger which lies in front of us, and to the necessity of being particularly careful as to how far we shall expend money for different purposes. Take the case of a private individual. When he finds that certain inevitable charges are growing day by day, does he not proceed to look round and see in which directions he can save, and so avert the possibility of drifting into the Bankruptcy Court? The Government of the Commonwealth ought to pursue that course, too. We want them to give us particulars of these items, and to convince us, not merely that the- expenditures are necessary or desirable, but really urgent in the present position. I feel quite .sure that so lon? as honorable senators are satisfied on that point Ministers need anticipate no difficulty in regard to getting money voted. I have made these remarks, not with the idea of causing trouble or embarrassment to the Government, but to point out to honorable senators that all these matters ought to be looked at in a methodical manner before they are called upon to vote large sums.
.- What I have to say is prompted by certain remarks which fell from Senator Gould. I am very suspicious of honorable senators on the other side who preach economy, because from my experience, and from my study of politics, particularly of their administration, I find that their notion of economy very often consists of cutting down necessary public works, and then proudly boasting that they have gone in for a policy of economy which is in the best interests of the nation. What we ought to do at this juncture is not to stop necessary public works. We are now engaged in a very great war. If we win, Australia will be, I believe, a greater country than ever she has been, and her prosperity will be abounding. The money expended to keep necessary public works going and to encourage a policy of development will undoubtedly bear fruit in the future when we have prey hair or are in our graves. But if we lose, it does not matter much anyhow.
– Spend your money like “ toffs.”
– We shall not have the dictating of the policy which will be pursued if the Central Powers triumph, and, therefore, I think that any policy which proposes to cut down unnecessarily developmental works should not be encouraged by any member of the Senate. There is one thing which, I think, we could do, and that is to follow on the lines already instituted by the present Government, and encourage a policy of national efficiency, and commence that policy in the superintendence, the organization, and the control of public works. In the House of Lords, Lord St. Davids asked the Imperial Government whether, in view of the serious situation confronting the Empire, they would inaugurate a policy of investigating the civil service of Great Britain, and the Prime Minister promptly assented to the proposal. Mr. Harold Cox - one of the greatest financial experts in the Empire, and a man of great ability and wonderful powers of organization - was appointed to control a Committee of selected experts. Their duties are to investigate not so much the spending of money as the methods in which it is spent. According to the English files I have been able to see, the Committee started at the very top. and are going to dispense with much of the red-tape and trimmings which now mark the civil service. The present Commonwealth Government started with that policy. On taking office they appointed Mr. McC. Anderson, an expert of undoubted ability, to investigate the Post and Telegraph Department, and also the Defence Department. His recommendations were sensible, practical, and businesslike.
– Are they being put in force ?
– I think so.
– So far as the Defence Department is concerned, his main recommendations have been put in force.
– I am glad to hear that interjection from the Minister. Suppose that, in addition, the Government were to pick out two or three men of undoubted capacity, and with commercial and business training, and appoint them as a permanent Committee to go systematically through every public Department, I believe that the movement would save to the country hundreds of thousands of pounds. Not only that, but it would result in a more efficient and more workable Service than we have to-day.
– That is just what we have been advocating - economy.
– It is economy of a different kind from that which Senator Gould advocated.
– Your brand of economy would inevitably displace a number of men.
– It would mean efficient spending, but the brand of economy I have heard advocated from the other side would mean the cessation of spending. There is a great difference between efficient spending and stopping expenditure.
– That is not so.
– I am very glad that my honorable friends are disclaiming that sort of policy now. I can assure Senator Gould that it is the policy which his party has been advocating in Tasmania, and over which the crisis in the House of Assembly has arisen.
– What you are advocating is a Black Wednesday in the Public Service.
– This discussion is too general. I remind Senator Ready that this is a Works and Buildings Bill, not a Supply Bill.
– I bow to your ruling, sir. I do not advocate a Black Wednesday for the public servants, but I do advocate a policy which, in the case of our works and buildings, would make for a far more efficient method of spending the public money. It would improve the Public Service. It would give to every man with a valuable suggestion an opportunity to make it, and if it was a good one it could be adopted. T believe that that kind of economy would benefit the whole of the people of Australia.
Question resolved in the affirmative.
Bill read a second time.
Clause 1 agreed to.
Clause 2 (Issue and application of £647,696).
– I wish to refer to a statement of the Minister that some portion of this sum is to come out of a loan fund. The clause appropriates money from the Consolidated Revenue .Fund, and, therefore, even if a portion of these items are to be paid for out of the Loan Fund, some other authority will be required from Parliament later to pay into the Consolidated Revenue the proceeds of loans.
– The Loan Bill will do that.
– As this measure deals with an appropriation from the Consolidated Revenue Fund, it seems to me that any information which the Minister could give us would be of very little use, because the whole of this £647,696, although it is to be directly taken from the Consolidated - Revenue, might in reality come from the Loan Fund if later we should authorize the raising of loans and the payment of the proceeds into the Consolidated Revenue Fund. I had not noticed the position when I was speaking to the second reading, but this fact does very much emphasize the statement by the Government that we are placed in a very difficult position to determine what we ought to do until we have had an opportunity of learning the character of a statement which, I understand, is now being delivered elsewhere. However, whilst I recognise the difficulty of definitely determining this matter, I shall appreciate any information which the Minister can supply as to the apportionment of this sum between Loan Funds and the ordinary revenue.
– In my second-reading speech I made a statement as to the apportionment of this expenditure. I said that part of the Defence expenditure provided for in the Bill would be a charge against a special war loan, but I find, on investigation, that my statement was not correct. I spoke on the authority of a statement made by the Treasurer, who, apparently, spoke without full information, because the whole of the Defence expenditure provided for in this measure is to be charged against the Consolidated Revenue, and not any part of it against the Loan Fund. The only part of the expenditure covered by the Bill which will be chargeable against the Loan Fund is the money to be spent at Yass-Canberra and the transcontinental railway, and that will be a charge against a loan from the Bank Notes Trust Account. It will be remembered that the Estimates for last year were accompanied by a Loan Bill authorizing a loan from the Bank Notes Trust Account and a special war loan, and that there was a deficit. Although the Estimates showed that the expenditure and the revenue balanced, that result was obtained by means of a payment into the Consolidated Revenue from a loan from the Bank Notes Trust Account. lt was pointed out at the time that much of that expenditure would occur in the early part of the financial year, that before the end of the year we might be able to make both sides of the ledger balance, and that it would be necessary in the early part of the year to pay money from the Loan Fund into the Consolidated Revenue Fund, which would be recouped after money had come in. Much the same position exists now. The Estimates for the ordinary Departments could easily be submitted, but the expenditure on such Departments is a mere bagatelle compared with the total amount. The Defence expenditure is an uncertain and increasing quantity, and, therefore, any Estimates which we might bring down now would be very uncertain. The Government have thought it far better that they should make a statement of the financial position so far as it is possible for them to do so. Such a statement was made some time ago by Mr. Fisher, and it was correct up to the time at which it was made. He forecasted probable expenditure in future. A similar statement is, I understand, being made to-day by the present Treasurer in the House of Representatives, and will also be made here by the Assistant Minister, Senator Russell, when dealing with the Loan Bill. That statement will be based on the experience gained since the time Mr. Fisher made his statement, and I can tell honorable senators that that experience haspractically justified the forecast of the position which was then made. The expenditure has been found to be practically what Mr. Fisher estimated it would be. But there is one disturbing factor which prevents the making of anything, more than an approximate estimate of expenditure. As honorable senators are aware, our Forces are sent oversea, and the responsibility for a considerableamount of material required to keep them in the field must necessarily be undertaken by the British Government. The Government of the Commonwealth have agreed to bear the whole of the expenditure involved in keeping our Forces in the field. What that expenditure will amount to it has been impossible for us up to the present time to say, as no accounts of it have yet been rendered by the British Government. We have asked that the accounts should be rendered from time to time, and as soon as possible, so that periodic adjustments might be made, but no accounts have so far been rendered. It is, in the circumstances, impossible for us to bring forward anything more than an approximate estimate of expenditure.
– Will that expenditure include freight charges and the chartering of ships?
– It does include such charges. Transports have been chartered by the British Government to take our troops from Egypt to the front, and the cost will be debited to our expenditure.
– I am afraid we shall have a very big bill to pay.
– Did the estimates of expenditure given by Mr. Fisher make allowance for charges on this account not yet rendered by the Imperial Government?
– Yes; all the estimates so far submitted have made allowances for this charge, and have been estimates of what the total expenditure will be. The estimates that will be submitted by the Assistant Minister in making his statement on the Loan Bill will include an amount to cover such expenditure, and, so far as’ we can see, it will be approximately correct. But because of this disturbing factor the estimates made cannot be so accurate as to place the Government in a position to ask Parliament for so much money, and no more. On this clause, I might be allowed to refer to one or two things which were said on the second reading of the Bill by Senator Gould, who, I am sure, has no desire to misrepresent the financial position of the Commonwealth. That would be a most unpatriotic thing to do. The honorable senator has overlooked one or two things in his estimate of our total indebtedness. First of all, as regards the£18,000,000 which we had borrowed from the Imperial Government, the honorable senator has overlooked the fact that we have lent a similar amount to the State Governments on what we believe to be good security.
– Have we not to meet that out of the NotesFund?
– No. Senator Gould mentioned the total of the note issue as a liability of the Commonwealth, and then added to that the £10,000,000 which we have borrowed from the banks.
-Is it not a fact that the Government have authorized the issue of notes for circulation to the amount of £46,000,000?
– That is so: but the honorable senator has failed to notice that for the £10,000.000 we have borrowed from the banks, we have issued notes to the value of £10,000,000, and they are included in the total of £46,000,000, representing the total note issue. Quite unwittingly. I am sure, the honorable senator has debited the Commonwealth twice with this amount of £10,000,000.
– That is not an unusual thing for members of the Opposition to do.
-It ought not to be done.
– What I understand the Minister to say is that for the £10,000,000 lent to the Government by the banks, the Government have issued £10,000,000 worth of notes, and they form a, portion of the total note issue of £46,000,000.
– That is so. The exact position of the note issue is that it is estimated that the total value of notes in circulation on 30th June, 1916 will be £45,783,000, and the gold reserve will amount to £16,837,000, and not, as the honorable senator said, to only £10,000,000 or £12,000,000. The financial position is, therefore, very much better than Senator Gould represented it to be. We have, in the first place, to strike off £18,000,000 from his estimate of total indebtedness, because of a contra indebtedness of the States to the Commonwealth for the same amount, and we must not charge against the Commonwealth the £10,000,000 lent by the banks, unless we deduct the same amount from the total note, issue. In the next place, we have to take into consideration that against the total note issue we have the £10,000,000 lent by the banks, and £16,837,000 in gold.
Senator Lt.-Colonel Sir ALBERT GOULD (New South Wales) [4.12].- I welcome the explanation given by the Minister of Defence, as no one could have any object in misrepresenting our financial position.I find that my estimate of the total note issue at£46,000,000 is correct, but that it includes notes to the value of £10,000,000 issued on the strength of money lent by the banks. With regard to the £18,000,000 lent to the States, I remind the Minister that it is still a part of the indebtedness of the Commonwealth.
– Hear, hear! We still owe that money.
– That is so, though the State Governments also owe the Commonwealth £18,000,000.
– Did not the British Government advance £24,000,000 to the Commonwealth ?
– Yes, and that means that another £6,500,000 should be included in our total indebtedness. When it is said that against the £18,000,000 which we have borrowed from the Imperial Government there is a similar amount which we have lent to the States, it might be said that there are all the assets and resources of the Commonwealth to set against the whole of our debt. The Government, no doubt, estimate that the £18,000,000 lent to the States will be repaid within reasonable time.
– They are clamouring for more now.
– I am aware of that, and if we give them another £18,000,000 they would be prepared to spend it. The Minister of Defence was quite right in pointing out that £10,000,000 of the note issue, which’ may be set against the £10,000,000 lent by the banks, is included in the total note issue of £46,000.000; but I say that there is still great necessity for being very careful in our public expenditure.
Clauses 3 and 4 agreed to.
– Perhaps it would save time and trouble if I were to explain at this stage that this Bill is based on the Works Estimates of 1914-15. Honorable senators have complained that no details are supplied in this measure, but they have each been supplied with a cony of the Appropriation (Works and Buildings) Act of 1914-15, and if they consult that they will find that the amounts in this Bill represent progress payments on the basis of the schedule to that Act. Taking, for instance, the first item under the Home Affairs Department, there is a vote for a store at Darling Harbor^ and a vote for additional accommodation for the High Court.
– It is rather a coincidence that the votes should be the same for each year ?
– The point is that the expenditure has been authorized, but the buildings have not been completed. The store at Darling Harbor is a very large building. It has not yet been completed, and progress payments upon these works are. made as they become due.
– Perhaps the Minister could give the Committee some information as to what is being done at the Federal Capital at the present moment.
– Two items included in the Works Estimates are £270,000 towards the cost of the establishment of the Capital, and £2,850 for the acquisition of lands lying outside the Federal Territory. I am unable to say to what purpose particular votes in this Supply Bill are to be applied, but I can inform Mie honorable senator that the principal works now proceeding at the Federal Capital are the main-pipe line, service reservoir, and pumping station for the water supply for the Capital ; the putting down of the main sewers as the commencement of the sewerage system, and work in connexion with the establishment of a brickworks at the Capital.
Senator STEWART (Queensland) the Government to the position of a number of persons whose land has been practically commandeered by the Commonwealth. These people cannot sell, though they can use their land, but they have no security of tenure, and do not know the moment at which the Government may intimate to them that they desire to purchase their land outright. When Senator Mullan and I were at the Federal Capital some time ago, that was a matter of very serious complaint. These people told us that they wanted to know definitely what position they were in, because every day’s delay made the bargain between them and the Commonwealth more disadvantageous to them. If these lands are ultimately resumed they will be resumed at what is regarded their value at the time the Commonwealth intimated its intention of taking them over. I need scarcely remind honorable senators that land all over the Commonwealth is constantly increasing in value. Let me put the case of a man at Yass-Canberra who possesses 200 acres of land, which in 190S was worth £2 per acre. Had his land been actually resumed at that time he would have been paid £400, plus the value of improvements, or a total, we will say, of £600. With that money he could have gone into the land market, at the time of which I am’ speaking, and have made a much more advantageous purchase than he could do with the same amount of money to-day. The probability is that £600 then would bc the equivalent of £1,000 now. Every year which passes without a final settlement of this matter being arrived at adds to the disadvantage of the persons whose land will be ultimately resumed. Senator Mullan and myself informed the owners of these lands that we would do our best to secure a settlement of the matter. I would like to know from the Minister whether anything has been done in that direction.
– I am glad that Senator Stewart has brought this question before the Committee. Upon many occasions I have endeavoured to direct attention to the” undoubted injustice under which land-owners in the Federal Territory are living. Senator Stewart has disclosed one aspect of this injustice, but he has not disclosed the worst aspect. There is a much more serious disability under which these men labour. Not only are they denied their right to share in the general prosperity of Australia, but they are often unable to sell their lands, because they cannot agree with the prospective purchasers as to the value which the Commonwealth is likely to put upon their lands. Senator Stewart has put the case of an individual whose land at the time the Commonwealth notified its intention to resume it wa3 worth £2 per acre. May I point out that such an individual, if he were desirous of disposing of his land, would be at once met with the inquiry on the part of the prospective buyer, “ How do I know that the Commonwealth Government will regard £2 per acre as the value of your land in 1908”? In one case of which I have some knowledge, the Home Affairs Department was asked to declare its valuation of certain land in order that the vendor and a prospective purchaser might come together and make a deal. The Department declined to do this. It adopted a dog-in-the-manger attitude. It would not even say the value that it placed upon the land. If it would only do that, it would enable land-owners in the Territory to transfer to others.
– Did the Department ask for an offer?
– I acted on behalf of the vendors, who wished to sell the land in subdivision. But the executors of the estate found that they were unable to sell by reason of the embargo which had been placed upon the land. The sale was announced, but the first question put to the auctioneer was, “ Can you tell us the value that the Commonwealth places upon the land?” Nobody would buy until that matter had been settled. The Department undertook to give a valuation, but the Minister who represented the present Government at the time declined to redeem that promise. I do urge that if the Government do not intend to take over these lands in the Territory, they ought to put a valuation upon them. It is a difficult matter for any body to say now what was their value in 1908. But that- difficulty will be considerably increased if another ten years are allowed te elapse before the matter is dealt with. In the particular case which I have cited an attempt was made to subdivide the land, and, but for this disability, the land would have been subdivided, and more people would have been settled upon it. This is a fact which is worthy of serious attention. But the main consideration is that a distinct injustice is being done to the land-owners in the Federal Territory, because the Department will not say ‘whether it intends to take over their lands, and because it declines to put a value on them. I urge the Assistant Minister to again bring this matter under the notice of the Minister of Home Affairs, with a view to notifying owners, whose lands the Department is not prepared to take over immediately, of the value which it places upon them. The land to which I have referred was known as Cunningham’s Estate. By acting in the manner I have suggested the Government will be placed under no disability, and will be doing only a simple act of justice.
– I am glad that Senator Millen has brought forward this matter, because I am sure that we all sympathize with the land-owners in YassCanberra. At the same time, there is only one satisfactory way of settling this vexed question, and that is by the Commonwealth acquiring their lands at the earliest possible moment. Unfortunately, our finances -will not permit us to purchase them just now.
– The Government 0have £1,000,000 to throw away on the Murray River.
– It is a pity that that stream does not run through Queensland. We should then hear less objection from the honorable senator to the Murray Waters Agreement. I hope that the lands at Yass-Canberra will prove as productive as the lands along the banks of the Murray will prove in the near future. Whilst I was acting for the Minister of Home Affairs I took up the position that the Commonwealth was not keen in spending money in the purchase of lands there just now, but that wherever the owners were pressing us to resume, so long as a reasonable price could be arranged, steps should be at once taken for their acquisition. As a result, quite a number of applications were received from landowners, but in all instances they were accompanied by unduly high claims. In no instance could we acquire the land at a reasonable price. Some fifteen or sixteen blocks were offered to us, but in every case the owners asked what the Department regarded as an exorbitant price. The result was that we immediately entered into negotiations for putting into operation the provisions of the Lands Acquisition Act. These blocks are now in process of acquisition. However, I will bring the matter under the notice of the Minister of Home Affairs. Generally speaking, I think that where special circumstances exist, and where any landowner desires to get rid of his land, so long as a reasonable price can be arrived at. that land ought to be acquired by the Commonwealth.
– I was interested to hear the statement of the Assistant Minister, but he has not dealt with the point which I raised. I can see no difficulty in regard to putting a valuation upon land which the Department does not propose to purchase, but which it has the right to resume. If the Minister will do what he has stated, I am sure the executors of the estate to which I have referred will be very glad.
– My own idea is that, in all cases where the land-owners are keen upon getting rid of their land, we ought either to take it over or put a valuation upon it.
– I am not particularly anxious to continue this discussion, but it seems to me that the Government are acting very unfairly towards these people. When I hear this matter discussed, and discover the real facts of the case, I do not wonder that Governments become unpopular, and that they “ stink in the nostrils “ of the people. Look at what the Government are doing! Let us take a square look at what has been done to these unfortunate land-owners, not only by the present Government, but by past Governments. Some years ago, they were informed that their lands had passed under the control of the Commonwealth, and that at some time in the dim and distant future those lands might be acquired by the Commonwealth. An embargo was thus “laced upon the sale of those lands. Even if the owners wanted to dispose of them, they could not offer them to the public, because the Commonwealth had a lien upon them. On the other hand, the Commonwealth will not buy until it discovers, in the fullness of time, whether it actually requires these lands. This kind of conduct bears a very near resemblance to an act of robbery. The Government ought either to resume these lands or to release their owners from the embargo which has been placed upon them. If the people of the Commonwealth understood that any lection of its citizens were being treated in this fashion, they would not tolerate it. If a private land-owner indulged in similar conduct, there would be an outcry against him from one end of the Commonwealth to the other. If any private individual endeavoured to impose similar conditions on his employees, the same thing would happen. If any wholesale company attempted to deal with its retail customersin, a manner approximating to the course I have outlined, the country would ring with denunciation of it. Yet the Government go -on imposing these unfair conditions on the people. When Senator Russell was speaking, it was pressed home to my mind that he had no realization whatever of the injustice which was being done to those unfortunate people.
– You could not have heard what I said then.
– I heard what the honorable gentleman said.
– Have you any idea nf the areas held privately?
– I said that in regard to every application that came before me, if we could not agree upon a fair valuation, I immediately put into operation the Lands Acquisition Act. I could do no more.
– I heard that, but I also heard something else. In any case, I think the Government ought to take action to close the matter. If there is to be any loss the people of Australia are much better able to bear it than those unfortunate people who happen to be situated in a particular area of country which has been commandeered by the Commonwealth Government for the purpose of the Capital city. I hope, therefore, that before another year has passed this matter will be settled definitely.
– I will bring the matter under the notice of the Minister of Home Affairs, and, as far as possible, I will endeavour to have it settled. I would like to say, however, that not every person at Yass-Canberra desires to be disturbed, and those who do not wish to leave will not be interfered with until the financial situation is a little easier.
– But can you not give them a valuation of the property ?
– There might be something in the Lands Acquisition Act to interfere with that course, but if there is not, I will see what can be done. At a later stage I hope to let the Senate know what is the position, and I might add that I am quite in sympathy with what has been said on this subject.
– I understand a proposal has been made for an increase in the telephone rates, and I would like to know if the Minister can give us any definite information in connexion with that matter?
-That will come up under the Supply Bill.
– I would like to know if the Minister can indicate, in regard to the Naval works, the particular items that are covered by the £100,000?
– In the Appropriation (Works and Buildings) Bill 1914-15 the items were as follow: - Naval works, including labour and material,£150,000; machinery and plant, £100,000; Naval College, machinery and plant, £300; Cockatoo Island Dockyard, and Naval engineering works, £100,000 ; Cockatoo Island, machinery, £40,000; power plant, Garden Island, £10,000.
– Are none of those works finished yet?
. -I gather from the Minister’s statement that no items are included in that £100,000 that were not voted previously, and the only other reference I have to make is that the Naval works are lumped together. Perhaps the Minister can tell the Committee exactly what those works are?
.- The works referred to are Westernport torpedo and gunnery school and dredging channel; Naval Base at Cockburn Sound, Fremantle ; surveying and incidental work of that kind at Port Stephens, New South Wales.
– Has there not been some trouble with the workpeople at Westernport ?
– I have not heard of it.
Schedule agreed to.
Postponed clause 2, preamble and title agreed to.
Bill reported without amendment; report adopted.
Bill read a third time.
Increase or Expenditure and Public Debt - Economy in Public Works - Transcontinental Railways - Navigation Department : Regulations and Staff - Expeditionary Forces : Recruiting and Formation of New Units : Employment of the Physically Unfit : Paymenit of Soldiers : Separation Allowances and War Pensions : Local Camps : Appointment of Officers - Conduct of the War - Defence Administration : Business Methods : Internal Audit: Supply and Tender Board - Queensland Sugar Industry: Agreement with the Colonial Sugar Refining Company - Protection - Land Values Taxation and Land Monopoly.
Bill received from House of Representatives.
Standing and Sessional Orders suspended.
– In moving
That this Bill be now read a first time,
I may say it is the ordinary Supply for the services for the year ending 30th June, 1916, and the amount involved - £7,201,735 - will be sufficient to meet the expenditure up to the 28th February, 1916. The first item is that of the Defence Department, which, unfortunately, is the worst sinner in this respect, the amount debited to that Department being £5,713,816. The greater part of that sum is, of course, for war expenditure. As regards the other items, apart from that contained in the schedule, they represent the ordinary departmental expenditure for the period 1st January to 28th February, 1916.
– Based upon last year’s expenditure?
– In the main, yes. Of course, there are some statutory increases to those officers inreceipt of less than £200 a year. These have to be paid, and in that respect this Supply Bill contains increases on the Estimates of last year, but it is not new expenditure. It is simply increased expenditure under the provisions of the Public Service Act. I have already informed the Senate why the Estimates are not forthcoming. I have, however, some information which I think I should read, because it is of an interesting character. Although these increases are not provided for in this Bill as a whole, they are, to some extent, partially provided for in this measure, and, therefore, they affect the situation. The principal items of increase in the Estimates for the current year as compared with the expenditure of 1914-15 are - Interest and sinking fund, Commonwealth war loan, £919,000; interest on loan from British Government, £749,000; interest on loan for works purposes and redemption of Northern Territory loans, £58,000; Naval and Military ordinary services, £1,186,000; Military stores, including field guns, small arms, ammunition, &c, £310,000; Naval works, £472,000; war pensions, £500,000.
– Is it known with certainty that pensions to that amount have been allocated ?
– No, nor to anything like that amount. PostmasterGeneral’s Department, salaries and contingencies, £367,000; conveyance of mails, £125,000; lighthouses, £104,000; lighthouse steamers, new lighthouses, &c., £72,000; navigation, £80,000; referendum, £80,000; war census, £50,000; Public Works staff, £32,000; railway working expenses, transcontinental railway, Port Augusta to Kalgoorlie, £25,000. Those are the principal increases as compared with the actual expenditure of 1914-15.
– It is going up merrily.
– But what items in that list could we avoid ? The interest and sinking fund on the war loan, the loan from the British Government, and the loan for works, are inevitable. The increase for naval and military ordinary services is due to the fact that portion of those services, apart from the Expeditionary Forces, has to be kept on a war footing. Certain local expenditures, such as guards for prisoners, have to be kept up, being the effects of the war. The increase of military stores is due to the war. The naval works increase is due to the fact that some of the works already undertaken are reaching a stage when bigger expenditure is imperative if ‘ they are to be kept going.
– Does that include Fleet construction ?
– No; but I will make inquiries, as I am not positive on that point. The war pensions are inevitable, and nobody would suggest that they should be cut down. Does any one propose the cutting down of the services of the Postal Department? The pressure brought to bear in Parliament is always for increased, rather than reduced, services, and we cannot have increased services and reduced expenditure.
– But the Post Office is a paying concern.
– I wish it was. Indirectly it may be “paying, but directly it is losing. The increase for conveyance of mails is chiefly for horse and coach services. That is one of the legacies of the drought. The drought and the war having increased the price of fodder immensely, it was simply an act of justice on the part of the Commonwealth to increase the amount paid to the contractors, who could not possibly have foreseen either calamity when tendering.
– Do you apply that principle all round to the workmen in view of the increased cost of living ?
– In my Department the tendency has been for the increased cost of living to cause a general increase of wages.
– Will the cost of those services remain at the higher rate?
– No, not when the price of fodder comes down. The contract prices are not being altered, but a percentage is being paid on them as a special grant in the circumstances, each claim being considered on its merits. The Commonwealth has partially taken over the lighthouse service, and must, therefore, meet the expenditure on it.
– What is your income from it up to now ?
– I could not say; but I know the light dues have been fixed in relation to the expenditure, and it ia anticipated that one will about balance the other. That increase, therefore, is not all loss to the Commonwealth, but the light dues, of course, will not meet the expenditure on lighthouse steamers and new lighthouses. These are imperative if our coast is to be safely lighted and I have heard many honorable senators bring forward an unanswerable case for new lights, particularly on the Queeusland coast and on the north-west coast of Western Australia. The Navigation Department has been created, necessitating additional expenditure.
– What is the Department doing ?
– It is being organized, and regulations are being framed under the Act, which, unfortunately, we cannot bring into force until after the war.
– How many men are making regulations ?
– Considering that it took Parliament about eight years to make the Act, we cannot expect the regulations to be made in a few months.
– Whenever Parliament wanted to get on with the Navigation Bill the Government used to sidetrack it.
– The honorable senator took a fair share of time on it. Some of the clauses took days to pass, and a competent staff is necessary to frame regulations, especially with such a vigilant watch-dog as Senator Guthrie ready to pounce on them.
– It is foolish to have a full staff with no Act to administer.
– Before the war an early proclamation of the Act was contemplated, and it was necessary to have a staff to work it. That staff was engaged.
– Do you need to keep it?
– Should it be disbanded ?
– It should be transferred to the Defence Department, where you are putting ou men every day.
– I suppose the Minister of Customs is satisfied that they are doing something. If they are not, we can very soon find them a Department where they can be utilized, and I am willing to make inquiries in that direction. There is no need for any of them to be unemployed. The war census has been taken in pursuance of an Act passed almost unanimously, and requires many. There has for long been considerable dissatisfaction in Parliament because Commonwealth works were carried out in several States through the State Public Work? staffs. It has been thought more economical and business-like to have our own staff in each State, and the increase mentioned above is necessary in order to get a staff under our own control. The Kalgoorlie-Port Augusta line is getting further out, and the cost mounts up with the extended mileage, but there has been an increase of revenue as a set-off. There is an explanation for each increase, and it lies with those who challenge them to say what items they would cut down. It is not right to deplore an increase without indicating where reductions could be made. I agree with Senator Stewart on the general necessity for economy. The present Government have not had the time or opportunity to decide their policy on the general question of public works, but the late Government took the view that - as the greater part of Australia was suffering from the effects of the drought and the war, private employment had become scarce, and when this Parliament first assembled nearly every State was faced with a serious unemployed problem - it would be most unwise to intensify the difficulties by stopping public works, and throwing more men on the labour market. We, therefore, decided to continue our public works, but as the prospects for the forthcoming season were good, it would be our policy, when other avocations were able to absorb the labour engaged on some of our puNk works, to consider the advisableness of slackening off those which were not necessities. I take it that that also will be the policy of the present Government. There are in the Defence Department some works which, ‘if the harvest is able to absorb the labour, I would be prepared to recommend should stand over for a year or two at any rate. There are drill halls and similar works which are very good if we have the money to spare, but some of them can quite justifiably stand over for a year or two if we are short of money. Many places have carried on very well without them in the past, and, if necessary, they can wait. If employment is plentiful, and we can see that it will not dislocate the labour market, I will recommend the Government to let some of those public works stand over for a time. Other works which in themselves create wealth, or enable wealth to become productive, I believe the Government will agree with me that it would be false economy to stint. Australia, unlike older countries, is still being developed, and the best way to stand the stress of the war and the effects which flow from it is to increase the productivity of the country by increasing our population, the number of our wealth producers, and our possibilities of settlement. All governmental expenditure which leads to that result is, in my opinion, justifiable, and even more justifiable under present conditions than it would be under other conditions.
– There is a limit.
– Of course there is.
– Would you not increase productivity very much more by adopting a different policy?
– I do not think so.
– For instance, by breaking up land monopoly?
– I contend that we are breaking up land monopoly now.
– I Know that you are not.
– We, at any rate, are just as earnest as the honorable senator in the desire that it should be done.
– Neither the eastwest railway nor the north-south railway will pay for twenty years.
– I believe that the proposed works are necessary in order to properly develop the country. I think that they will achieve that result. I believe that they will enable a large number of people to earn a living, and I anticipate that they will enable the people of the country to earn a better living in the future than in the past. And what is even more serious, I believe that, if we are to hold this country, the construction of these works is inevitable. Otherwise, we shall have to pass the country, with its debt and assets, on to somebody who will develop its resources.
– The only thing which can save the country is population ; but these railways will not bring population.
– I differ from my honorable friend in that respect. There has never been a railway built in Australia yet but has helped to increase the population.
– Some of them in a very small degree.
– Senator Millen asked a question about the item for naval works. I am in a position to say that there is no increase in the item for the building of the Fleet. The vote is required purely for works.
– Does that mean that the only amounts being voted are for continuing vessels already commenced?
– No; it means that the amount to be voted this year will not exceed the amount voted last year. As this is a measure on which honorable senators can discuss various subjects, administrative and otherwise, I shall reserve for my reply whatever else I have to say.
– Under existing conditions, I shall not make a pretence of dealing with the financial position, because it would be impossible for any one to seriously address himself to that subject in the absence of further information. I think that there is a good deal of misunderstanding with regard to what is intended. When a claim is made for governmental economy, honorable senators on the other side seem to immediately assume that one of the first things to keep in mind is that no cessation of public expenditure shall seriously disturb the labour market. I admit at once that it would be a very serious thing for a Government to attempt to do that; but I can conceive of circumstances in which they might curtail the public works expenditure with less detriment to the labour market. There never was a timo when a Government had on their pay-roll so many men. There are 150,000 men on the Military pay-roll alone, a bigger number than have ever been employed by the States in all the public activities put together. In addition, there are several thousands of persons employed in various factories administering to the needs of the Army. It is quite obvious that we have to-day an enormously larger number of men employed by the Government than ever was the case before the war. So that, so far from any cessation of governmental activities in one direction disturbing the labour market, all that the Ministry have done is a much bigger set-off against that. In view of what Senator Pearce has just stated - that he holds the view that the Government would diminish their public works activities where they could do so without disturbing the labour market - I submit that there never was a time so opportune for a careful review of what we are doing in the way of public works to see whether some of the works are not of such a character that they might safely be left over until the country is in a position to more easily finance them. I share the Minister’s view that Australia needs development. But that argument can be applied to an unlimited extent. Not only the public works now in progress, but even hundreds of other works of greater magnitude, will be necessary for the development of this country. But we do not tackle them all at once. Why? First, because we are not financially strong enough ; and, secondly, because, if we were, the time is not yet ripe for them to be undertaken. We ought to seriously consider whether we cannot limit our expenditure in that direction. If we do not, I venture to say that before a long period has passed away we shall find ourselves absolutely unable to carry on the public works expenditure at the present rate. I do not want to discuss the financial position more than that; but I would invite the attention of Senator Pearce to a statement he made here yesterday. I feel sure that if he unwittingly conveyed an impression which is contrary to what is in his mind, he will be only too glad to correct it at the first opportunity. I hope that he will amplify what he said, and correct the impression, if it was a
Wrong one, which I formed yesterday in listening to him, and which is confirmed by a report in the press. His statement amounted, it seems to me, to a declaration that, whilst the Government were accepting it as an obligation to keep the flow of reinforcements to a given figure, they had no particular concern about forming new units. The statement of the Minister is reported in these words -
The policy of the Government was to continue on these lines - first, to maintain the strength of present units; and, second, if there were sufficient mcn, to form new units.
Later, speaking of the recruiting arrangements, he said - -
The Government believed that, with the present system of recruiting, there would be no difficulty in keeping the units in the field up to full strength.
The impression I formed in listening to the statement and in reading the press reports was that the Government considered that that was their chief obligation, and that they were not greatly concerned as to whether they could raise additional units or not. I hope to hear that that impression is wrong. I trust that, in addition to keeping up the Forces in the field by a regular despatch of reinforcements, the Ministry are entirely sympathetic towards the formation of new units. I do not want for one moment to belittle what has been done. I would be the last person in Australia to under-rate the difficulties which surrounded the doing of it. I am as proud as anybody could be of what she has done in a short space of time. In this connexion one may turn aside to hail with pleasure the very eloquent and generous recognition by the Prime Minister of England of the efforts of, not only Australia, but the other Dominions. It was something which we knew and felt ourselves, but it is entirely gratifying to get a recognition of it from the man who, of all others, is entitled to speak in the name of the Empire. Whilst I recognise what has been done, and appreciate the recognition of it elsewhere. I still feel that we must ask ourselves whether an obligation is not upon us, not merely to maintain what we have done, but to consider whether we cannot go a little further, join with the other parts of the Empire, and make an even greater effort. I am not a pessimist. In my judgment nobody can be a pessimist who reviews the history of this war. I am not pretending that the conduct of the war has been as satisfactory as we could wish. I do not think that we have yet faced the war. When we recollect the achievements of our troops in Flanders and Gallipoli ; when we recall what the Allies have done elsewhere; when we realize how absolutely unprepared the Empire was for a land war, no one can be a pessimist unless, indeed, he is constitutionally incapable of being anything else. It is one thing to abstain from pessimism, but.it is another thing to ignore the difficulties which are there. I consider that it is a moderate description of the position to say that itis a grave one, calling for the very best efforts of which the Empire is capable, and demanding that all portions shall throw into the contest every ounce of effort, and, if necessary, every item of material wealth. Can it be said that Australia is doing the best of which she is capable ? I am proud of what she has done, but in view of the fact that the war is dragging on month after month, we must recognise that the way in which we could make it cheapest, if I may use that term, both in treasure and in life, would be bv putting forward at the earliest moment the supremest effort of which we are capable. I wish to ask whether Australia can be fairly said to be doing; the utmost of which she is capable ? The answer to that question, I submit, may be furnished by asking another question. Suppose that the Germans, or any other hostile force, invaded Australia, would we be content with the effort which we are now making? I venture to say that there would be an instant and unanimous demand to do something more. If that is the direct answer to my second question it means that we are not doing as much as we are capable of doing. Some honorable senators may interject, or think that there is a difference between an enemy landed here and the enemy we are fighting in Europe. To my mind there is no difference. The frontier of Australia to-day is not washed by the waters of the Pacific, but by the waters of the Mediterranean, and is marked by the trenches in Flanders and by the Russian plains.
– The age-limit for recruits now is forty-five years but the agelimit when the Germans land here will be sixty-five years.
– I admit that we can expand our forces in many directions. I want to seriously raise the question whether, in spite of what we have done, we are not capable of doing a little more, and I raise it in connexion with the Minister’s statement yesterday. I hope that be will say at once that he is desirous of encouraging the formation of new units, if only for the effect it would have upon recruiting. Senator Turley, by interjection, has suggested a method by which we might perhaps do a little more. But first let me ask what is going to be done with the information obtained as the result of the war census 1 It was useless to take a census Unless the knowledge thereby gained is to be utilized in some way. Before it was taken we knew from the Statistician that in Australia there were available a certain number of men between the fighting ages. He could also tell us the number of men who were single, and the number who were married. He could not tell us exactly whether Bill Smith or Tom Brown was married, but we did know that we had a certain number of men between the fighting ages. I am anxious to know what is to be done with the detailed information which has been collected by the Statistician. Surely we are not going to allow it to remain in his office, or to be buried in parliamentary papers. The census was taken for some other purpose than that. What was the purpose?
– That is what we were all wondering.
– And are still wondering.
– That information was taken for some purpose which will be present in the mind of the Government. I think it is entirely reasonable to ask what it is proposed to do with the information ?
– I think that the thing was done because the British Government proposed to do it.
– The information which has been collected is having a distinct influence in the systematic efforts by which a direct personal appeal is being made by the local committees to all persons within certain ages.
– What does that amount to? If I were a single man living in the Old Country, what influence could they bring to bear upon me ?
– No influence brought to bear upon Senator de Largie would induce him to do what he did not want to do, but in the campaign now being conducted in the Old Country by Lord Derby the information which has been collected has enabled local committees to make a personal appeal to individuals, and its influence is having a decided effect.
– According to Mr. Asquith’s speech, recruiting is falling off.
– Mr. Asquith says straight out in his speech that he anticipates that the results of Lord Derby’s campaign will be entirely satisfactory.
– Are we not getting as many men as we can equip?
– Does the honorable senator mean in this country?
– And at Home also.
– The honorable senator will see at once that I am not in a position to answer that question. If it is a question of equipment, my contention still applies. It comes to this: Is Australia putting forward the utmost effort of which she is capable? In spite of the fact that she has done well, 2 do not think that she is stretching herself to the fullest extent, and the position seems to me to be serious enough to demand that she should do so. I submit that in many ways the information obtained by the war census might be utilized ; otherwise it was a waste of money to take it. At the present moment our efforts at recruiting about maintain the numbers required for reinforcements. The Minister of Defence made a reference to the War Committee having prepared a scheme which it was anticipated would result in securing a good number of recruits. The so-called scheme is merely a general outline, leaving the details and the work to organizations in the different States. That scheme will be good or bad, according to the way in which the local organizations do their work. I express no opinion concerning the way in which the work has been done in other States, but I want to say that recruiting in New South Wales has, in my opinion, been entirely unsatisfactory. The Minister has referred to the fact that a campaign is taking place in New South Wales, but in my view the efforts made in that State are not entitled to be referred to as a campaign. There was a series of meetings in one small section of the State, and then the matter seems to have come to an end. The only portion of the State which was covered was that comprised within the Gwydir electorate, and some parts of adjoining districts which by means of railway and other facilities could be naturally grouped with it. I do not know the area, but certainly not one-tenth of the State of New South Wales has been covered by this so-called campaign. One would have thought that if the matter were entered upon seriously after opening meetings had been held, arrangements would have been made for other meetings to have immediately followed. Practically nothing was done beyond arranging for a few meetings. I speak as one who is entitled to a seat on the State Committee, and having gone into the matter carefully, and with a full sense of the fact that I am speaking of a public body, I make the statement that the whole affair was absolutely futile and ineffective. There is now some hope for a slightly better state of affairs, because at length Mr. Holman has formed a committee, which I think is called the State War Council, and there is reason to hone that the members of this committee will seriously address themselves to the task. There are other factors which are militating against the effect of recruiting in New South Wales. I was very much disappointed, for instance, when members of the Government party in the State Parliament declined to adjourn to enable them to take part in the recruiting cam.paign. That was their business, and not mine; but, at the same time, I express my sense of disappointment at the decision arrived at.
– It is a very delicate work for a man to take part in.
– If a man is not going to the front himself, he does not feel like asking others to do so.
– All I can say is that if a man of military age is fit to go to the front he ought to go.
– Men might consider themselves fit to go, and yet not be permitted to go to the front.
– My answer to that is that if there are members of Parliament who are afraid to go upon a recruiting platform because they know they should themselves offer to enlist, and do not intend to do so, the best thing for them to do is to stop away from the recruiting platform.
– Some have offered and have been rejected.
– That is so; and they are just as much entitled to recognition as are those who have been accepted. It was their misfortune that they were not accepted. The fact remains that, although Mr. Holman tried to persuade the members of his party to agree to an adjournment, that they might take part in the recruiting campaign, they would not do so.
– It is only fair to say that when Mr. Holman tried to get pairs for men who proposed to take part in the campaign the Opposition refused him the pairs.
– Exactly, because he proposed to go on with a certain class of business. It has been stated that one reason why men have declined to throw themselves heartily into a recruiting campaign is that there has been a tendency on the part of Federal Ministers to abstain from taking part in that work. I mention this in order to ask Ministers whether they cannot themselves arrange to remove that objection. The Minister of Defence is aware that a request has come from Queensland that a Federal Minister should take part in the recruiting campaign there. If there is anything in this objection at all, and if it is not a mere idle excuse, it can be set aside at once if Ministers will take a personal part in these recruiting campaigns. I know nothing of the justification for the complaint which has been made, but I know that meetings in Sydney were not particularly well attended by Ministers. I admit all their responsibilities; but, so far as I know, only two Federal Ministers addressed meetings there.
– That is not correct; there were four, to my knowledge.
– I knew only of two, and Senator Gardiner, the VicePresident of the Executive Council, was one of them.
– But for certain important reasons, there would have been five Federal Ministers attending the meetings, for I took a seat on the Sydney express for the purpose.
– I wish Ministers to understand that I bring this matter forward only with a view to some improvement of the existing state of affairs. I am not suggesting anything in the nature of a censure of Ministers. I have merely referred to an excuse that has been put forward by others for not taking part in these campaigns, and Ministers can easily get rid of that excuse by determining that, so far as time and their responsibilities will permit, they will take a hand in the recruiting campaigns. I cannot help thinking that if a lead is to be given, and perhaps the Central War Committee might give that lead, something could be done by a systematic canvass in the various districts. When recruiting first commenced, Mr. Holman struck upon what seemed to be a very happy idea in the formation of local committees. Those committees were extremely useful in securing recruits in the early days of the war. Whilst doing good work it seems to me that they merely went round and gathered in the recruits who at first were presenting themselves with some readiness. What is wanted are local committees, the members of which will make a systematic search of their districts; and to enable them to do that, the information furnished by the war census should be made available to such organizations. I suggest, also - and it all hinges upon whether Ministers are anxious to obtain additional units - that something might be done by determining a quota for each district in Australia, and asking the people of that district to make themselves responsible for raising within their boundaries the necessary number of recruits to complete their quota. That would give local committees a definite objective towards which they would have to work. If a local committee were informed that the quota for their district was 50, 100, or 200. they would have an objective before them, and would be stimulated to see that the district they represented did not fall behind others in its response to the national appeal. When referring to this matter of a quota, I cannot resist directing attention to the dubious position occupied by the metropolitan area of my own State. Roughly, it contains within its boundaries one half of the population of New South Wales; yet, as a result of the last recruiting campaign, only 3,000 recruits were obtained from the metropolitan population, whilst 11,000 were obtained from the country population. I do not hesitate to say that that result is discreditable to the metropolitan area of New South Wales. There the determination of a quota might help materially. It might be brought home to the people of each district that their particular locality was lagging behind, and this would be a stimulus to those who had charge of recruiting to endeavour to obtain within their area the numbers necessary to make up their deficiency. Whether this plan be approved or not I still feel that circumstances are appealing to us to-day with irresistible force not only to maintain the efforts we are now making, but to extend them. I have two other suggestions to make by which I think something might be done. I was pleased to hear the Minister of Defence say that he did not propose, at this juncture at any rate, to lower the standard of height for recruits. I think that by special efforts we can obtain the men we want without making the standard too low. There are other way in which it is within the competency of the Minister of Defence himself to help very much, assuming always that he is prepared and desires to form new units. There are at present a great many men of fighting age and capacity retained for service as guards at the Camps and in other ways, whilst we have many men in Australia over the age of forty-five years who are still capable of discharging such duties, and who might he called upon for the purpose.
– That has been done.
– It should be done to a greater extent.
– It is being done altogether. That is to say, depot staffs are now in course of formation, or have been formed, and guards and military police will in future be men who are not fit for service abroad.
– I am glad that that is being arranged for; but I know from my own observation that to-day there are men of the fighting age and physically fit who are carrying out duties of this kind. As the Government are taking steps in the direction I have mentioned, I assume that the men I have seen are only those who, by force of circumstances, have been the last to be displaced. Apart from men beyond the military age who might be called upon for these duties, there is quite a number of men who have sought to enlist, but have been rejected because of some slight infirmity. In some cases, their eyesight may not have been too good, but they are not unfitted for home defence.
– They are being availed of, too.
– I am glad to hear that, as their employment will release a number of men who are physically fit to go to the front. I ask the Minister of Defence to accept my assurance that I bring these matters forward, not to add to his troubles or those of the Defence Department, but because I am firmly convinced, .without belittling what Australia has done, that it is her duty, in common with the rest of the Empire, to look around and see whether she cannot do more. Before I resume my seat, let me remind the Minister of Defence that, rightly or wrongly, one of the impressions which is having an injurious effect upon recruiting is due to the frequency with which troubles are alleged to exist with regard to pay. I do not want to give individual cases. I placed some of them before the Department, but the Minister will recognise that the frequency with which these complaints are being voiced in Parliament and in the press indicates that some smartening up of the system, or some alteration of system, is required to meet the difficulties which are so frequently raised. I am not assuming that all these mistakes are the fault of the Department. Probably some of them are due to the. acts of omission and commission on the part of the claimants. But a sufficient number of complaints have come under my notice to warrant me saying that if the Minister will only look into some of them he will soon become acquainted with the nature of the trouble underlying them, and will be able to devise a remedy. A great deal of adverse criticism which has been directed against his Department is the result of these complaints. Frequently, complaints relate to the sustenance of a woman and her children. In such cases the necessity for applying a remedy becomes very much more pronounced. I only wish to touch briefly upon one other matter which has been raised by Senator Stewart - I refer to the establishment of local camps. I cannot say how far the establishment of such camps is justified. But their establishment, I am sure, is a very potential factor in securing recruits. I believe that the policy of establishing camps in convenient country centres would do more to raise recruits than would any other expedient that we could adopt. The men who have already joined the Forces are the best recruiting agents we can get. A man who is in a military camp in the country, and who is thus able to move about the town in which he has lived, and to mingle with those with whom he has played football and cricket is, in the very nature of things, a powerful recruiting agent. Therefore, whilst I express no opinion as to the advisableness of establishing a particular camp, I do not hesitate to say that a very liberal application of the policy of establishing local camps, especially in the larger States, must have a beneficial effect in promoting the flow of recruits which I hope will be encouraged, not merely to the extent necessary to maintain our reinforcements, but to enable us to proceed with the formation of new units.
– I wish to refer to only two matters on the motion for the first reading of this Bill. The first relates to the payment of separation allowances to the dependants of soldiers, and the second to the War Pensions Act. Some little time ago I had occasion to write to the Minister of Defence regarding the claim of a lady in Fremantle whose only son, who was her sole support, is at present fighting at the front. When he enlisted he was sent to Black Boy Hill Camp, and whilst there his mother received the separation allowance. But after he had departed for the front that allowance was suddenly discontinued. The mother inquired the reason why, and the answer of the authorities in Western Australia was that she was not entitled to receive the separation allowance, because she was in receipt of an old-age pension. In this connexion it may be well for me to read a letter which I received from the Defence Department under date 25th October last. It is as follows : -
Department of Defence,
Melbourne, 25th October, 1915.
With further reference to your memorandum of the 18th inst., written on behalf of Mrs. M. Cradden, care Mrs. J. Beverage, Quarriestreet, Fremantle, Western Australia, I now beg to inform you that separation allowance, which is quite separate from, and additional to, an allotment of the soldiers’ pay, cannot, it is regretted, be paid to the recipient of an old-age pension.
The soldier can, of course, make an allotment in his mother’s favour, which, it is presumed, has been done in this case.
Regarding war pension, this question has been referred to the Deputy Commissioner of Pensions, War Pensions Board, Railway Buildings, Flinders-street, Melbourne, who has been asked to communicate direct with you on this matter.
Yours faithfully, (Sgd.) T. Trumble,
In writing to the Minister I pointed out that an injustice would be inflicted if any person in Australia who was in receipt of an old-age pension, was, by reason thereof, deprived of any allowance to which he or she might otherwise be entitled under the War Pensions Act. Whilst this young man was in the Black Boy Hill Camp, and whilst his mother was in receipt of an old-age pension, the separation allowance was paid to her, but as soon as the man departed for the front the payment of that allowance was stopped, and the reason assigned for such action is that she is in receipt of an old-age pension.
– If a person is receiving more than a certain amount per annum, can he obtain the old-age pension?
– That is the trouble.
– The separation allowance was not stopped because the young man was sent to the firing line, but because it was discovered that his mother is in receipt of an old-age pension.
– When the War Pensions Bill was under consideration in this Chamber - as will be seen by reference to Hansard for the present session, pages 5620 and 5622- the Minister was asked whether the’ fact of a soldier’s dependant being in receipt of an old-age pension would affect that dependant’s rights under the measure in question. On that occasion, the Minister distinctly stated that it would not. In the letter which I wrote to the Minister in reference to this particular case, I raised the question as to whether, in the event of the young man being killed at the front, his mother would be deprived of the war pension. In view of the definite declaration of the Minister that the fact that a dependant was in receipt of the old-age pension would not affect that dependant’s rights under the War Pensions Act, why is the Commissioner of War Pensions asked to decide this matter ? I also asked the Minister, on the occasion to which I have referred, whether the fact that a dependant was receiving a war pension would militate against the payment of an oldage pension. In reply, the Minister stated that if such occurred it would be necessary to amend the Old-age Pensions Act. Other honorable senators are interested in similar cases. Senator Mullan is interested in one, and Senator Henderson in another. I maintain that the old-age pension, the war pension, and the separation allowance should stand independently of each other. If the young man to whom I have referred is the only support of his mother, why is she not entitled to the separation allowance? Because she is receiving 10s. per week by way of an old-age pension, why should she be deprived of that allowance?
– The only person who is entitled to take notice of the position is the Old-age Pensions Commissioner.
– Evidently an alteration of the Act is required to protect people who are suffering these disabilities. We grant to persons who have reached a certain age an old-age pension. Why ? Because it is presumed that they have done something to build up our nation. Yet, when they send to the front their best and bravest to fight the battles of the Empire, they are to be denied their rights under the War Pensions Act.
– The Old-age Pensions Act does not say that.
– But the official letter which I have read distinctly says that, because this woman is in receipt of an old-age pension, she is not entitled to the separation allowance.
– The separation allowance is not granted under the Old-age Pensions Act.
– Why should it be mentioned in the letter?
– That is merely an excuse on the part of the Department to avoid paying it.
– 1 repeat that the War Pensions Act and the Old-age Pensions Act should stand entirely independent of each other. The receipt of a war pension should not militate against the payment of an old-age pension, and vice versâ.
– If a person draws the full war pension of £156 a year, is the old-age pension to be paid on to:> of that?
– I think that the war pension should be paid quite independently of everything else.
– It is not the war pension that should be cut down, but the old-age pension.
– It is a question of bookkeeping, after all.
– If any person in the Commonwealth is in receipt of an oldage pension, that circumstance ought not to disqualify him from receiving the full benefit of the War Pensions Act.
– Was there not some reference made to that matter in this Chamber previously?
– I have already alluded to it. The Minister promised an amendment of the Old-age Pensions Act, so ‘that each would stand independently.
– An amendment of the Old-age Pensions Act is not required to meet the case cited.
– Perhaps not; but I am bringing the matter before the Minister, and I am sure that when he looks up Hansard, he will find that he made a distinct promise that the two Acts would stand independently of each other. When a man Or woman in Australia has reached the age at which he or she is entitled to the old-age pension, it should be paid, irrespective of the war pension.
– But that letter you quoted had nothing to do with the pensions.
– Yes, it had; and for the information of the honorable senator I will read the third paragraph again. It is as follows -
Regarding war pensions, this question has been referred to the Deputy Commissioner of Pensions, War Pensions Board, Railways Buildings, Flinders-street, Melbourne, who has been asked to communicate direct with you on this matter.
I have not had that communication. I raised the question of what would happen if the separation allowance were not granted to this woman because she was receiving an old-age pension,’ and her son was killed at the front, and I have been told that the Commissioner of War Pensions is inquiring into the matter, although the Minister made a statement on the floor of the Senate that an amendment of the Old-Age Pensions Act would be made to meet that situation.
– Did the letter come from the Pensions Board ?
– It is signed by Mr. T. Trumble, acting secretary of the Defence Department. I am not making an attack on the Minister, and I believe that once his attention has been drawn to the matter, he will rectify this error of administration. I shall listen for his reply, and if I cannot get an assurance that the pensions will be regarded as independent payments, some further inquiry will have to be made, because I am sure it was the consensus of opinion in the Senate that each Act should stand alone.
– I desire to take advantage of the scope afforded by this Supply Bill to make a few remarks on a matter which is interwoven, to a certain extent, with the present war, and which is of very great importance to the people of Australia. I refer to the agreement recently entered into between the Commonwealth AttorneyGeneral, Mr. Hughes, on behalf of the people of Australia, and Mr. E. W. Knox, the general manager of the Colonial Sugar Refining Company, relating to the refining and sale of the Queensland sugar crop for the current season. The necessity for that agreement, a copy of which I have, was brought about by a couple of factors, the more important of which was the unprecedented shortage in the Queensland sugar production for this year, rendering necessary the importation of a far larger consignment than the yearly average. It will be remembered that, prior to this agreement being entered into, the price of sugar in the several States of the Commonwealth varied somewhat. In Queensland the Food Prices Board fixed it at £23 per ton for refined sugar. In New South Wales, the price was about £21, and in Victoria it was about £21 2s. 6d. The average ruling in the southern States - New South Wales and Victoria^ - was a good deal less than the average during the five years prior to the outbreak of the war, and representations were made by deputations, and by the press, that the southern States should come into line and agree upon a fair figure for the selling price of sugar. The Food Prices Boards, however, did not agree, although they acted inconsistently, because after refusing to advance the price of sugar, they agreed to an increase in the price of jam to the extent of Id. per lb. Jam is composed half of sugar and half of fruit, approximately, and this increase in the price benefited jam manufacturers to the extent of about £4 13s. 4d. per ton, while the producers of the sugar received no benefit whatever.
– Would not that increase in the price of jam be justified by the scarcity of the fruit crop ?
– The fact remains that jam is composed half of fruit and half of sugar, and therefore the jam manufacturers benefited at the expense of the sugar producers.
– Your case is practically that the Food Prices Boards allowed jam to increase in price in a greater proportion than sugar.
– That is only by the way, and it has no bearing on the agreement to which I have referred. In the making of that agreement, Mr. Hughes, the present Prime Minister, and then, as now, the Federal AttorneyGeneral, acted on behalf of the Commonwealth Government, and incidentally represented the people of Australia, while Mr. Knox, the general manager of the Colonial Sugar Refining Company, represented his company. While I have a great admiration for Mr. Hughes’ ability, I have almost a veneration for Mr. Knox in the ability he displays when the interests of the Colonial Sugar Refining Company are at stake; and I have no hesitation in saying that the sugar company obtained very favorable conditions under the terms of that agreement. At this stage I would like briefly to refer to the history of the company, and in order the better to illustrate its position, I am utilizing an excellent table which appears in the financial columns of the Sydney Bulletin every half-year following on the half-yearly meetings of the sugar company. From that table, I find that in March, 1908, the company for the previous half-year made a net profit of £134,782; it paid a dividend of £124,037, and carried to reserve £10,475, making the total reserve £364,961. At the next half-yearly meeting the profits were shown to be £146,493, the dividends paid totalled £124,885, the amount carried to reserve was £21,608, and the reserve then totalled £386,369. At that date £350,000 of the reserve was capitalized.
– What is the capital of the company ?
– It is £3,250,000, but it was not that amount then. Here is the table -
The amount carried to reserve at the September meeting of this year has not been given, but the total amounts carried ‘to reserve, it will be seen, have reached £630,188. During the period covered by these figures the total profits of the company were £3,396,680, and the total dividends reached £2,712,047. At the half-yearly meeting held in Sydney on Friday last the profit and loss account of the company was not disclosed, so that the public could not ascertain what amount had been carried to reserve. One can scarcely believe Senator Gould’s suggestion that the company does not know what it will make out of its syrup and other by-products.
– I did not say anything of the sort. I wanted the honorable member to quote the figures of the company’s first five or ten years, when it was struggling for an existence.
– The honorable senator has accused me of injustice in charging the company with using the agreement to cloak the profit and loss account, so that the public could not ascertain the amount of their reserves.
– They are very wicked!
– They have been wicked, and are bleeding the people of the Commonwealth enormously.
– We get sugar here cheaper than in London.
– Yet the fact remains that the company are increasing their profits as they go on. The £500,000 per annum disclosed profits would be bad enough if that was all. but the company are at their wits’ end to hide their real profits.
– You said just now that sugar was too cheap in New South Wales, and that the Necessary Commodities Board ought to increase the price there.
– I said the £21 selling price was too cheap. With sugar selling at £21 a ton in Sydney, and £23 in Brisbane, we could buy sugar retail in Brisbane cheaper than in Sydney or Melbourne. This fact was proved before the Necessary Commodities Commission; but it is not the sugar-grower or consumer that makes the profit.
– To raise the wholesale price would not cheapen sugar.
– Evidently not, if those are the commercial methods practised in Sydney and Melbourne. If there was a fairer distribution of profit the consumers might reasonably expect to get their sugar cheaper, and the producers a much better return.
– I suppose they ought to have had a dividend, too?
– The shareholders got a dividend of £203,000 for the last half-year, made out of the growers on the one hand and the consumers on the other. It would be bad enough if these exorbitant profits were made on the original capital of the company, huge as it is, or if the present capital was bond fide subscribed capital, but it is not. In 1901 the capital of the company was £1,800,000. To-day it is £3,250,000, without the addition of a penny of subscribed capital. The increase has been brought about by watering the stock, capitalizing reserves, and so on, a practice resorted to whenever the reserves became so huge that it was necessary to get rid of them. The transactions of the company since the outbreak of the war are interesting. The half-year ended September, 1914, included two war months, and at the half-yearly meeting the Honorable H. E. Kater, M.L.C., chairman of directors, significantly remarked -
Before moving the adoption of the report, he wished to say that it gave him great satisfaction to be able to assure them that the Board, after having carefully considered the situation, felt no hesitation in recommending the distribution of the usual dividend and bonus. Although the troublous times through which they were passing had, in many cases, caused worry and anxiety, the volume of their business had not suffered; in fact, their sales had been record ones during the past halfyear, and their earnings quite justified the payment to the shareholders of the usual return on their investments.
– A great deal of sugar, especially that from Fiji, went to London, where the price was very high.
– The honorable senator would like to see sugar sold in Australia at the London price. But for the action of the Minister of Trade and Customs in prohibiting exports, we should have been paying London prices here now.
– Your trouble justnow was that they did not make the price high enough.
– As one who has been a sugar-grower, I say that £23 a ton was a bedrock price. The whole of the next half-year period was a war period, yet the profits were £272,708, as against £256,361 for the previous half-year, or an increase of £16,347 over the period which
Mr. Kater described as their record sales period. They carried that additional sum to reserves. What a consolation it is to the people of Australia to know that this benevolent institution is making such lavish profits in spite of the war !
– It is good for the shareholders.
-And it is their interests the honorable senator is apparently here to conserve. Probably he is one of them. The company also paid away in debenture payments £61,650 in the half-year ended September, 1913, and a similar amount in 1914, making a total of £123,300 more of concealed profits hy this monopolistic concern.
– Those debentures represent money lent to the company, and put into the business.
– But the interest on them had to be’ paid out of profits, and they were repaid out of profits also. Adding up these totals, they have made profits during the period I have reviewed of £3,396,680; paid away in dividend: £2,712,047, and carried to reserves £630,188. Owing to the existence of the agreement behind which they can shelter themselves, their accumulated reserves are not ascertainable. It is reasonable to assume that as their profits in the half-year ending March, 1915, were £16,000 greater than in their record year, they carried at least an equal amount to reserves in the half-year just closed, which would make their total accumulated reserves about £300,000. This is in spite of the war, and it is safe to assert that if the war was not on it would have been announced in Sydney1 on Friday last that their reserves had again been capitalized to the extent of at least £250,000 in pursuance of their policy of watering their stock. The company have gone still further. They are dividing their business into Australian on the one hand and Fijian and New Zealand on the other. This is a splendid arrangement, but we must not overlook the fact that they are the same body of shareholders. The original body of shareholders is taking the Australian business at a capital value of £3,250,000, and selling the Fijian and New Zealand business also at the capital value of £3,250,000; but the curious aspect of the case is that they are selling it to themselves as well as buying it from themselves. They will continue to buy it out of profits, and at the meeting in Sydney the other day £250,000 was applied for the purchase of these bonus shares. They are, therefore, in a very happy position, retaining half of their business for nothing, and selling the other half to themselves, paying for the purchase out of the profits of the concern.
– Always bear in mind that the dividend is 6^ per cent, in one case, and 6 per cent, in the other.
– The total dividend is 12^ per cent., but for a long time the company paid only 10 per cent. This jumped up to 11 per cent., then to 12 per cent., and, finally, to 12A per cent., which sounds a large return, but I have elsewhere asserted that the real profits are more like 25 per cent. The process of bringing the 6 per cent, and the 6£ per cent, rates up to 10 per cent, each will be gradual, and therefore not so noticeable as an increase in the total rate from 12£ to 20 per cent. The latest transaction of the company in dividing its business actually means a duplication of the capital value of the concern - watering their stock 100 per cent., another £3,250,000. What we have to realize is how this concern is treating the people of Australia during the currency of the war. This is a particularly opportune time for bringing the matter under notice, seeing that we hear so much about patriotism.
– You mean the way in which this concern, in collusion with Mr. Hughes, is treating the people of Australia ?
– No. I am not going to shelter Mr. Hughes from any little criticism I have to pass on him in this connexion. The fact is that he made an agreement with this company, and I am referring to a part of the agreement. I shall endeavour to show that the position has been more exacting, so far as this monopoly is concerned, than ever it was in the time of peace. I recommend Senators Millen and Gould, when they are talking about patriotism on the platform, to bring in a little of the patriotism concerning this company, and how they are treating the people of the Commonwealth.
– And that Mr. Hughes is a party to that agreement?
– I have denounced the agreement as being wholly in favour of the Colonial Sugar Refining Company, and against the interests of the people of Australia. I am not so much lamenting what has been done in this comparatively small transaction oi importing 14,000 tons of sugar, as pointing out the danger which would follow upon a repetition of an agreement of this nature on similar grounds; because we were assured that the sugar shortage, owing to reduction of the crops, would mean the importation of only 14,000 tons. That estimate was based on the sugar crop of Queensland, which for the last year totalled about 225,000 tons, and then it was found necessary to import about 25,000 tons, making the Australian consumption for the purpose of these references 250,000 tons. The latest estimate is that this year’s sugar crop in Queensland and New South Wales will total only 150,000 tons, namely, 120,000 tons in the former and about 30,000 tons in the latter. That is the official estimate received from the Government Sugar Bureau in Queensland, and I am sorry to have to admit that I think it is pretty near the mark.
– Do you think that the company was too clever for Mr. Hughes?
– No. Perhaps to dispel any doubt on that point I had better deal now with that phase of the question, and revert later to the matter of the Tariff. I believe that Mr. Hughes made a mistake in that he did not give the full particulars of the agreement in the pamphlet which was circulated amongst honorable senators. Clauses 4 and 5, particularly the latter, set out the deductions which are to be made by the company for putting through the crop. The expenses of railing, bags, and freight are put down at 26s. per ton of sugar, the cost of refining at 30s., and the expense of sale at 7s.. in all. not exceeding £3 3s. In addition, the company are to receive a payment of £1 per ton, 10s. of which they will refund in their wellknown spirit of generosity, making the total apparent deductions, according to the agreement. £3 13s. When we representatives of Queenland saw that the crop of that State was being sold to the Federal Government at a cost of £18 per ton, and that the refined article was being sold at £25 10s., we naturally started to ascertain where the difference of £7 10s. was going to. Under the agreement the difference is set down at £3 13s. It was from a reprint of a statement in the Queensland Hansard that I got full particulars as to the items.
– You must bear in mind that there are several grades of sugar.
– I am speaking of grade 1 A ; but, in my opinion, the fine distinctions which the company draw in hieroglyphics, such as 1 A, 1 B, and 1 X, are so much “ tommy rot.” I admit that there are different grades of sugar, but not so many grades as the company claim to put on the market. They claim to put on the market fully twenty grades, and call them by different titles.
– Fifteen brands represent practically the same quality of sugar.
– I ask honorable senators to listen to an extract taken from the Australian Sugar Journal -
In reply to a question in the Legislative Council a few days ago, the Honorable W. Hamilton stated that the following particulars had been supplied by the Commonwealth Attorney-General, in response to an inquiry from the State Government: - Difference between £18 per ton, price of raw material, and cost of actual quantity raw material, at an average of 94 n.t., required to produce one ton refined, £1 2s. lid. ; freight and charges, £1 6s.; refining, £1 10s.; selling charges, 7s.; payment to company, 10s.; reimbursement of Customs duty on importation of sugar, spread over estimates for current year’s crop, 12s. 8d.; allowance for discount, £1 10s. 7d.; total cost, £G 19s. 2d.
– Was it £6 as against £7?
– When the company had a complete monopoly, and before the outbreak of the war, they were content to keep a margin of £6 per ton between the price of raw sugar and the price of refined sugar, but with the altered conditions following on the war, and under the terms of this agreement, they allowed a margin of £7 per ton, and that is what I object to.
– That is to say. left alone they were content with £6. but when Mr. Hughes came in to direct them, they got £7 ?
– If the company had been left alone they would have exported sugar to London, and the price of sugar here would have gone up to £38, as it did in London at one time. I think that the people of the Commonwealth have to be thankful to the Labour
Government for prohibiting; the exportation of sugar. The extract continues -
Leaving a balance of about 10s., out of which must be met further cost of administration and incidental charges on seven-tenths of the output, and possibly part freight and charges, in addition, on one-seventh, to Western Australia and Tasmania.
Sitting suspended from 6.30 to 8 p.m.
– I have referred to the two items of the charges made by the Colonial Sugar Refining Company for the operations they have undertaken to fulfil. They claim £1 2s. lid. per ton as loss in refining, and I am fully justified in describing that as an alleged loss, and they fix the cost of refining at £1 10s. per ton.
– How much is lost in refining ?
– The alleged loss in refining is mythical. The Colonial Sugar Refining Company do not actually lose anything in refining.
– I think there must be some loss.
– If the honorable senator had fully inquired into the matter he would agree with me that there is little, if any, loss. That there are good grounds for my assertion I can prove from an extract taken from the Louisiana Planter, a recognised authority on sugar, which was published in the Mackay Sugar Journal about fifteen years ago. I quote the following from that article -
The question of profit or loss in refining sugar is attracting particular attention just now, and lends special significance to the evidence of the various refiners before the Industrial Commission. According to current quotations there is a difference in favour of refined sugar of 63.75 cents per 100 lbs. (£2 19s. 6d. per Australian ton), but it is evident that the difference between the cost of raw and refined is, in fact, nearer 50 cents per 100 lbs. (£2 6s. 8d. per ton), than 63£ cents (£2 19s. 6d.).
I stress this particular point -
Even at the lower figure the refiners are not selling at a loss if the sworn evidence of tho refiners themselves is to be believed, for it must be taken for granted that, as competent business men, the refiners in their estimates must have given proper consideration to fixed charges, depreciation of plant, and the numerous other items that readily suggest themselves.
This Industrial Commission was appointed in the United States for the specific Purpose of finding out what was a fair margin between the cost of raw and refined sugar, so that the evidence given before it is not to be treated lightly. The articlecontinues -
The presumption is that when the margin, falls below 50 cents (£2 6s. 8d.), the refiners; are not doing a profitable business. This margin includes the cost of refining proper, and the loss of weight in refining. Mr. Jervis made the above as a general statement, but refused to state the precise cost of refining in his establishment. Mr. Havemeyer said that when the margin was only 50 cents (£2 6s. Sd.) it is a “fair inference” that refiners are running at a loss. Dividends could hardly be paid from profits from such a margin; but the witness refused to state the source from which his company now paid 12 per cent, when’ the margin is below 50 cents (£2 6s. Sd.). “’ We may borrow it,” he says.
Mr. Doscher declares that his refinery has been unable to make any profits from refining at the existing margin of 32 to 51 cents (£1 9s. lOd. to £2 -7s. 7d. per ton). He believes that 93 lbs. of refined sugar from 100 lbs. of raw sugar is a better estimate than 92 in figuring the loss of weight in refining. From the same quantity (100 lbs. of raw sugar) about 2 gallons of syrup, worth 12 cents a gallon (£1 2s. 4d. per ton’ of raw sugar), are obtained.
Mr. J. H. Post, of B. H. Howell, Son, and Company, agent for the Mollenhaeur refineries, submitted an estimate prepared by the general manager of the National Sugar Refining Company. This showed that the cost of refining, including the revenue tax of 4.799 cents per 100 lbs. (4s. 6d. per ton), amounts to about 35 cents per 100 lbs. (£1 12s. 8d.), while the loss in weight in refining amounts to 28 cents per 100 lbs. (£1 6s. Id.); total, 63 cents per 100 lbs. (£2 18s. 9d.), as the necessary margin. Large refineries, such as Havemeyer and Elder, with 12,000 barrels capacity, and Spreckels, with 8,000, could produce it from 3 to 5 cents less.
Mr. Post, a refiner himself, gives the cost of refining at £1 12s. 8d. per ton, which, less revenue tax of 4s. 6d., makes a cost of £1 8s. 2d. per ton. He also says that the loss on refining is £1 6s. Id. per ton, but Mr. Doscher. another refiner, in giving evidence before the Commission, stated that out of 100 lbs. of sugar two gallons of syrup could be obtained, worth 24 cents a gallon, equal to £1 2s. 4d. a ton. He puts down the loss of weight in refining sugar at 3s. 9d. per ton. If we add that loss to the cost of refining, according to Mr. Post £1 8s. 2d. ner ton, we get-£l lis. lid., which, less the 5 cents reduction of 4s. 8d., gives the total cost of refining at £1 7s. 3d. per ton. This includes depreciation and numerous other charges which readily suggest themselves. Adding the two items mentioned in the agreement to which I have specially referred, of £1 2s. lid. alleged loss in refining, and £1 10s. cost of refining, the margin, according to the Colonial Sugar Refining Company, should be £2 12s. lid. But what is the position 1 It is that the margin is not £2 12s. lid. per ton, but £7 10s. per ton. It must be clear to honorable senators that there is a great disparity between the figures which requires to be explained in some way. In Great Britain the difference in cost between raw and refined sugar has been about £1 15s. per ton, and in the United States between £2 6s. 8d. and £2 19s. 6d. per ton. Yet we are told that one of the American companies paid 12 per cent, dividends when the margin was below £2 6s. 8d. per ton. Prior to the outbreak of the war the system operating in Europe was what is known as the cartel system, which may be translated into English as the trust system, and which we in Australia would refer to as the combine system. At that time in Europe the margin between the cost of raw and refined sugar was £4 7s. 6d. Acting on the margin of £4 7s. 6d. obtaining in Europe in past years, the refining monopoly here has been quite safe in adding to that margin the cost of transport, insurance, commissions, and so forth, which would accumulate in the shipment of raw sugar to Australia, and bring the margin up to £6 per ton. That margin was their own, quite independent of the £6 per ton import duty which goes to the sugar miller and the sugar farmer. The tables I have quoted show that with the £6 per ton margin the monopoly has disclosed profits for years past in the vicinity of, and sometimes over, £500,000 a year. On the ton of that they have entered into an agreement with the Attorney-General jumping the margin up to £7 10s. per ton. This brings me back to an interjection persistently made by Senator Millen, to give me a reminder which was not necessary, that Mr. Hughes, acting on behalf of the Commonwealth Government, was a party to this agreement, which gives the sugar monopoly an additional margin of £1 10s. per ton. I admit that the honorable gentleman is a party to the agreement. I have not discussed the matter with him, but I asked him whether the items as set out were correct, and he told me they were. I made inquiries at the AttorneyGeneral’s office, and Mr. Garran told me that Mr. Hughes had been dealing with the matter. It did not occur to me at the time that the matter was in the hands of the Trade and Customs Department, as
Senator Russell has since informed me. I mentioned the matter also to Senator Gardiner, as representing the AttorneyGeneral in the Senate, in the belief that he would be able to give any explanations that might be asked for. In my opinion, the reason why Mr. Hughes signed this agreement was that Mr. Knox, the general manager of the Colonial Sugar Refining Company, was in the happy position of being able to hold a pistol to the head of the Federal Attorney-General. We know that since the defeat of the referenda in 1913 the Commonwealth Government have been powerless to interfere with these monopolies. The Colonial Sugar Refining Company were able to plank on an additional £1 10s. per ton, raising the margin they previously enjoyed to £7 10s. per ton, knowing that they could disregard operations under the cartel system in Europe, which was largely conducted on German, Belgian, French, and Austrian supplies of beet sugar. I do not approve of the agreement, but I can quite understand that Mr. Hughes had his back against the wall . I believe that it is a well-founded assumption on my part that when the proposition was put to him, the Federal Attorney-General had no alternative but to enter into the agreement. I wish to impress upon honorable senators that while, in common with my colleagues representing Queensland, I do not overlook the importance of this question from the point of view of the interests of that State, I have endeavoured in discussing the matter to deal with it from the Australian stand-point. When the Premier of Queensland closed his deal with Mr. Hughes for the sale of its crop of sugar to the Federal Government, he was interviewed by representatives of the press, who asked him what the State Government would do if the Colonial Sugar Refining Company refused to refine the sugar. Mr. Ryan gave what was, in my opinion, a very terse and significant reply. He said, “ The State Government do not intend to meet trouble half way. We will wait until that position arises, but if I were a refiner I would not refuse to refine.” He there threw out a hint in pretty plain English that if the Colonial Sugar Refining Company did not undertaKe to refine the sugar the Ryan Government of Queensland would commandeer the two refineries in that State and enter upon refining operations. I personally believe that if the Colonial Sugar
Refining Company refused to refine, the Ryan Government would take that course. But the fact would remain that the two refineries in Queensland could not refine all the sugar required for Australia, and the Commonwealth Government being powerless to interfere, there was no course open to Mr. Hughes but to accept the agreement.
– There are refineries in other States.
– The Queensland Government could not commandeer them, and the Commonwealth Government would not have the power to do so.
– But the South Australian and the Western Australian Governments might have done the same thing.
– I do not think that there is a refinery in Western Australia. In any case, the State Governments were losing sight of the fact that the Legislative Councils have always to be “reckoned with. I contend that the Colonial Sugar Refining Company has displayed its monopolistic tendencies in their very worst form at an exceedingly opportune time for opening the eyes of the people. I can quite understand honorable senators who do not agree with my views inquiring. “ What means of redress do you suggest?” I stated earlier in my remarks that the cost of refining sugar was £1 10s. per ton. The other costs include freight and charges, £ 6s. ; selling charges, 7s.; payment to company, 10s. ; reimbursement of Customs duty on importation of sugar spread over estimates for current year’s crop, 12s. 8d.; and allowance for discounts, £1 10s. 7d. I have already stated that the total quantity of sugar to be imported represented only about 14,000 tons. I am not aware of the system under which Mr. Hughes and Mr. Knox arrived at the 12s. 8d. per ton for reimbursement of Customs duty, but I imagine that it was pooled over the whole of the Queensland crop. Recognising that the estimated crop in New South Wales and Queensland for the current year is only 150,000 tons, we are faced with the probability that we shall have to import 100,000 tons of raw sugar. Now, the import duty upon that quantity of sugar will have to be pooled and spread over the whole. The addition on account of
Customs duty, instead of 12s. 8d., will then border upon £2 per ton. If another agreement like the present one be entered into, I cannot see any prospect of the retail price of sugar being less than 4d. per lb., without any advantage to the producer. The agreement also imposes a big obligation on jam manufacturers and the manufacturers of confectionery and condensed milk. This afternoon an honorable senator referred to the fact that £25 per ton was the price charged for only the highest class of sugar, and that inferior grades were sold to jam manufacturers and the manufacturers of condensed milk at a cheaper rate. But I would point out that, although the Colonial Sugar Refining Company makes these manufacturers an allowance, it deducts that allowance from the price paid to the sugar-growers in Queensland. I have it on the authority of one of the leading agricultural chemists in that State - I refer to Mr. Brummich - that in 1911 this concession to the jam and other industries lessened the price of raw sugar in Queensland by 9s. per ton, which is equivalent to ls. per ton of cane. In my opinion, there is only one way in which the operations of this company, which for years has been bleeding the producers on the one hand and the consumers on the other, can be effectually checked. The National Parliament should be given the requisite power to curtail its exactions. No doubt my assertion will be met by the familiar platitude that I am overlooking the findings of the Sugar Commission. I have read in the Conservative press, under glaring headlines, that the findings of that body represent the last word in the matter of the control of this refining monopoly by the National Government. I do not agree with that statement. At the same time, I do not say it would be a good thing for the Commonwealth to take over holus-bolus the refineries of this monopoly. That opinion, I may add, has not been formed since the Sugar Commission undertook its investigations. I arrived at it shortly after my advent to the sugar districts in 1907. ‘ Personally, I did not see any necessity for the appointment of that Commission. Anybody familiar with the industry knew quite well where the profits from it were going. One had only to study the balancesheet of the refining monopoly to ascertain that. Speaking in the Queensland Parliament on 3rd August, 1911 - as will be seen by reference to the Queensland Hansard, page 428 - I said -
It will be said that it is the duty of the Federal Government to establish a State refinery. In spite of what I may call my ultra Australianism, I am one of those who have always held, even before the defeat of the referendum - in no spirit of State provincialism I have always held that it was the duty of the State Government to establish a State sugar refinery, and I hold this proposition because the State has the better opportunity.
Amongst the reasons which I assigned for my conviction were that the State possesses control of the railways, and that it would be idle for the National Parliament to enter upon the refining business unless it also controlled the raw sugar business. It is no exaggeration to say, knowing, as I do, the hatred of Mr. Barnes, ex-Treasurer in Queensland, to all things Labour, that he would not have supplied sugar from the Government mills to a national refinery unless he had first taken the precaution to pretty liberally adulterate it with cyanide. I am speaking, of course, in a political sense. That is one of the reasons why I do not think it would be advisable for the National Government to take over holus-bolus the refining business of this monopoly. Moreover, I am not prepared to see the Commonwealth hand over to the Colonial Sugar Refining Company the sum of £3,250,000, which is represented by its present capital. As a matter of fact, that capital value does not belong to its shareholders. I make that statement unhesitatingly. It has been taken out of the profits of the sugar-growers and out of the pockets of the sugar consumers. Seeing that the production of sugar is in the hands of a monopoly, I regard the position as something worse than it would be if a public utility were similalry controlled. In Queensland the Labour Government has in contemplation the taxation of profits derived from public utilities, such as tram services, electric lighting works, &c. I hold that a universal commodity like sugar is far more vital to the interests of the people than is a public utility.
– We cannot do without light.
– But we can generate light easier than we can manufacture sugar. The carrying of the referendum proposals would vest the National Government with power to con trol the sugar monopoly, and to regulate its exactions.
– Would the Commonwealth Government produce sugar at a cheaper rate than it manufactures rifles and builds ships?
– I would get at this monopoly in another way.
– “ Get at “ is a very good term to employ.
– Considering that the Colonial Sugar Refining Company has got more than £500,000 in profits-
– By honest trading.
– By legal trading. I do not know that it is honest trading.
– What does the honorable senator propose to do with enterprises whose operations result in a loss?
– When I am dealing with that matter I will give the honorable senator the benefit of my opinion.
– The honorable senator is dealing with an enterprise which is successful, and which has aroused his envy on that account.
– Nothing of the kind. How does this agreement affect the people of Australia in other avenues? It will not only increase the price of sugar by1d. per lb., but it will increase the price of jam and of many other commodities.
– What caused black sugar to be worth 6d. per lb. in Australia once?
– I suppose the fact that there were so many blacks in the country - people of whom the honorable senator’s party is so fond. To-day we grow sugar with white labour, and that is the reason why it is cheaper. Something has been said in reference to the cost of taking the referendum. Honorable senators have affirmed that it will involve an expenditure of£100,000.
– That is what the members of the honorable senator’s own party say. It is a very patriotic move just now.
– If the National Government were empowered to control this monopoly, hundreds of thousands of pounds would be saved to the people of Australia.
– The Royal Commission which’ inquired into it advised the Government not to touch the industry.
– Surely the honorable senator could not have been listening. I hope that the people of Australia will intrust the National Government with the power to control this monopolistic enterprise, a concern which during a time of war exacts increased profits from the consumers of this country.
– Why does not the Australian Workers Union start another enterprise in competition with the Colonial Sugar Refining Company ? Has it not sufficient capital ?
– I do not think so. They would be unable to sell a business to themselves at a cost of £3,250,000, the profits of which have been obtained from the consumers, as in the case of the Colonial Sugar Refining Company.
– Why not start a company in a smaller way in competition with the Colonial Sugar Refining Company then?
-That is what I have advocated for years. I have urged that the Colonial Sugar Refining Company should keep their refineries, and that the State Government, as a natural corollary of their central mills, should go into the business of refining. Where, however, an attempt has been made to establish small companies in competition, we have seen how this monopolistic institution has deliberately undersold other mills by working at a loss, in order to crush them.
– That is the usual practice of monopolies.
– It appears to me that this is not only a Queensland matter at this juncture. It is an Australian matter, and I want to appeal to the members of this Chamber to endeavour to put the true facts before the people .of the several States. I am of opinion that the cities of Sydney and Melbourne defeated the referendum proposals in 1913. I “will not accept the assertion that it was the Conservatives in the country who defeated those proposals. I believe that if the workers of New South Wales and Victoria had done their duty their influence in Sydney and Melbourne would have been strong enough to have counteracted the influence of this monopoly. It is the duty of members of this Chamber, those representing country as well as metropolitan areas, to point out that if the people have to pay 4d. per lb. for retail sugar for table purposes, and pay an increased price for sugar for manufacturing and so forth, they are not to turn round and blame the Labour Government. It might be said that Mr. Hughes had no alternative than to sign the agreement, and that Mr. Hughes, under the War Precautions Act, could have put in a receiver; but that would have been a most injudicious course to adopt.
– He would have spoilt the leaf in your book then.
– I do not know that I am concerned about that. Assuming that Mr. Hughes had put in a receiver during the currency of the war, he might have curtailed some of the extra profit made by the Colonial Sugar Refining Company since the beginning of the war; but immediately the war was over the monopoly would have put the rates up. The Colonial Sugar Refining Company, after the war, would have had no hesitation in putting up the price to such an extent that it would have got back all that it lost temporarily, and would have got it tenfold over. Mr. Hughes, I say, did the right thing when he signed that agreement, which I condemn. I condemn it as being unfair to the people of Australia; but Mr. Hughes had no other alternative but to sign it.
– What specific payment do you consider too high?
– The alleged loss in refining £1 2s. lid., and the cost of refining, £1 10s. I am also complaining about the margin of £7 10s. between raw sugar and refined sugar, and also the other items that make that total. My own belief is that, instead of it costing £1 10s. to refine the sugar, the Colonial Sugar Refining Company is able to do it for 7s. 6d., but I cannot substantiate that by sworn evidence as I have substantiated other statements.
– But was not the Minister guided by expert advice in connexion with this agreement ?
– Yes; but Mr. Knox had a pistol at his head.
– Does not the honorable senator think it was the other way about ?
– No. because we were in the hands of the monopoly.
– You have shown what the alternative was.
-Yes ; but it would not have made any difference to the real position, because the Colonial Sugar Refining Company would have made up ten times over all they might have lost temporarily during this time of war.
– It would merely have been a palliative.
-The real remedy is for the people to trust the National Parliament with the power to control this harmful corporation. I trust, therefore, that the Labour members in this Chamber, upon whom I have thrown the onus, will tell their constituents in city and country the true position of affairs, as we have done in Queensland. We have not gone behind the door to inform the sugargrowers of Queensland what is the real position. We have done so even at the expense of losing votes; but while at one time we did not receive much support in sugar districts, by the mere fact that we put the position as it exists, and told the people how they are being robbed right and left, we can to-day make the proud boast that the sugar districts of Queensland now support the Labour party. I firmly believe that if the people of Australia would only grasp ihe full significance of the question, and were apprised of the ramifications of this concern, which hides its profits in a dozen different ways, they would intrust to the National Parliament the responsibility of dealing with it.
– Will the honorable senator tell us what is his estimate of the annual profits of this institution?
– I have given the disclosed profits.
– But you are insinuating that there are great profits undisclosed.
– And so there are. In addition to the 10 per cent, dividend they have capitalized their reserves, as I have pointed out, during the last eight years to the extent of over £1,000,000 out of the profits which belong to the producers and consumers. I have discussed this question with people who have been in the employ of the Colonial Sugar Refining Company, and they have given me to understand that the company have many methods of hiding their profits. For the special edification of the honorable senator, I will detain the Senate a few minutes longer, while I explain the position as it appears to me. The Colonial Sugar Refining Company have their refineries throughout Australia, and they bring their sugar down to the refineries by the vessels of the Adelaide Steam-ship Company. As a matter of fact, it is found to be cheaper to bring the raw sugar from Java than to bring the Queensland sugar down from Bundaberg, although the first-named port is four times the distance, the explanation being that many of the shareholders and directors of the Adelaide Steam-ship Company are also shareholders in the Colonial Sugar Refining Company, with the result that they charge exorbitant rates for the carriage of the Queensland sugar, and money which should be shown as profits in the affairs of the Colonial Sugar Refining Company goes to the Adelaide Steam-ship Company in the form of freights.
– I think I have read that the Adelaide Steam-ship Company at times has been unable to declare a dividend.
– The honorable senator overlooks the ramifications of this great institution, which is able in so many ways to hide its profits.
– What are the annual profits of the enterprise?
– Roughly, 25 per cent.
– There are too many rough statements. Give us something definite ?
– These rough statements, as shown by the balancesheets, are fairly accurate.
– Are you in favour of the repeal of the sugar duty in the interests of the consumers ?
– No. Whether an industry is canning mosquitoes in Western Australia, bottling flics in Western Queensland, or catching Tasmanian devils, so long as it is an Australian industry, and gives promise of success under an import duty, I, as an Australian Protectionist, would give it the benefit of the Tariff.
– Are you not in favour of cheap sugar for the people?
– I am in favour of getting some of the huge profits of the company for the benefit of the sugargrowers and the consumers.
– The political situation is altogether unparalleled, and deserves the closest attention of Parliament. I believe we are entering upon a new era, totally different from any that has passed. Hitherto Australia has been known as the working-man’s paradise, standing out above other countries as the one in which the working man had a fairly decent position. It was a paradise for the working man when contrasted with Europe, America, and more particularly Asia; but I believe that in the near future the reward of labour in Australia will more nearly approximate to the European level than it has done for many years. This changed situation has been brought about in several ways. Hitherto the Commonwealth has been almost free from debt. It has had no interest bill to pay, but by the end of the financial year I estimate that the debt of the Commonwealth will approximate to £100,000,000. which will mean an altogether new interest payment of about £4,500,000 per annum. The Opposition have grumbled at the £2,500,000 that we pay for old-age pensions. What will they say to this extra burden, especially as, if the war continues for another year, our debt will rise to £150,000,000, and before the end is reached may be £200,000,000?
– Your basis is too high. We have reckoned on sending an additional number to the front, and yet our estimated military expenditure does not reach £40,000,000per annum.
– I thought we were spending at the rate of £1,000,000 a week, and we shall certainly have a very heavy debt at the end of the financial year. To owe a debt is not in itself altogether a bad thing, so long as one has assets to show for it, bub about £80,000,000 of our debt will be entirely unproductive.
– We shall have a splendid army of trained veterans.
– My experience of the veteran in Great Britain was that the man who had been for a number of years a soldier was of very little value in the industrial arena. I hope it may be otherwise here. We are faced with the serious problem of raising additional taxation. Our population is not increasing as it ought to be, and probably will not increase largely for some years, because we shall not be willing to admit immigrants from central Europe, from which we drew so much of our population previously. The war pensions account will be high, being estimated by the Government now at £500,000 per annum, and we shall have a number of other new expenses. We have had considerable difficulty in the past in financing the Commonwealth, and our problem will be to meet the added taxation. We have been meeting our own expenditure, and paying the States 25s. per capita, but one of the first effects of the new era will be that we shall be compelled to put a stop to the payments to the States, and the States will have to rearrange their finances. We shall have to re-arrange ours, and one of the first things that must be done to clear up the mess is to stop the per capita contribution to the States. Our Tariff has been a revenue one, producing about £15,000,000 per annum. Our policy for a number of years has been professedly protective, and if the temper of thepeople continues as at present, it will be more protective than ever, which must result in a diminished Customs revenue. It is necessary from the defence point of view to make the country as nearly self-contained as possible, and one of the great objects of every true Australian will be to bring this about. If that is the policy which the people of Australia are going to carry out, what will become of the Customs revenue ? If we have a truly Protectionist Tariff, inevitably there will be a drop in the Customs revenue of something approaching 50 per cent. Suppose that we lose £5,000,000 per annum from that source, how are we going to make up the deficiency ?
– Is not the assumption that with the development of internal production the volume of the national wealth will increase?
– Of course it will, but if we derive less revenue from one particular source, we must get more from some other source. As the population increases the cost of government per head will become less, but I do not think that it will be so much less as to counterbalance the loss I have indicated. This state of affairs cannot be brought about unless Australia goes in for Protection. I do not wish to say very much on this subject. I desire to point out that if Australia is to prosper and to become a self-contained community, she must have a policy of Protection, but I quite realize that very powerful influences will be directed against its adoption. We shall have our honorable friends of the Opposition, who believe in a revenue Tariff, opposing the policy. We may have members of the Government, who are more anxious about getting revenue and squaring the ledger than they are about anything else, not offering active opposition, but presenting an obstruction to the carrying out of a policy of this kind. Those of us who believe in Protection may make up our minds that there are very strenuous days ahead of us. If we are going to compel the adoption of the policy, we shall have to work very hard indeed, and I believe that, unless it is adopted, there can be little or no prosperity ahead for this country. There may be other forces adverse to us. We know that Great Britain prides herself on her Free Trade. I believe that her Free Trade proclivities have, on the present occasion, brought her right up to the edge of the precipice.
– And left her rich enough to see it through.
– Great Britain would have been infinitely richer with Protection, and if she is rich, why are so many of her people very poor? Why are there milhous of poverty-stricken wretches in the country ? The honorable senator was at Home, and knows something about the position.
– It is the same in Protectionist America.
– The honorable senator was in the Old Country for only five minutes, whereas I was there for many years, and know more about the position. He said something about Protectionist America, but we do not hope to have the same conditions here as there. In any case I am not going to be led aside to discuss America, or even Great Britain. What I want to impress upon honorable senators is that Great Britain is a Free Trade country; that Japan is taking a part in the present war, and that, as a price of her assistance, Great Britain may bring her influence to bear on Australia to allow Japan, and, perhaps, other countries, the right of Free Trade with Australia. When the war successfully terminates, as we all hope it will, some Australians may be anxious that we should reciprocate throughout the Empire. This idea of an Imperial Customs Union is not a new one. It has been broached time and again, and, so far as I can discover, there has never been a better opportunity for those who favour the idea of presenting their case than there will be at the end of the war.
– Who ever favoured it in Australia ?
– I am not saying that it was favoured in Australia, but the Imperial connexion will inevitably be stronger at the end of the war than it was at the beginning. We have the Indians, the South Africans, and the Canadians helping us, and we also have the Japanese giving us a kind of negative assistance. We know that the Japanese are extremely anxious, not only to come here, but to be allowed to trade with us under practically Free Trade conditions.
– They are trading with Australia to some tune at present.
– I know that they are. If we desire to create industries here, can it be done in the face of Japanese importations? Can we do it in the face of even British importations? I submit that we cannot, because in Great Britain the conditions are such that, unless we have some Protection, her manufacturers can flood us with their goods and stamp out any attempt we may make to establish industries. The struggle before the sincere Protectionists is one which promises to be of a most strenuous character. I trust that when the time comes to engage in that conflict, the members of the Labour party - a large majority of whom have hitherto been convinced Protectionists - will not fail or flinch. I was attempting to deal with the financial aspect of matters, pointing out how, if we adopt Protection, we must have resort to some other form of taxation. We shall require more revenue than ever we needed before. Where will it be obtained ? I have indicated here on many occasions one source which has been tapped, no doubt, and has produced a little trickle, but we cannot be satisfied with a trickle in the future. We must have a river of money flowing into the Treasury if Australia is to remain solvent. Where are we going to get that money ? I contend that we have a virgin area of taxation, which, so far, has been almost wholly neglected. I refer, as honorable senators can easily guess, to land values taxation. The three words “ communitycreated values” describe what I am alluding to. What does taxation mean? When a man with an income of £1,000 a year is taxed at the rate of 2s. 6d. in the £1, or something smaller, it means that he is taxed on his industry. The more enterprising, the more indus- trious, and the more fortunate he is, the more money he has to pay in taxation. This form of taxation, instead of encouraging industry, has an exactly opposite influence. When the community as a whole takes from its individual members the values which it has created, and which at present are passing into the pockets of the private owners of land, it is not taxing those persons, hut simply taking from them something which they have been improperly allowed to pocket. The community is taking its own money.
– Is not the line of demarkation between what you call communitycreated value and individuallycreated value very indistinct?
– I do not intend to enter into a debate on this question with the honorable senator.
– It is the pith! of the whole matter.
– The difference between the two is very clearly defined. If there are no people in a country, there can be no community-created value. If to-day there are 1,000 persons in a town, and a year hence there are 5,000 persons there, the land values in that period will have increased, at least, fivefold. As population increases land values increase, and as population diminishes land values diminish. Why is it that land values in Tasmania are lower in Bothwell than in Launceston ? For the simple reason that there are more people in the latter than in the former. Why are land values higher in Hobart than in Launceston ? Because the former has a bigger population than the latter. Again, why is it that land values are higher in Melbourne than in any other town in Victoria ? There is no other reason for it except that there are more people in Melbourne than in any other town in this State. If we go to Sydney and ask why land values are higher there than in any other part of the Commonwealth we find that exactly the same reason applies. If the population of Melbourne were to dwindle within a year from 500,000 to 250,000, there would be a tremendous drop in land values. That must be evident, I think, even to the meanest understanding. It naturally follows that land values are created by “the presence or the absence of population. If it is the case that the people create the values, to whom do they belong? They belong to the community, and not to in dividuals. Instead of passing into the pockets of private owners the righteous destination of these community-created values is the public Treasury. “Unless the people, the Parliaments, and Governments of this country realize that, our financial system in the near future is apt to become exceedingly mixed. Governments have hitherto, except in a very mild way, carefully refrained from drawing upon this reserve of taxation. But I believe that events will shortly be too strong for all Governments, and they will be compelled to fall back upon the one just and righteous form of raising money, and that is by taking up this communitycreated value. There is another aspect of the question which ought to appeal to honorable senators, and it is that when we take for the community the values created by the community, we do not injure but, on the contrary, stimulate industry. We free the resources of the country, and give the people access to its natural wealth. Let us consider for a moment the position in Australia with regard to the location of our population. Speaking roughly, 50 per cent, of our people live in our cities. There is no parallel to this position anywhere under the sun to-day.
– A larger proportion than that live in the cities in Great Britain.
– Of course, Great Britain is all a city, but if we take the capital, London, containing a population of between 5,000,000 and 6,000,000, we shall find that it has only about oneseventh of the population of the British Isles, whereas in Australia nearly half the population in each of the States is to be found in the capital of the State. When the United States of America had reached the same population as we have in Australia at the present time, only about 3 per cent, of the people lived in cities. It is true that since that time industrial conditions there have very much altered. A large number of industries Have been concentrated in centres of population, but, giving all that in, the position of Australia is an altogether abnormal one, and is extremely injurious to the development of the Commonwealth. I was saying that by taking the community-created values for the people an immense stimulus would be given to industry. I have spoken in the Senate times without number on the question of land monopoly. I have pointed out that the large estates held in various parts of Australia by a comparatively small number of people are a perfect blot upon the progress of the Commonwealth. I believe that land monopoly is as rampant in Australia to-day as it ever was, and, if that were possible, I am more satisfied than I ever was before that if we are to do anything for ourselves as a community that monopoly must be broken up. I have here a “list of large estates in Victoria, comprising in the aggregate 1,200,000 acres. This is* not a very old document. It was published only two or three years ago. I do not know whether I ought to read the names of the owners of these estates, but when they are read they will probably be familiar to some representatives of Victoria in this chamber. Here is the list: - Dr. Atkinson, 96,000 acres; Sir Rupert Clarke, 78,000 acres; William Laidlaw, 63,000 acres; Walter Laidlaw, 33,000 acres; A. Johnson, 42,000 acres; Edward Manifold, 50,000 acres; J. S. Manifold, 31,000 acres; W. T. Manifold, 35,000 acres; James Russell, 30,000 acres; Philip Russell, 41,000 acres; John Ware, 55,0°0 acres; Thomas Shaw, 30,000 acres; William Wheatley, 54,000 acres; the estate of Sir S. Wilson, 86,000 acres; S. Wilson, jun., 42,000 acres; and J. Robinson, 36,000 acres; the estate of Sir William McCulloch, 32,000 acres; Silas Harding, 31,000 acres; Charles Armitage, 48,000 acres; Charles Avery, 42,000 acres; William Bailey, 47,000 acres; William Barker, 36,000 acres; Rear Admiral Bridges, 47,000 acres; H. S. Chirnside, 57,000 acres; Percy Chirnside, 36,000 acres; Mrs. A. B. Chirnside, 52,000 acres; G. N. Buckley, 42,000 acres. These estates aggregate, as I have said, 1,200,000 acres of probably the best land in Victoria. I suppose that they are valued at anything from £20 to £50 per acre, and they are occupied by a comparatively small number of” people. I want honorable senators to consider for a moment the number of people who could be settled upon this huge area of fine country. I think I am well within the mark when I say that any family might make a living from 250 acres of these lands. If that estimate be correct, we could, out of this area of 1,200.000 acres, have at least 4,500 farms, each carrying from six to eight people. Let honorable senators think for a moment what a valu- able addition to the population of Victoria that would mean. It would mean a direct addition of about 40,000 people, and an indirect addition of probably 20,000 or 30,000 more. That would mean more business for the railways, for the Post and Telegraph Department, and for the people of Melbourne. It would mean more people to carry the load of taxation, and to help to defend the country if ever it were attacked. It would mean a most tremendous advantage to the State of Victoria. “Under existing conditions this huge area is in the hands of about twenty-five families. This kind of thing ought not to be tolerated in a free country. This is not the only portion of Victoria in which monopoly exists. In almost every corner of the State land monopoly is to be found. Huge estates are dotted here, there, and everywhere. I read in the pamphlet before me that a branch railway 100 miles long runs through only nine estates. How many people are settled along that 100 miles of railway? I venture to assert that there are not very many. If we had an effective land tax or an effective system of garnering for the public Treasury our community-created values, the probability is that there would be thousands of people living along that, railway, providing traffic for it, paying taxation to the Federal and State authorities, and helping to strengthen Australia. What can be said of Victoria in this connexion can be said of every other State in the Commonwealth. In my own State of Queensland, land monopoly is as rampant as it is anywhere. In New South Wales it is just as bad. Senator McDougall was good enough to hand me a newspaper cutting yesterday, and if what is stated in it be true it discloses a condition of affairs in New South Wales which is not at all creditable. For the benefit of honorable senators I propose to read the quotation.
– From what newspaper is it taken f
– Judging by appearance, I should say it was taken from the Sydney Sun. It is as follows: -
A rather funny case has just come to me from Nundie, New South Wales. A is the holder of 11 acres of Government homestead leasehold. He has a family of seven children and too much stock for his 11 acres, and has to put them out on others’ land. B is the holder of 621 acres of Government leasehold won in the previous ballot, none of which is under cultivation, and has no crop, and, fur- ther, has only a family of one child. Now both A and B, with others, enter a second ballot for a lot of 405 acres adjoining A’s 11 acres. B’s holding is 7 miles away, and, strange to say, B wins the second ballot, making him a total of 1,021 acres. A comes second in the drawing, and naturally objects to B being allowed to participate in the second ballot, and the matter is brought before the Land Board for consideration. A claims that B had no right to enter the second ballot, as he had won the previous ballot. B claims that 621 acres is not a living area, and that he was given permission by the Minister for Lands to enter the second ballot, and was recommended by the district surveyor; and the Land Court decides in favour of B. So that, in their opinion, 11 acres is a living area, and 621 acres is not.
– Put the man who has 11 acres probably follows some other occupation, and does not live upon the land.
– In any case, here was a man who had only 11 acres, whilst another man had 621 acres. Unless the country was very poor indeed, a man who could not make a living off, practically, a square mile, did not know very much about his business. Yet, although one of these individuals already possessed 621 acres, he was allowed to enter a ballot and to secure an additional 400 acres. To-day, therefore, he is holding more than 1,000 acres, and he has no stock; whereas the other man, who has only 11 acres, is compelled to graze whatever stock he may have on other people’s land. I have quoted this instance to show honorable senators the condition of affairs which obtains in New South Wales. On several occasions I have informed them of the rush which has taken place for land in that State. There have been 2,000 or 3,000 applicants for five or six selections. I remember pointing out that a comparatively small number of persons in New South Wales owned 20,000,000 acres of its best lands. No community can prosper whilst that state of things exists. Coming to Victoria, We know that the renting system is very common in this State. In many cases, persons who own large areas let portions of them to tenants. I wish to quote the experience of one of these tenants, who rented 141 acres of land. The country was fairly good, as it was capable of carrying from fifty to sixty cows.
– It was irrigated land.
– No. The rent paid for it. was £3 per acre, the annual contribution under this heading being £432. The total produce of the farm was £700. After the rent had been paid, therefore, the tenant had £278 left. He had to buy his own cows, and a fair average price for these would be £8 per head. This meant an outlay of £430 for a start. That expenditure had to come out of his original capital, if he had any ; if not, he had to scrape a few pounds together and give security for the balance. It he put his own money into the herd, it would be a fair thing to allow him 5 per cent, interest upon it. After making certain deductions, and providing for interest, we find that there is a balance of £233 from which has to be deducted one man’s wages for a year £65, board £26, one man’s wages for six months £26, and his board £26 - items totalling £143. The tenant thus had a balance of £90, after allowing nothing for depreciation. Here was a case in which the landlord obtained an income of £432 per annum from 141 acres, whilst the man who did all the work, provided the stock, and made the land productive, received only £90.
– He did not get that.
– He did not, if all deductions were accounted for. This illustration will suffice to show the condition under which a large number of our working people are living. It is the duty of the Commonwealth Parliament to alter that condition. It can be altered in only one way, namely, by increasing the land tax to such an extent as to make it unprofitable for the men who hold large areas to retain them. That step must be taken, in the interests of the country. We find now, when we are, unfortunately, at war, that Australia is being drained of her best manhood. Probably, before the present conflict terminates, 200,000 of our best workmen will have been taken away from us. What a tremendous drain that will bs on the resources of this country ! How is it to be made up ? How are the gaps to be filled? How can they be filled other than by making the lands of the country available to those who are disposed to settle upon them? Many of our people are disinclined to accept the conditions of country life. Why ? Because they have never been given a fair chance. Instead of being permitted to settle on the best lands of the country, they have invariably been sent to some outpost of civilization, far from schools, far from churches, and far from every other convenience in life. That ought not to be the case. We hear a great deal about the State Governments borrowing money for the purpose of constructing railways. Why, we have more miles of railway in Australia to-day than would suffice for ten times our present population. This insane idea of building railways whilst the lands along existing lines remain unsettled seems to me to be unworthy of a reasonable people. When the Minister of Defence moved the first reading of this Bill, he claimed that a considerable amount of the Commonwealth indebtedness will be more or less productive. But what production will there be along the east-west railway line, or along the northsouth transcontinental line?
– A great deal.
– When I hear men talk in that strain, I wonder whether they are really sincere. These two lines are being built through the most inhospitable portions of Australia. We have railways in Queensland which have been constructed through much better country, which for over a period of twenty years have not done more than just pay their way, and which for ten years, at least, did not pay interest upon their capital cost of construction.
– Does the honorable senator regret the fact that they were built ?
– I regret nothing. But at this time in our history, when we need money so badly, if we are to expend anything in developing our resources, let us expend it in those portions of ‘Australia which are capable of being immediately settled. Do not let us go out into the desert places which will not be inhabited to any extent during the next hundred years.
– Does the honorable senator suggest the cessation of construction on those two lines?
– The _ money which is being spent upon them is being absolutely wasted, so far as our present needs are concerned. Neither of them will add a thousand souls to our population. If the money that is being expended upon them were spent in some other portions of Australia, which are more fertile, and in which the rainfall is more plentiful, the results might be extremely profitable.
– Does the honorable senator advise the stoppage of those particular works?
– I opposed the starting of them. If the people of Australia could have foreseen what has happened, if they could have known the financial quagmire awaiting us, they would never have consented to those two railways being constructed. The mere giving of employment is no reason for spending money. What we want to do is to spend money in such a way that it will become reproductive. It will not be reproductive on the east-west railway within the next fifty years. Some day, I have no doubt, the railway line will be settled, but everybody knows why the line is being built. It is being constructed for political reasons.
– It is being built for the defence of the country. 0
– The people of Western Australia threatened what they would do with regard to Federation unless the east-west railway were built. The people of that State and of South Australia joined hands and made a bargain, which no sensible Government ought to have concluded. I have said before, and I say again, that it was an undiluted job, due to political pressure, and that these schemes were not considered on their merits. I would not like to say for how many years the Northern Territory will be a burden on the Commonwealth.
– At least a generation.
– Undoubtedly, and the east-west railway, unless some important mineral discovery is made, will be in exactly the same position.
– What do you suggest with regard to the Territory ?
– I am not going to suggest anything.
– The honorable gentleman is destructive in his criticism.
– I am merely saying that these railways will never pay during our lifetime. I point out again that we want more people to help us to develop this country, and to assist us in carrying this load of taxation ; but, above and beyond everything else, we want a large population to put us in a condition of independence. We can only get that by encouraging and protecting our industries, both in country and in town. When we reflect that last year we imported somewhere about £80,000,000 worth of goods from abroad, and exported only about £78,000,000 worth, and when we consider that of the £80,000,000 imports at least £50,000,000 or £60,000,000 worth could have been produced here, we can only come to the conclusion that we want a policy of protection for our manufacturers and a land policy which will have the effect of breaking up the big estates from one end of the country to the other. I do not know that I have very much more to say. We are undoubtedly entering upon a new era of Australian history. After the war Australia will be a very different country to what it was before the war.
– The same remark will apply to all the nations engaged in this war.
– I am not troubling about other nations. I am thinking about the country in which I live. If I were to trouble about other countries I would feel some concern for Great Britain, for she has been brought almost to the verge of destruction because of the stupid and inhuman policy which has been in force there for a couple of hundred years. However, we are not called upon to criticise Great Britain. Our duty is to Australia. If we can pursuade the people of this country to adopt a rational policy, and if we can give them the opportunity of establishing themselves in industries where they can live comfortably and contentedly, we shall be doing some good for this country of ours. If we adopt a policy such as that outlined it will free the land, it will protect us against the sweated labour of other countries, and we shall at least have laid the foundation of coming prosperity for Australia.
– One or two matters have been raised to which I have been asked to reply before this Bill passes its first reading. Senator Millen expressed some doubt as to the meaning of my remarks in regard to recruiting, anr I would like to draw his attention to the fact that my statement was in answer to a question which had been asked by Senator McKissock’ as to whether we would consider the advisability of reducing the height standard. Therefore, anything that I said subsequently should have been read in the light of what I was replying to. I was endeavouring to show that there was no need to reduce the height standard, because we were able to find sufficient recruits for all our reinforcements, and, indeed, had a margin over. That being so, any incidental references I made as to the number of recruits required for reinforcements could not fairly have been regarded as an indication of the intention of the Government only to raise the number of reinforcements, because from time to time we have said we shall welcome every man who is fit and will come along. There is no desire od the part of the Government to place any limit on the number of men to be sent from Australia. If Senator Millen had read further down in the statement I refer to he would have seen that I said this -
While the policy of the Government was to utilize recruits additional to the number required as reinforcements, in the formation of new units, its unceasing duty was to maintain the strength of the units and to see that they had trained officers and proper organization and equipment.
Senator Millen also wanted to know whether it would be possible for Ministers to take part in the recruiting campaigns. The honorable senator has had some experience of Ministerial office, and he must know that the amount of time a Minister has. apart from his departmental and parliamentary duties, is exceedingly limited. I think, however, we can claim on behalf of the late Government, and I certainly think on behalf of the present Government also, that whatever we can do to assist recruiting we will do. I might mention that four Ministers took part in the recent campaign in New South Wales, and Senator Russell also offered his services, but they were not availed of for various reasons, for which he was not to blame. When we consider, therefore, that five out of ten Ministers took part in that campaign, and that they were equal to the number of honorable members who assisted, Ministers have no cause to blush for shame concerning their part in it. Senator Millen also referred to the difficulty concerning the payment of recruits, and in connexion with that matter I would like to say that while we hear of the men who do not get their pay, there are many thousands who have no cause for complaint at all. Altogether we have about 160,000 men to pay. Of that number about 12 per cent, are married men; in these cases there has to be payment of separation allowances to the wives as well as to soldiers, so that the number of payments is greatly in excess of 160,000. It should be borne in mind also that these payments have had to be made by a staff that had to be increased tenfold during the last few months, and that many of them have had no previous experience in the Department whatever. Is there any reason for surprise, therefore, that some delay takes place occasionally ?
– They are doing remarkably well.
– I have followed up a number of those cases to find out where the trouble occurs, and I think it is only due to the Paymaster’s office - particularly in this State, where there has been severe criticism, and where I myself meted out punishment recently - to say that I have found that it is not so much to blame as the military officers in the camps. The company officer at, say. Seymour, taking that as an illustration, is responsible for sending down to the pay office before each pay day the number of men on his strength for whom he has to draw pay. and it might happen that before, that time arrives, for some reason or other, men have been detailed from Seymour to go to, say, Broadmeadows, or some other camp. It has to be remembered that company officers have to learn internal administration as well as military drill, and we have found that in cases where there has been delay over payment it has been because the company officer has thought he had done with a man who might have been sent from Seymour to Broadmeadows, and had simply struck the man off the list without making any record of the transfer. The man is not accounted for, and is not even mentioned. The Paymaster’s Office has no knowledge of what has happened to him. The fault lies with the officer at Seymour in not notifying the Paymaster’s Office of the transfer of the private to Broadmeadows. When the private has been long enough at Broadmeadows, he will be included in the Broadmeadows list; but, in the meantime, the Broadmeadows officer naturally thinks that the Seymour officer is doing his duty. It is the duty of the officer at Seymour, when a man has done his service there, to see that he is paid. That is done in thousands of cases; but in an individual case here and there, through want of knowledge or incompetence on the part of the company officer, a mishap occurs. In every case I have traced I have found that to be the explanation. Having found the cause, we must apply the remedy. No system is fool proof. Mr. Newman, a Home Affairs officer in the Defence Department, has suggested the application of the card-index system, and that is now being done. In a case like that mentioned, the Seymour officer would have 100 cards, and transfer the card with the man to Broadmeadows, where the officer would know that the man had not received his pay, and would claim for him ; while we should have in the Central Office a corresponding card. The new system will take a little time to bring into operation, but when it is complete we believe it will cure the evil. We are told that we want business men in the Defence Department. My answer is that the Defence Department at present is being run by business men. The men running the Camps followed all sorts of businesses prior to the war. They are military officers to-day, but were business men then; and we find that the” whole of the trouble is coming from those very Camps and those very men who though they have had a business training, have not much acquaintance with Defence organization, and have not therefore been able to get thoroughly in touch with the operations necessary to avoid these troubles. I am amused at some of the statements about the need for business men in the Defence Department. What is a business man ? Is he a man who keeps a draper’s shop or sells a few hundred pairs of boots in a year? We have in the Defence Department men who handle boots by the half-million pairs. We purchase and handle more hats than the biggest drapery emporium or warehouse in Australia, and have done so for years. Men running these branches of our Department have had more business experience of that kind than those who pose outside as business experts. Apparently a grocer who has been doing a business of £5 or £10 a week deserves the glib designation of a business man, but one who has earned his living as a workman is disqualified for all time, no matter what his experience has been, and can never hope to have that blessed term applied to him. If I had been a grocer turning over £4 or £5 a week before entering Parliament, I could have lived for all time on my reputation and my administration could never have been attacked, because I could always have said that I was a business man ; but, because I worked for wages as a carpenter, no matter what experience I may have had, or what ability I may be able to acquire in the administration of my Department, I am damned for all time. I could never, for instance, be a director of a company, although many of those now running our biggest mining enterprises did not have two halfpennies to jingle together before they made their lucky rise. Because they made their fortune by a lucky stroke of chance, our Conservative newspapers and Liberal friends opposite fall down and worship them for their wonderful business capacity. A man should be judged by results, and not by the way he previously earned his living; and I am more than surprised to find some members of our own party impliedly condemning themselves by using this catch cry of the Conservative press in criticism of men on their own side.
– You admitted tho principle when you appointed Mr. Anderson.
– We chose him because we believed he had done something more than prove his business ability by luck. He had had experience, not only in private business, but in association with business departments.
– What has been his verdict as to those business men you talk about?
– His report on the Defence Department was anything but a condemnation of it, read as a whole. He was brought in, not to praise the Department, but to find its faults. He began by saying that, on the whole, the Department had done wonders; and then pointed out its faults, which he was paid to do.
– They were all faults of previous administrators.
– They were faults that had grown up with the Department; and he showed how they could be rectified. One of his chief recommendations was an internal continuous audit, not merely of the bookkeeping, but of values in the Department. That has been introduced, and is now in operation. We have a continuous separate audit, independent of the Minister, and responsible only to the Auditor-General, auditing not merely the bookkeeping arrangements, but also checking the values received by the De partment. That reform has been put into operation during the war. Mr. Anderson also recommended the creation of a Supply and Tender Board. A few days ago one honorable member attacked the Department for not having such a Board, yet it had actually been in operation for several weeks before, and the men on the Board are the men Mr. Anderson recommended should be there. Before uttering such criticisms, honorable members should make themselves familiar with the facts. Senator Needham brought forward the case of the mother of a soldier who is in receipt of an old-age pension, and whose claim for separation allowance was disallowed on that account. The principle is simple. The Commonwealth Administration cannot be treated as a set of watertight compartments. The money is contributed by the taxpayers, and the payments have to be looked at in their totals. A fair rate of pay was fixed for single men, and then it was deemed advisable to grant something over and above this in the case of married men as a separation allowance for their wives and families. Australia has recognised through its laws that a person who reaches a certain age should be paid a certain sum. If that sum is inadequate, Parliament is responsible; but are we to say that, in addition to the 10s. a week pension paid to the mother of this soldier bv the Treasury, she must receive also a separation allowance from the Defence Department?
– If the son was free to work for her, his contribution to her support would not be taken into account under the old-age pension law.
– The country has said, through its Parliament, that 10s. per week is the proper provision to make for her. If the country thinks that the provision is inadequate, it ought to rectify the inadequacy through its Parliament. It is not the duty of the Defence Department to say, “ We do not think that the Parliament has provided enough for this woman, and we are going to provide something additional through the defence pay.”
– Why was she getting a separate allowance?.
– It was simply because the Department did not know that she was an old-age pensioner. It has laid down the principle that it is not its duty to subsidize an old-age pensioner.
– If the man is killed in the war, will the woman get a war pension?
– The honorable senator raised two questions, and I am dealing with one question at a time.
– I think there is a difference of 6d. per week. In the case of a wife, of course, or other dependant who is not a parent, we recognise that he or she has a claim to consideration, and that the amount fixed for a single man is not adequate for a married man. That is the principle on which we have proceeded. Now I come to the hypothetical case which Senator Needham raised. He asked whether, if the man is killed, his mother will be entitled to a war pension. She will, because section 3 of the War Pensions Act reads -
If the member or his dependants is or are entitled under any Act other than the Invalid and Old-age Pensions Act 1908-1912 or any Act amending or substituted for that Act, to receive any payment by way of compensation, pension, retiring allowance, superannuation, or gratuity, the right to payment by way of pension in accordance with this Act shall be taken to be substituted for the right of the member or his dependants to any payment by the Commonwealth under such other Act, and the right of the member or his dependants under that other Act shall be by force of this Act determined
That is to say, the right of the mother to an old-age pension does not in any way abrogate her rights under the War Pensions Act.
– Then why refer this matter to the War Pensions Board?
– Simply because it comes under the administration of the Board, and not under the administration of the Defence Department.
– Why does not the Department rectify the matter?
– The Department is fairly busy, and if it looks after its own business that is all which can be expected of it. We received a letter which dealt with two questions. One of them came under our province, and as to the other we simply advised that the matter referred to would have to be determined by the Commissioner for Pensions.
– If it is the law, why refer the matter to the Commissioner ? j
– The honorable senator should know that the administration of the War Pensions Act is not under the Defence Department, but under the Treasury.
– In the event of the man being killed, would she be able to draw the two pensions?
– In that event the woman would be entitled to the pension, provided in the War Pensions Act.
– And she would lose the old-age pension.
– The War Pensions Act says that, notwithstanding what a person receives under the Old-age Pensions Act, it does not take away his or her rights under the former Act.
– To the extent of his or her dependence.
– Yes. I am not prepared to say that it takes away from the old-age pension. I do not know whether it does or not. If Parliament desires that it should not do so, it has the remedy in its own hands. If this woman is wholly dependent, she will get £1 a week under the War Pensions Act, whereas under the Old-age Pensions Act the amount she ‘could get is 10s.
– You appear to have destroyed the position which you put just now. You said that you would not take the responsibility of paying the separation allowance, but would take the responsibility of paying a pension on top of the other one.
– No; I have said that it does not take away the woman’s rights under the War Pensions Act.
– That is not on allfours with your speech of the 5th August as it appears in Hansard.
– I cannot help that. Senator Watson raised the question of alleged injustices in the appointment of certain officers in the Army Service Corps in New South Wales. He said that certain officers had been overridden, and officers had been appointed from other States who did not have the same experience, and were not qualified. I asked him to let me have the facts, which he has done. According to his statement, Lieutenant Macaulay bad six years’ service, passed through a school of instruction from the 13th to the 25th September, and was superseded by Captain Robertson, who had been eight years on the reserves, and was alleged to be incompetent; by Lieutenant David, of Victoria, who had never been through a school or camp; and also by Lieutenant Graham, of South Australia, with inferior qualifications. The honorable senator says that none of these officers had attended a school of instruction, that Lieutenant O’Connor is another officer who has thus been superseded, and that both Lieutenant Macaulay and Lieutenant O’Connor were recommended by Colonel Ramiciotti and the Selection Committee. I have had the cases investigated, and the circumstances are set out in the following communication from the Ad j utant-General : -
In the formation of small units, such as Army Service Corps, in a particular district, it was recognised that if the appointments of officers thereto were restricted to the particular district in which the unit was formed, there might be highly qualified officers in other districts for the particular arm who would be overlooked. For instance, Tasmania does not provide any reinforcements at all for L.H. officers. There have been some competent L.H. officers from Tasmania appointed, therefore, to L.H. reinforcements in Victoria and New South Wales.
In the case of the A.S.C. under consideration, on 27th August, 1915, three weeks before the A.S.C. School was commenced there, the following instructions were issued by lettergram to all districts : - “ Wire names all applicants for commissions in A.S.C. units of A.I.F. recommended by Selection Committee soon as possible direct to Q.M.G. Headquarters. Most suitable applicants throughout Australia will be allotted irrespective Military Districts.”
That is to say, the officers appointed, although not on the recommendation of the District Committee, N.S.W., were appointed on the recommendation of an equally competent Committee in some other district. As’ to their qualifications : -
Lieutenant (Prov.) J. L. H. Macaulay, 25th Infantry. - First commission, 2nd Lieutenant, 1/7/13; Lieutenant (prov.), 1/7/15. Has never been an A.S.C. officer in his life, but attended an A.S.C. School of Instruction from 13th to 25th September, 1915, i.e., for 13 days only - the only A.S.C. experience he has had, and his age is 22½ years.
Lieutenant (Prov.) A. A. O’Connor. - Age 23 11-12 years, 2nd Lieutenant A.S.C., 16/10/14; Lieutenant (Prov.), 1/7/15 - a very junior officer.
Lieutenant Macaulay has now been appointed Adjutant for the Infantry Base Depot for the A.I.F., which is not an A.S.C. appointment, and Lieutenant O’Connor, consequent on the withdrawal of an officer, has now been appointed to the 20th Company, A.S.C, A.I.F.
With regard to the officers who were appointed to the A.S.C. in preference to Lieutenants Macaulay and O’Connor, the follow ing is their record, all being appointed on the recommendation of the District Selection Committee, Victoria, and selected from the whole of the Australian recommendations, by the Q.M.G., Colonel J. Stanley:-
Lieutenant S. A. Robertson, of the A.S.C. - Age36¼ years, Lieutenant, Infantry, 20/8/99; Lieutenant, A.S.C, and in command of a militia company, A.S.C., 22/3/15. Served in the Boer War as Adjutant of the 5th Victorian Contingent. For four months as an officer of the A.S.C, held the appointment of Officer in Command of Supplies of the Broadmeadows Camp, which duty he performed in a very ‘ satisfactory manner.
Lieutenant (Prov.) E. B. Graham, of the A.S.C. - Age 32) years, 2nd Lieutenant, A.S.C, 28/6/12; Lieutenant (Prov.), 1/7/15. Has been mobilized in camp since the outbreak of war doing A.S.C. work.
Lieutenant T. A. David, of the A.S.C. - Age 29¾ years, Lieutenant, Senior Cadets, 13/9/09; Lieutenant. A.S.C, 1/5/15. He has been mobilized for two months at the Base Supply Depot of the A.S.C.
Every one of these officers has had a very much longer experience than the men whom it was complained they had superseded.
Question resolved in the affirmative.
Bill read a first time.
Sitting suspended from 10.27 to 11.35 p.m.
Bill received from the House of Representatives.
Standing and Sessional Orders suspended, and Bill read a first time.
Bill returned from the House of Representatives without amendment.
Referenda Proposals : Agreement with State Premiers.
– I move -
That the Senate do now adjourn.
In submitting this motion, I wish to state that the Premiers of the various States have to-day made an offer to the Government, on behalf of their respective Governments, to grant to the Commonwealth, for the period of the war and for one year after the war, the powers, with certain limitations, sought for in the proposed amendments of the Constitution which are embodied in the measures about to bo submitted to the people by referenda. This offer has been accepted by the Federal Government, and it has been agreed, therefore, to postpone the taking of the referenda.
– Hear, heart
– Action will be taken to give legal effect to this arrangement.
Question resolved in the affirmative.
Senate adjourned at 11.40 p.m.
Cite as: Australia, Senate, Debates, 4 November 1915, viewed 22 October 2017, <http://historichansard.net/senate/1915/19151104_senate_6_79/>.