Senate
13 December 1916

6th Parliament · 1st Session

  1. Senate
  2. 6th Parliament
  3. 1916

The President took the chair at 3 p.m., and read prayers;

page 9655

PERSONAL EXPLANATION

Tasmanian Recruiting Committee

Senator READY:
By leave

– I desire to make a personal explanation. In to day’s Argus the following cablegram from the State of Tasmania appears : -

Hobart (Tasmania), Tuesday. - At a meeting of the Returned Soldiers League, held to-night, the following resolution was passed: -

That this general meeting of the Hobart branch of the Returned Sailors and Soldiers Imperial League of Australia protests against the appointment of Senator Beady as chairman of the Tasmanian Recruiting Committee, and asks the Prime Minister for his removal, owing to the insults he offered to the Tasmanian Returned Soldiers League during the referendum campaign.

I give the statement contained in the resolution a complete and emphatic denial. The resolution is not only inaccurate, but misleading. It is not true that I, at any time or at any meeting during the recent referendum campaign, insulted or reviled or in any way cast the slightest suspicion of a stigma on the men who have returned from the battle-front, and axe now in the State of Tasmania. Instead of those conditions existing, the relations between returned soldiers and myself have been of a most harmonious character, and, with one exception, I have had nothing but the best of relations with these men. In fact, I think I can claim, as a senator who lives in Tasmania, that I have received as many requests, ; if not more, than any other Tasmanian member has received from the soldiers, and that I have always endeavoured to fulfil the requests and to help the men in’ any way which has lain in my power. At my meeting in the Hobart Domain, which was the best one that I addressed in Tasmania, and at which over 5,000 persons were present, some of the most prominent of the returned soldiers thanked me for what they claimed to be a fair handling of the side I represented in the campaign. One. of them, who shook hands with me and particularly congratulated roe, was a leading member of this same Hobart body.

It is indeed inexplicable to me why a body of men should take such a strange course as this, and I cannot too strongly repudiate it. In the same newspaper this advice appears in an appeal or a circular quoted in full to be sent out to the local recruiting committees by Captain Robinson,secretary to the DirectorGeneral of Recruiting, Mr. Donald Mackinnon, M.L.A -

Enlist all the public aid that you can, and help from citizens of all classes and views. To win this war all must co-operate.

Avoid all discussions which cause differences of opinion.

It was my desire; in accepting the position of chairman, to follow out those instructions literally. I chatted on the matter with Mr. Mackinnon, and he specially stressed the condition that in asking for recruits for our Army the differences of opinion, the conflicts, and any soreness which might exist as a result of the recent campaign were to be entirely turned down, or, to use his own words, we were to start de novo, and to put all previous happenings behind us. As one who was anxious to help, recruiting, I agreed with that proposal, and I am fully prepared to carry it out. But my position in this matter is that I accepted the position of chairman of the recruiting committee for two reasons. The first reason was that I believed in the voluntary system, and the second was that I thought it my duty to take some part in the organizing work, in order that a constant flow of recruits might be secured for the men. at the front. It means work, worry, personal expense, and -time. All this I was prepared to give, and will give to some extent now, but to me it is indeed’ regretful that such an action should be taken without, in my opinion, just cause by one body of the Returned Soldiers Association of Tasmania. Speaking frankly, the only’ construction I can put on this resolution is that it wears a strong political, aspect, and that is just the very thing which we were advised by the Director-General of Recruiting to put behind us, and start fresh when we were dealing with the new scheme.

In view of this statement, as I wish to help recruiting, I desire to say that, in order that there shall not be any conflicts of opinion, in order that the scheme may be harmonious, in order that we may get the best results in Tasmania, I beg to intimate to the Minister for Defence that I intend to resign my position of Chairman of the State Recruiting Committee, and will he pleased to help in my private capacity as a senator in any way that I can, and support the man who is elected as chairman in my place.

page 9656

QUESTION

MILITARY SERVICE REFERENDUM

Voting in Territories - Questioning of Voters.

Senator GRANT:
NEW SOUTH WALES

– Can the Minister representing the Minister for Home

Affairs now answer the question I put a few days ago as to the number of voters’ in Canberra, Northern Territory, and other centres during the recent referendum?

Senator RUSSELL:
Assistant Minister · VICTORIA · ALP

– The information is as follows : -

The number of persons living in the Federal Territories whose names appear on the. electoral lists compiled, ‘ pursuant to the Regulations, for the purpose of the recent referendum by the Returning Officers,, and the number of persons to whom ballot-papers were issued, are set out hereunder: -

Senator McKISSOCK:
VICTORIA

asked the Minister representing the Minister for Some Affairs, upon notice -

  1. Will he inform the Senate if any, and, if so, how many, telegrams were transmitted by the Chief Electoral Officer to the Presiding Officers throughout Australia, advising the questioning of voters of military age in the polling booths for the taking of the conscription referendum poll?
  2. Under whose instructions were these telegrams sent?
  3. If any, and, if so, how many, telegrams were transmitted to Presiding Officers throughout Australia cancelling the previous instructions?
  4. What was the cost of these two sets of telegrams ?
Senator RUSSELL:

– The answers are -

  1. The Chief Electoral Officer did not . communicate direct with Presiding Officers. The -. number of telegrams despatched to Presiding Officers by Divisional Returning Officers was nineteen.
  2. The Chief Electoral Officer, acting on a Regulation approved by the Executive Council on the 27th October - a certified copy of which was forwarded to him by the AttorneyGeneral’s -Department - issued instructions to the Commonwealth Electoral Officers for the several States for transmission to the Divisional Returning Officers. These instructions were subsequently cancelled on receipt of an official ‘ intimation from the Attorney-General’s Department that it had been decided not to proceed, with the Regulation.
  3. The number of cancelling telegrams despatched by Divisional Returning Officers to Presiding Officers was forty-nine.
  4. £53 10s.1d.

page 9657

QUESTION

HOME DEFENCE PROCLAMATION

Contagious Disease

Senator STORY:
SOUTH AUSTRALIA

asked the Minister for Defence, upon notice -

  1. How many men, called up under the Proclamation calling up men for compulsory military service) were found to be suffering from a contagious disease?
  2. The number in each State?
  3. Were they all released when the proclamation was withdrawn?
Senator PEARCE:
Minister for Defence · WESTERN AUSTRALIA · ALP

– The answers are - 1 and 2. This information will take some time to obtain, but action will be taken to get it, and to lay the information on the table of the Senate.

  1. Yes. Except a very small number who were too ill to be discharged from the hospital. By the repeal of the Proclamation these men were released from the control off the Department.

page 9657

QUESTION

FREE RAILWAY PASSES

Visit to New Zealand

Senator McDOUGALL:
NEW SOUTH WALES

asked the Minister representing the Minister for Home Affairs, upon notice -

  1. Has the Minister’s attention been drawn to the statement in the daily press that some of the gold free life passes on the railways of the Commonwealth issued by the late Minister have been returned?
  2. If so, how many have been returned, and what are the names of the gentlemen who have returned them?
  3. Do any of the gentlemen who have returned the said passes now hold life passes on. the railways of the States?
Senator RUSSELL:
ALP

– The answers are -

  1. Yes.
  2. One - Mr. Dugald Thomson. Some of the ex-Ministers to whom passes were issued are at present away from Australia.
  3. Not so far as I am aware.
Senator NEEDHAM:
WESTERN AUSTRALIA

asked the Minister representing the Prime Minister, upon notice -

  1. Did the Government cancel the order of the ex-Minister for Home Affairs in connexion with the visit of private members of the Commonwealth Parliament to New Zealand; and, if so, why?
  2. Did the Government cancel that portion of the order of the ex-Minister for Home Affairs providing free railway passes on Commonwealth railways to all ex-Presidents of the Senate, ex-Speakers of the House of Representatives, &c, and retain that portion which gives free railway passes to ex-Ministers of the Commonwealth who have had twelve months in office- and, if so, why?
Senator PEARCE:
ALP

– The answers are -

  1. Yes, as it was not considered desirable, anyway at the present juncture, to provide members with free travelling outside the Commonwealth, unless engaged upon some definite public mission.
  2. The matter is under consideration.

page 9657

QUESTION

EXPEDITIONARY FORCES

Mental Cases : Female Medical Corps : Casualties

Senator WATSON:
NEW SOUTH WALES

asked the Minister for Defence, upon notice -

  1. What arrangements have been made for members of the Expeditionary Forces who have been invalided back to the. Commonwealth suffering from mental disorder?
  2. How many returned soldiers are at present in the different State lunatic asylums in the Commonwealth?-
  3. Does the Government propose to provide separate and proper treatment for the returned soldiers mentally afflicted Or alleged to be mentally afflicted other than the treatment provided in asylums which existed for ordinary insane subjects previous to the commencement of the war?
Senator PEARCE:
ALP

– The answers are -

  1. Mental cases from overseas are treated in New South Wales, Victoria, and Western Australia, and kept separate . from ordinary civil patients. Every endeavour is made to give the necessary treatment for these cases without their being certified as lunatics. As the laws of Queensland, South Australia, and Tasmania do not allow of their being treated otherwise than as insane, the soldiers belonging to Queensland are treated in New South Wales, and those of South Australia and Tasmaniain Victoria.
  2. Three in Victoria,, two in Western Australia have been certified as insane.’
  3. As it is desired to obtain the services of experts in treating’ these cases, , the various expert staffs of States are utilized. Returned soldiers suffering front mental disorder are provided with proper and separate treatment from ordinary insane subjects until it is decided by mental experts that the case is incurable,’ and then the patients are- certified as insane, and placed under the care of the Master-in-Lunacy of the State they belong . to.
Senator WATSON:

asked the Minister for- Defence, upon notice -

  1. Why female doctors are not encouraged to form a medical corps for service abroad, notwithstanding that many lady doctors have offered their services?
  2. Are their services considered of less value than lady doctors serving in the Allies’ cause, and who haverendered such valuable service?
  3. Will the Minister take into consideration the question of forming such a corps, to enable ladies in the medical profession to play their part in the war?
Senator PEARCE:

– The answers are -

  1. As far as is known the Imperial authorities do not employ female medical practitioners, except in non-military capacity, but it is known they were unable to place one unit offered by the Bed Cross for service in Europe.
  2. No. It is considered that female medical practitioners are doing better work by attending to the civil population, and so allowing males to go forward on active service.
  3. There are no suitable places for female doctors in the Australian Imperial Force, and no more Army Medical Corps units are being forwarded, but any applications will be referred to Imperial authorities to ascertain if they can be utilized. Very few have been received so far.
Senator WATSON:

asked the Minister for Defence, upon notice -

  1. How many casualties have occurred to the Australian troops since the commencement of the war?
  2. How many returned to the firing line from those that were wounded during the months of July, August, and September of this year?
  3. What were the casualties of the past two months?
  4. What numbers enlisted during that period?
Senator PEARCE:

– The answers are -

  1. Accurate figures representing total casualties under the various headings at the present time cannot be furnished. Many cases which were first reported wounded ormissing have subsequently been posted as deceased, ‘and vice versa; similar alterations have, been made from time to time under the remaining headings, consequently net figures as at 4th December, 1916, covering the latest reports received, are only shown. The casualties from the commencement of the war up to, and, including reports received, 4th December, 1916, total as follows : - Deceased, 16,384; wounded, 80,295; missing, 3,264; sick, 17,618: prisoners of war, 834; casualty not specified, 299; total, 68,694.
  2. According to reports received in Australia, the total number returned to duty for the months of July; August, and September, 1916, are as follows, but the Department is not able to say what proportion, if any, of these were wounded during the months named : - July, 1,531; August, 757;. September, 624; total, 2,912.
  3. The casualties reported during the past two months are as follow,but judging from past experience these cannot be taken as a complete list of the casualties that actually occurred during the period : -
  1. The number of enlistments during the months of October and November, 1916, was : - October, 11,522; November, 5,066; total, 16,588.

page 9658

QUESTION

COAL MINERS’ HOURS

Senator WATSON:

asked the Minister representing the Prime Minister, upon notice -

If it is a fact that Judge Edmunds has given a judgment conceding to the miners of the Commonwealth eight hours from bank to bank, will the Government bring in a Billto make it a Federal law?

Senator PEARCE:
ALP

– The award of the tribunal has the force of law.

page 9658

PRICES FOR MINERALS

Senator Lt.-Colonel Sir ALBERT

GOULD asked the Minister representing the Prime Minister, upon notice -

Will he state what are the latest London quoted prices for wolfram, molybdenite, manganese, and antimony?

The prices paid by the Government or their agents?

Are any of these minerals supplied to the British Government, and, if so, at what prices?

Does the Government permit the exportation of these minerals other than through their authorized agents?

Who are such agents, and what is the remuneration paid them?

Senator PEARCE:
ALP

– The answers are -

  1. Wolfram, molybdenite, and antimony are not quoted, as they have been requisitioned by the Imperial Government. Manganese - Indian manganese ores, on 50 per cent. basis, delivered in England next year, are quoted in the Mining Magazine, London, for September, at 2s. 5½d. per unit, and Brazilian ores at 4s.
  2. No official prices are now given for wolfram or molybdenite. The official price for antimony is £95 per ton.
  3. Wolfram at 55s. per unit of WO3 c.i.f. London. Molybdenite at 105s, per unit of MOS2 c.i.f. London.
  4. Wolfram and molybdenite can only be exported through the Government agents.
  5. Dalgety and Co. Ltd. ; collecting agency commission, 1¼ per cent. (when they act as collecting agents), and export agency commission, lj per cent., but producers are at liberty to have their own collecting agents.

page 9659

QUESTION

PRESS CENSORS

Senator GRANT:

asked the Minister for Defence, upon notice -

  1. How many press censors are at present employed by’ the Federal Government?
  2. What are the name, salary, and terms of employment of each censor?
  3. Has the number employed been increased or diminished since 1st November last?
Senator PEARCE:
ALP

– The answers are -

  1. There are twenty -two officers employed as press censors in conjunction with their other duties, and the proportion of time engaged in connexion with press work is equivalent to the full working time of 10.85 officers : -
  1. The number of officers employed on press ^censorship has been .diminished by one since 1st November last.
Senator FINDLEY:
VICTORIA

– Am .1 to understand from the Minister’s reply that one of the censors is employed only three-fifths time, and another only one-third time ? If so, will the Minister telL the Senate how, and by whom, a censor’s time is determined ?

Senator PEARCE:

– The time of engagement ranges from full time down to one- third time. Some of the censors are employed for only a portion of a day, notably in certain of the smaller States, where they work only for such time as may be necessary.. That fact determines the length of their employment.

Senator Findley:

– Is it a fact that one censor is employed for only three-fifths of his time?

Senator PEARCE:

– Yes; Lieutenant West.

Senator Keating:

– Does the list include all the censors in the Commonwealth t

Senator PEARCE:

– No; the question referred to press censors. There are, of course, other censors engaged in dealing with postal matter.

Senator Keating:

– I think there are omissions from that list.

page 9659

PAPERS

The following* papers were presented : - -Customs Act 1901-1916. - Proclamation prohibiting exportation (except under certain conditions) of Wire Ropes and High Speed Tool Steel. (Dated 29th November, 1916.)

Defence Act 1903-1915. - Regulations amended, &c. - Statutory Rules 1916, Nos. 294, 295, 296.

Defence Act 1903-1915 and War Precautions Act 1916. - Regulations amended, &c. - Statutory Rules 1916, No. 296.

Military Service Referendum : Manifesto by the Prime Minister, the Right Honorable W. M. Hughes, to Australian Soldiers on service abroad.

Northern Territory. - Ordinance No. 2 of 1916 - Noxious Weeds.

Papua.- Ordinance No. 11 of 1916 - Post and Telegraph.

War Precautions Act 1914-1916. - Regulations amended, &c. - Statutory Rules 1916, Nos. 250, 252, 254, 255, 263, 272, 283, 284.

page 9660

CONSTITUTIONAL ALTERATION (TRADE AND COMMERCE) BILL

(No. 2).

Bill presented, and (on motion by Senator Gardiner) read a first time.

page 9660

CONSTITUTION ALTERATION (CORPORATIONS) BILL (No. 2)

Bill presented, and (on motion by Senator Gardiner) read a first time.

page 9660

CONSTITUTION ALTERATION (NATIONALIZATION OF MONOPOLIES) BILL (No. 2)

Bill presented, and (on motion by Senator Gardiner) read a first time.

page 9660

CONSTITUTION ALTERATION (INDUSTRIAL MATTERS) BILL

(No. 2).

Bill presented, and (on motion by Senator Gardiner) read a first time.

page 9660

CONSTITUTION ALTERATION (TRUSTS) BILL (No. 2)

Bill presented, and (on motion by Senator Gardiner) read a first time.

page 9660

CONSTITUTION ALTERATION (RAILWAY DISPUTES) BILL

(No.2).

Bill presented, and (on motion by Senator Gardiner) read a first time.

page 9660

SUPPLY BILL (No. 3) 1916-17

Australian Steel for WarPurposes - Financial Proposals: Taxation - Expenditure : Defence Department - Treasurer’s Advance Votes - Sinking Funds - Military Service Referendum : Regulations : Disturbance of Meetings - Recruiting CampaignGerman Peace Proposals - The Government and the Liberal Party - Settlement of Coal Strike - Statutory Eight Hours Day- Split in Labour Party: Proceedings in Caucus - Senator Ferricks and Mr. Dunne - Land Monopoly and Land Values Taxation - The Tariff.

Bill received from House of Representatives.

Senator PEARCE:
Minister for Defence · Western Australia · ALP

– I move -

That so much of the Standing and Sessional Orders be suspended as would prevent the Supply Bill being passed through all its stages without delay.

I wish to explain, in moving this contingent notice of motion, that it is not submitted with any intention to curtail the privileges of the Senate in the matter of debate. Honorable senators are aware that on the first reading of Supply Bills general questions may be discussed. Such a debate might take up considerable time, and it occurred to me that honorable senators might prefer to take up the debate upon questions involved in the Bill on the second reading.

Senator Millen:

– Does the honorable senator wish a debate on the first reading straight away?

Senator PEARCE:

– Yes. If we did not suspend the Standing Orders the first reading might be taken as purely formal, and we could not go on to the second reading in connexion with which honorable senators may desire to discuss the financial proposals of the Government.

Question resolved in the affirmative.

Senator PEARCE:
Minister for Defence · Western Australia · ALP

– I move -

That this Bill be now read a first time.

There is one matter which I take this opportunity to bring under the notice of the Senate. It is an important development, and one concerning which the Senate should be informed at the earliest possible opportunity. I should have given the information in. the form of a Ministerial statement, but on the motion for the first reading of the Supply Bill, honorable senators’ who desire to do so may traverse the statements made, and I thought it better that they should have that opportunity of doing so. The subject to which I desire to refer is that relating to the supply of steel to the British Government for the purpose of assisting in the war. As I shall have to refer to the negotiations and cables, I hope honorable senators will pardon me for reading this statement: -

Steel Production of Australia. Although there was general knowledge of the shortage of steel in Great Britain, it was not till July this year that the Minister of Munitions stated definitely that there was a shortage. The first intimations were in connexion with a regretful refusal to sanction exportation of steellocking bars and rings for the Adelaide waterworks, and the supply of boiler plates and blooms for railway locomotive construction. In January, 1916, the Imperial Government ordered 500 tons of shell steel from the Broken Hill Proprietary Company as a sample; and in August, after receipt of the steel, they ordered the balance of the unused Australian shell steel, 1,500 tons. In September, 1916,another order was placed for 10,000 tons of round mild steel bars for munitions; 2,000 tons of this has already been shipped. On the 15th November, a long cablegram was received from the High Commissioner regarding economy in the use of railway material in Australia, and, in view of its importance, a copy is attached.

On the 15th November, a cablegram was received from the High Commissioner as follows: - “ Minister Munitions asks: -

  1. What is the total estimated steel output of Australia for 1917, and could it be stated for two half-years separately ?
  2. How is output distributed as between domestic requirements and manufacture munitions?
  3. Could any material at present being devoted to domestic requirements be made available munition requirements without unduly hampering trade?
  4. Is there any increase in output in view at the present moment, or could any increase in output be arranged for if necessary? If so, what would increase be, and what steps will have to be taken to arrange for it?

Immediate reply requested by Minister of Munitions.”

The Broken Hill Proprietary Company Limited, Newcastle, and Messrs. G. and C. Hoskins, Lithgow, were asked to furnish returns of their estimated production for 1917, and a- statement of how their production is disposed of. Their estimated productions for half-year ending 30th June are as follows: -

It will be seen that of the production of 93,000 tons at the Broken Hill Proprietary Company’s works, only 17,150 tons is for domestic use, leaving a balance of 75,850 tons. This balance is made’ up of 57,000 tons for rails (Australian Government Railways), 10,070 tons for structural steel (Victoria and New South Wales, Governments), 7,500 tons of mild steel for the British Government, and . 1,280 tons surplus production.

At Lithgow, of the production of 38,096 tons, 13,700 tons are used for Government work, 1,011 tons for domestic structural steel, and the balance, pig-iron, 23,385 tons, usedfor domestic purposes. Note. - A large proportion of the pigiron for domestic use is utilized for making cast-iron pipes.

A cablegram was sent to the High Commissioner as follows: - “Answering your telegram of 15th instant, Steel for Minister of Munitions -

  1. Total steel production Australia six months ending 30th June, 1917, 90,000 tons; 31st December, 1917, 75,000 tons.
  2. Domestic requirements solely.
  3. Government will make available during period ending 30th June, 37,500 tons, in addition to 10,000 tons already ordered by Minister’ of Munitions.

Will Minister Munitions take this quantity, or how much? Will advise later regarding supply for six months ending 31st December.

  1. Broken Hill building second blast furnace. If special material required from America can be expedited and prompt shipments arranged when ready Broken Hill, can after erection make approximately 25,000 tons steel extra half-yearly. Round bars, 4, 4½ and 5¼ inches diameter can be rolled in greater quantity and more expeditiously than structural steel, but will cable particulars of rolls ready for latter if structural required. Can also supply in addition above vast quantities iron ore 64 per cent. iron low phosphorus and sulphur, and can load into ships with draught not exceeding 25 feet at rate of 800 tons hourly.

Early decision Minister of Munitions regarding steel will be appreciated enable Government make necessary arrangements apportion balance domestic steel.”

After Messrs. Hoskins’ return came in, the figures were amended as follows: -

  1. Total steel production Australia six months ending 30th June, 120,000 tons, instead of 90,000 tons; 31st December, 1917, 110,000 tons, instead of 75,000 tons.
  2. Government will make available during period ending 30tn June, 50,000 tons, instead of 37,500 tons.”

As a result of this cablegram, the Broken Hill Proprietary Company has received a message from its London office as follows : - “ Munitions inquire price per ton for 75 lb. per yard steel flange rails and fish-plates. Delivery at approved British port or France. Shipment before 30th June, 1917. Important know when delivery can be commenced, and at what rate.”

Briefly, the figures show - for the six months ending 30th June, 1917, a total production of 121,000 tons. To be made available for export - 50,000 tons. This leaves 71,000 tons for Australian consumption, of which only 41,000 tons are required for domestic use.

Copy of Cable from High Commissioner, dated 9th November, 1916: - “ The Minister for Munitions states that the shortage in supply of various metals necessary for the maintenance of railway stock and permanent way is becoming increasingly acute, and with a view to an equitable apportionment of such material as is available and to meeting the urgent need of various railways in the Empire, will you be good enough to furnish at the earliest possible date the following particulars arranged in conformity with the following schedule and certified by a competent authority. - “1. Quantity of material actually used in 1914 for purposes of repair and. maintenance of the railways in each State, leaving out new rolling-stock, whether by way of addition at cost of capital or replacement chargeable to revenue account: also leaving out of account re-laying of permanent- way . “2. An estimate of the bare minimum amount of such materials necessary for repairs and maintenance of railways during 1917, leaving out new rolling-stock. “ Of the items scheduled there are difficulties in particular in supplying : - ” (a) Steel sections bars and angles. ” (b) Copper tubes and plates. “ (c) Steel tubes. “ (d) Steel rails. ” (e) Steel sleepers. ” (g) Steel fish-bolts. “and in fact possibilities of supply of any of the last four mentioned items by United Kingdom manufacturers at the present time are remote. “ The Minister of Munitions also points out -that the requirements of the Admiralty, War Office, and the Munitions Department exceed the supplyavailable, and requests that every effort should be made and every device employed to diminish the consumption of material for railway purposes. The Minister further adds that this action is of vital importance from the point of view of the prosecution of the war. Since the outbreak of war, passenger services of British railways have been largely curtailed, and probable further reductions of these services may be necessary in the near future. The Minister is advised that a considerable saving in material required for maintenance can be effected, and he hopes that favorable consideration may be given to the desirability of adopting similar economical measures in the various Australian State railways.”

In view of the receipt of these cablegrams, the Government felt that they were absolutely justified in taking the course which they have taken. It will be seen from the figures I have quoted that we shall still have sufficient steel on hand to meet the domestic demand in connexion with necessary works. But nobody will contend, in view of the demand which exists for war purposes, that we should use up this steel on works which can well be deferred until this great demand for steel for war purposes has passed.

Senator Findley:

– Will that policy be applied to the East-West railway?

Senator PEARCE:

– It will be applied to all railways which can legitimately be asked to stand over until the demand for steel for war purposes has been relieved. The question of what works shall stand oyer is now the subject of negotiations between the Commonwealth and State Governments, and in that regard the Commonwealth will have to take its share of responsibility along with the other Governments of Australia.

Senator Findley:

– Does that mean that the construction of the East-West line will have to stand over ?

Senator PEARCE:

– I can tell the, honorable senator no more than I have told him. The question of what works shall not be proceeded with at present is the subject of negotiations between the States and the Commonwealth.

Senator Findley:

– What have the States to do with that line?

SenatorPEARCE.- The quantity of steel to be allocated in Australia will be allocated between the Commonwealth and the State Governments.

Senator Millen:

– In the statement which the honorable senator has just read it is set out that there will be available for export 50,000 tons, leaving 71,000 tons for Australian consumption, of which 41,000 tons are required for domestic use.

Senator PEARCE:

– By “ domestic use” there is meant structural steel,. as against steel for railway purposes. If honorable senators will turn to the statement they will see that it estimates 57,000 tons from the Broken Hill Proprietary Company alone for railway purposes, and 10,000 from Hoskins’ Iron Works.

SenatorWatson. - What effect will that have on the labour market?

Senator PEARCE:

– I cannot say.

Senator NEWLANDS:
SOUTH AUSTRALIA · ALP; NAT from 1917

– What effect will it have upon winning the war?

Senator PEARCE:

– I believe as the interjection of Senator Newland suggests, that it will have an important effect upon winning the war.

Senator Watson:

– I take it that my question is fully in order, notwithstanding the interjection?

Senator PEARCE:

– Yes, I do not object to the question. We are approaching harvest time, and apparently it will be one of our biggest harvests. We have already seen that the demand for harvesting labour is not met, as shown by the fact that men have had to be released from the training camps. I wish to take this opportunity of referring briefly to the Government’s financial policy. In that regard I remember that Senator Millen rather questioned my action in leaving that out of the last statement of Government policy which was made here. There were reasons for that action. I think it is usual when a statement of policy is to be made that the financial proposals are left to the Treasurer, especially when he is about to follow very closely with a statement. It had been arranged at that time that a financial statement by the Treasurer would follow immediately after a general statement of Government policy, and in no sense was any discourtesy intended to the Senate. Otherwise, we should have had a financial statement made here before it was made in another place. The Government have revised and reviewed the previous Government’s proposals for taxation and for revenue and expenditure, and have made some very important changes in them. In that regard the present Government had an advantage over the previous Government. When the latter framed their proposals they were not. so well informed as the present Government are, because of the fact that they were at the beginning of the financial year, as to the amount of money which would be required during the forthcoming year, and the figures proposed then were very largely in the nature of estimates, whereas over three months of the financial year had gone when the present Government revised the old proposals. We were ablethen more accurately to estimate the expenditure. It is obvious that it is extremely unwise for any Government to tax for purposes other than those of meeting the expenditure of thecountry. When we came to look over the proposals, we found that by the exercise of economy, by a reduction in expenditure in certain directions, and by reducing the payment to the sinking fund to liquidate the war debt, we could make extensive reductions in the amount of our taxation. I propose to indicate in what directions these reductions have been made. Take, for instance, the war profits tax. There was another factor which weighed with the Government there. Not only did we come to the conclusion that we would not require to put on the amount* of taxation which the previous Government had proposed, but we concluded .that that proposed tax could very well be re-adjusted in the interests of the industries of this country, that there were some directions in which that tax would hit very hardly new industries, and would probably have the effect of injuring industries and preventing the development of them. There was still another factor. The previous Government . had proposed that there should be a tax on the profits of gold mining. The present Government took the view that these profits cannot properly be considered as War profits in view of the fact that gold has a standard value, and that the value of gold has not only not increased as a result of the war, but has actually depreciated.

Senator Turley:

– They were covered by the_general terms; they were not specially mentioned.

Senator PEARCE:

– They were not exempted, and, therefore, they were included. The purchasing value of gold has. actually depreciated, so that not only is there no war-time profit in gold mining, but a special tax on any extra profit which may have been made during war time would really be a penalty.

Senator Bakhap:

– Do these remarks apply to mining for one or two other ores ?

Senator PEARCE:

– My remarks apply to any class of mining where the article has a standard value, and where the value has not increased as a result of t-he war. In some of the mining industries we know there has been a considerable increase, due almost solely to the existence of the war, and, therefore, it may be legitimately said that these profits are war-time profits. If a gold mine has earned more profit during the war it certainly has not been due to the fact of any increase in the value of gold. It may have been due to an increase in the’ richness of the lode, but certainly not to the war. There is another factor that occurs in regard to all mining which the present Government considered the previous Bill did not take sufficiently into consideration, and it also applies in a large measure to other industries, and that is the question of waste profit, or capital. There is a form of what is called profit which’ is really a repayment of capital. The present Government considered that the Bill did not give sufficient consideration to that fact, and so they amended it accordingly. I will now state the principal decreases. The previous Government proposed that the tax in the year 1915-16 ‘ should be 50 per cent., and in the present financial year 100 per cent. It is obvious that the latter proposal would take the whole of the war-time profit made during ‘ the financial year. The present Government considered that that was not wise, that it would not encourage industry, that it would discourage industry, and therefore we decided to reduce the tax this year to 75 per cent. In regard to the wealth levy. The previous proposal was that there should be a levy of l£ per cent, on the corpus of wealth’, and that the payments should be spread over three years. It is pretty definitely understood now that the expenditure which this war levy is to meet will spread over a greater period than three years, probably at least five years, and possibly longer. There is no object in compelling the taxpayers, who* will have very heavy burdens to carry during the next few years, to pay more to this levy than what is actually required for the purpose, or that they should pay in advance of the - time when the money will be required, and therefore it is proposed to spread the levy, over a period of five years instead of three years.

Senator Stewart:

– You will need a lot for land settlement.

Senator PEARCE:

– I remind the honorable senator that this is not the fund from which the expenses of land settlement will be met. The cost of land settlement is to be met by the States machinery, and the Commonwealth Go- vernment undertaking to raise money to enable it to be advanced to the States. It will not be from this fund that that money will be appropriated.

Senator Stewart:

– What is this money to be used for?

Senator PEARCE:

– To enable returned soldiers to re-establish themselves in civil life, to settle in business, or, “in cases where they have been rendered unsuitable for a former occupation, to be trained for a new occupation, and to give them a start in various small industries. In the case of a man on the land, advances can be made to him, in the way of sustenance, to enable him to tide over the first or second year.

Senator Stewart:

– Will these, be loans or gifts t

Senator PEARCE:

– In some cases they will be loans without interest, - and in other cases gifts.

Senator Findley:

– There are no gifts from the Repatriation Fund. They are all loans.

Senator PEARCE:

– The honorable senator is wrong, because, in some cases, there are gifts. Another important change which has been made in regard to the wealth levy is in respect to the proposal of the previous Government that’ the war levy should also be made on war bonds. There was a considerable amount of doubt in the minds of members of that Government, as I know, as to whether they would he justified in taking that -action. There was a clear statement made by the previous Prime- Minister, Mr. Fisher, that the war bonds would not be subjected to Federal taxation. That statement was understood to mean the income from the war bonds. But the present. Government took the view that if we were to levy on the capital itself, that is, on the war bonds, it would have the same effect as though we were to levy on the income from the bonds; that to that extent we would depreciate the war bonds, and, therefore, depreciate the income earned by them. We felt that, in view of that promise or distinct undertaking, we would not be justified in carrying out a levy on war bonds.

Senator Turley:

– That was only made in connexion with the first war loan.

Senator Millen:

– And only in connexion with income taxation.

Senator PEARCE:

– While tho statement was only made in regard to the first loan, it was repeated in regard to subsequent loans as the Bills were brought forward. Anyhow, we are advised by our financial advisers that, apart from the equity of the proposal, nothing would be gained by taking that course; that, if the Government were to levy on the bonds, we would depreciate the Commonwealth stock, and have to pay a higher price for our money; that we would lose in that way the equal of what we would get by a levy on the war bonds. In regard to the income tax, the Government are adhering to the proposal of the previous Government to increase the rate by 25 per cent., but there is an alteration to be made in regard to the exemption, which will disappear entirely at the figure of £1,020. In regard to the entertainment tax, the alteration made is that there will be no Commonwealth, tax on tickets below 6d. in value, and that the tax will commence on tickets of that value.

Senator Ferricks:

– Can .the Minister say what sum would accrue from the imposition of the tax if 6d. were exempted 1

Senator Turley:

– If 6d. .is paid for a ticket, will that come under the tax ?

Senator PEARCE:

– Yes; tickets of the value of 6d. and over.

Senator Ferricks:

– How would it be if you exempted the 6d. and started at 7d., or even 9d. ?

Senator PEARCE:

– I could not give -the information. The following alterations in revenue have been made either by the Treasurer_in his Estimates or by the alterations in the various proposals that I have just roughly indicated : -

The increase in the Customs revenue is not derived by additional taxation, but is based on the experience of the three months of the current financial year already expired. The Treasurer, in consultation with the Ministers of the spending Departments, has been able to effect substantial decreases in the expenditure out of both revenue and loan, as follows: -

The decrease in the sinking fund is due to the fact that the previous Treasurer proposed to put aside £2,747,000, whereas the present Treasurer proposes to put aside only £1,301,778, which will extinguish the debt in thirty-nine years, and represents 1 per cent, on the loans raised by the Commonwealth. In the above decreases there i3 included £637,900 for expenditure on additions, new works, and buildings The total effect of the alterations is -

Revenue decreased . . . . f 1,750,000

Expenditure decreased … . . 2,413,807

Npt improvement . . . . f 663,807

Senator Millen:

– That is” a very bad way of stating it.- The net improvement is the amount you dc- not raise.

Senator PEARCE:

– It is a bad way of stating it, because’ it does not show the real position, but the figures I have given represent the difference between those two items. The Treasurer announces that he has been able also to effect reductions to the extent of £5,850,000 in the amount which the previous Treasurer expected to have to borrow. There again, of course, he has had the benefit of experience. For instance, the previous Treasurer had to consider the fact that the Government had issued a proclamation calling all men of certain ages into, camp and that a referendum was being taken with a view to the adoption of compulsory service oversea. He had to adjust his estimate to meet the possibility of that being carried, and the men being taken into camp, trained, and sent oversea.- The present Treasurer, when he framed his estimate, knew that the referendum had not been carried, and that the proclamation had been repealed, consequently he had not to provide for the retention of the men ‘ in camp. He was able to1 get the exact’ figure, which came to something under £400,000 all told, and did not have to provide for the same numbers of men being sent oversea.

Senator Bakhap:

– In other words, our war expenditure is to be reduced.

Senator PEARCE:

– It is being reduced by £5,850,000, very largely owing to the factor to which I have referred.

Senator O’Keefe:

– Is that estimated reduction to the end of June next?

Senator PEARCE:

– Yes. We shall, therefore, borrow that much less than the previous Treasurer expected to have to borrow, and the interest charge is re duced accordingly. That is one of the reasons for the decrease of interest which I read out in a previous list of items.

Senator GARDINER:
New South Wales

.- I listened with a good deal of attention to the speech of the Leader of the Government, but regret that he did not let me have a copy of the statement that he read. I suppose I can put it down only to an oversight. Had no one been furnished with a copy I should not have said. anything about it.

Senator ALBERT GOULD:
NEW SOUTH WALES · FT; ANTI-SOC from 1910; LP from 1913

-Colonel Sir Albebt Gould. - Surely the Leader of the Opposition is entitled to one?

Senator GARDINER:

– As the’ Leader of a party of nineteen, I am entitled to at least the same consideration as the leader of any other party in the Senate. I am not complaining. I take it, as I said, to be an oversight.

Senator PEARCE:
WESTERN AUSTRALIA · ALP; NAT from 1917; UAP from 1931

– I ‘kept one copy for ~ myself and gave the other copies to my secretary to give to the press, forgetting that’ I should have given copies to the leaders of the two parties opposite. When I sent for them I found that they had all gone but one, and that I handed to Senator Millen. The honorable senator will recognise that I have to deal with rather a novel situation in having two” Oppositions.

Senator GARDINER:

– That explanation ends the matter so far as I am concerned. I hope my speech on this motion will be sufficiently “brief to satisfy even the Government. Financial statements are matters not to be- discussed merely with a view to seeing how many words we can pile into Hansard, but to be criticised, in order that the public may be able to understand what is taking place here, and the probable policy of the new Government. Last week I was met by interjections all round when I said that the honorable understanding, or arrangement, between the Government and the Liberal party was that there should’ be a wateringdownof the financial proposals. I had from the Leader of the Opposition a statement that no arrangement had been come to. I accepted that, and still accept it. I had the same assurance from the Leader of the Government. Accepting both as= correct, it is rather interesting that we have here a financial statement showingthat the price the ‘Government are paying for their lease of office is the wateringdown of the financial proposals -of’- the last Government just on the lines I foreshadowed. It will also be remembered that Senator Findley interjected that the very dogs in the street were barking the arrangements that were being made.

Senator Bakhap:

– The alteration in the financial proposals took place before the Liberal party even had a party meeting-

Senator GARDINER:

– I have accepted the statement. I am only saying that it is a remarkable coincidence that exactly what I sa.id would be the price of keeping this Government in office is the price that is being paid, and that the financial statement shows that the one section of the public that has received extraordinary concessions from the new Government is the wealthy section. We see that in the extension of the wealth levy over five years instead of three. The previous Government were quite in earnest about the repatriation levy. They were determined that the men at the front,- or those who might hereafter volunteer for the front, should know that we were determined to get money in hand, so that we might have ample funds’ to provide for those who returned fitted to take up occupations. We all hope that when peace comes many will return fit and well, and we ought to have a large and well organized fund in hand now. We ‘could do better with £3,000,000 in hand this year than with’ £6,000,000 a year or two hence. Now is the time to make preparation for the repatriation of the soldiers, but this necessary work is being postponed! by the watering-down process from one-third to one-fifth. I suppose we may take it that a little more pressure from certain quarters will bring the fifth down to one-tenth, and so on till the vanishing point is reached. That indicates the weakening attitude of the Government towards the repatriation -question. The, new Treasurer has also reduced the amount expected to be received from the war-profits taxation by £400,000 in the first year and £1,100,000 in the second year. That is a remarkable reduction of £1,500,000, and is quite a sufficient price to pay for the Government we have there. Any Government, arid especially this Government, that was prepared, without consideration at all, to “take any man between, twenty-one and thirty-five years of age away from his “business, and actually did so drag men away, leaving their businesses to take care of themselves-

Senator Millen:

– You did that.

Senator GARDINER:

– Yes, I quite see that I did.

Senator Millen:

– Is this a public confession ?

Senator GARDINER:

– It will be what the Leader of the Opposition permits me to make it. This more merciful treatment of the wealthy section of the community comes very strangely from a Government that insisted on taking men from their business irrespective of the sacrifices that it caused them. It was the high-handed way in which men with small businesses were treated that helped to bring about at the , recent poll results so satisfactory to my friends and myself. It may yet be that this combination of parties, this ‘Government supported by the Liberal party, both of which tried to -inflict upon this- country a system by which men could be taken from their occupations irrespective of what it cost them, - for a man earning £10 a week could be, and was, taken from his occupation, and put into an encampment where his full’ return would be about £3 a week-

Senator Shannon:

– By this Government ?

Senator GARDINER:

– Yes. The honorable senator can he early or late with such trivial interjections, but I am satisfied that the public will judge well between us. It comes with a very bad ‘grace from a party and from honorable members who were prepared to take from their occupations and businesses men who were earning £10 a week and over and placing them in positions, at which they could earn £3 a week, thus compelling their families to live at a lower standard of comfort, to say now that the wealthy sections of the community shall, within the next two years,- be relieved of taxation to the extent of £1,500,000.

Senator Bakhap:

– But would not those men have been obliged to leave their businesses if Australia had been invaded?

Senator GARDINER:

– If ever Australia is invaded there will be no occasion for any one to worry about that matter.

Senator NEWLANDS:
SOUTH AUSTRALIA · ALP; NAT from 1917

– But have you not a word of commendation to say for the Government with regard to the relief of those people who pay 3d. to enter a picture show?

Senator GARDINER:

– I intend to come to that aspect of the financial statement in due time. The point I am making is thatit appears that the Government have suddenly discovered, by their treatment of the wealthy portion of the community - those people who are well able to pay rtaxation - that there are reasons why the financial proposals of the previous Government should be watered down to the extent I have mentioned. There is no occasion to labour the point. It merely requires to be stated to indicate what has. been in the mind of the Government. I am not saying that an arrangement was made, because that has been denied, but the statement shows the price the Government are paying for being allowed to continue in office. There has been an alteration also in the proposed tax on amusements which is to operate on tickets of 6d. and upwards in value. Had the tax been fixed at above 6d., it would have relieved that section of the community which enjoys sixpenny entertainments of a very considerable amount of taxation, and it would also have been a convenience to the providers of such entertainments, as they would have been enabled to give sixpenny patrons the usual entertainment at the usual price. . However, I have not much to say with regard to that matter. The chief feature of the financial statement is the unmistakable evidence it bears thatthe Government are slackening their efforts, and are getting into stride with the wealthy interests of this country to such an extent that it looks as if, before long, they will directly represent the wealthy people of Australia.

Senator Mullan:

– But the wealthy interests are keeping the Government in power, and, of course, they had to pay something for that.

Senator GARDINER:

– I am aware that the Government have to pay, but I think the price is altogether too big.

Senator NEWLANDS:
SOUTH AUSTRALIA · ALP; NAT from 1917

– The honorable senator does not go quite so far as his henchman.

Senator GARDINER:

– The honorable senator must not endeavour to score off any of my followers by endeavouring to protect me. I am criticising the statement because it bears out exactly what I said last week concerning the relations between the Government and the Liberal party, although the leaders, both of the

Government and of the Liberal Opposition, denied that any such arrangement had been come to.

Senator NEWLANDS:
SOUTH AUSTRALIA · ALP; NAT from 1917

– But you said then that you believed them, and now you donot.

Senator GARDINER:

– I said at the time that I was speculating as to what the Government would do. I was anticipating what would be the price to be paid by the Government for being allowed to continue in office with the support of the Liberal party. I was entitled to speculate, and now I can speak of the facts which are disclosed in the financial statement made by the Leader of the Senate, and that shows the price to be even greater than I anticipated a week ago.

Senator NEWLANDS:
SOUTH AUSTRALIA · ALP; NAT from 1917

– You are taking up a very”Yes-no” attitude. You have admitted that both the Leader of the Government and the Leader of the Liberal Opposition denied that there was any arrangement.

Senator GARDINER:

– I understand what my honorable friend means; and I remind him that as it is the parliamentary practice to accept assurances, I was merely following the usual parliamentary procedure. I might have started by refusing to accept those assurances, but if I had done that, the document which I have in my hand would almost make one question the accuracy of those statements.

Senator Shannon:

– You are questioning their accuracy by innuendo, which ia worse. 1 will have something to say to you by-and-by.

Senator GARDINER:

– If the honorable senator waits, possibly I may say something which will give him a handler upon which to hang his criticism. This financial statement, I repeat, indicates the price paid by the Government for the support of the Liberal party, and it will indicate to the outside public that the financial proposals of the previpus Government have been watered down to such an extent as to be acceptable now to the party representing the business interests of this country. In saying that, 1 am not speaking as one who is adverse to the business interests of Australia; but I do say that in a time of war, in a great emergency such as we are now facing, while men are being called upon to offer their lives, it is not too much to ask that the big interests shall be satisfied with 7. or 8 per cent. of their profits. If honorable senators vote for this watering; down of the proposals of the previous Government, who contemplated ultimately to take the whole of the profits - after allowing the management a margin of 7 or 8 per ‘cent. - I venture to say that from one end of the country to the other there there will be a feeling of keen disappointment. I- regret that in this crisis there has not been any clamouring that the big interests of the country shall do their full share in carrying on this war. It would not have been unfair, unjust, or unreasonable to ask that during this war the wealthy business interests of the country should be content with 6, 7, or 8 per cent, profit. To allow 50 per cent, of the profits would be an encouragement for some of them to go on, and with their powers of combination, organization, .and control of the necessaries .of life, enable them to make the cost of living higher than it has been in the past.

Senator Story:

– Should they all be guaranteed 7 or 8 per cent, profit ?

Senator GARDINER:

– I recognise, with the honorable senator, that during this war many businesses have been run at a loss, and it must be .remembered that the previous Government did not propose to inflict any taxation upon the people controlling businesses that were on an unsatisfactory basis. It was proposed that all businesses should be allowed a sufficient margin of profit. In the press, in this Senate, and in the other House, it has been well said that this is the time when we should be “ all in,” and when there should be no holding back; and I feel certain that the people will be keenly disappointed at the financial proposals of a Government that will hold office at a price which will permit of this country being only. “ partly” in the war.

Senator Story:

– There is a feeling of disappointment in this country that the honorable senator advised the people to hold back from sending men.

Senator GARDINER:

– I will not permit the honorable senator to put into my mouth words which I have not uttered. I have never said or done anything to prevent men from going to the front; but, on the other hand, I have used my best efforts to persuade as many men as could be got in Australia to go. The honorable senator will look in vain through my speeches for anything to justify a statement which he is trying to put into my mouth now. We are in a very grave position. While war is raging, while the business interests of this country are threat ened, surely it is a time when we may say to our great financial institutions, “ The men who are fighting your battles expect that you will put money into the Repatriation Fund now as an encouragement to them to continue, and an encouragement to others to offer their ‘services.” That is the position we are up against, and because we are nearing the end of this session, and because the Government are anxious to get on with the business of the country, I do not propose to speak at length. In the few words that I have uttered, I have said all that I wanted to say concerning the price paid by the Government to the Liberal party for their support. Even admitting that no arrangement has been made, the price paid by this Government to the Liberal party for support is the watering down in the interests of the wealthy section of the community, of the financial proposals submitted by the previous Government.

Senator MILLEN:
New South’ Wales

.- The Minister for Defence has this afternon read a statement covering negotiations, if we may so term them between the Imperial and Commonwealth Governments with respect to the despatch of steel from this country. In common with other honorable members of the Senate, I have had only the opportunity to listen to the statement, and have had no chance to consider it in detail. In the circumstances, I cannot say more than that I believe it is the duty of this country, without looking too closely into the effect which it may have upon local conditions, to do anything that we can which the Imperial authorities may suggest to help towards the successful prosecution of the war. One of the principal arguments used by those opposed to conscription during the referendum campaign was that we should be best helping the Allies by the products which we could raise in Australia. We have now been shown by the Imperial authorities one way in which we can give this assistance. I hope that, whilst not disregardful of the interests of local industries, we shall not hear too much from certain people of the effect upon local industries which this proposal to assist in bringing the war to a successful conclusion may be likely to have.

Senator Turley:

– It will be a spur to increase production.

Senator MILLEN:

– It should be, but on this proposal we have an opportunity ho test the sincerity of those who have been saying that we can help the Empire and the Allies in other ways than by sending men to, the front. They have contended that by sending the products of this country we shall be assisting to carry on the war. I hope that there will be no objection to the proposal on the ground that it may lead to the construction of this or that railway being delayed, for a few months, or even for a year or so. The Minister for Defence referred to some remarks of mine upon a previous occasion in which I directed attention to omissions from an earlier statement made by him. The honorable senator has misunderstood me. I was not then asking for a financial statement. The point I stressed then, and wish to stress now, is that the Government should have stated what proposals it is their intention to submit for the consideration of the Senate. There has been an intimation that two Bills dealing with war-time profits and the wealth levy are to be - submitted. But the Senate should be told whether the Government have other proposals to bring down, or whether this is the whole of the legislation they contemplate immediately presenting to Parliament.

Senator Pearce:

-t-I think that I said only measures calculated to assist in the prosecution of the war would be submitted.

Senator MILLEN:

– On a previous occasion, whilst the Minister for Defence disclosed the recruiting policy of the Government, he did not say what other proposals they intended to submit. Although this is not a new session , under the Constitution, it is, to all intents and purposes, a new session, and I had ex,pected that the Minister for Defence would tell the Senate what business the Government .contemplate putting before it,

I wish now to say a word or two about the War-time Profits Bill. This measure seems to have perturbed the prophetic soul of Senator Gardiner. It has sent him amongst the prophets, and he has attempted to predict the result of negotiations which, in his opinion, have keen in progress. No one can misunderstant the tone in which Senator Gardiner accepted the declarations made by the Minister for Defence and by myself as to the absence of the negotiations which he had in mind. I want to say that they must have ‘been very poor negotiators on be half of the Liberal party if this is the best they could get from a Government placed, as Senator Gardiner would have us believe, in the position of looking for support for which they are prepared to pay. I do not suppose that the Liberal party are at all satisfied with the proposals of the Government, and they must have had mighty bad negotiators if this is all they could get out of them, presuming that it was their, desire to make an utterly immoral use of any chance power which they might possess as a result of the; condition of affairs in Parliament.With regard to the War-time Profits Bill, the Government propose to reduce the tax from 100 per cent, tb 75’ per cent. It does n6t require more than the possession of common sense to’ show that that is justified. If you propose to take 100 per cent, of a man’s profits by taxation, how long is he going to sweat and labour to produce- those profits? If you say to a man that with respect to all profits over 8 per cent, you will take the lot, do honorable senators imagine’ that he is going to “ shun delights and live laborious days “ in order to make something more for the tax-gatherer. If you tell a man that you will take so much from him, no matter whether he works hard or takes it easy, he is not going to work hard when he learns that by reason of additional enterprise and effort the Government will collect the greater amount from him in taxation.

Senator Watson:

– He would get his ordinary profits, would he not?

Senator MILLEN:

– What would be his ordinary profits?

Senator Watson:

– The profits he wasmaking previous to the war.

Senator MILLEN:

– I say that no man will strive to make any more than ordinary profits if he is told that the Government propose by taxation to take from him everything over ordinary profits. It is a cardinal principle -with me that human nature is spread as thickly to the square inch upon one individual as upon another, and it is impossible to suppose that the business and trading ‘ community are going energetically to work in order to- make profits for the taxgatherers, unless it can be shown that in some way or another they will themselves derive some benefit from their efforts. This is to me so unanswerable that I believe that if -ohe matter were discussed quietly outside *-he political arena no man in his senses would contend that it is possible to get as much revenue from taxation up to 100 per cent. as may be obtained from a lower rate of taxation which would leave the taxpayer something for himself. A fundamental objection to the Bill, however, is that its title discloses that it proposes a tax not on war profits, but upon war-time profits. There is a fundamental difference between these two. I admit at once that profits which are made in consequence of the war are quite legitimately the subject of special taxation, but it isquite a different thing to say that because a profitis made during a time of war it should be similarly liable to taxation.

Senator Turley:

– How are we to distinguish between the two?

Senator MILLEN:

– The Government are not going to distinguish between them in the Bill. They have recognised the immense difficulty and extreme complication which will follow when this machinery is set in motion, and they therefore propose to set up a board of reference to deal with each case on its merits. If I am asked to distinguish between the one and the other I say that I am nob so much concerned as to how that can be done, but I am concerned to point out that there is a vital difference between them. Honorable senators will know cases in point to mark the difference. I give one case to illustrate what I mean. There is in a suburb of Sydney an oldestablished business, started many years ago by a man who until two years ago owned and ran it himself. He started in a very humble way, and built the business up until he reached the stage at which, with gathering years and a competence for himself, he ceased to hustle. The business was conducted as a slow, oldfashioned establishment. Two young men employed in the business, managed with the aid of some friends to buy it out, and have modernized it. The first thing they did was to put an entire new front to the building in which the business is carried on. Then they adopted modern methods to push the business.. For the first year in which they ran it it was all outgoing to cover the expense of making it a modern business. The second year they about paid their way, and this year they are securing some benefit from their enterprise and from the more modern methods they have adopted. Will any one tell me that this is due to the war? It is due to the introduction of new blood, new capital, and new ideas. Whilst the profit now being made is being made while the war is going on, it is not a war profit.

Senator Turley:

– It might be due in some way to the war all the same.

Senator MILLEN:

– It is equally open to me to say that but for the war the young men who have now got this business would be doing better still. I draw a big distinction between theprofits earned by a business such as this and by industries such as the woollen mills of this country, which to-day are making increased profits, not, perhaps, upon the individual articles which they turn out, but because of the fact that their machinery is running almost continuously. This is clearly due to the manufacture of cloth for military garments. These industries are making, npt merely a war-time profit, but a war profit. Then we can turn to the metal industries affected by the war. No one will dispute that they are making definite war profits. The steel industry, the Broken Hill industry of spelter, and the copper industry, are making war profits because of the enormous increase in the price of the products of these industries as a result of the demand due to the war. These profits constitute a legitimate field for the operation of the war profits tax gatherer. I dispute altogether that a business should be taxed on profits made in war time unless the Government can establish a connexion between those profits and the war itself.

I have a word or two to say now about ithe wealth levy. I am unable to understand the plea tnat the war loan bonds should be exempt from the levy. First of all, it is not correct to say that any assurance or undertaking was given to investors in the war loans that they were to be exempted from other than income tax. I raised the point distinctly here, and I had from Senator Pearce the assurance that income tax was the only taxation from which investors in the war loans would be exempt. I pressedthe point, reminding the Senate that other taxation might follow, and it would be a monstrous thing to give investors in the war loan permanent exemption from all forms of taxation. If this proposal goes through, what it means is that any one who has invested his substance in war bonds will notbe called upon to pay a single penny towards the cost of the war.

Senator Turley:

– He merely becomes a rich man.

Senator MILLEN:

– I do not say that he is going to become rich from the investment. SenatorFerricks is an investor, and I want to know why Senator Eerricks, because he has chosen to invest his untold millions in war loans, should be exempt from taxation, whilst Senator Lynch, who has put his money into a farm, should be taxed? It has been stated that although no specified promise was made, people who invested in the war loan were under the impression that they would be free from all taxation. In common with many other honorable senators, I have had opportunities to know something of the methods of those who are in a position to invest large sums of money, and I am strongly of the belief that they do not make their investments upon impressions. They read the prospectus of the war loan, and I have no doubt that they analyzed it with more ingenuity and attention than was devoted to it by Parliament. That they may have desired to be exempt from taxation I do not question. I am not speaking now with so much regard to the loans that have already been floated, as with regard to those which have yet to be issued. I desire that we should know where we are to stand. We should know whether those who receive interest on war bonds, and especially the bigger investors, are to be exempt entirely from any measure of taxation. I should like to put before honorable senators what we are doing for the holders of war loan bonds. We have first of all given the larger subscribers to the war loans a very substantial bonus in the shape ‘of the remission of income tax upon their investment, although, when the matter was before the Senate, I directed attention to an argument which did not prevail with the Government - that income tax being imposed, not upon a flat rate, but upon a graduated rate, we were giving more to the big investor than to the small one. Senator Gardiner on that occasion, I remember, met the argument by saying that the more a man put into the war loan the more he was entitled to get out of it. The point, however, was that an investor who paid no income tax received in terest at the rate of £4 10s. per £100, whilst another man paying income tax at the rate of 3d. in the £1 got1s. l£d. in addition, and so receives £4 l1s. ld. for his £100. Then we come to consider the investor of large sums who might be paying 2s. in the £1 income tax; he wouldbe getting £4 19 s. for every £100 he invested in the war loan.

Senator Stewart:

– But the honorable senator did not support an amendment in opposition to that.

Senator MILLEN:

– I was not present when the amendment to which Senator Stewart refers was moved, and I am sorry for it. The only amendment of which I have any knowledge was one under which subscribers to our war loans would have been paid no interest.

Senator Stewart:

– Oh, no!

Senator MILLEN:

– Honorable senators know perfectly well the views I expressed on that occasion, and I think that Senator Stewart will be the last to forget that there are times when a man is able to express his views in this chamber, but cannot be present to give effect tohim. At the present time we are paying the small investor 10¾d. for every £1 that he invests, but to the big investor we are saying, “ That is not enough. We will give you more. We will give you 12½d. on every £1 you invest.” That is due to the fact that the income tax is based on a graduated scale. Suppose that we abolished all these little side trimmings, and paid interest at the rate of 5 per cent. all round ?

Senator Pearce:

– The Commonwealth would get no advantage.

Senator MILLEN:

– Yes, it would, because neither the Minister nor anybody else can tell me at what point the needs of the Commonwealth in the matter of taxation will stop. Let us take the case of the holder of war bonds whose income tax is in the region of 2s. in the £1. He is receiving as interest £4 10s. for every £100 he has invested in our war bonds. As he is exempt from income tax, that means an additional 9s., which brings his interest up to £4 19s. The Government now propose to increase the income tax by 25 per cent., so that, in effect, they are offering the gentlemen who purchased these bonds some months ago a further bonus of 2s. 3d. In addition, Ministers say to them, “ We are going to collect taxation to the extent of 30s. per £100 from everybody but you.” Altogether the Government are offering the large investor £5 4s. 3d. for the use of his £100, whilst to other people they are paying only £4 10s, This does not appeal to my sense of equity. It makes a distinction between the small man and the big man.

Senator Grant:

– The land tax is graduated.

Senator MILLEN:

– But there is no exemption of the graduation. If there were a flat rate in connexion with the income tax, half my objection would’ disappear, because everybody would get the exemption.

Senator Grant:

– How would the honorable senator like a flat land tax ?

Senator MILLEN:

– I wish to deal with this question alone. The Minister for Defence has said that the Government would get no advantage by abolishing the side trimmings of which I have spoken, and fixing the interest payable under our war bonds at 5 per cent. His statement is doubtless based on the assumption that if the existing concessions are withdrawn people will not subscribe to our loans. But small men have found the inducements sufficient, and, apparently, it is only the large subscriber who wants more.

Senator ALBERT GOULD:
NEW SOUTH WALES · FT; ANTI-SOC from 1910; LP from 1913

-Colonel Sir Albert Gould. -What have the British Government paid by way of interest?

Senator MILLEN:

– They have paid as much as 6 per cent, on some of their war loans. It would be far better and fairer in connexion with future war loans to pay the market Tate of interest, and to strike away all these concessions and bonuses. Then the manwho invests £10 will get, proportionately, the same return as the man who invests £10,000. I hope that the Government will consider this aspect of the case, with a view to removing an obvious anomaly and injustice. I am utterly unable to see why subscribers to future loans should be exempt from taxation. We are going to call upon small farmers to contribute their share to the needs of the State, and the man with a little grocery store will have to contribute to the Repatriation Fund. Consequently, I fail to see why the owner of thousands of pounds should not bear his share of the burden.

Senator Findley:

– Somebody must have made complaint, otherwise they would not be exempted.

Senator MILLEN:

– No complaint has been made in regard to people being taxed for the purposes of the Repatriation Fund. Australia having sent her troops abroad with this promise ringing in their ears, it is only a fair thing. But I cannot regard as fair the proposal that large investors shall be exempt from this levy whilst everybody else shall make a contribution to it. Now I desire to offer my. congratulations to the Government.

Senator Stewart:

– The honorable senator will vote for them, anyhow.

Senator MILLEN:

– It is a good, sound, common-sense principle that of two evils One should choose the lesser. I wish to congratulate the Government, because, after many years it has at last come to recognise that Australia has been engaged in a revel of public expenditure which, the present Treasurer states, “is still rampant in both Commonwealth and State activities.” I desire to stress the fact that it is not a Liberal Treasurer who makes this statement. True, the Liberals have been saying the same thing for many years, but they have been as a voice crying in the wilderness.

Senator Findley:

– They were in power for a number of years. Why did they not do something ?

Senator MILLEN:

– In power! Why, whenever I looked at the honorable senator he would walk out of the chamber, and leave me without a quorum. His conception of power and mine are vastly different. In the Treasurer’s statement we have the admission that there has been a revel of public expenditure, which is still rampant in both Commonwealth and State activities, and a hint that economies are being effected. This is followed by the declaration that greater economies will yet be made. That announcement is distinctly welcome. I say that any Minister who ignored the writing on the wall, and . who sought to continue public expenditure on the old lines, would be helping to precipitate a crisis in this country too unpleasant for serious contemplation. Whilst on this matter, I should like to know what we are spending on our ordinary services. With regard to war expenditure, this Chamber has never yet had a statement submitted to it showing what the war is costing us. It is all very well for a Treasury official to say that he can tell us. The fact remains that no statement has been presented to Parliament showing clearly what the war has cost, and is costing, us. I submit to the Minister whether it is not desirable that we should be givena clearer idea of the cost of the war than has yet been vouchsafed to us.

Senator Pearce:

– The position was clearly set out in the last Budget statement.

Senator MILLEN:

– No. Turning to an interesting pamphlet containing an interim financial statement by the late Treasurer, Mr. Higgs, I find that it sets out the various itemsof revenue and expenditure, and thenstates that the normal expenditure out of revenuewas £32,000,000. I have endeavoured to ascertain how that £32,000,000 is made up, but without success. It ought to be possible for the officials to present us with some very much clearer financial statement, showing what proportion of our expenditure is consequent upon the war and what proportion of it is necessary for the carrying on of our civil Departments. The country would appreciate that. “Until we can tell what the cost of the war is, nobody can say whether true economy is being practised or not. In the statement of the financial position by the late Treasurer, I find the following: -

It is impossible in a brief statement of receipts and expenditure to show the whole of the naval and military items under two heads, for the reason that other Departments of State incur naval and military expenditure which is included in the totals appearing opposite the said Departments.

I have drawn attention to the absurdity of this practice on previous occasions. Whenever the Defence Department requires certain works to be carried out, strangely enough those works figure under the heading of the Department of Home Affairs. I contend they are essentially Defence items, and as such should be charged to the Defence Department. The mere fact that that Department employs another Department as its constructing agent has no bearing on the question.

Senator Senior:

– But it will be necessary to differentiate between what is war expenditure and what is defence expenditure.

Senator MILLEN:

– This would be defence expenditure, apart from the war. The same remark is applicable to war pensions, which are charged to the Treasury merely because Treasury officials pay them. They are essentially a defence expenditure, and the sooner our financial statements are remodelled on the lines I have suggested the sooner we shall be able to know exactly what we are voting money for. To illustrate the importance of the thing, as that statement now appears, it would seem that for normal pur poses we are asked to vote this year £7,500,000 more than we voted last year. I ask the Government whether that is intended. As shown in that statement, the normal expenditure is £7,500,000 greater than it was last year. I do not believe that it is. It is not normal. There are included some of the items which I have referred to; they might become normal, such as the war pensions, but they are not normal in the sense of being the ordinary expenditure of previous years. I suggest that these figures, as published now, . place thefinances of the country in an extremely unfavorable light. I am perfectly certain that if the figures were prepared with the view to present them, not merely in a convenient form, but to show what we are doing, it would not be made to appear that in time of war our normal expenditure had increased by £7,500,000 in one year. Passing from that matter, I want to refer to the claim that we are getting away from the Treasurer’s Advance vote. This Supply Bill makes no mention of an advance to the Treasurer. Mr. Poynton takes up the view - a very sound one - that we have hitherto given too much elasticity in regard to theTreasurer’s Advance votes, and he proposes in some way . to minimize them, if not to avoid them. But this Bill does not do it. It is quite true that it contains no item called ‘” The Treasurer’s Advance Vote”; but, if I understand what is in contemplation, we are asked now to give tothe Treasurer one of the biggest advances which have ever been granted. Let me show how it arises. The Treasurer had advance votes in two previous Supply Bills, and but of those votes he paid away for certain works, and for purposes exceeding the amount which Parliament had given him, an amount running into £1,020,000. We are now asked to vote £1,750,000 for specific purposes, but as £1,000,000 has already been paid away from the Treasurer’s Advance vote on these votes, it does not require to be paid again. So that out of the sum we are asked to vote now, £1,000,000 is going to the Treasurer to recoup his votes which he has already spent, and the balance to complete works commenced by the previous advances from the Treasurer. It would be just the same if it were put down,” Advance to the Treasurer, £1,000,000, and for certain works, £750,000.”That, I venture to say, is one of the biggest advances ever given to a Treasurer. It is twice as large as the advance given on the last two occasions, because it recoups the amount spent under the last two Supply Bills, each of which was for a period of two months. If that is so, I suggest to the Government - I assume that it is inadvertent - that the position has not been candidly stated. Unquestionably, the position is that the Government are seeking to avoid an advance to the Treasurer, whereas, as a matter of fact, they want a bigger advance than has ever been voted before. There is another matter I wish to refer to. I congratulate the Government upon making evena halfhearted, halting step in a very sound direction, and that is in regard to the sinking fund. When the Inscribed Stock Bill was before the Senate, I ventured to detect what was called the fallacy of the sinking fund. I said-

Although Irecognise that I am rather out of touch with public sentiment on this matter, I believe that in course of time the fallacy underlying the establishment of so-called sinking funds will be perceived, and that the people of Australia will recognise, just as those of Great Britain have recognised, that the only form of sinking fund which is worthy of the name is a fund which is made up of the excess of income over expenditure.

On that occasion I remember quoting from a recognised and very sound American authority, who demonstrated that, by reason of her sinking funds, Great Britain had wasted a sum of money greater than the whole cost of the Napoleonic wars. Of course, I am speaking of a sinking fund being a fallacy when the Government pay into the fund at the same time asthey borrow. Weare borrowing here: We borrowed last year some millions, and on our Budget appeared an item of some few thousand pounds which we paid into a sinking fund. We were paying into that fund out of borrowed money, for that is what it comes to. There is only one sinking fund which is sound, and that is when your income is greater than your expenditure. If it is not, although you earmark one particular pound for one job, just so long as you borrow at the same time as you have a sinking fund, it makes no difference to your financial position whether you pay into the fund out of the sovereigns actually borrowed, or out of income, and use some of the borrowed money for other purposes. It must be remembered that when you have a sinking fund and borrow money, every pound borrowed has cost something more than the interest payable thereon. The soundthing would not be to fool ourselves with a sinking fund, but to borrow less, and have no sinking fund at all. I am glad to see the Treasurer is commencing to recognise that.

Senator Stewart:

– Do you mean using the sinking fund money instead of borrowing ?

Senator MILLEN:

– Yes, to borrow less, have no sinking fund, and wait until such time as the income is in excess of the expenditure, when the excess will be a genuine sound sinking fund.

Senator Turley:

– That is what Great Britain did for many years.

Senator MILLEN:

– Yes, but for 100 years before she wasplaying the same stupid game as we play here. This system cost Great Britain enormous sums running into hundreds of millions. Instead of starting where she left off, we are proceeding to experiment for ourselves. The present Treasurer, Mr. Poynton, I should say, holds that view, and I am surprised that he has hesitated to give full effect to it. He states here -

At present We have at ‘the credit of Commonwealth Sinking Funds the amount of £388,313. Of this, £158,380 has been invested in Commonwealth Treasury Bills and £140,630 in Commonwealth Inscribed Stock.

Before I proceed further let me direct attention to the fact that we vote here £150,000 to go into a sinking fund. We do not pay off any debt, but the Treasurer, as the recipient of the’ revenue, comes along to the Treasurer, who is the official authorized to float loans, and he hands over a sum to himself in one capacity, and gets a piece of paper called a Treasury-bill back in the other. Having done that, he solemnly opens a big ledger account in which every year they charge out a certain amount of interest. What becomes of the £150,000 ? It has gone again in a loan. Would it not be better to have no loan, and use the £150,000? It is multiplying work at the Treasury, and creating a false impression that we are paying off our debt, whereas we are not. We are merely borrowing £150,000 from ourselves. Instead of going through all that nonsensical and tedious operation, it would be much better to vote £150,000 for the purpose for which it was spent.

Senator Ready:

– Does not the sinking fund come out of revenue?

Senator TURLEY:

– Yes, but we borrow against it.

Senator MILLEN:

– If Senator Ready comes and borrows £1,000 here, and says, “I will pay £100 into a sinking ( fund,” had he not better borrow £900, and not fool with the sinking fund ? That is my position to-day. Any country which is borrowing is only engaging in a costly experiment when it has a sinking fund at the same time. Its correct policy is to do away with the sinking fund so long as it borrows, and borrow less, as it could do, as shown by the case I have put. For every pound which is borrowed, somebody collects something in the way of commission or brokerage. According to Mr. Poynton, £89,000 is lying in the Treasury earning nothing, and, at the same time, we are paying 4£ per cent, interest on another sum of £89,000 which we borrowed somewhere else; and this is called finance.

The balance, £89,303, is held in cash, and is now awaiting investment. Following the usual practice, the investment would probably be made in the War Loan.

In .the name of common sense, what is the good of doing that? Instead of paying that £89,000 into the sinking fund, would it not be better to borrow that amount less ? That is the simple procedure. But, in some way or other, this idea of a sinking fund has a sort of charm. I do not know that I need except the Treasurers of the Commonwealth, but certainly every Treasurer in the States was under some pressure to borrow more money than was safe for him to borrow. Members responded to the aspirations of their constituents clamouring for the construction ‘ of public works, ‘ and it became necessary that money should be borrowed to meet that demand until the public became a little restless about borrowing, so some Treasurer con- ceived the idea of an anaesthetic, and called it a sinking fund, and commenced to strut about as if he had done some virtuous act. He would Bay, “ “We have a sinking fund with a loan ‘ ‘ ; and criticism was supposed to be stilled by the sound of that magic term. If I borrow every year more than my income, it is only fooling with the thing to say that I am paying off my debt by establishing a sinking fund. If I borrow less than I pay into the sinking fund, there is no need for me to borrow at all . The people who lend money to Australia to-day are not lending it on the strength of the sinking fund of £380,000 which we have. They are lending on their belief in the integrity and good faith of the people of this country, and on the capacity of those people to yield the interest in the form of taxation.

Senator Lynch:

– It is a case of doctors differing.

Senator MILLEN:

– It is not a question of doctors at all. It is obvious that if I borrow £100 with one hand, and pay £10 into a sinking fund with the other, I am £90 more in debt, and I would do better to rest content with borrowing £90 and having no sinking fund. It is curious to find a colleague of Mr. Poynton finding fault, by his interjections, with what ‘ Mr. Poynton has done. The Treasurer has come to accept that view. The only trouble is that he hesitates to go more than, half-way to give effect to it. He says -

Thus our sinking funds are not held for the redemption of our loans -

What are sinking funds for but that? Mr. Poynton is quit© right. They are not there for the redemption of loans, because we immediately lend them to ourselves and spend them for some other purpose - but have always been used for subscribing to fresh Commonwealth loans, and the money has been expended for the Commonwealth’s current needs.

But. we were able to pat ourselves on the back and say, “ We are sound financially; we have a sinking fund.” -

The position created! is equivalent to the direct expenditure of that money on Commonwealth present requirements.

It is equivalent, and being so we might as well short-circuit, the thing and cut out all this pretence. It is not a sinking fund, seeing that the money we are supposed to pay into it is immediately spent in some other direction.

Senator NEWLANDS:
SOUTH AUSTRALIA · ALP; NAT from 1917

– Or collared by the next Treasurer for some other purpose.

Senator MILLEN:

– That is another point. I do not know to-day in Australia, with one exception, a sinking fund that has not been violated at some time or other.

Senator TURLEY:

– What is the exception ?

Senator MILLEN:

– I believe Western Australia has a fund which has not yet been violated. So far as I know, every other, anywhere, has been violated, either by a needy Treasurer raiding it, or by a suspension, with parliamentary sanction, of the payments into it.

Senator Turley:

– You cannot violate the Queensland sinking fund, because if there is any overplus it is immediately used by the Government to buy up some of their own stock on the market.

Senator MILLEN:

– If you have a sinking fund with money in it, you can violate it.

Senator Turley:

– But Queensland has no sinking fund.

Senator MILLEN:

– Then, of course, it cannot be violated. Mr. Poynton went on to say that it is not possible to place funds beyond the control of the Parliament of the day. That has. been proved by experience here and elsewhere. In Great Britain and every other country, so long as money is easy, the pretence is made of paying into a sinking fund; but the moment the Treasurer becomes impecunious he says, “ Either I will stop the payment to the sinking fund, or draw money from it.” That is exactly what has happened with Mr. Poynton. He says, “ Here is a sinking fund proposition by my predecessor; I can ease my position to the extent of nearly £1,500,000,” and so he cuts it down to 1 per cent. Mr. Poynton’s successor will say,, “ That £1,500,000 is a very attractive sum.- The last man who looked into it cut it in two. I can still divide it by two. I will bring the payment down to per cent.” Then, before many months are over, some one else will abolish it altogether, but he will call it a suspension for the time of the war.- Mr. Poynton has shown that the thing is unsound, and that we are not really paying’ off debts by providing sinking funds. I am only surprised that he still makes the pretence of paying 1 per cent, in as a sinking fund. So long as we are under the necessity of borrowing, we ought to stop making sinking funds altogether, and use the money that is being paid into them for a diminution of the money which we have to borrow.- If I have dealt with these matters” in a disconnected way it is due to the fact that as usual the Bill has been thrown on the table with no opportunity of considering the questions that arise under it, and the Senate is called upon to debate it straight away. I suppose that it is too late to look for any reform in that direction, but with these big financial and other questions of Government policy involved, it1 becomes more than ever a matter of regret that the Senate is not in a position to take a serious hand, I will not say in controlling, but at least in examining, the many financial problems which are urgent today, but which will become infinitely more serious in the course of the next few months.

Senator FERRICKS:
Queensland

– I wish .to express my gratification at the news which came through this morning that peace proposals - had been definitely made by the Central Powers. I have not read the details in the afternoon paper, but I take it as a very good omen that a step in that direction has been made. It is high time that the Parliament and peoples asserted themselves on the question of the termination of the present bloody and world-wide war.

Senator Bakhap:

– We have put ourselves out of court. We cannot have any say in the matter.

Senator FERRICKS:

– If Senator Bakhap takes that view of the return that Australia will get for what she has done he is paying a poor compliment to the British nation and its Allies. They have the highest regard for Australia and the work she has done in the war to date. I hold that the peoples, the Democracies, the workers, have the most right to decide these matters.

Senator Bakhap:

– Do you think these terms will be accepted?.

Senator FERRICKS:

– I do not know them. I am simply expressing my gratification at the fact that definite proposals have been made. I think they should be made now on the other side. The proposals should be considered, and the Democracies, the workers, the soldiers, ought to be told what they are fighting for. We should be told how long we have to fight. Are we to continue operations until that stage is reached when Germany will be beaten to her knees, when the Kaiser will be taken prisoner and put upon an island as Napoleon was, and when the Christmas dinner of the Allies will be eaten in Berlin 1 If so, it is just as well that the people should know. I have for some time held the view that this Parliament should have taken, and should now take, definite steps to make representations to the Imperial authorities to state what the proposals of the Allies are, so that the nations will understand what is aimed at by each side. About five or six months ago I spoke in Brisbane in support of a motion that the Federal Parliament should be requested to make representations to the Imperial Parliament to endeavour to ascertain a definite statement of peace terms on the side of Great Britain, and, if possible, its Allies. After that meeting there was a regular furore of press attacks on the speakers, particularly on Mr. Finlayson and myself, for daring to make that suggestion.

Senator Henderson:

– Are you really speaking seriously?

Senator FERRICKS:

– I was never more so. We have read from an, American war correspondent recently returned from the front the cool statement that Great Britain is prepared to sacrifice a million men next year.Is it unfair to suggest that those million men should have somesay in the matter ? Surely the workers have a greater right to a say in these questions, seeing that they do all the work, than a few men on top? If the Imperial authorities do not state their definite proposals, or do not consider the proposals advanced to them, I think it is time the people of the British Empire should havetheir say.

Senator Guthrie:

– What would you advise for a peace settlement?

Senator FERRICKS:

– I am not assuming anysuch powers of discernment, but therepresentatives of the workers are just as able to advance proposals, and have an infinitely better right to do so, than anybody sitting in a high citadel of authority. They have proved in the past that they are not deficient in brain or perceptive powers.

Senator Millen:

– Would you subscribe to a peace which refused to give Belgium back in its entirety ?

Senator FERRICKS:

– I have not seen the terms offered. I want this Parliament to make representations to the British Government to state what terms they would accept. If the restoration of Belgium is what the Allies want, let them say so. I am not competent to decide such a question, and the honorable senator should know it.

Senator Millen:

– Any man could decide as to Belgium.

Senator FERRICKS:

– I want the Allies to say what their terms are.

Senator Bakhap:

– We want victory.

Senator FERRICKS:

– I quite realize that the great interest that is being shown in my few remarks on this question is not caused by reason of my arguments, or by the reason in my arguments, because rea son does not appeal to people so blinded. The unusual attention being paid to me by interjection and otherwise is due to an ulterior motive, shown plainly and in an undisguised form by my friends who are jingoistically inclined. They are saying it with a nakedness which is not even covered with a veneer of decency, and with an eagerness that they cannot conceal. They are hoping that I, as a member of this party, in a heated or impetuous moment, may make an unguarded statement which, while expressing my own view, would reflect upon the members of the party. They are waiting like a pack of wolves in anticipation of some scraps that may be thrown to them, not that they want tp utilize them for their own sake, but because, after smacking their chops over them, each of them would carry his share to their Critchley Parker satellites outside, where these scraps would be distorted, torn asunder, misrepresented, and painted in all colours, to be brought f orward at the proper time, not to. bombard me with, for I am always prepared to take the responsibility of anything I say inside or outside this Chamber, but to bombard the party with which I am associated.

Senator NEWLANDS:
SOUTH AUSTRALIA · ALP; NAT from 1917

– If there is one man who has had plenty of rope in Australia, that man is Senator Ferricks.

Senator FERRICKS:

– As a freedomloving Australian I demand that rope, and intend to take as much as I am entitled to. We are in freedom -loving Australia, and not in Prussia.

Senator NEWLANDS:
SOUTH AUSTRALIA · ALP; NAT from 1917

– A most lucky thing for you.

Senator Pearce:

– You would have had rope all right in Prussia!

Senator FERRICKS:

– If a public man in Australia had, in the early stages of the war, made the statements that Liebknecht dared to make in the German Reichstag, he would have been literally torn asunder. Now, with regard to the financial proposals enunciated this afternoon, I want to refer to a phase which has not been touched upon to any great extent up to the present. When Senator Gardiner was speaking about the relief extended to the wealthy section of the community, Senator Newland, by way of interjection, referred to the abolition of taxation on the threepenny picture-show ticket. I think Senator Newland, in all good faith, endeavoured to drive that fact home to Senator Gardiner, as a contention that ths exemption was a concession to the workers and their wives and families. To an extent it is, but not so much as it appears, on first sight, to be. The amount involved by the exemption from taxation of a sixpenny entertainment ticket would’ be very small, and really not worthy of consideration from the stand-point of the Federal Treasurer, but it would be a big factor to the working man with a family. It must not be assumed that working men, with their wives and families, always desire an opportunity of going into threepenny seats at picture theatres, because such seats are only available at continuous shows in the heart of the cities, and all of the suburban shows, which are patronized by the workers, charge a minimum of 6d. If the exemption were allowed in respect of sixpenny tickets there would not Be a great depreciation of revenue, and at the same time the mass of the working people would receive substantial benefit. With regard to the commandeering of excess profits, I want to remind the Senate that the proposal of the previous Government was to take 50 per cent. of such excess profits for the last financial year, and 100 per cent. durin? the current financial year. Even ‘ that proposal was not as drastic as that of the Liberal Government in Great Britain, because the Imperial Government actually acquired 50 per cent. of the war profits, while the Labour Government here promised to take 50 per cent., but have not taken anything at all yet.

Senator Bakhap:

– You must remember that it is in Great Britain where the war profits are being made.

Senator FERRICKS:

– Some war profits are being made in Australia, too. Unless the Government take the whole of the excess profits, the policy is unsound, because if 50 per cent. only is taken an inducement will be held out to the operator of a business ‘to put up his charges sufficiently high to recompense him for the loss of that 50 per cent.

Senator Millen:

– But if he passed it on in that way, the more profits he collected the greater would be his payment.

Senator FERRICKS:

– The only sound method is to commandeer the whole of the excess profits after making due allowance for interest on capital. That, also,is the only scientific method of fixing prices, because it removes the inducement to inflate prices. I think the Government are making a mistake in suggesting that the excess profit should be halved. The Liberal Government in England are determined to acquire the whole of the excess profit, but we have not got up to that stage here yet. Regarding the question of an understanding between the Government and the Liberal party, I have no desire to say that a hard-and-fast compact has been entered into, but we can draw our own conclusions from a review of the interim financial statement presented by Mr. Poynton. That statement reminds” me of a remark I heard the other day in Sydney. I was shown a cartoon appearing in the Sydney Worker which depicted Mr. Joseph Cook turning the handle of a barrel organ, and Mr. Hughes figuring as the monkey on a chain. It was an amusing and clever cartoon, and when I showed it to a gentleman friend of mine, he said, “Yes, it is very good ; but it has one little defect. If ever you see an organgrinder with a monkey on his barrel, you will always see the pennies coming in, but in. this case Mr. Cook is getting no pennies.” A perusal of this financial statement how shows, to my satisfaction, that the collection of pennies, from a political point of view, has begun. Although Mr. Cook, in the other House, and Senator Millen in the Senate, may express dissatisfaction at the concessions handed out to the Liberals, I may be pardoned if I say that Mr. Cook, at any rate, and I may include Senator Millen, were then speaking with their tongues in their cheeks, because I think they are pretty well satisfied that this financial statement represents a very fair step in the way of further concessions. If they can do so much without any collaboration or communication with the Government, we may imagine what a lever the Liberal Opposition will have when they make their representations direct to Mr. Hughes and his Cabinet. Mr. Hughes and his Government realize their position. They know that they cannot carry on without the help of the Liberal party, and, presumably, members of the Liberal party are prepared to bear that responsibility because they demonstrated the other day in the House of Representatives in a division on an amendment that they would stick to the Government. The manner in which the Liberal Opposition is viewed from outside is well illustrated by a paragraph which I read in the Sydney Bulletin the other day.

Senator Bakhap:

– Why do you not quote one or two articles from the Bulletin on the question of conscription ?

SenatorFERRICKS. - That is the amusing part of the business. The Bulletin is one of the papers that howled loudly for conscription; that went bloodmad in the conscription campaign; that for many months howled in favour of compulsion, and extolled the Government for launching the campaign. Just now it appears to have turned right round and flogs the Hughes Government and the Liberal Opposition for keeping the Government in power. “When (Senator Watsonwas speaking the other night on the question of the coal strike, he asked how much Mr. Hughes had done towards bringing about a settlement of that trouble, and I think it was well pointed out in replythat Mr. Hughes had done nothing.

Senator de Largie:

– He did everything.

Senator Bakhap:

– Who brought about a settlement if Mr. Hughes did not?

Senator FERRICKS:

– The coal miners brought about a settlement. They would never have received recognition of the eight hours day if they had not gone on strike.

Senator Bakhap:

– Did they not get a settlement through a Judge appointed by Mr. Hughes?

SenatorFERRICKS. - We have been told that if we were in Prussia we Would never have an eight hours’ day. As a matter of fact, we have had the eight hours agitation in existence in our unions for sixty-one years, but in not one State of the Commonwealth is there a statutory eight hours day. In the face of all this, where is the value of our legislative enactments? I repeat that only for the coal miners taking drastic steps and going on strike they would not yet have had the eight hours bank to bank, though they have been fighting for that principle for the last twenty years. The part that Mr. Hughes took in bringing about a settlement of the coal strike was to say to Mr. Baddeley, one of the miners’ representatives at the conference, “ If you sign that telegram “ - and to the representatives of the employers, “ If you indorse it - I will send it.”

Senator Keating:

– If that were the only part he took it was not very dignified.

Senator FERRICKS:

– That was the strongest action he took.

Senator de Largie:

– If the honorable senator knew a little more about the history’ of the coal trade in Australia he would notso so ungenerous to Mr. Hughes.

Senator FERRICKS:

– I know that even five years ago, in Queensland, we had to go on strike to get away from the ten hours day in the sugar fields.

Senator de Largie:

– What has that to do with the coal strike ?

Senator FERRICKS:

– It shows that if we had not fought for the eight hours we would not have got the concession. Now I want to read the extract referred to from the Sydney Bulletin, which ran amok in its advocacy of conscription, and, in view of that fact, the opinion expressed of Mr. Hughes is particularly interesting -

Prime Minister Hughes handled the coal strike for a fortnight, and left it where it was. Then a second-rate New South Wales Judge took it up and settled it in some sort of way within 24 hours. There is a lot of significance in this. The long and the short of the matter is that the principal supporters of the political Labour party will give Hughes no opportunity to make political capital out of them. Their business is to show him up as a failure. That is one reason why Hughes as a Prime Minister is at present a danger to Australia. He failed to do anything with the coal-strike problem; he will, for precisely the same reason, not be permitted to successfully solve the recruiting problem. And Joseph Cook, in deciding to keep Hughes where he is for a while, must be held more responsible for the failure than Hughes himself.

If Mr. Hughes had shown any strength such a paragraph about him could not have been written.

Senator Keating:

– Does the honorable senator really believe that Judge Edmunds blew in on his own? or does he not know that he was appointed by Mr. Hughes ?

Senator FERRICKS:

– I did not contend that Judge Edmunds blew in on his own. Who made such a ridiculous suggestion ?

Senator Keating:

– That is the suggestion of the paragraph the honorable senator has just read.

Senator FERRICKS:

– What I say is that if Mr. Hughes had wished to show strength in the matter, he would have passed a regulation under the War Precautions Act providing for an eighthours day from bank to bank in the coal industry.

Senator McKissock:

– He was afraid of his new-found friends.

Senator FERRICKS:

– That is so. If he had desired to do so, he could have done that.

Senator Keating:

– The honorable senator supported him for two years, and why did he not ask him to do it? He never opened his mouth on the subject.

Senator FERRICKS:

– When Senator Keating says ‘that I never opened my mouth in opposition to the last Government his statement is scarcely correct.

Senator Keating:

– The . honorable senator criticised the last Government, but he never in two years asked them once to exercise their power under the War Precautions Act to declare an eighthours day from bank to bank in the coal industry.

Senator FERRICKS:

– The honorable senator forgets that there was no coal strike at the time.

Senator Keating:

– The honorable senator has just told us that the demand had been made for the last twenty years.

Senator FERRICKS:

– I say that the workers have been fighting in the Courts for the last fifteen or twenty years. It appears that the War Precautions Act and the regulations which may be framed under it are not intended for operation against the coal barons, but only against the workers. I pointed out the other night, when Senator Pearce became so frantic, that the coal barons of Newcastle coaled the German raiders in the Pacific. They supplied them with coal which was used in the sinking of British battleships off the coast of Chili. But the Defence Department War Precautions Act and its regulations are not intended to be operated against them.

Senator Millen:

– Is the honorable senator suggesting that the Defence Department was cognisant of that?

Senator FERRICKS:

– They must have been, because they prohibited the exportation of coal immediately afterwards. Senator Pearce made a statement in this chamber to the effect that Newcastle coal had been supplied to the German raiders in the Pacific.

Senator de Largie:

– Does the honorable senator think that they should have gone on supplying them ?

Senator FERRICKS:

– I think that those who supplied the coal should have been dealt with under the War Precautions Act. They were far more deserving of severe treatment under that Act than were men who have expressed from the stump their opinions on the question of the war. Evidently the War Precautions Act was not meant for them, or to compel the coal barons to give an eighthours day from bank to bank. Some honorable senators here have had experience of what it is to work for eight hours underground.

Senator Millen:

– I do not think that the honorable senator has yet answered Senator Keating’s question. Why did the honorable, senator continue to support the late Government, and why has he raised this question only since he has fallen out with Mr. Hughes ?

Senator FERRICKS:

– As far back as May last, before there was any talk of a coal strike, I denounced the Government in connexion with the same matter. The President will remember the occasion, because I referred to the fact that we had no statutory eight-hours day in Australia, and denounced all Governments for not giving us a statutory eight-hours day.

Senator O’Keefe:

– The New South Wales Government promised a statutory eight-hours day at the last election.

Senator FERRICKS:

– Yes, and after the measure was introduced the New South Wales Legislative Council blocked its passage.

Senator Millen:

– That does not get the honorable senator out of his responsibility.

Senator FERRICKS:

- Senator Millen is ‘welcome to his opinion on that matter. I hope that he will be found as loyal a supporter of his chief, Senator Pearce, as I have been.

Senator Keating:

– I think that we were more loyal to the last Government than the honorable senator was.

Senator FERRICKS:

– Then what is Senator Keating complaining about? He has just been complaining; of the excess of my loyalty to Mr. Hughes.

Senator Keating:

– No, I have been complaining about the honorable senator’s inconsistency.

Senator Millen:

– About the hypocrisy of now raising the question of an eight-hours day when the honorable senator sat for years behind the late Government, and never said a word about it.

Senator FERRICKS:

– In the first speech I made in the Senate I referred to the need for a statutory eight-hours day in Australia.

Senator Millen:

– Speeches -are cheap, unless action is taken to give them effect.

Senator FERRICKS:

– Every time Senator Millen has had the opportunity he has opposed it. We desired that the power to establish a statutory eight-hours day should be given constitutionally to the> Commonwealth Government, and Senator Millen and his friends tore around the country in opposition to the proposal.

Senator Keating:

– The Labour party were thirty-one to five in the Senate, and they did nothing.

Senator FERRICKS:

– We always desired that the power should be constitutionally given to the National Government, so that advantage might be taken of it at any time. In the language of our friends, the exuberant loyalists, .in such a time as this- it might have been expected that Mr. Hughes would show some strength and give the miners an eight-hours day from bank to bank.

Senator Millen:

– Why is it that only now a question appears on the businesspaper of the Senate asking the Government to bring in a Federal Eight-hours Day Bill?

Senator FERRICKS:

– Because it is only by the adoption of a statutory eight-hours day that we can prevent the recurrence of such a thing as a general coal strike in the future.

Senator Keating:

– The Labour party has had a strength of thirty-one to five in this chamber, and has done nothing, and this proposal is now made when we are nearing an election.

Senator FERRICKS:

– I think that my attitude during the past two years and since the outbreak of the war willbetter bear examination than that of Senator Keating. Legislation brought forward by the Labour Government, which I believed was not in the best interests of the people, was opposed by me at every stage. It may be true that perhaps in a mistaken spirit of loyalty to the late Government some of us did practice self-restraint to an undue degree. I know that I did. I supported the Government whilst suspecting that the lines upon which they were proceeding were not in conformity with Labour ideals. The proof of the correctness of my suspicion is brought home to us by the calamity which has overtaken certain honorable senators from a Labour’ point of view. Honorable senators may laugh at that expression, but I can assure them that in the opinion of a large section of the Labour party it does not overstate the position at all. Dealing with general matters I realize that the disruption in the late Labour party had to come. It was no surprise to me. Whilst there is regret amongst us as individuals and very great regret in some cases, because of the severance which has taken place, I for one realize that the disruption was long overdue. The wonder to me was not that the Labour party should be burst up but that it should have hung together so long as itdid. To be quite candid, before I became a member of it, I formed that view of the Federal Labour party by reading the Federal Hansard. I expressed the opinion very freely in Queensland that the Federal Labour party would never be worth a “ tuppenny dump “ as a reform party until it had gone through a cleansing process. Whether all who have gone should have gone and all who have stayed should have remained in the party, time alone will tell. It will be proved by the length to which the different sections are prepared to pursue the path they have chosen. It is my opinion that the Labour party to which- I belong will pursue the policy which, has marked its footsteps since the birth of the reform movement in Australia.- With regard to the recent referendum and the action in connexion with it taken by the Prime Minister, I think there are one or two matters which should not be allowed to escape attention: When the Referendum Bill was before the Senate, I raised lie question of the form of the question to be put to the people. The question was canvassed by Mr. Hughes? The electors were to be asked whether they were prepared, in this grave emergency, to do so-and-so during the currency of the war. The phrase “ during the currency of the war “ covered the phrase “ this grave emergency,” and its repetition was purely for the purpose of canvassing the question.

Mr. Hughes could not put a straight question. Evidently he is constitutionally unable to put any question fairly and squarely. Then I would ask whether honorable senators noticed any little innovation in connexion with the ballotpaper used at the referendum. There was one. It is well known that the names upon a ballot-paper are placed alphabetically, beginning with A and ending with Z. But on the ballot-paper used at the military service referendum the “Yes” was on top and the “No” at the bottom, “Yes” was not’ on the top after the polling day, but it was placed on top on tie ballot-paper.

Senator ALBERT GOULD:
NEW SOUTH WALES · FT; ANTI-SOC from 1910; LP from 1913

-Colonel Sir Albert Gould. - Does the honorable senator say that “No” should have been placed before the “Yes” on the ballot-paper?

Senator FERRICKS:

– Yes, since alphabetically N comes before Y. Mr. Hughes, or whoever was responsible for drawing up the ballot-paper, should have put the “No” before the “Yes.” On every electoral ballot-paper the names are printed in alphabetical order.

Senator Lt Colonel Sir Albert Gould:

-I think that on all the constitutional referenda ballot-papers the “Yes” was placed before the “ No.”

SenatorFERRICKS . - This is the first occasion upon which I have noticed a ballot-paper which did not read’ alphabetically. In connexion with the attitude of the Government with respect to the forthcoming recruiting campaign, I find that they are not prepared to submit to any experiments in recruiting. They are advocating a second referendum. The Brisbane Courier, which with apologies to Senator Turley, I will call the Government organ, is already advocating a second referendum.

Senator Bakhap:

– I notice that honorable senators have a proposal for a third on the business-paper.

Senator FERRICKS:

– A question of life and death is one thing and a question of constitutional amendment is quite another. I notice that the Government are throwing the onus of making the new recruiting scheme a success upon those who voted “ No “ at the referendum. I take the opposite view, and I say that every fit man who voted “ Yes “ at the referendum is morally bound to enlist. I do not think that the Australians are made of the selfish material which some honorable senators would have us believe. If Tom Jones desires to enlist, does he turn round and ask why John Smith is not enlisting ? If half-a-dozen Australians were standing on the pier at Port Melbourne when a boat containing women and children was capsized, and if John Smith desired to dive in and save them, would he say to his companions, “ I will not do it unless you come with me”? If he did so, what would Senator Bakhap think of him?

Senator Millen:

– What would the honorable senator think of him if he said, “ I will not go to the rescue of those drowning persons, and I will not ask anybody else to do so “ ?

Senator FERRICKS:

– They would not want asking. If Mr. Hughes expects his recruiting scheme to be a success, his first step should be to apologize to the majority of the people of Australia, whom he recently described as traitors, pro-Germans, and the recipients of German gold. Is it to these people that he is going to appeal? He certainlyowes an apology to the majority ofthe electors who voted” No “ on the referendum.

Senator Guy:

– And many of them are now at the front.

Senator FERRICKS:

– Yes . Letters constantly being received show that our soldiers at the front expressed their opinion on the question of conscription in an unmistakable manner. I have here a letter dealing with the treatment that is meted out to Australian soldiers in London, which I desire to bring under the notice of the Minister. There are parts of it which I will not read, because I am not personally acquainted with its author, but I am assured by the secretary of the Australian Builders Employees Union that he is a friend of his. I am prepared to show his name to the Minister. The letter reads -

Salisbury Plain,

England, 8th October, 1916.

Dear Ben,

Just a line to see if you can do anything for our boys on this side of the world ; you may not be able to do anything in a direct way, but indirectly you might be able to do a lot. I believe, by the papers that we receive from Australia, that the Defence Department are forming a Royal Commission to inquire into the severity of some of the sentences that have been imposed on some of our soldier boys. Believe me, Ben, this Commission is badly needed; God knows how bad. This camp is something frightful; a man tries his best to get on, and he is threatened with’ the “clink.” It is just “clink,” “clink,” from morning till night, besides being fined in the bargain. Believe me I have seen some of our boys in the “clink,” and have had a £14 fine entered into their pay-book under a Royal warrant- that means that they will only draw 4s. a fortnight until the fine is paid. I have seen men clinked for neglecting to shave every day, for speaking’ in the ranks, for having their hair too long, having a button off their tunic, &c. Mind, Ben, I have been lucky so far; I have not been a victim yet, but suppose I will fall to the joke yet; but you can take it from me that the moment they confine me that’s the end of me as a soldier. I have never been in as a civilian, and I’ll see them further. If I fall to the joke, I give you my word, that when I go in I will commit a crime of such a serious nature that the civil police will confine me. Words fail me to describe this system, Ben, nor can I bring any specific charge on account of not being able to have access to some of the prisoners. From what I see of it, the tendency seems to be to make criminals out of our chaps. I suppose they would call it. trying to discipline us. That’s wrong, Ben; our chaps take discipline all right, but they won’t stand injustice in any shape or form. Believe me our boys are worth fighting for, they are simply marvellous. The people of England, fairly worship them. Mind, I haven’t seen the front yet, but the British instructors and men that know say that there is nothing to come up to oar lads. The camp is good; better than anything we have in Australia, and the food is beautiful, but very light. We get four days’ leave in London. Of course, some1 of the boys overstay their leave, and then they cop out when they are caught. Of course, they deserve what they get, as they are warned what will happen if they do. The British Tommies are perfect gentlemen, and our Australian instructors are perfect Australian adjectives. You would think, being from our own country, they would be better than the Tommy, but such is not the case. They put a man in the “clink” quick and lively. Well, I suppose we will get a vote on this Conscription question; I fancy we will surprise the people of Australia if we do, as I fancy I can see us turning it completely down. I will be very pleased the moment I leave this place for the firing line, and I think most of the boys are the same way of thinking. We will be more than glad to shake the dust of Salisbury Plains off our feet. We expect to leave here in about five weeks from now, and I pray that it be soon. I believe from what they tell us here that it is perfect hell in the firing line, but anything rather than this. Remember me to - , and any of the boys. You can show them this if you like, and tell them, from me, that I am not talking through my hat. I believe if a little publicity was given on this matter that some of my poor Australian comrades, who are in detention prisons or camps in England, would be very pleased.

In view of the fact that soldiers are returning to Australia every day, who are probably giving similar accounts of the Salisbury Plain Camp, it behoves the Defence Department to see whether some alteration cannot be effected in the direction outlined by this letter. In conclusion, I desire .to prefer a request to Senator Lynch. When I was speaking the other day he interjected that I had better be quiet otherwise he would tell the Senate about John Norton’s editors, and blow me out. Upon the next occasion that he speaks he should in justice to himself and to me put the Senate in possession of the information that he has connecting Mr. Dunne, the editor of the West Australian Truth, and myself, and which will have the effect of blowing me out. I may add that Mr. Dunne is a personal friend of mine. I knew him when he was a leader writer on the Brisbane . Standard, and his calibre from a Labour stand-point may be judged from the fact that he was deputed to read before the Anglican Synod a paper on the ideals of the Labour movement. Latterly he has been editing Truth in Western Australia. -

Senator LYNCH:
ALP

– He is an anti-Labour man.

Senator FERRICKS:

– He had the temerity as an anti-conscriptionist to oppose Mr. Scadden, and I believe that* I did inquire of some of Senator Lynch’s colleagues what electorate Mr. Scaddan represented, and what were Mr. Dunne’s chances in the contest. I did not know the name of the electorate from Adam, and I was informed by everybody to whom I spoke that Mr. Dunne had not a chance. As the election proceeded, however, Mr. Scadden was forced, evidently by the weight of public opinion, to- declare himself an anti-conscriptionist. But no sooner had he been elected than he turned round and joined the Universal Service League.- I have no quarrel with Mr. Scadden except on the question of conscription, and I have never seen him in my life. But I count Mr. Dunne amongst my close and valued friends, and I appeal to Senator Lynch on the next occasion that he addresses the Senate to tell what he knows about us, and thus give effect toy his threat to “ blow me out.”

Senator O’KEEFE:
Tasmania

– I cannot help wondering why the usual course has been departed from, and why we have not had a Minister speaking on the question which was so earnestly debated here last week. Apparently the discussions on the Supply Bill and the Ministerial Statement are to be taken together. A number of honorable senators, thinking they will not get much opportunity this week to continue the debate on the statement, will avail themselves of the opportunity presented by this Bill to ventilate their opinions on the matter set out in the statement.

Senator Findley:

– What is to prevent us discussing the statement next week and the week after?

Senator O’KEEFE:

– I do not think that any honorable senator is anxious to discuss the vital matters mentioned in the Ministerial Statement twice, and there is no desire to unduly delay the passage of this Bill. We are now nearing the date on which the Senate will probably rise over the Christmas holidays.

Senator Millen:

– When will that be ?

Senator O’KEEFE:

– The honorable senator may be able to tell us that. Certainly I cannot do so. Senator Millen is now in the councils of the Government and I am not. It does seem remarkable that no Minister has yet seen fit to rise for the purpose of answering any of the criticisms that have been passed upon the Government in regard to some of the very important matters mentioned in the Ministerial Statement. Is there a conspiracy of silence on thepart of my honorable friends opposite ? It certainly looks like it. On the question which was debated last week as to whether we should disallow a certain regulation, two Ministers did speak. But on the great issues mixed up with the question of Supply, no Minister has thought fit to put his views before the Senate or the country, or to make any explanation.

Senator Russell:

– Did not the Minister for Defence put forth the views of the Government in the statement?

Senator O’KEEFE:

– No. Senator Pearce made a very brief public statement. In fact, it was almost a formal statement giving facts which everybody knew - namely, that there had been certain resignations from the old Government, that those vacancies had been filled, and that a new Government had been appointed, but not one word did he say as to what had brought about the resignation of the old Government and the various events which happened afterwards. My old and esteemed personal friend, Senator Russell, has also sat remarkably silent, and Senator Lynch, strange to say, has also been able to keep himself silent onthis question.

Senator Lynch:

– When I speak I do not please you, and when I am silent I do not please you; what am I to do?

Senator O’KEEFE:

– We all like to hear the honorable senator speaking. As regards the Supply Bill, I cannot understand the change which in a few weeks has come over the taxation views of certain members of this Government. I remember, sir, as you do, that not many months ago a conference was held of a certain body connected with the InterState Labour movement, and that it was decided that there should be a recommendation to the Federal Government that a war profits tax should be imposed, not to take only 50 per cent. of the war profits, but to absorb the whole of them. The Prime Minister was at the conference. It is a well-known fact - because of the statement which was issued later - that after the Labour party met, and before the split occurred, he, in conjunctionwith His Ministerial following, and supported by the party behind him, decided that not only should we take 50 per cent. of the profits in the first year, but the full amount of the profits in the second year.

Senator Barnes:

– But who is behind the Prime Minister now ?

Senator O’KEEFE:

– It does not matter very much who is behind the Prime Minister, or what party is bringing forward the war profits tax. It does seem to me, as a layman, that it is the height of absurdity to talk about a war profits tax, and to take only 50 percent. of the profits; in other words, to allow 6 or 7 or 8 per cent. as a reasonable margin for business profit, and then to take 50 per cent. of the profits in the first year and 75 per cent. in the second year, instead of taking the lot. What does it mean ?

Senator Lt Colonel Sir Albert Gould:

– It means that the tax will yield more money.

Senator O’KEEFE:

– No. The veriest tyro in finance, the merest school-boy who can do a simple sum and read the press, knows that unless we take the whole of the war profits, after leaving a reasonable margin, a business man will simply pass the tax on to the public.

Senator Millen:

– He will get the same measure of profit out of his business.

Senator O’KEEFE:

– The business man will take care that he will get the same measure of profit out of his business.

Senator Millen:

– And you want to go and tax that.

Senator O’KEEFE:

– It can have only one effect, and that is to keep on increasing the prices of commodities to the public, unless we take the whole of the profits, leaving, of course, a reasonable margin” to the business man. It is a war profits tax, and not a tax for ordinary requirements. If the country is entitled to have war profits at all, it is entitled to have all those profits over and above what

Would beconsidered as reasonable profits in ordinary times. Otherwise it will only give an incentive to business men to increase the prices of commodities, so that after giving 50 per cent, in the first year, and 75 per cent. in the next year, they will still have pretty large profits over and above the reasonable margin. Touching the general situation, I see only four men here who came into the Senate in 1901 as members of the original Federal Labour party. Two of them are still members of that party, while two of them belong to another party, having of their own free will broken away.

Senator de Largie:

– We still belong to the same party.

Senator O’KEEFE:

– That interjection comes strangely from the honorable senator, because I remember reading a report of a meeting where he announced that certain public men had called themselves the National Labour party.

Senator de Largie:

– That was in order to distinguish us from yourparty.

Senator O’KEEFE:

– Wherein lies the reason to distinguish if the honorable senator and his friends still belong to the same old party ?

Senator de Largie:

– We had to take a name to distinguish us.

SenatorMillen. - You kicked them out, and then accused them of leaving you.

Senator O’KEEFE:

– I wish to make that matter perfectly clear. There has been a good deal of misconception and misrepresentation in that regard, and it is just as well that the public should know the facts from Hansard. Our honorable friends say that they were compelled to split from their old friends of the Labour party because they were driven out.

Senator de Largie:

– Because you violated the platform and the policy.

Senator O’KEEFE:

– They left tha Labour party of their own free will, following Mr. Hughes-

Senator de Largie:

– After we were kicked out.

Senator O’KEEFE:

– Simply because they refused to accept majority rule.

Senator de Largie:

– Not at all.

Senator Russell:

– All of us ?

Senator O’KEEFE:

– If Senator Russell is an exception we shall be interested to hear him. I believe that there are special reasons in his case.

Senator Russell:

– I was not eligible to attend that meeting.

Senator O’KEEFE:

– Well, the honorable senator attended it. I believe that there are special reasons in his case, and we shall be interested to hear those reasons from him. I repeat the statement that our friends, comprising about a third of the members in the two Houses, left the original Labour party simply because they refused to accept majority rule ?

Senator Henderson:

– Which do you call the original Labour party?

Senator O’KEEFE:

– I mean the old Labour party.

Senator Henderson:

– We left no Labour party. We left the Trades Halt bosses; that is all.

Senator de Largie:

– We would not obey the junta; that is all.

Senator O’KEEFE:

– Majority rule is the basis on which the Labour party in Australia has been built up.

Senator Henderson:

– Are nine or tea men a majority?

Senator O’KEEFE:

– Majority rule has always been accepted by my honorable friend Senator Russell, and I can assure him that this division is not a pleasant tiling to me. Perhaps it is more painful to me than to most honorable senators, for the reason I stated just now. There are four of us who have stood liere loyally shoulder to shoulder since 1901, who have fought loyally according to the platform which we had signed, and who kept an fighting together until the last few weeks. At the present time Senator Stewart and I sit on this side of the chamber, while Senators de Largie and Pearce sit on the other side. For that reason it is a Dainful thing to me to find myself even politically separated from my honorable friends. I hope that we shall never be more than politically separated, and I do> not think that we shall.

Sitting suspended from6.30 to 8 p.m.

Senator O’KEEFE:

– It is only fair to those who still belong to the Labour party that the position should be put clearly. The members of this party have been blamed by those who left it for having turned them out. It has been said that those who left the party, and who, according to interjections, still claim to belong to it, had no option but to leave, because they had been declared to be outside the party prior to this split taking place within Parliament. I am going , to put what really did happen on the official records, and I appeal to my honorable friends to correct me if I say anything which” is not correct. When the Parliamentary party meton a certain Tuesday, and asked the Prime Minister’to make a statement, he refused. He met the party by appointment. In other times, and other circumstances, there would have been no reason to ask him to call a meeting of the party, but, apparently, he was not anxious to have a meeting. He was still leader up to that time, because he had not been deposed. He came into the full meeting, practically every member being there, and took the chair. The minutes of the previous meeting were read, and he then asked, “What is the next business?” Somebody, or several at once, interjected, “ Have you no statement to make ?” He replied, “I have been asked to convene a meeting. Surely the gentlemen who asked , me to convene it know what they wanted me to convene it for,” or words to that effect.

Senator Henderson:

– Quite right.

Senator O’KEEFE:

– Even Senator Henderson says, “ Quite right” to that. I simply want to put the facts on record to correct misrepresentations which have gone abroad to the public.

Senator NEWLANDS:
SOUTH AUSTRALIA · ALP; NAT from 1917

– I thought Caucus business was secret.

Senator O’KEEFE:

– This business has not been kept secret. Senator de Largie made a public statement of his version of what happened. There is no question of secrecy now between the members on this side and those who left the Labour party.

Senator NEWLANDS:
SOUTH AUSTRALIA · ALP; NAT from 1917

– Then we do not belong to the Labour party?

Senator O’KEEFE:

– They have left the Labour party absolutely of their own free will.

Senator NEWLANDS:
SOUTH AUSTRALIA · ALP; NAT from 1917

– We have left the snob with which you are associated.

Senator O’KEEFE:

– The “ mob “ with which I am associated, to use Senator. Newland’s language, still belong to: the Labour party. I shall not call my friends on the other side a mob, for I would like this discussion to be on somewhat different lines. Up to that point, my friends admit that what I have stated is correct. The Leader of the Labour party who, up to that moment, was leader because he occupied the chair, a fact which showed him to be the leader still, instead of following his usual course after a recess, and making a statement, waited, and when asked if he had no statement to make, replied that the gentlemen who convened the meeting ought to know what they convened it for.

Senator Henderson:

– Quite right; they ought to know.

Senator O’KEEFE:

– Then so far we agree. He was then asked,” Have you no statement to make?” and when he said “ No,” Senator de Largie is correct in. saying that a member moved that he no longer possessed the confidence of the party as leader.

Senator Pearce:

– Was that motion moved simply because Mr. Hughes made no statement?

Senator O’KEEFE:

– I am only stating what occurred. So. far as concerns any knowledge I have of anything which might have occurred before, that is the reason, and I am going to show Senator Pearce that what I say is correct.

Senator Guthrie:

– Do not you think that that motion was prepared beforehand?

Senator O’KEEFE:

– I do not know whether it was or not. It may have been, butif it was I know nothing about it.

Senator de Largie:

– Did you know anything about the action of the executive in Sydney with regard to Mr. Hughes?

Senator O’KEEFE:

– Of course I did. I shall have something to say about that in a minute. When the motion that Mr. Hughes no longer possessed the confidence of the Labour party was. put, a number of us rose at once and a number of us spoke. Will Senator Pearce or Senator de Largie deny that I made an earnest appeal to Mr. Hughes to make a statement, and outlined a motion which I had prepared ?I was going to move it as % motion, showing that I knew absolutely nothing about what wassaid to have gone before, or about the other motion having’ been prepared. I went into the meeting With the motion written out, but, in consequence of what happened, I had to move it as an amendment.

Senator de Largie:

– Did not the mover of the motion say that he had his mind made up, and that there was no need for any talk?

Senator O’KEEFE:

– The honorable senator says that somebody had his mind made up. I did not say so, because I did not know anything about that. But, and this is the fact that the public want to know, I outlined an amendment which I had prepared as a substantive motion.

Senator Pearce:

– Quite correct.

Senator O’KEEFE:

– Then I am not doing anything unfair in stating the terms of that motion, because this is a question on which we want the light let in.

Senator de Largie:

– The public will know ‘all about it.

Senator O’KEEFE:

– They have heard it from one side only. Now they will get it from the other. The terms of my motion, or amendment, without pretending to give the exact words, were : That an Inter-State Labour Conference be called within thirty days; that the whole of the members of the Ministry who had resigned be reinstated and carry on the Government until such Inter-State Conference was held, but that that meeting, and every memberin that meeting, including the Leader and the other Ministers, pledge themselves to abide by the majority verdict of that Inter-State Conference on the question as to whether the then Government should continue in office as a Labour Government, as it was before, or whether they should hand in their resignations and let a new Government be appointed. . If that was not a fair motion, I want honorable senators to give me their ideas of fairness.

Senator Pearce:

– It was not, because the dice were loaded.

Senator O’KEEFE:

– I knew, and know, nothing about that. If the members of the Ministry and those who have followed them still believed that majority rule should prevail; if they still believed that that should be the basic principle of the Democracy which had built up the Labour movement, they should have been prepared to accept that amendment. But the Prime Minister absolutely refused to accept it. Why ?

Senator de Largie:

– Because sentence of death had been passed weeks before.

Senator O’KEEFE:

– That is tantamount to saying that if nine out of every ten Labour members were against him, and it did not suit him to resign, Mr. Hughes must still be the dictator, still be the czar; he must be right and the other nine wrong.

Senator Russell:

– Was not your motion a revolt against the executives ?

Senator O’KEEFE:

– I do not know whether it was ; it was not a revolt against the Federal executive, because that body had made no declaration. It was not a revolt against the Tasmanian executive which was the only executive that I recognised.

Senator Russell:

– How would you vote: to put me back in the Labour Ministry after I was excluded?

Senator O’KEEFE:

– I could do that quite in consonance with the action of the State executive to which I owe allegiance - the central body of the Labour movement in Tasmania. That body left every Federal member from Tasmania absolutely free to follow the dictates of his own reason. Other honorable senators from? Tasmania can bear out what I say, and I believe it was the same in the case of one other State.

Senator Lynch:

– Then why did you vote for my expulsion the other day?

Senator O’KEEFE:

– I shall come to that in good time. That being so, the motion I moved was in order, and5 quite in keeping with the desires of the central body in my own State.If the Prime Minister still believed that he was a Labour man, if he still believed in majority rule as the basic principle of the Labour movement, he should have accepted that amendment, but he absolutelyrefused. A number of other members then spoke, including Senator Lynch, and then Mr. Hughes who, till that moment, was the Leader of the Labour party, because, up to then, he had not left the chair, suddenly got up. Instead of being content to accept the majority vote of that big meeting of the party which had’ built him up and made him Prime Minister - for, brilliant and capable man as he is, and as everybody acknowledges him tobe, he could never have,, been Prime Minister but for the loyal support of the party behind him - he absolutely refused to have anything to do with that party, two-thirds of whom were against him.

Senator GUTHRIE:

– Why? What reason did he give?

Senator O’KEEFE:

– Because he wanted to be a dictator, because he wanted “to be W. M. Hughes, the Czar of Australia, because he absolutely refused to accept the verdict of the people of Australia.

Senator NEWLANDS:
SOUTH AUSTRALIA · ALP; NAT from 1917

– In what way did “he refuse to accept the verdict of the people ?

Senator O’KEEFE:

– Because as soon as the referendum was over, in his first speech at the Town Hall banquet, he cried and grizzled about the verdict of the people. t

Senator NEWLANDS:
SOUTH AUSTRALIA · ALP; NAT from 1917

– He did nothing of the kind. A member of your own party here refused to obey the verdict of the people. Mr. Hughes never did so.

Senator O’KEEFE:

– He was compelled to accept the verdict of the people much against his grain.

Senator NEWLANDS:
SOUTH AUSTRALIA · ALP; NAT from 1917

– Why don’t you put the facts?

Senator O’KEEFE:

– That has nothing to do with the facts under discussion. “Senator Newland will have an opportunity of putting the facts in his own way later.

Senator NEWLANDS:
SOUTH AUSTRALIA · ALP; NAT from 1917

– If you set out to give the facts, you should do so.

Senator O’KEEFE:

– I am stating the facts. Here was a Labour party consisting of members from both Houses, to the number of about seventy. Of these, forty-six or forty-seven, roughly twothirds, were against Mr. Hughes as leader. Would anybody dare to say that Mr. Hughes bowed to the will of the majority, when he refused to accept the decision of two-thirds of the party? Because of his actions during the campaign, and because of his abuse of the franchise, .they felt that they could no longer accept him as leader. Will any one say that he was prepared to accept the decision of the majority? Is it not a fact that after he had heard a number of speakers he got up and walked out?

Senator GUTHRIE:

– Did he not say something before he- walked out? ‘ .

Senator O’KEEFE:

– He did. He made a speech. He said he was sorry to leave the party. He declared that he had never ‘ done anything against its principles, and had never broken a pledge.

As a matter of fact, he broke a most vital pledge of the party when, a few minutes before, he refused to abide by the decision of the majority of the party in caucus, because he evidently considered that he was the only man fit to lead Australia. He said : “ Let my friends follow me,” and a number of them did so. I am not blaming them for their action, but my own opinion is that it was due to a mistaken sense of loyalty to their old leader. They followed him, and with him left the Labour party.

Senator Guthrie:

– And the honorable senator wanted to smooth it over.

Senator O’KEEFE:

– Undoubtedly. And I brought forward my motion because I believed that there was still a possibility of the Labour party being kept together if Mr. Hughes’ had made a statement, and had given anything like a’ good reason for his actions within a few weeks before that meeting. I did so against the wishes of a number of my political friends. While I bitterly resented the action of the Prime Minister in many respects, and the insults that he had hurled at me and other members of the party during the campaign, by classing us with criminals and pro-Germans, and by innuendo suggesting that we were accepting German money; while I resented his unwarrantable interference with the secrecy of the ballot-box, up to that moment I thought there might be some chance of the breach in the party being healed, so that the Labour movement could go on with the work that lay to its hand, and which must be done in the near future.

Senator Lynch:

– But why did you vote for my expulsion ?

Senator O’KEEFE:

– Senator Lynch is anxious to come to that part of the story. Up to that moment no man in Australia would have been more pleased than I to see the breach healed; but immediately the Prime Minister and his supporters, decided that they would not accept the decision of the majority, I could no longer consider Senator Lynch as a member of the Australian Labour party. Only a day or two afterwards the party behind the Prime Minister decided to carry on the government of the country, and in so doing they broke one of the fundamental rules of the Labour movement, namely, by forming a Ministry chosen by ona man, and not elected by the whole party. The Ministry was. chosen from a section of the party, which represented only onethirdof its members. Will any member Bay that those-ho elected to remain true to the old party did wrong? If they think so, they are welcome to their opinions. Senator Lynch asked me why I voted for his expulsion. I did so, as I would haveto do to-morrow, and as he, in similar circumstances, would have to vote for my expulsion.

Senator Guthrie:

– But why did not your leader vote for it too?

Senator O’KEEFE:

- Senator Lynch used to be loud in his advocacy on the. platform of the principle vox populi vox Dei - the voice of the people’ is the voice of God - but now, according to Senator Lynch, the voice of the people is the voice of the devil. Senator Lynch came to the Labour Conference the other day as the elected representative of a State. He had a perfect right to. be there, because his State had sent him, and, up to a certain stage, I had no objection to his sitting in conference; but after a motion was adopted that those who had left, the Labour party, and formed a new party, should no longer be considered as members of the Labour movement, I voted for his expulsion and that of his co-delegate, Mr. Burchell.

Senator Lynch:

– You had no right there, because you are from a scab State that has not paid its fees.

Senator O’KEEFE:

– That is not correct.

Senator de Largie:

– It is a fact.

Senator Guthrie:

– Pay up.

Senator O’KEEFE:

– I had a right to attend that conference, because I was sent there with the confidence of the people in my State; while Senator Lynch had no right to sit at the conference, because he had left the Labour party, and joined another party.

Senator Lynch:

– Pay up, or shut up.

Senator O’KEEFE:

– I will shut up when I am ready. The position is quite correct, because the Tasmanian delegates have not been declared outside ‘the Labour movement. Senator Lynch has, and that is why he is rather angry about it. The Labour movement has grown up because the people belonging to the different -unionsor political leagues in every corner of Australia believe in majority rule. Each league may send proposals’ forward to the annual State Conference. Any proposal emanating from the humblest union in any small town has a chance of going before the InterState Conference, and ultimately of finding its way on to the platform of the Labour party. All this depends upon majority rule. And yet these gentlemen whose very political life depended upon majority rule decided at the last that they would not accept the principle any longer, and thus they left the Labour party.

Senator Lynch:

– Would you accept majority rule if the majority was wrong.?

Senator O’KEEFE:

-That means then that a majority is wrong if it is not of the same’ opinion as Senator Lynch. It is not surprising that the outside organizations which expelled certain members from the Labour movement should have become a little bit suspicious of their leaders when they saw the company that the Prime Minister was keeping immediately upon his return to Australia. He left this country as the idol of the Australian Labour movement, and when he returned to Fremantle he made a speech without, so far as we know, consulting the majority of his Cabinet, or the Cabinet as a whole. He may have done so by cable, but I have pretty good reasons for believing he did not. In his speech at Fremantle he tried to bind his Cabinet to a decision in favour of conscription before he knew whether that decision would be acceptable to a majority of his colleagues or not. He said on that occasion that he was going to “ follow the light “ as he saw it. His words, although some said they were obscure in their meaning, left very little doubt in the minds of most people that he intended to fight . ‘for conscription. When he reached Adelaide he made a similarspeech, and upon his return to Melbourne he spoke again in the Melbourne Town Hall. I repeat that the members of the outside ‘organizations could not be blamed for becoming suspicious concerning his intentions when they saw who were supporting him. The extract from his speech, which I intend to read, will prove that Mr. Hughes considered only himself, and not his Cabinet or the party that had kept him in power, that had breathed into him the breath of political life, and hadsent him to the other side of the world, where he had such a triumphant, career. The extract will show that unless every member of his Cabinet was prepared to allow him to ride roughshod over their feelings he would smash up the Cabinet and the Labour movement, and I thinkhe is able to say that in a few months he has more effectively wrecked the movement than anybody else could have done in the same number of years.

Senator Ferricks:

– The party, not the movement.

Senator O’KEEFE:

– I stand corrected. Mr. Hughes may have wrecked the , party, but he cannot wreck the Lahour movement, which will go on, and will probably become stronger than ever. He came back to Australia determined to have his way, and in the face of a mixed audience at the Melbourne Town Hall, he said -

I rejoice that there are men who do not see eye to eye with me, and that there are some who regard those sentiments, to which I gave utterance in England, with abhorrence. I am glad of it. All I say is this, that I have tried during my political life to pursue the light as I know it, and as I have madeperfectly clear to the people of every part of the Empire, as well as to my fellow citizens here, I am following, it. now, and shall go on to the end. (Loud cheers.) If they can arrest my progress, let them do it - but they will not. (Cheers.)

Those cheers came from men who hitherto had always been ready to cut his political throat.

Senator BakhAp:

– But I thought you said it was a mixed audience?

Senator O’KEEFE:

– Yes, but there were no cheers from Mr. Hughes’ supporters to that sentiment. The Prime Minister, I repeat, said -

I am following it now, and shall go on to the end. If they can arrest my progress, let them do it.

That is a fine democratic sentiment from a Prime Minister who up to’ then had always bowed to the rule of the majority of his party, and who was always prepared to consult his colleagues. Later on, he said - . . We must resolve to sacrifice all things that we may be victorious. That resolve animates the whole people of the Empire. That resolve spurs me on to do what in me lies, and in doing it I believe I shall have the support of nine-tenths of the people of Australia.

Senator Guthrie:

– No. “To go on to’ victory.”

Senator O’KEEFE:

– He could not get the support of one-half of the people of Australia.

Senator Pearce:

– Is the honorable senator against that sentiment?

Senator O’KEEFE:

– No, I am not. The Prime Minister said that he was going to get the support of nine-tenths of the people of Australia, and a few minutes before he had said that he raw the light and would follow it, that he intended to go on to the end, and that if they could arrest his progress, let them do it.

Senator Guthrie:

– Who? Those who did not want victory.

Senator O’KEEFE:

– When he said that if they could arrest his progress, let them do it, what had he in mind but conscription ? He could have had nothing else in his mind. He saw the conscription light, and that was the light he intended to follow. When he found that instead of nine-tenths of the people being behind him not one-half of them were behind him, he did not pursue the only course left, it seems to me, to an honorable politician, and return to the party the trust imposed in him.

Senator Senior:

– Was Tasmania behind Senator O’Keefe?

Senator O’KEEFE:

– Yes. Tasmania has been behind me for many years, and will be behind me the next time I appeal to the electors there. Inview of the statements he had made, there was only one honourable course left to Mr. Hughes, when he found that not one-half of the people were behind him. Instead of going on with this attempt to wreck the Labour party in Parliament he should have given up his leadership. He should have given back his trust and tried whether the party could carry on without him. Of course that did not suit Mr. Hughes, and he was determined not to do that. Statements have been made in the Senate and throughout the country with respect to what has occurred under the operation of the censorship. I shall not occupy time in referring to it now, but here and now I utter my complaint against Mr. Hughes for some of the literature which he issued. He knew very well that those who did not believe in conscription thought that Australia was doing her fair share, and would continue to do so without having this curse of militarism imposed upon a freedomloving country. Still he was a party to the publication of stuff like this, the final paragraph of one statement issued over his signature -

What alternatives are offered to voting “Yes “ for reinforcements ? There is not alternative save one, that it will cover Australia with eternal dishonour.

Senator Pearce had something to say the other day as to the way Germany viewed the result of the referendum vote, but I would ask who is to blame if Germany had reason to be pleased with the result of that vote. The Prime Minister, before the vote was taken, and when he believed that he would receive a big majority at the referendum, said that a “No” vote would cover Australia with eternal dishonour. If Germany has gained anything, and if Australia and the Allies have lost anything as the result of the vote at the referendum, it is the Prime Minister who is to blame, and no one else.

Senator Guthrie:

– Senator O’Keefe agreed to the referendum.

Senator O’KEEFE:

– That is stale news; every one knows that. The statement to which I refer continues -

If you vote “ No “ when you know that men cannot be obtained By voluntary enlistment, your action is one of shameful abandonment of the Allies who have been fighting your battle. If you vote “ No “ you are guilty of craven desertion of your own Australian soldiers. You cannot vote “ No “ and look the world in the face. You cannot turn down Britain’s request for reinforcements and still claim her. protection.

That is signed “ W. M. Hughes.” Yet the Prime Minister and his friends who have preferred to remain loyal to him rather than to the Labour movement which made them members of this Parliament, are blaming us because we went to the party meeting to demand an explanation from Mr. Hughes. We should have received a reasonable explanation of these things, or he should have been deposed from his leadership.

Senator Senior:

– “ Demanding “ is a nice word.

Senator O’KEEFE:

– Of course we had a right to demand a reasonable explanation from the Prime Minister. Had not the constituents of Senator Senior a right to demand that he should give them an answer upon a question arising out of a matter of public importance? Honorable senators, have only to read the Hansard reports of the closing speeches of the debates before the referendum was taken to know that Mr. Hughes spoke as reasonably as any man could in giving promises of fair play to each side during the referendum. He promised that freedom of speech would be allowed to each side.

Senator Guthrie:

– How much freedom did we get from the conscription side ?

Senator O’KEEFE:

– The Prime Minister promised freedom of speech and freedom of action, but, as a matter of fact, the anti-conscriptionists were not only denied freedom of speech, but were actually denied justice. After the vote was over, the battle was still carried on. In proof of this, I have only to quote some of the proceedings which took place in the Courts in my own State. I have here a report of Police Court proceedings in cases against men who were charged with inter- - jecting when Mr. Joseph Cook made hi3 speech at Hobart. In his very first sentence, the right honorable gentleman insulted his audience. As free men and women, they could not stand that kind of thing, and they interjected. The names of some were taken and they were prosecuted. It may be interesting to some of the new-found friends of Mr. Joseph Cook to learn something of what took place at Mr. Cook’s meeting. The officer for the prosecution in one of these cases, in replying to Mr. Chant, who represented those charged with disturbing the meeting, said -

He had not heard the Mayor prac tically open the” meeting with the observation -“If you vote ‘No’ you will be voting as theKaiser would wish you to vote.”

Every one else who was present at the meeting heard the mayor say that. This was a big public meeting, held in connexion with a question upon which the people of Australia, from Sydney to Fremantle, and from Port Darwin to the southern part of Tasmania, were about equally divided as to what was the proper thing to do. The mayor, in opening the proceedings of the meeting, made the remark that those who voted “ No “ wouldvote as the Kaiser wished them to vote. It is no wonder that a number of the free electors of Tasmania resented that kind of thing. The officer in this case went on to say -

He declined to express an opinion on that observation if it were made. He did not hear Mr. Cook open his speech by saying, “ I came down on the train to-day with an I.W.W. man.”

What had that to do with the meeting? The obvious inference from the statement was that Mr. Joseph Cook tried to link up the anti-conscriptionists with the Industrial Workers of the World man who was in the train. There was probably no Industrial Worker of the World man on the train.

Senator Bakhap:

– As a matter of fact, four or five of them crossed over on the Loongana on the very day Mr. Joseph Cook went to Tasmania. I happen to know that.

Senator O’KEEFE:

– What had that to do with the matter ? An interesting little episode occurred at one of Senator Bakhap’ s meetings) on which I will have something to say later. The officer associated with these prosecutions said, further -

He would not venture on an opinion as to whether such an observation, if made, was peaceful or not. If Mr. Cook said there Were plenty of Germans in the hall he spoke the truth, because he saw Germans there himself. If Mr.’ Cook said there was German gold behind this he might have his opinion, but would not express it. He could not say anything there one way or the other as to whether such an observation was insulting to citizens or not. If Mr. Cook said all the brains were on one side, and all the clamour and extremists on the other side, he would not say there that that was insulting or “a direct incitement to disorder. No insulting words, if they were insulting, could justify a breach of the law. If Mr. Cook said those who were opposing his view were scabbing on their mates, he would not discuss the question as to whether that line of argument was likely or hot to incite disturbance at the meeting. . .

Mr. Chant, in speaking, said ;

It was suggested it was Mr. Cook’s meeting. He submitted it was nothing of the kind. It was not Mr. Cook’s meeting. It was a meeting of the citizens of Hobart, called officially by the Mayor, and was no more Mr. Cook’s meeting than his. The Mayor invited the people to hear the Right Honorable Mr. Cook on a certain question. The citizens had as much right ?o resent Mr. Cook’s remarks in a loud tone as Mr. Cook had to make insulting remarks, which the audience may have naturally resented; indeed, they had more right. If Mr. Cook said the things imputed to him, was it not probable persons present would resent them ? The Court had nothing^ to do with whether they were right in resenting such language or not.

My object in reading these quotations is to show that Mr. Joseph Cook tried to associate certain people with the anticonscriptionists. A number of the men who were prosecuted were fined amounts of 10s. or ?1, with costs, for disturbing Mr. Joseph Cook’s meeting. I could have had fifty leading residents of Burnie prosecuted for disturbing the meeting which was addressed by Mr. Lyons and myself two nights before the holding of the re ferendum. I would not do that, because I recognised that we were dealing with a big public question, upon which there was ground for difference of opinion.

Senator Bakhap:

– Will the honorable senator admit that Mr. Joseph Cook had nothing to do with the prosecutions?

Senator O’KEEFE:

– My contention is that, both before and after the referendum, the advocates of no conscription did not get the same fair play as did the other side. Senator Bakhap is nearly as much excited now as he was when he addressed a meeting in Launceston during the referendum campaign. At Launceston there was a series of prosecutions in connexion with which Senator Bakhap was the central figure.

Senator Bakhap:

– What did I have to do with those prosecutions ?

Senator O’KEEFE:

– Nothing at all. I refer to these matters only to show that the poor anti-conscriptionists were not given a fair chance, either before or after the vote was taken. Every one was against them; the big newspapers, practically all the clergy, and the big financial interests, and even the Courts of law were against them, when prosecutions we’re entered upon for the disturbance of meetings. I have not read of a single case throughout Australia, before or after the referendum campaign, in which persons were prosecuted for the disturbance of meetings held to advocate no conscription. A poor woman was dragged into Court at Launceston for having interrupted Senator Bakhap’s meeting there. I am not blaming Senator Bakhap -for that.

Senator NEWLANDS:
SOUTH AUSTRALIA · ALP; NAT from 1917

– The honorable senator is blaming Mr. Hughes for it.

Senator O’KEEFE:

– I am blaming the Court, and those who in their fight for conscription were sd bitter -that, after the vote had been taken, they were not prepared to allow their bitterness to die out.

Senator NEWLANDS:
SOUTH AUSTRALIA · ALP; NAT from 1917

– The anticonscriptionists threw road metal and rotten eggs.

Senator O’KEEFE:

– The following is a clipping from the Daily Post : -

At the Launceston Police Court yesterday before Mr. E. L. Hall, P.M., and Mr. p! Boland, J.P., Annie Brooks was charged with having, on 25th October, behaved in a disorderly manner at Senator T. J. K. Bakhap’s meeting. Defendant pleaded not guilty, and was defended by Mr. M. J. Clarke. SubInspector Lonergan prosecuted. Constable Herbert gave evidence that the defendant was behaving in a disorderly manner at the meeting, and was shouting in a loud tone of voice. Amongst other things, she shouted out, “You Chinaman, you ought to be back in China.” When he spoke to her, she only laughed at him. Superintendent Hedberg corroborated Constable Herbert’s evidence as to the defendant laughing. He did not hear any interjections; it was one continuous noise. Defendant gave evidence on her own behalf. She did not call Senator Bakhap a Chinaman, and said nothing while he was addressing the meeting. Constable Herbert was sitting two seats behind her, and she did not hear him speak to her. liliza Murphy, a married woman, gave corroborative evidence. The Bench held the case proved, and fined defendant £2 10s., with 12s. costs, in default three weeks.

And that woman’s husband was at the front fighting for Australia.

Senator Guy:

– And every son she has is at the front.

Senator O’KEEFE:

– Is that what one may call fair play and freedom of speech ? This poor, unfortunate woman was dragged before the Court because she desired that her husband and sons who had left Australia for the front, should return as free men, and not as conscripts.

Senator Story:

– She was carried away by the other side’s misrepresentations.

Senator O’KEEFE:

– I stand corrected. I am told that this woman was a widow, who had sons at the front. But apart from the interference with anticonscriptionists, the crowning act of treachery of which the late Leader of the Labour party was guilty was that of attempting’ to interfere with the secrecy of the ballot. My honorable friends opposite saythat we are always talking about that. We are not the only persons who believe that the secrecy of the ballot is dear to Australia. Certainly other men believed it not long ago. I may be pardoned for quoting from Hansard theutterances of Senator Pearce regarding the necessity for keeping the ballot inviolate. . Upon one occasion, not long ago, when the Cook Government was hanging to office with the aid of the Speaker’s vote, it brought forward a Billcontaining certain proposals which would have interfered with the secrecy of the ballot, and there was then no more eloquent advocate for preserving the purity of the ballot than Senator Pearce. Speaking on the proposal to restore the postal vote, he said, as will be seen by reference to Hansard, volume 72, page 3878, of 1913-

We are anxious to preserve the secrecy of the ballot. There is nothing for which we would fight with more determination, because no other party has gained more by the secret ballot than the Labour party. There would not have been a Labour party if there had not been a secret ballot; I doubt if there would have been a Labour member in any House of Legislaturein Australia. We owe our opportunities more to the secret ballot than to anything else on the statute-book.

There are other members of the Ministry who have had something to say on this subject.

Senator de Largie:

– Does the honorable senator know what Senator O’Keefe said on compulsory training ?

Senator O’KEEFE:

- Mr. Hughes is the gentleman who proposed to rob thousands of young men of Australia of their votes.

Senator Barnes:

– Who did rob them.

Senator O’KEEFE:

– When an Electoral Bill was under consideration on 18th September, 1913, as will be seen by reference to Hansard, vol. 70, page 1354, Mr. Hughes said -

I venture to say that many thousands of persons got on the roll within one month of the prescribed time. It is of no use to talk about what electors ought to do, to say that they ought to’ be sleeplessly vigilant. They ought; but they arc not, and honorable members on the other side should thank God for it. During the greater part of the time people take very little interest in politics; but they wake up with a feverish anxiety a fewweeks or days before the election, and go about trying to make up for lost time. Just before the last election they came in their thousands to try to get on the roll.

He also had something more to say - something very strong - about the secrecy of the ballot -

It must be known, and it shall be known, to the people, that while the Labour party are ready, willing, and anxious that every sick man and every sick woman in the country shall vote and have the opportunity to vote, they are not willing, and will not permit the power of money, and the influence of money, to violate the secrecy of the ballot.

A few of the other Ministers also spoke on this question. Mr. Archibald, for example, said -

I appeal to honorable members opposite not to be so eager to pass proposals of this kind.

Mr. Hughes on the occasion of the recent referendum did something much worse than was attempted by Mr. Joseph Cook or the members of his Government. Mr. Archibald proceeded -

Australia’s great strength lies in the homes of Australia’s people, and it should be our first desire to do everything to protect those homes. . Their chief protection is the ballot-paper, which can be used at election time, and the secrecy of the ballot. I have no quarrel with the wealthy class; but ve need not worry about them. We may be sure that they will always be represented. But is any one prepared to say that this is not an attempt on the part of the Government, obviously for party ‘purposes, to reduce the number of persons going to the poll?

Senator Pearce:

– Is the absent- voters’ provision in the Electoral Act an’ interference with the secrecy of tho ballot?

Senator O’KEEFE:

– No.

Senator Pearce:

– Mr. Hughes’ proposal was that certain votes should be placed in envelopes and treated just as absent voters’, ballot-papers are treated.

Senator O’KEEFE:

– Not for a moment do I believe that up till a few weeks before the . referendum would Senator Pearce have agreed to the proposal of his leader that certain questions should bo put to men of military age, and that such interference with thousands of voters should be allowed. Upon his own statement here, Senator Pearce was in favour of that regulation. Knowing him as I do, and have known him for sixteen years, and realizing the fights that he has put up for the secrecy of the ballot, I cannot understand how he came to consent - unless it were in a moment of madness - to such an unwarrantable interference with the secrecy of the ballot. Our honorable friend Senator Millen does not agree with the regulation, and none of my honorable friends opposite have dared to excuse it. Only one or two honorable members in another place have attempted to defend it. It is true that Mr. Watt stated that if he had proposed that regulation he would have carried (through his dictatorship. Mr. Hughes, apparently, became afraid. Other statements, equally strong, can be found in Hansard in favour o.f the maintenance of the purity of the ballot. The utterances of Mr. Archibald can be seen in volume lxxi., pages 1537, 1538, and 1541. In Hansard, also, is the speech of Mr. Poynton, the. present Treasurer, on page 1581. Every one of these Ministers has spoken of his determination to keep the ballot-box absolutely secret.

Senator Russell:

– When that matter was under consideration in this chamber I was the only Labour man who voted to retain postal voting.

Senator O’KEEFE:

– But the honorable senator did. not agree with Mr Hughes in the issue of these regulations, because he resigned as a protest against them.-

Senator Russell:

– And I got strangled for doing it.

Senator O’KEEFE:

– That is a quarrel between Senator Russell and the organizations in Victoria to which he owed allegiance. We all know that he remained in office till the last moment at the wish of a number of Labour ‘ supporters of the late Government, but that he resigned rather than consent to these infamous regulations.

Senator Millen:

– Was his resignation “a protest against the regulations or against the way iri which they were passed ?

Senator O’KEEFE:

– It was both; it was a protest against the regulations and a protest against the autocratic method by which Mr. Hughes passed them. Enough has been said about that, I think. .An Executive Council composed of four members met here and turned down the proposed regulations, and Mr. Hughes, with one other man, in Sydney, went right over their heads, put the regulations through, and acted upon them. ‘ To use Senator Millen’s own words, “ Make no mistake about it, the regulation was put through and acted upon, and it was only through fear of consequences that it was withdrawn.” Our honorable friends have said that they can cling to office without the loss of self-respect.. How can they possibly do it ? This great issue of conscription was considered by Mr. Hughes to be large enough to divide Australia into two hostile camps - into two more bitterly hostile camps than she had ever been divided into before. The people were ranged against each other with greater bitterness than had been exhibited in any election campaign. Mr. Hughes made the proposal important enough to separate from his life-long political friends. He thought it was important enough to justify him in insulting his personal friends. Yet he did not think the question vital enough to resign on when he was defeated. And he has a number of apologists.

Senator de Largie:

– Tour State did not support your attitude in the matter.

Senator O’KEEFE:

– My honorable friend has made a statement.

Senator Henderson:

– He does not require any apologists. You require morethan he does.

Senator O’KEEFE:

– No, I am quite happy. I require no apologists. I am keeping straight on.

Senator Henderson:

-Round the corners.

Senator O’KEEFE:

– The light that I saw, the light that I am following, and the light I have my eyes fixed upon, is that of the Labour movement - the movement which put me in this Parliament, as well as Senator Henderson and other men. They may be associated with the movement again at some time, but they are not now.

Senator Senior:

– That is not correct.

Senator O’KEEFE:

– It is correct. My honorable friends are not members of the Australian Labour party, and they know it.

Senator Senior:

– We are.

Senator Henderson:

– We are just as good members of the Labour party as you are, or ever were.

Senator O’KEEFE:

– My honorable friends, out of mistaken loyalty to their leader, preferred to follow him, and keep their eyes fixed on the light he saw, but his light was the light that failed. Australia did not follow Mr. Hughes towards that light. But these honorable gentlemen, who are keeping my friends in office - they say without the loss of any selfrespect on their part - have indulged in some rather free criticism of them.

Senator de Largie:

– Why should they not?

Senator O’KEEFE:

– Mr. Fowler stated inanother place the other day that the Prime Minister should have resigned, that he could not understand the right honorable gentleman, asking for a commission to form another Government when he had no majority, behind him in either House, when he had only threeor four direct followers in the other House and a majority against him in this House.

Senator Millen:

– You took no exception to that condition of affairs when the members of your party supported Mr. Deakin for years.

Senator O’KEEFE:

– That was many years ago. My honorable friend is a pretty old parliamentarian, and knows that as a man goes on, he learns a little in parliamentary tactics. The platform on which theparty led by Mr. Deakin stood, and the platform on which the Labour party stood, were very close together indeed, and there was a reasonable and fair working arrangement”. We stood really on the same platform. We were in favour of a White Australia, adult suffrage, and all the big democratic, ideals of the day but Senator Millen and his party were not. The men who occupied the benches on this side in the early days were not, a good many of them, very strong White Australians. They were not the good Protectionists of Australia. They did not believe in the new Protection, in adult suffrage, and in halfadozen of the bigger ideals which the then Australian Labour party supported, and were fighting for. We had every justification for standing side by side with Mr. Deakin until they feared that he was going to play the Labour party false. Then they cut from under him, and let him fall. When the Labour party got from under Mr. Deakin, very soon he and his followers sank into political oblivion, and to-day there are only two or three of the old-time followers of that gentleman in either House of this Parliament. My personal friendship leads me to hope that, in the very near future, that will not be the fate of my honorable friends on the other side, who have cut away from the Labour party. Mr. Fowler said that the Prime Minister should have resigned, and he is one of the supporters of the Ministerial party.

Senator de Largie:

– No junta forus.

Senator O’KEEFE:

– Let honorable senators listen to one or two of the compliments passed on Ministers by Senator Millen the other day. Speaking of the action of Mr. Hughes in daring to go away to Sydney to overthrow the decision of an Executive meeting held there about the regulations, to go over their heads, and pass the regulations in Sydney, he said, for I took down his words, “ The action was so arbitrary, so extraordinary, bo absolutely unreasonable, that no Minister with any self-respect could, do anything but resign.” The fact is that it was a question of a one-man Government ; that Mr. Hughes wished to play the part of a czar and a dictator, though out of loyalty his colleagues would not like to say that. Because he could not get his way, every other, man was wrong. It was because he wished to play the part of a dictator that the whole of this trouble came about. Is it not on record in Hansard - at least, if it is not, it was reported in the Herald - that when an interjection was made to Mr. Hughes about why he withdrew the regulations, he said that he did not pass the regulations, and therefore he did not withdraw them? When he was making these peculiar denials in the other House, when he seemed to be twisting-

Senator de Largie:

– Hear, hear!

Senator O’KEEFE:

– I do not know why the honorable senator should say “Hear, hear” to that. Senator Millen does not cheer it.

Senator Millen:

– You are confusing two issues - the issue of the regulations and the issue of the instructions.

Senator O’KEEFE:

– There is as. much difference between those two issues as there is between “ tweedledum “ and “ tweedledee.” They were both out for the one object, and Senator Millen knows perfectly well that, as a matter of fact, there is not one member of his party in this or the other House, who has dared to get up and condone the action of Mr. Hughes as to those regulations.

Senator de Largie:

– You are ignorant all the while that that regulation was withdrawn !

Senator O’KEEFE:

– Were they not acted upon? Will the honorable senator say that the questions were not put in any polling booths?

Senator de Largie:

– If the regulations were acted upon, it was done by mistake, as you know.

Senator O’KEEFE:

– No ; instructions “were issued. The honorable senator is trying to mislead the public. He knows quite well that it has been stated here by Senator Gardiner, who was a member of the previous Government - and the proofs are easily obtainable - that the regular instructions were issued that the questions should be asked under the regulations, but that about midnight a second set of instructions was telegraphed all over Australia withdrawing the questions; too late, however to reach some of the polling booths, with the result that the questions were put there. But if every ballot-box in Australia had been reached, if every Returning Officer had obeyed the instruction to withdraw the questions, was not the mischief done? Had not Mr. Hughes achieved his end and his object? Of course he had, because in every big newspaper issued on the Saturday morning he had announced that the questions were going to be put. These newspapers did not say that the instructions had been withdrawn. All that they did say on the Saturday was that three Ministers had resigned because the questions were to be put under regulations which had been passed against their consent. That kept thousands of young men in Australia from going to the ballot-box. We are making so much of this business because it was an unwarrantable and unfair interference with the ballot by a gentleman who wanted to be a czar; who went right over the heads of other Ministers; who, in short, made little of them, and attempted to do this thing, but whose courage apparently failed him at a minute before the twelfth hour. Yet, he does not admit that his courage failed him, because when an interjection was made to him in the House the other day, he said, “If I had wanted to do it, I would have done it, even if every one of my Ministers were against me.” Is that responsible government? Is that Ministerial control?

Senator de Largie:

– You know that that is perfectly true, too.

Senator O’KEEFE:

– That he would do it, even if all his Ministers were against him?

Senator de Largie:

– You know him well enough to realize that.

Senator O’KEEFE:

– I do ; and that is my quarrel with Mr. Hughes. This country has no time for a dictator, a kaiser, or a czar; and that is why that section of the people representing the Labour movement said, “ This gentleman is not any longer fit to lead the Labour party, because he wants to be the Dictator, the Czar, the Kaiser of Australia.” He said openly on the floor of the House, “If I wanted to do it, I would do it if every one of my Ministers disapproved.” Australia does not want that sort of thing.

Senator Millen:

– You said just now that as a man got older he learnt more. You have been pretty slow if you have taken all these years to learn this about Mr. Hughes.

Senator O’KEEFE:

– That is not correct. Mr. Hughes, up to recent days, accepted the verdict . of the majority at every party meeting. He accepted the verdict of the majority at the conferences, and he had to accept the verdict of the majority in the Cabinets of which he was a member. It was not until be came back suffering from swollen head, or obsessed with the conscription idea that he saw the light; that he was determined to follow that light as he saw it, and said to the great battalion of workers who had made him what he was, “ Arrest my progress if you can; you cannot do it.” If Senator Millen does not know, Senator de Largie knows full well that Mr. Hughes had always bowed to the decision of the majority in former meetings, otherwise he would not have been there for twenty-four hours.

Senator Millen:

– You have always denied here that your party coerced any man.

Senator O’KEEFE:

– I have never done anything of the kind. I have always admitted that I bowed to the will of the majority of the party in caucus assembled, and Senator Millen does the same.

Senator Millen:

– You always denied it.

Senator O’KEEFE:

– It is empty humbug to say that there is only one party which accepts the decision of the majority on these questions when they are discussed in party meetings. Every party does the same thing. We know that we are living under party government. Party government may be good or it may be bad; but whilst it exists there is only one way of governing the country. The majority in the party must rule, the majority in Cabinet must rule, the majority in Parliament must rule.

Senator de Largie:

– On party questionsonly, and conscription was not a party question.

Senator O’KEEFE:

– That opens up a pretty big issue, and, to some extent, I believe that my honorable friends opposite have every reason for their opinion. I do not know but that theyare right. At all events, there is a great deal of doubt as to whether conscription was a party question or not.

Senator Senior:

– Read the platform on which yarn were elected.

Senator Millen:

– If the Labour party had decided in favour of conscription, am I to assume that, in bowing to the majority, the honorable senator, an anti-eon- scriptionist, would have come out as a conscriptionist?

Senator O’KEEFE:

– I answered the question on several platforms in Tasmania, and I will give the same answer to Senator Millen- If Australia votes Yes,’ I will obey.”

Senator Millen:

– Not “Yes,” “No.”

Senator O’KEEFE:

– Is not that the question?

Senator Millen:

– No, your statement was that at your party meeting you were bound by the decision of the majority. If in that case they had decided in favour of conscription, would you, as an anticonscriptionist, have swallowed your opinions and come out as an advocate of conscription ?

Senator O’KEEFE:

– I would bow to the decision of the majority. I have always been in favour of majority rule. Like a number of others there I was willing to accept the ruling of the majority.

Senator Millen:

– The most immoral declaration ever made in this chamber !

Senator O’KEEFE:

– Either I come to the time when I have to get outside the Labour movement, or I must obey the will of the Labour party in the party meetings. I was asked on various platforms whether, if “ Yes “ were carried, I’ would support compulsion, seeing that I was then advocating “No.” I replied that I would loyally abide by the decision of the Australian people. Mr. Irvine for one, and I think Mr. Boyd for another, amongst the conscriptionists, said they would flout the will of the Australian people if “ No “ were carried. All these sophistries of my friends, all their excuses for Mr. Hughes, cannot cover up the fact that Mr. Hughes and his party are governing Australia when they have no right to. They have not a majority of the people behind them. They were defeated in the country. Mr. Hughes was defeated in his own State, and defeated by an enormous majority in his own electorate. Still he elects to cling to office with only a remnant of his party behind him, kept in power by a set of gentlemen -every one -of whom has been after his political scalp ever since I have been in Parliament, and every one of whom is opposed to him to-day on . all -the questions of policy which be has considered vital from the beginning. The matter was important enough for him to insult his friends on, but not important enough for him to get out of the Cabinet. One is inclined to believe that the old idol has feet of clay-

Senator Story:

– That is the sore point.

Senator O’KEEFE:

– Not with me. I am not hoping for any position.

Senator Story:

– He upset your plans.

Senator O’KEEFE:

– What position was the honorable senator to occupy in the Cabinet? Some years ago a gentleman in another place said that Mr.

Hughes, after a taste of four months in office, was like a boy dragged screaming from the tart shop. I always thought that was a nasty thing for Mr. Deakin to say, but one can hardly wonder that a number of other people say it now. “ I am the only man fit to govern Australia,” says Mr. Hughes. “ I am the only man fit to be Minister for Defence,” says Senator Pearce.

Senator Shannon:

– Have you not said a few things in this chamber about him?

Senator O’KEEFE:

– Only since I found him out. Only a few weeks ago I stood at this table when the Referendum Bill was going through and defended Mr. Hughes against attacks made on him, because I have always been loyal to those I have been supporting.

Senator Story:

– You had not orders at that time to repudiate him.

Senator O’KEEFE:

– And I have had none since. The honorable senator is making a big mistake. I am more free on the conscription issue than he is. He has his orders. He did not carry out the orders given him by his organizations.

Senator Story:

– Who had no right to order me.

Senator O’KEEFE:

– I had not orders, as he had. After all, they could claim some right to order him, because it is the organization outside that works pretty hard for Labojur members. They gave Senator Story orders, for I understand that, at their conference, they decided that their Federal members were free to vote for the referendum being submitted “ to the country, but instructed or asked them to vote against conscription. Whether Senator Story chose to obey those orders or not is his business; but he must not tell me that I had orders, because I never had any, and have none to-day. I opposed conscription out of sheer conviction, and after long and serious thought, because it seemed to me that it was the. very antithesis of Democracy and political freedom.

Senator Lynch:

– Is that the reason why it is onour platform, where you have supported it for years?

Senator O’KEEFE:

– The honorable senator refers to compulsion for home defence, which is as different from conscription for service 13,000 miles away as chalk is from cheese. The Age says there are two Labour parties. I wonder which of the two, if there are two, the Democrats of Australia are going to follow. The Age says we have to take our orders from secret juntas, but those secret juntas were splendid organizations only a few months ago. Who and What are the juntas ? My honorable friends on the other side take orders from somebody every time they come to this Parliament. First they take them from the electors, because they make promises. They say, “ There is my platform; if you approve of it, put me into Parliament, and I will carry it out.” And the electors will see that those orders are obeyed, or kick them out next time. They are obeying orders today. I do not say that Senator Story is; but Senator Lynch and the other members of the Government are obeying very direct orders, for they know perfectly well that if they do not accept the orders given them by the Liberal party, which is keeping them in office, they will soon get one order, and that is the order of the boot.

Senator Mullan:

– From Sir John Forrest.

Senator O’KEEFE:

– Probably from Sir John Forrest.

Senator Lynch:

– The man yoiu supported for years.

Senator O’KEEFE:

– I never did so. He was a political accident in the Deakin Ministry. Heaven only knows how he got there, and it does not saymuch for the intelligence of Western Australia that he was kept there for so many years. I have been just as bitter an opponent of Sir John Forrest for sixteen years in this Parliament as Senator de Largie has. I shall not do Senator de Largie the injustice of thinking that he approves of Sir John Forrest’s views on politics generally.

Senator Lynch:

– Is that the reason you supported him so faithfully for years?

Senator O’KEEFE:

– I supported a programme, and Sir John Forrest was always willing to bow the knee to the Labour party, and do the things we wanted the Deakin Government to do, because he was so fond of the sweets of office. He was another gentleman who would not be dragged from office. Whatever political convictions he had, he was willing to swallow, and he would accept the ideals and requirements of the Labour party rather than lose it.

Senator Guthrie:

– You stuck to Forrest, and sacrificed Kingston.

Senator O’KEEFE:

– Never. The honorable senator is a Rip Van Winkle. Kingston was a man and a Democrat. Sir John Forrest was never accepted as such by our party. Senators de Largie, Stewart. Pearce, and myself, the only four left of the original eight Labour senators who came into this chamber in 1901, never approved of Sir John Forrest’s policy. He might not have approved of ours, but he accepted it to keep himself in office. The Age says we take our orders from secret juntas. From whom does Senator Lynch now take his orders ? From the Conservative press, the Liberal party, the big financial institutions, the commercial magnates, the Conservatives, and, generally, from those who have been trying to kill him, politically, up to the last few weeks. Now all these influences are so glad to see the split in the Labour party that they are accepting the present Ministers as brethren, as new-found friends.

Senator NEWLANDS:
SOUTH AUSTRALIA · ALP; NAT from 1917

– It is wicked of you to say that Senator Lynch has turned in a few days from the Labour party to the Conservatives. It is not a fact, and you know it.

Senator O’KEEFE:

– I did not say sc; but people are quite capable of judging a man by the company he keeps. Can Senator Lynch, or any of my other friends opposite, object if the great battalions of workers outside judge themby the company they keep? It is not surprising if the Labour organizations, the central bodies, have for argument’s sake overstepped the bounds of their proper constitutional power-

Senator Senior:

– Then you are admitting it?

Senator O’KEEFE:

– I do not admit it. If we admit it for a moment, for the sake of argument, are they so much to blame ? Are those who have built up the

Labour movement in the unions so much to blame if they stand aghast to see their one-time idol, the leader of the wharf labourers, cheek by jowl with Mr. Irvine; to see Mr. Hughes, the lawyer, the idol of the old Labour’ party, taking counselwith Mr. Irvine, the lawyer?

Senator NEWLANDS:
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– Has he done that?

Senator O’KEEFE:

– Yes. The onetime great Democrat of Australia is now accepting advice from, or taking counsel with, the man whose chief claim to political prominence lies in the fact that he attempted’ in a more savage fashion than any other public man ever didto take away the liberties of the people of Victoria. The people outside cannot be blamed for being a little suspicious, or for having the same opinion of the Government’s new-found friends that the members of the Government themselves had a little while ago. Let me put Senator Lynch in the witness-box. This is what he thought only a little while ago of those gentleman who are now keeping him in office -

The gentlemen now in charge of the Government have trimmed their sail to every wind thatblew.

He was referring to the’ Cook Government. That was when Senator Lynch used to utter fierce denunciations from his old seat against Mr. Cook, Sir John Forrest, Mr. Watt, Sir William Irvine, and the rest. He also said -

If they had not the continual benediction of the press of this country they would never be where they are. Except for the press, there would not be sufficient of them to bury the corpse of their party.

That is what the honorable senator thought of them only a few months ago.

Senator NEWLANDS:
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– What does he think of them now?

Senator O’KEEFE:

– Oh, they are the best fellows in the world.

Senator NEWLANDS:
SOUTH AUSTRALIA · ALP; NAT from 1917

– Has he said so ?

Senator O’KEEFE:

– He is acting so. He is taking his political favours at their hands. They have made him the Minister for Works and are keeping him in that office. I can also give the Senate an opinion of the Cook Administration as expressed by Mr. Bamford, another new Minister. It may be found on page 703 of volume 70 : -

This Government and their supporters are mere spots on the democratic sun.

Mr. Webster, another Minister, also had something to say on that subject.

Senator Senior:

– What year was that?

Senator O’KEEFE:

– It was only three years ago. Do my honorable friends claim that they should be allowed to change their political views every three years?

Senator Guthrie:

– But you did it in two or. three weeks.

Senator O’KEEFE:

- Mr. Webster spoke for nine hours on one occasion, and the whole tenor of his remarks was a tirade of abuse of the Cook Government and their policy. He said then that they were hanging on by the skin of their teeth. I am now entitled to ask if that is not what this Government are doing? They have no right to govern the country, because they had not a majority of their party behind them.

Senator NEWLANDS:
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– Suppose your party came into power, how could you carry on?

Senator O’KEEFE:

– We would not attempt to carry on unless we had a majority of our own. If Mr. Hughes, had done the right thing with regard to the referendum issue, which he regarded as so vital, he would have handed in his resignation as the Leader of the Labour party immediately the issue was known. If they had done that, he and his supporters would not be where they are to-night, but we would all be together. By not doing that he has wrecked the party more effectively than could have been done in eight or nine years by any other man. I have no personal quarrel with my friends on the other side. We differ only in a political sense, and when we go outside and into the country, as members of the Senate will no doubt in the near future, we shall have no personal differences whatever.

Senator Guthrie:

– You have absolutely set yourself out to get Mr. Hughes’ head.

Senator O’KEEFE:

– On the other hand, Mr. Hughes has set himself out to get my head - I mean politically speaking, of course. He is out to kill every member of the Labour party if he can.

Senator Guthrie:

– No.

Senator NEWLANDS:
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– No.

Senator O’KEEFE:

– Mr. Hughes will, if he can, kill the original Labour party.

Senator Guthrie:

– A few months ago you would have licked his boots.

Senator O’KEEFE:

– The Prime Minister, I repeat, will kill the Labour party if he can, but I am glad to think that the Labour movement is too big even for the Prime Minister to kill.

Senator Guthrie:

– He is a giant though; you must admit that.

Senator O’KEEFE:

– He may be a giant, but he is not big enough to kill the Labour movement. Although this is not a personal quarrel, and need not give rise to personal animosities, my friends on the other side of the Senate must not be surprised if the people who have voted for them for the past sixteen years are now viewing them with suspicion.

Senator Senior:

– You will be guilty of creating that suspicion, then.

Senator O’KEEFE:

– No; my friends will be guilty of that because of the company they are in. Oil and water cannot mix, and likewise the. politics of my friends who are behind the Government now cannot mix with the politics of Sir. William Irvine, Messrs. Watt, Hughes, and Senator Millen. There is a saying “ You may fool some people all the time, end all the people some of the time ; but you cannot fool all the people all the time.” My friends opposite are fooling some of the people now, but they will not be able to fool them all the time,

Senator Senior:

– Ditto!

Senator O’KEEFE:

– It will not be long before the organization of the Labour movement will say to them, “ Get away from the company you are in, or we shall no longer regard you as being associated with the movement.” They will be judged by the company they keep. They cannot justify that company by any of the ideals to which they have been pledged during the whole of their political life, or by the pledges which they have made on a thousand platforms in Australia. They have only to look at the people who are supporting the present Government to realize that the Democracy of Australia will begin to wonder before long, and will judge them by their political company. Unless they leave that company the workers of Australia will have no more time for them.

Senator STEWART:
Queensland

– I feel that the present position of Australia calls for the most serious consideration on the part of every man who takes a share in the government of this country. It ought also to deserve the most serious attention from the whole of the people of this continent. We are faced with a position of very extreme danger and difficulty. The fate of Australia is trembling in the balance. Our very existence as a free community is in hourly danger, and even if we survive this trouble those who live in this Commonwealth during the next twenty or thirty years will be practically slaves owing to the heavy debt which will have been piled up and upon which huge sums of interest will have to be paid. They will have to work like serfs to pay it off. I do not charge any political party particularly with being the cause of this state of affairs. Every partyin this Parliament - and there are now three of them - is responsible. During last session I brought before the Senate a proposal for raising money which I believe was on the right lines of justice and finance. But how many supporters were to be found for that thoroughly democratic proposal ? There were only two.

Senator ALBERT GOULD:
NEW SOUTH WALES · FT; ANTI-SOC from 1910; LP from 1913

-Colonel Sir Albert Gould. -What was that idea ?

Senator STEWART:

– It was that instead of raising money by a voluntary loan, the Commonwealth should make a levy upon the wealth of the people. I put that idea forward because the money was required to defend this country, to defend property, to save the lives of our people, to preserve’ their liberties, and to maintain their families intact. When money is raised for purposes of that kind anything in the nature of interest ought not to be paid. I go further and say that if money is required for the defence of a country voluntarism should have no part in it. Every man in the country ought to be called upon to contribute according to his capacity. Then no one would suffer unduly, and no one would profit unduly. That, I consider, to be a democratic sentiment. Those with no property would not be called upon to pay anything. It is a serious matter that those who may live in this country hereafter will have reason to curse every one of the political parties which exists at this time, seeing that not one party had the common sense to grasp the proper idea with regard to financing the war. We have been following the old Conservative idea which obtained in Great Britain, a country that has been ruled for centuries by the rich people, and in which the poor section of the community have had no voice whatever.- When we wanted to raise money for the war, we threw overboard every Labour ideal and fell back upon the time-honored and crude system which had been in vogue not only in Great Britain, but in every country in Europe for centuries. In a young country like Australia, and with a powerful Labour party in office, we had an opportunity to do otherwise, but I always felt that this opportunity would vanish before the Labour party had the courage to grasp it, and unfortunately that has happened. Now there is no prospect whatever of carrying out a proposal of this kind, because however we may look at it, it must be admitted that it is not” the Labour party that is in power today; it is the Conservative party.

Senator Shannon:

– Who are they?

Senator STEWART:

– The honorable senator ought to know, because he is one of them. Whatever party may be in power, I consider it to be my duty’ to place this matter before the Senate and the people of Australia. I say that we ought not to be called upon to pay a single farthing of interest for any money raised for the purpose of defence. We should abandon entirely the system of voluntarism in this connexion. There should be a levy made upon every man from one end of the Commonwealth to the other, according to his capacity. For what purpose was the wealth census taken? Some people suggested that it was taken for the purpose of the conscription of life. I say that even if that were the purpose, it could be used equally well for the conscription of wealth. When I moved my amendment here I outlined a scheme which I believe is perfectly workable.

Senator de Largie:

-The honorable senator’s scheme went only half way.

Senator STEWART:

– Half way is better than none of the way. Senator de Largie was not prepared to go with me half the way. If I had proposed to go the whole way I do not know what he would have done or said. I say that my scheme is perfectly workable and intelligible, and it is the only fair scheme for the people of this country. Our debt in a very short time will . amount to nearly £200,000,000. The annual interest payment upon that sum will be within cooee of £10,000,000 a year.

Senator Lt Colonel Sir Albert Gould:

– What about the State debts?

Senator STEWART:

– I am not troubling about the State debts just now.

Senator Senior:

– The same people have to pay both.

Senator STEWART:

– I am dealing solelywith this debt of the Commonwealth, which will be’ wholly unproductive. Even if we come out of the war successfully, all that we shall have to show for it will be our independent existence as a community. But the people of Australia will have to pay annually £10,000,000, and if the war goes on for another two or three years, heaven only knows how much our debt will be, and how much the annual interest payment we shall be called upon to make. This is a burden which ought not to be placed on the shoulders of the working people of Australia. We hear a great deal about the taxation of the rich, and no man believes more in the taxation of the rich than I do. . One of the fundamental planks of the Labour platform has been to alter the incidence of taxation, so that the burdens of government, which hitherto have been borne by the patient working class, shall be carried by those best able to bearthem. I make bold to say that a very large proportion of this annual interest payment to which I have referred, unless our taxation is fundamentally altered in its incidence, will be borne by the working people of the country. I have not the slightest doubt about that, because with all our wisdom, skill, and patriotism, we have not yet got within measure of a proper scientific, honest, and just system of taxation. I think that the loan money required ought to be raised by a levy. Let me give an example to show how the levy would . work. Suppose a man had property worth £1,000, and the levy is 5 , per cent., his payment would be £50. If a man had property worth £10,000, the levy upon him would be £500. If a man had £100,000 worth of property his contribution to the levy would be £5,000. If a man had property to the value of £1,000,000 the levy upon him would be £50,000. If I were worth £1,000,000 Ishould be very pleased, not merely to lend the Government £50,000 without interest, to be spent in the defence of my property, but to make them a gift of the £50,000. I would ask neither for principal nor interest, and I think I would be making a very good bargain. I mention this merely to show honorable senators howit would pay the wealthy people of Aus tralia to adopt the plan I have suggested. I honestly believe it is the only fair and just method of raising money for the defence of the country.

Senator de Largie:

– The honorable senator knew that I had three pigs.

Senator STEWART:

– I think that honorable senators should at least be serious when discussing a matter of so much importance. -The condition of the country at present is very much too difficult and serious for any ill-timed jesting. So much for raising money to carry on the war. I do not wish to dwell any longer upon that aspect. I want to say a few words with regard to raising money for current expenditure. Here, again, the Parliament of the Commonwealth is utterly at sea. Our system of raising revenue is wholly unscientific, and falls with crushing effect, not upon the rich people, who are in most cases merely the vehicle through which it is paid, but upon the great mass of the workers of the country. We raise nearly £4 per head per annum through the Customs, and I say that 90 per cent, of that amount is paid by the working people. Then, again, we have income taxation. Many politicians believe that income tax is paid by the people who have the incomes. But here again I think Iam well withinthe mark when I say that at least 75 per cent. of income taxation is passed on, just as Customs taxation is passed on, and ultimately falls upon the shoulders of the people who do the work of the country. That is not the policy of the Labour party or the ideal of the Labour movement with regard to taxation. Indeed, it is altogether opposed to any principles which the Labour party may have upon the subject. Yet while there is to be an increase in the Federal income tax, and whilst, in addition, we have an income tax levied by every one of the States, the first method for the raising of money for the purposeof government that ought to be adopted is almost wholly neglected by this Parliament. I refer to land values taxation.

Honorable Senators. - Hear, hear !

Senator STEWART:

– I know that, in the case of’some honorable senators, that “ Hear, hear” is ironical, but never mind-

Senator Guthrie:

– The day will come.

Senator STEWART:

– AsSenator Guthrie interjects, the day willcome. I do not intend to read the Senate a lecture upon land values taxation, or upon the justice of the community taking to itself the values which it creates. The justice of this must be abundantly evident to every one. What surprises me is that, having had the Labour party in power, with a majority in one House of this Parliament, and with an overwhelming majority in the other House for several years, we have not gone in for a thorough and effective system of land values taxation*. I never could understand why the Labour party were so kind and so tender to the land monopolists. It was one of those mysterious circumstances which I never could get to the bottom of. I do not understand it yet.

Senator Grant:

– I shall explain that to-morrow.

Senator STEWART:

– I hope the honorable senator will. If he does, he will do something which I confess my utter inability to do. Having the thing within’ our grasp, having the power in both Houses,, having the country behind us, and having the ball at our feet, that we should lose the opportunity is something which I can never under-, stand. Now, unfortunately, the opportunity is gone - I will not .say for ever, but at least for some considerable time. There never was a time in the history of Australia when the need for dealing with this question was greater, or even so great, as it is at the present time. We hear a great deal about providing for our returned soldiers. We can read day after day in the newspapers about schemes proposed for settling them upon the land. Money is being raised for the purpose here, there, and everywhere. Various State Governments are in the market to buy land on which to settle the men who are now shedding their blood in defence of their country. I say that nothing we can do for those men will be enough. We ought, and I hope we will, do the best we can for them. But unless we destroy land monopoly, what is going to happen? How many of these men are we going to settle comfortably on the lands of this country? We know perfectly well that the very best lands in every State, and in every portion of every State, are still in the hands of the monopolists. I read a proposal the other day to give returned soldiers farms worth £4,000, and another to give them farms worth £2,500. The thing is ridiculous. I know people in Queensland liv ing within easy distance of myself who are making a -comfortable living upon £500 worth of land. I say that any man who has £4,000 worth of land is a fool if he does any work. He could let his land *to some one else at 5 per cent, per annum, and draw £200 a year for doing nothing. The idea of settling a returned soldier upon £4,000 worth of land seems to me to be so utterly ridiculous as not to be worth a moment’s consideration. One fact I wish “to dwell upon in this connexion is that with such a huge demand for land as there must be, if any large proportion of bur returned soldiers decide to adopt this method of making a living, the price of land must inevitably go up.

Senator Guthrie:

– If they happen to come back.

Senator STEWART:

– A very large proportion of them will come back. With such a huge demand for land, its price will inevitably go up,’ and will become so extravagant that country life will be even less attractive than it is at the present moment. But not only have we the returned soldiers to consider- we have the people of this country. We have the future of this continent to take into account. Let us look at the position. I say that there is an altogether disproportionate number of people in Australia living in our cities. We hear a good deal about the high cost of living, and of how it is continually rising. But while we have the number of persons growing food1 steadily decreasing,” with the number of persons who are consuming it just as steadily increasing, it is as inevitable that the COSt of living should rise, as it is that the sun will rise to-morrow. If the people want cheaper food the lands of Australia must be thrown open to them, and inducements must be offered to many who now live in our cities to go into the bush and make a living there. Inducements must be held out to the bush-born population of this continent to remain in the bush. Unfortunately, owing to landmonopoly, thousands of our bushmen and bushwomen are driven into the city every year. There is a continual drift’ from the country into the towns.

Senator de Largie:

– Why? Because they can get a better living in the towns.:

Senator STEWART:

– That is true, and the reason they cannot get a good living in the country is largely because the price of land is so high that unless a man is a small capitalist he cannot get a holding. If he rents a place his rent will_ be so extortionate as to prevent him making a decent living out of it. Last year I gave one example of this which might be multiplied by hundreds even in Victoria. I told the Senate of a case in which a man paid £430 a year to his landlord for the use of 140 acres. There were two parties to the bargain - the landlord who provided nothing but the land, and the tenant. The landlord received an income of more than £400 a year from the farm, whilst the individual who worked it. and owned the cattle upon it, received about £80 from it. Such cases might be multiplied many times over even iu Victoria. In circumstances like these people will not remain upon the land. If the positions were reversed there would be some inducement for men to go upon the land and to stay there. But, unfortunately, this state of affairs is prevalent in every State of the Commonwealth. Until the evil is destroyed the people will never have a fair opportunity of making the best out of the land in which they live. The Labour party had an opportunity of dealing with this vital question. It is the most vital of all questions which affect the people of Australia. There is no other question which is of equal importance to them, and there -is no other quesMon which every political party burks so zealously. Whilst we have these evils in the country, we have all the evils of monopoly in our cities. We have heard of allotments that were sold in Melbourne fifty or sixty years ago for practically a song, and which to-day are worth £100,000. How has that value been created 1 Who created it ? The owners of “the properties or the people of Australia? The people of Australia, of course. But the owners get the added value, and the people have to pay. for it. Where such a state of things is possible the great mass of the people will never get their heads much above a slave condition, j do not care how high their nominal wages may be, their real wages will be very much lower than appears on the face of things, because their earnings will be filched from them by means of profits, interests, rents, &c. Any political party which desires to do something effective for the workers cannot neglect this great question of land values taxation. This ought to be our first line of revenue. In stead of being a minor line it ought to be the principal line. To-day the unimproved value of land in Australia approaches £600,000,000. I know that a return recently issued sets it down at between £400,000,000 and £500,000,000. But my experience is that when people value their own lands they nearly always undervalue them. Consequently, I place the unimproved value of land in this continent to-day at £600,000,000. At 5 per cent, that would mean £30,000,000 per annum, which is now finding its way into the pockets of the private owners of land, and which ought to go into the public Treasuries of the various States. There has been a good deal of plain speaking here to-night, and I think that the time has arrived when there should be more of it. The time has come when the land tax exemptions laid down by the Federal and State Labour parties should be entirely swept away. Either the communitycreated value belongs to the people of this country or it does not. If the community created that value, the community ought to get it, irrespective of whether a man owns £100 worth of land or £1,000,000 worth. Of course, I am bound by my platform to vote on this question in a particular way, and I am now speaking more from a propagandist stand-point than from any other. Good government in this country demands that there should be no exemptions from land tax. I trust that those parsons who believe in the principle of land values taxation will see the necessity for sweeping them away. Land monopoly, as I have said, is one of the greatest evils which can afflict any community. Not only do the values which are created by -the community pass into the pockets of private individuals, but land which is held out of use for speculative purposes is indirectly a tax on the community.

Senator de Largie:

– Hear, hear; that is the land we want to get at.

Senator STEWART:

– We want to get. at all land - at the land’ which is used, and the land which is not used. Unless, a man’s faith carries him the whole way in connexion with this matter, it is of very little value to- the people of thiscountry. The present Government aregoing to be a little more lenient in regard, to income taxation than were the late Government. I am not very sure that they are not right, for the reason that an. income tax is a tax upon industry and. enterprise. My theorywith regard to taxation, is that we ought to get all the community-created value first. If that is not sufficient, we should then have recourse to other methods of taxation. But with us the position is reversed. We get the bulk of our taxes from the Customs House, from income taxation, which is all passed on to the multitude, and various other indirect systems. Landvalues taxation can never be passed on to the multitude. That is the one fundamental difference between it and every other kind of taxation. _ Customs taxation is passedon, income taxation is passed on-

Senator Bakhap:

– The Government propose to increase the income tax by 25 per cent.

Senator STEWART:

-Seventy-five per cent. of the income tax will be passed on ; I have not the slightest doubt about that.

Senator Bakhap:

– Does the honorable, senator contend that land values taxation would not affect the prices of commodities ?

Senator STEWART:

– Unimproved land values taxation, if it was imposed in such a way as to be effective, would affect the prices of commodities, but not in the way which the honorable senator seems to expect. It would affect commodities in this way: that many of them would be very much cheaper and more accessible than they are now. What is making living so dear ? I have dealt, or attempted to deal, with this aspect of the question already, but for the benefit of the honorable senator I will repeat what I said.

The PRESIDENT:

– I hope that the honorable senator does not propose to transgress the Standing Orders by repeating what he has already said.

Senator STEWART:

– I will only refer to the matter very shortly, sir. Land values taxation would increase production, and increased production would mean a reducing of prices, and that, in turn, would affect in a very substantial fashion the people who live in cities. Income taxation is a tax on industry and enterprise, and that is what I wish bo sink into the minds of honorable senators. During the debate to-night some honorable senators seemed to favour the taking of the wartime profits over 7 or 8 per cent. If that is done, what will happen? If I am in a business and the Government say to me, “ All that you can make out of your business is 7 per cent. on the capital,” how much more am I going totry to make ?

Senator Keating:

– Why should you ?

Senator STEWART:

– Why should I? If any honorable senator was working on a wharf and was told that anything he made over 10s. a day would be taken from him by the Government, would he ever earn a shilling more than that sum? No; not a penny more.

Senator Ready:

– Suppose that he knew it was a direct contribution to the cost of the war?

Senator STEWART:

– He would not . care what it was. He would say, and very rightly say,”Iam willing to pay my fair share of the cost of the war with the other citizens of this country, but I object to a particular tax being laid upon my shoulders.”

Senator O’Keefe:

– How can you make a fair comparison between a wages man and a man who is putting up prices all the time in order to get additional profit ?

Senator STEWART:

– A man can make more profit, and does in 90 cases out of 100, not by that method, but by extending his business, by increasing his sales, by doing more work, by passing more money through his hands.

Senator Keating:

– By taking bigger risks.

Senator STEWART:

– Yes.

SenatorO’Keefe. - Is not your objection that the business man puts up his prices too much and makes his profits “too large ?

Senator STEWART:

– The honorable senator seems to think that business men can do whatever they like with their prices. But let me tell him they cannot.

Senator O’Keefe:

– Are not a lot of them doing it, and so getting unfair profits?

Senator STEWART:

– What I wish to point out to the honorable senator is that wages and freights have gone up, that everything has gone up to the business man. I went into a shop the other day to buy some woollen underclothing, and I found that I. had to pay 100 per cent. more than I paid some time ago.

Senator Guthrie:

– German-made goods ?

Senator STEWART:

– No, they were English made. In the first place, the price of wool has gone up; in the second place, the freight to Britain has gone up ; in the third place, wages in Britain have gone up; in the fourth place, the freight back to Australia has gone up; and, as the honorable senator knows, insurance rates have gone up.

Senator Guthrie:

– Buy colonial stuff and save the freight.

Senator STEWART:

– The wages of the shopmen in Australia have gone up. In fact, everything has gone up, and every one of these ‘items is expressed in the price which I paid.

Senator O’Keefe:

– Do you not think that his profits have also gone up ?

Senator STEWART:

– I cannot tell the honorable senator, but my little experience of business proves to me that it is not in times of high prices that business men make the best profits. It is when prices are low, and when purchases are very much freer and more common. .

Senator O’Keefe:

– What about the shipping freights?

Senator STEWART:

– Have I not been pointing out the increase in the shipping freights? Why does the honorable senator blame the shipping companies? I do not blame them. For every ton of freight which they can carry they take the best prices they can get. I have nothing to say in regard to the shipping companies, but I have something to say about the Government which did not commandeer every ship on the coast of Australia, and in Australia, when the war broke out. I think that we had a Labour Government in power then, so that if anything has gone wrong it is not the shipping companies which are to blame, but the Government which permitted that sort of tiling to take place. Even if the Government had commandeered the ships they would have found that they would have had to put np their freights, because wages, ‘ insurance, and everything else have gone up. When that happens the price of a particular commodity with which a person is dealing must also go up. When honorable senators think that they are going to get the best out of the country in the way of taxation by an income tax or taxation of that character, in my opinion they are on the wrong track. What they ought to do is to get back to the community-created value; to get at something which cannot be passed on to the great multitude; to get at something which will free the natural resources of the country to the people, and in that way enable them to make comfortable livings. In all seriousness, it seems to me that we ought to go in for economy. In Australia we have been spending money since the war began upon’ things which are of no earthly use to us at the present moment. W& have spent upon railways millions which ought to have been spent on the war. Wehave spent on the Federal Capital large sums which ought also to have beenspent. on the war. Expenditure of that kind in every corner of Australia ought to be cut down to the narrowest limits. I shall be told, “ If you do that you will throw a large number of people out of employment.” That may be the case, but as against that I put this consideration: There are 300,000 men withdrawn from the labour market of Australia. Is it necessary that we should now spend huge sums of loan money in keeping theseother men employed?

Senator Mullan:

– It is always our duty to find work for the unemployed.

Senator STEWART:

– Yes.

Senator Bakhap:

– Have not the unemployed any duty to find work for themselves ?

Senator STEWART:

– From many parts of the country we hear complaints of the lack of labour. There are many places in which we are told labour is so> scarce that almost every activity has been stopped. Yet we hear now and again that there are numbers of unemployed in the country.

Senator de Largie:

– You cannot get men in the cities to go out to the country and do that.

Senator STEWART:

– Unfortunately we cannot.

Senator Mullan:

– You cannot get a painter to learn shearing in a week.

Senator STEWART:

– Men can very soon adapt themselves. What I am about to say may not be palatable to some people, but I think it is absolutely necessary in the interests of the country that it should be said. There must be a limit to this coddling of the people who live in the cities. There must comean end to it. We have approached perilously near the danger-point now. In fact, I am not very sure that we have not got beyond it. Are we to be compelled to continually borrow money to find work for people in the cities when the great, empty spaces of Australia are calling out loudly to them?

You may pursue that policy if you please, but it can end only in social and political perdition; nothing short of it. It will absolutely ruin this country if a policy of this kind is continued very much longer. I know that this statement will not be popular. I know that many men who belong to the Labour movement will say that I ought to be garrotted, but I am convinced that what I say is true. Things have come to this pass now, that I believe it is the bounden duty of every man to say exactly what he thinks. The conclusion I have come to is that there are too many people in our cities, and too few people in the country, that there are great empty spaces calling out for habitation and occupation.

Senator Bakhap:

– And the. bigger a city the less patriotic the people.

Senator STEWART:

– That is a matter which I do not intend to touch upon. I do not know whether the people are patriotic or unpatriotic. . All that I say is that we have arrived at a position where we cannot continue to borrow money to keep people in the city. Here again the Labour party has lost a magnificentopportunity. We have been talking about a Tariff for years. The time was when we could have passed a really Protectionist Tariff. Can we do that now?

Senator Grant:

– You could never have done it.

Senator STEWART:

– We could. We had the numbers. We had a party pledged to Protection. One of. the great objections I had to the late Leader of the Labour party was that he was a Free Trader. I believe his influence in the Cabinet and in the party is mainly responsible for the fact that we have not a Protectionist Tariff in Australia to-day. We cannot get a Protectionist Tariff now.

Senator Guthrie:

– Why?

Senator STEWART:

– Look at the adjustment of parties. The Labour party has lost its opportunity again.

Senator O’Keefe:

– You have a pretty strong Free Trader, over there in Senator Pearce.

Senator STEWART:

– I know. I did not want to mention them all, or I might have mentioned his name also. I do not say that these men were not as conscientious as myself. All I say is that the party had an’ opportunity of establishing a Protectionist Tariff, which would have given a largeamount of employment to the people who live in cities that they will not have the chance of getting in the near future.

Senator Guthrie:

– They have the same opportunity now.

Senator STEWART:

– I do not think so. I should be very glad to think we had the same chance.

Senator Bakhap:

– As a Protectionist, I ask the honorable senator and other Protectionists if it is not one of the defects of a Protectionist policy that it accentuates the tendency of the people to dwell in big cities?

Senator STEWART:

– I admit it. No policy, except that of land taxation, is free from some objection; but even with that drawback, I should be still prepared to advocate a truly Protective” Tariff. Some honorable senators seem to think that we are in as good a position from a Protectionist point of view now as we used to be, but we are not. We have certain obligations to our Allies. A ‘Conference was held in Paris earlier this year, at which a trade policy, intended to embrace all the Allies, was sketched. Our Prime Minister was there, and represented Australia.

Senator Turley:

– That is not so; he represented Great Britain.

Senator STEWART:

– That may be technically correct; but, all the same, we are in the same boat with the Allies, and when the question of trade with allied countries comes up Australia will not be in the same position as she was before. I wish to impress upon every honorable senator the absolute necessity of taking, not only the war, but the trouble we are going to have in Australia, seriously. The moment the war is over, or very shortly after, Australia will, I believe, be plunged into a position which has never yet been known in the memory of people now alive.

Senator Henderson:

– Are you sure it will be necessary for Australia to trouble herself about that?

Senator STEWART:

– We cannot be sure about anything; but I hope it will be. War is one of the most uncertain things.

Senator Bakhap:

– You are sure of the necessity of winning the war?

Senator STEWART:

– Yes ; and I am sure of the necessity of having some regard for what will happen here after the war. We are practically floating at present upon a bubble of borrowed money, which may be pricked at any moment. There is peace in the air. and within a comparatively short period the war may end, because those who read history know that on many occasions war has ended just as suddenly as it began. We may he fairly sure that when this war ends we shall have a period of stagnation and difficulty greater than has been experienced by any man now living in Australia. We ought to do our best to face that difficulty when it arises. I trust that, no matter now parties may differ, and whatever troubles they may have amongst themselves, the members of the Parliament of’ the Commonwealth, when the question of Australian interests is at stake, will act as Australians, and not as mere partisans.

Debate (on motion by SenatorRussell) adjourned.

page 9709

ADJOURNMENT

Sale of Wool Clip to Great Britain - Vacancy on Works Committee.

Senator PEARCE:
Minister for-Defence · Western Australia · ALP

– In moving

That the Senate do now adjourn,

I have to furnish the following information regarding the question of the sale of the Australian wool clip to the Imperial authorities which Senator Millen asked should be supplied : -

With - reference to your memorandum of the 30th November, relative to certain representations made in the Senate on the 29th idem by Senator Millen on the subject of the wool clip, 1 am directed by the Prime Minister to forward the following information for communication to-the Minister for Defence: -

To deal with all matters in regard to sale of the 1916-17 wool clip to the Imperial Government, a Central Wool Committee was elected by a Conference representative of all sections of the Commonwealth wool industry.

The Central Wool Committee comprises eight members, two of whom are wool-growers, three representative of selling firms, the directors of which in each case are mainly wool-growers, and an independent chairman, who has been a wool-grower.

The buying, manufacturing, and scouring interests are represented by one member each.

Senator GARDINER:
New South Wares

.- Will the Leader of the Government consider the desirableness of taking as the first business of the Senate to-morrow the election of a member to fill the vacancy on the Standing Committee onPublic Works? It would meet the convenience of practically all the members of the Senate if that were done. I promise the Minister, as far as I can promise it, that there will be no unnecessary delay in taking the vote. Probably it would be as satisfactory to the Ministry as to the rest of the Senate to have the matter settled.

Senator Pearce:

-There is no objection on the part of the Government to that course being followed.

Question resolved in the affirmative.

Senate adjourned at 10.40 p.m.

Cite as: Australia, Senate, Debates, 13 December 1916, viewed 22 October 2017, <http://historichansard.net/senate/1916/19161213_senate_6_80/>.

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