7th Parliament · 2nd Session
The President (Senator the Hon. T. Givens) took the chair at 3 p.m., and read prayers.
– I present the final report of the Select Committee on Intoxicants, ‘together with minutes of evidence and appendices, and move -
That the paper be printed.
– I rise to refer to the report of this Select Committee, because when the motion to appoint it was before the Senate, I had to bear the censure of many people who thought that I had no right to oppose it. With . a knowledge of Select Committees, I felt that the members of the Select Committee on Intoxicants would find themselves in the summer time at Hobart, and . in the winter time at Cairns. I find that they only got as far as Brisbane in the winter time, but they were in Hobart all right in the summer time. I have seen press references to. the. report and findings of the Committee, and it would appear that, so far as -its inquiry is concerned, we are now just about where we were before its appointment. There seems to have been a divided opinion amongst the members, and they were unable to come to a unanimous decision. Most inquiries by Select Committees’ of this character end in. a similar way, and I have risen merely to remind the Senate that the inquiry by the Select Committee on Intoxicants has ended exactly as I pointed out it would end, when its appointment was moved for.
– I think it is the most natural thing in the world that the members of any sensible Select Committee –
ThePRESIDENT (Senator the Hon. T. Givens). - Order! The honorable senator must confine his remarks to reasons why the paper should or should not be printed.
– I am in favour of the motion for the printing of the paper. The members of the Select Committee on Intoxicants went to very considerable trouble to secure evidence from all classes of persons who they thought would be able to give testimony which would enable them, if possible, to come to a unanimous conclusion upon the subject of their inquiries. A perusal of the whole of the evidence secured by the Select Committee should be most interesting to anyhonorable senator- who takes the trouble to acquaint himself with it.
– Especially Senator Grant’s cross-examinations.
-It will be found that on every opportunity that presented’ itself, I asked the witnesses appearing; before the Committee their opinion on the effect of a land tax. It was most reasonable for the Committee to visit Perth, as it, had full instructions and power to do so. We arrived there in a good season, butI understand that, the seasons are. always good in the West.
– Order ! That has nothing to do with the’ question of the printing of the report.
– The document is a very interesting one, and from ‘cover to cover will repay the most thoughtful perusal. If honorable senators, after perusing it, are unable to come to a decision on the. vexed question with which the report deals, it will not be the fault of the Select Committee. .
.- Should I be- in order in moving an amendment upon the motion?
– Then I move-‘ as an amendment -
That all the words after the word ‘” That “’ be left out, with a view to insert in lieu thereof the words “ the report, before being printed’, shall bo referred to a Board of Conciliation and Arbitration.”
– The amendment is not seconded.
Question resolved in the- affirmative:.
Land Settlement of Returned Soldiers
– I ask the Minister . for Repatriation whether his attention has been directed to a statement made by Captain a’Beckett, of Berwick Shire Council, at the Repatriation Conference, held at Dandenong, and reported in the Age of 20th November, to the effect that, in his district, land had “been sold to returned soldiers, though it was well known locally that other people had failed to make a success of their holdings, owing to the land being subject to floods, and that the present supervision in regard to the purchase of land was inadequate. Will the Minister inform the Senate upon whose recommendation the land in .question was purchased, the name of the owners from whom purchased, the amount of purchase money, and from what fund the purchase money was paid ?
– It is not possible for me to answer the honorable senator’s questions now,, but I should like to say, first of all, that, although. I have not seen the paragraph referred to hy the honorable senator, I had an opportunity of reading a report of the Conference appearing in the press a day earlier. The honorable senator should be aware that the land settlement of returned soldiers is a matter entirely controlled by the Lauds Department of the several States. If he will supply me with a copy of his questions, I shall undertake to forward them to the Victorian Minister for Lands, and invite that honorable gentleman to ‘make such comments upon them as he considers advisable.
The following papers were presented : -
Defence Act 1903-1918. - Regulations amended.- Statutory Rules 1918, Nos. 281 and 282.
Bill presented, and (on motion by Senator Pearce) read a first time.
– I ask. the Minister representing the Minister for the Navy whether it is a fact that there are 100 cases ‘ of influenza on board one of the Australian troopships which has returned to Sydney?
– I take it that the honorable senator is referring to the outbreak of influenza on board the s.s. Medic. My information is that the vessel is returning to Sydney, but at latest advices she had not reached that port. We have been informed that. there are 100 cases of influenza on board the steamer, which was recently in the vicinity of New Zealand, and had been ordered to touch there by the Admiralty authorities. I appealed against the troops being landed there, and the Admiralty then agreed to order them back to Australia. At present it is not quite clear whether the vessel did call at any New Zealand port. She is now returning to- Australia, and it is reported that she has 100 cases of influenza on board, but whether the outbreak is one of ordinary influenza or Spanish influenza I do not know.
Internment or Mr. Kiely.
– I have received from Senator O’Keefe an intimation that he desires to move the adjournment of the Senate until 9 a.m. to-morrow, in order to call attention to a matter of urgent public importance, name])’, “ the continued internment of persons arrested in Australia under the War Precautions Act, and the methods adopted iu arresting such persons.”
– I move -
That the Senate at its rising adjourn until 9 a.m. to-morrow.
Four honorable senators having risen in their -plates in support of the motion,
– I am submitting this motion because I regard its subject-matter as ‘ of sufficient public importance to come within the category of urgent matters, and because of a letter which I received yesterday from a man named Kiely, who is confined in the Darlinghurst Detention Camp, and whose case I first brought before the Senate many weeks ago. On 26th September last I asked the Minister for Defence (Senator Pearce) a question relating to the case of this individual, who had been arrested on the North Coast of Tasmania. Later on, either on a motion for adjournment,, or in connexion with a Supply Bill, I again referred to the case, giving the Minister such information as had been placed before me, and expressly stating that I had no personal knowledge as to what were the facts. However, I did express my desire that Kiely should be told in open court what were the charges upon” which he had been arrested. On the 2nd October last I put the following question to the Minister : -
Has any investigation been made into the charges against the man named Kiely, who. was arrested in Tasmania a few weeks ago under the War Precautions Act? If so’, where was such investigation made, what was the nature, and what was the result, of such inquiry ?
To that the”- Minister replied -
An investigation was made on evidence submitted to the Department. It is not proposed at this juncture to make public its nature. The result of the investigation was that it was thought desirable that Kiely should be arrested. Consideration is ‘being given to the question -as to whether there should be a magisterial inquiry in this case, and a decision will” shortly be given.
The statements made to me were made directly by a member of the Tasmanian Parliament. I have never yet met Kiely, and it was with some surprise that I received from him yesterday a letter which, if the statements contained in it Ve true, shows that a most lamentable course has been pursued by the authorities in his case. The letter reads -
I have noticed that a few weeks ago you asked some questions of the Minister for Defence concerning my case. I will now give you the full details, previous to and since my arrest and internment. My name is Michael Kiely. I was born at Illowa, Warrnambool, Victoria, on the 1st of November, thirty-seven years ago, of Irish parents. Therefore,_ I am not of hostile origin, unless the authorities _ regard Irishmen as such. During the last eighteen years I have suffered from ill-health. I have been treated by a number of doctors, but gradually grew worse, until three, years ago I was advised by one of them to try a change of air, as my system evidently would not respond to medicine. I took his advice, and went to New Zealand, where I remained for twelve months, which greatly improved my health. But on returning to Victoria I became as bad as before. I then decided to try another change, so I went to Tasmania, accompanied by a friend, landing in Hobart, where we stayed for four months,’ again greatly improving my health. While in Hobart we were told by the owner of the hotel where we were staying that we were liable to be arrested, as detectives had come to him making inquiries as to who we were, as to where we came from, and what we were doing, and if we seemed to have much money. Haying done no wrong, and paying 20s. in the pound, of course, we took no notice. But on leaving Hobart we went to Devonport, where we stayed a week. While there we met Detective Summers on several occasions. He never questioned us as to who we were, or anything else. If he did, we would have told him the truth. But w’hen we. left for Ulverstone he had wired ahead to two Secret Service men to watch the train for us when we arrived. They were there, and shadowed us to our hotel. Next morning, when we were leaving, we were stopped in the street by these men, who closely questioned us as to who we were and as to what we were doing in Tasmania; also our nationality and religion, which they carefully took notes of - I being an Irish Australian and Roman Catholic, while my friend was an Australian also, but a Protestant, which accounts for him not being where I am to-day. For, if there was anything against me, the same would apply to him. On leaving Ulverstone we went to Burnie, where we were arrested on the night of 25th June. Three police and a detective came -to ‘where we were staying, and demanded admittance to our room. When admitted, they addressed us in this manner : “Is this where ye are now? I see ye are shifting about from post to pillar. Have you. got any firearms?” When told we had not, and what would we require them for, and when we asked what all this, was about, we were told to accompany them to the police station, where we would find out what we were wanted for. They had plenty opportunities for arresting us during the day, but they waited until night till we were in bed to do so; and this was the means of causing us more trouble and anxiety. When at the police station a warrant was read to me, which stated that in view of my hostile origin and associations I was to be interned till the end of the war. - There - was also a warrant for’ my friend, but his was a search warrant; but as the search of his luggage, as well as mine, revealed nothing to incriminate, they immediately discharged him. But they detained me, and I was removed to a cold cell to spend the night, bail being -refused. I was sent on to Hobart the following morning, where I had to spend that night again in a. dungeon, all bail being refused, although any bail that was required was forthcoming. Next morning I was brought before military officials, who- informed me that I was to remain here until Saturday morning, which was three days later, to be sent by boat to Sydney to be interned at Holdsworthy. This was rather a shock to me, and I wanted to know why they were taking such action. But they told me they did not know. They had the warrant, and they had to carry out their instructions; but I would know when I got ‘to Sydney. The warrant stated that any representations made to the Minister would be considered by him. While waiting in the Hobart gaol I wrote to the Minister/ giving all particulars of my case, and stated I was prepared to make a sworn declaration as to the truth of my statements. But no action was taken, not even an acknowledgment of my letter. When the boat was to sail I was escorted down the street by five military officials. It would appear to those who knew me while I was in Hobart that they were making friends with a criminal. My frail constitution by this time had again given way from want of sleep and unsuitable food, which I could not eat. When I landed in Sydney the authorities were evidently discovering their mistake, for I was met at the wharf by more military officials, and removed to Darlinghurst gaol, despite the fact that the officer who escorted me over had full instructions to deliver me at Holdsworthy Camp. When I arrived at Darlinghurst they informed me that they were going to make a few inquiries, with the result that I have been interned with the Irish seven, here in Darlinghurst. I again wanted to know what the Minister meant by such action, but no one could give me any information as to the charge I was arrested for. That is five months ago, and I am just as wise to-day. Again, the conditions did not suit rae, as I had to eat food that did not agree with me, and was daily undoing what had taken months, in Tasmania to build up at a considerable cost. I consulted the gaol medical officer day after day, and explained to him my true position, and what the. result would be if I was forced to continue on as I was. But he only kept on prescribing medicine for me. But when I informed him that medicine was of no use, and that I had been long ago advised by medical men to give it up, and that what I required was. suitable food, I met with the reply that I must remember that I was in Darlinghurst, and not in Usher’s Hotel or in a hospital. I then tried to get a sum of money which was taken from me when I was arrested, and which I was entitled to get when I landed in Sydney, so I could buy suitable diet. I applied to every officer in the barracks, and explained the reason I required it for, but met with the same reply from each - “ I will .see what I can do for you.” Nine weeks had passed before I could obtain same. By this time my health was broken down, and I was removed to the hospital; but after a week there I was sent back as bad as when admitted. A few weeks later I was again admitted, and after a week’s treatment 1 was again sent back, but no improvement . whatever. I was then suffering greatly, for food of any kind would not agree with me, and sleep was almost out of the question. Seeing that the military doctors did not understand, or did not want to understand, what was wrong, and it appeared to me that they thought I was a malingerer, and consequently did not bother much with me, I then requested to see a specialist, which was granted. And, although I agreed to pay all expenses, it took a week before he would be admitted, as the Chief Medical Officer had stated there was very little wrong. When admitted, and when he could not locate the trouble by an examination, he requested an X-ray examination, which was granted. But nearly three weeks had passed before that event took place. When it did, weeks -more passed before the result was made known. In the meantime, I had to suffer severely. When the result came to hand it disclosed a serious state of the stomach, which required an. operation, which has been performed.
I have just pointed out the above facts to show you how an innocent man is treated in supposed free Australia. As the war is now ended, I suppose I will soon be liberated. But before that event takes place I want to know why I have been subjected to this treatment, and who has been responsible for giving the false information which led to my arrest. My friends in Victoria will also want to know. I had done nothing when in Tasmania to earn for me the penalty I received. I have been a peaceful, law-abiding citizen all my life, who has never injured any one, either individually or collectively. And I am sure my reputation is far above any of those responsible for my arrest. There was one incident that happened which may have been responsible for it. While at Devonport I stayed at a hotel kept by John Luck. One night, when seated in the bar parlour, the proprietor, who is a councillor, and another councillor, returned from a meeting. There were a few others also in the room. One of those men started a conversation on the war, and the part the Irish were taking in it, and said that they should be shot. Luck replied, “ The Irish are all right. They have done a lot for the Empire. It is their leaders that ore to blame.” “Yes,” replied the. young mon, “ we got some of them here - Mannix and a few others - that should be interned or deported.” I was very unwell the same evening, and had no~ desire to enter into an argument. However, I could not stand an honorable mon like Dr. “Mannix being abused by men who knew nothing about him. I asked them did they ever hear or see him. They said, “No,” nor did not want to; but they ‘had read the reports of his disloyal speeches. I then said it would be an unscrupulous judge and jury that would condemn a man on the evidence obtained in a biased newspaper, and that I heard himself state that when he read his own speech he could not recognise it, it was mutilated to such an extent. I then stated that if they were fair-minded men they would want to hear him before they should condemn, and it is a strange fact . that any man who has heard him has- never written against him, owing to the fact of being so honest, straight-forward, truthful in his statements, and it is a pity that we have not got a few more men in Australia like him, who have the courage of their opinions and who are not afraid to express them. And it was n blessing for Australia the day Dr. Mannix was sent here, for he, no doubt, played a big part in keeping us free from the conscription yoke. That was more than Luck could stand. The very name of Dr. Mannix was to him like a red rag to a bull. He went mad with rage, and, stamping his feet on the floor, said, “ Get off .my property.” Although it was 12 o’clock at night, and I was very’ ill, and n the prospects of getting -another place very re-, mote, I immediately left. About two weeks later I was arrested by Detective Summers, of Devonport.
However, if what 1 have said is responsible for the treatment I have received, I can assure you that if I was liberated to-morrow, and the same was to happen under the same circumstances, I would adopt the same ‘attitude. The manner in which 1 have been treated shows that justice in Australia has got to a pretty low level. And the account which I have given seems almost incredible, but, nevertheless, every item is true, and I am prepared to make a sworn declaration to that effect.
Thanking you again sincerely for the action you have taken on my behalf.
I hold* no brief for this man. I have never seen him, and do not know him, and was surprised when I received a letter from him. Where was the necessity for the continued internment of a man who said he was willing to make a sworn declaration of the truth of the tilings he has stated to be facts in that letter? He was born in this country. Surely, it would be quite easy for the officials to discover whether his statements are true or not, and whether or not he is a dangerous character. Surely, it was not necessary to do more than give him a chance in open Court to reply to his accusers, whoever they were, because he did not know who had accused him. Prom his letter he evidently suspects that he was arrested because of a conversation that took place in the hotel that night, but he does not know. The request I made here previously in the public interest, and not at the urging of the man himself , that cases like this should be heard in open Court,” is perfectly fair and legitimate. That was a good while ago, and even five or six weeks ago the Minister for Defence (Senator Pearce) said there would be an investigation, but that he had not yet decided whether it should be public or private.
The. letter I have read, is dated .15th November, and the writer says that he is as wise now as to the cause as he was when he was arrested. Colonel Clark, the Commandant of Tasmania, told me when I interviewed him, that the man was arrested by order of the Defence Department on evidence given by him. If the arrest was justified, that would be the proper course to pursue, but I presume that the authority of the Minister was first secured. If the Commandant of Tasmania heard that a man had said certain things, and considered that he should be arrested in the public interest as a precautionary measure, that would be a right step to take; but the man, according to his own statement, which he is willing to support by a sworn declaration, has never been given an opportunity of confronting hia accusers, or knowing the charges on which he was apprehended. Why did not the Min.ister take him at his word when he said he was willing to make a sworn declaration as to the truth of his . statements ? This man’s liberty is as dear to him as that of Senator Pearce is to himself,, and even in war time no mail’s liberty should . be taken from him without sufficient reason. If those in authority are sure they have sufficient reason, they will be doing only bare justice to the man whose liberty they take away if they give him an opportunity to reply ‘to the charges, and to be confronted with those who accuse him, instead . of keeping him interned for a number of months on the ex parte statements of two or three men, all of whom hold diametrically opposite political opinions to himself. Apparently, the only reason for his arrest was some public statements made by him in a public place - statements which the military authorities considered dangerous to the safety of the community. _ If the statements were publicly made, surely the charge should have been heard1 publicly, *and a proper tribunal given a chance, with the witnesses before it, to weigh the value of the evidence. If the man’s only offence was to stick up for Dr. Mannix, who has just as much right to his political views as those persons who were so violently and bitterly opposed to him on that occasion have to theirs, 1 submit that there was no crime, even if Dr. Mannix’s critics thought he should be interned or deported.. I am not saying whether Dr. Mannix’s views are right or wrong, but this man had as much right to support them as the other persons had to oppose them. If a man’s liberty may be taken from him on grounds of that sort, no one in Australia is safe in war time, or even now, because the same law is still in force. “ Any man in this chamber, except Ministers, if he made similar statements 100 yards from this building, might be deprived of his liberty in the same way and in the same circumstances. At all events the power exists and was evidently used on this occasion. Under such a power any one might be arrested and locked up for months without being given an opportunity to speak in his own defence.
From the day on which the Minister said that an investigation was to be made, but that he had not decided on the form which it should take, six weeks passed until the 15th of this month, when the above letter waswritten. Ifthe Minister was so busy before he spoke that he had not time to see into the matter, he should have made the investigation, or had a tribunal appointed to make it, immediately after he spoke. An extra six weeks in gaol to a man who says he is a chronic invalid is a serious matter. It may not appear much in the eyes of some of the Defence officials, or of the men in whose care this man is now, but it may be very serious to a man in such a grievous state of health that an operation had to be performed, on the advice of a specialist, after an X-ray examination, despite the opinions of the medical officer. If the man’s statements are not correct, they should be easy of disproof. If they are correct, somebody ought to be punished. Certainly the medical officer there ought to bebrought to book, and all others responsible for this man’s treatment should receive their deserts.
I should not have brought this individual case forward if I did not know that other cases have occurred where men’s liberties have been’ taken away without their being fairly satisfied as to the reasons. In the opinion of nine-tenths of the people of this free country - and it should be free now if it has not been free for the last four years - the time has arrived when all these men, who have been interned on charges similar to this, should, in the name of common fair play and political decency, be immediately granted a public trial, and allowed to be publicly confronted with their accusers. As they have been publicly arrested, impugned, and disgraced, they should be given the same public chance of clearing themselves. Now that hostilities have ceased, that chance should he afforded them, or they should be immediately released. Either one thing or the other. If the Minister and the officers of his Department still think that this man should be interned,there is ‘ only one alternative, namely, to give him and others who have been similarly treated a publicchance to confront their accusers and answer the charges brought against them.
.- I take exception to Senator O’Keefe designating this gentleman, and any others who have been similarly arrested, as political prisoners. I say that “neither this man nor any of those other men. to whom I have referred is in that sense a political prisoner. Kiely was interned as a precautionary measure in view of the fact that we were at war, and because of evidence submitted as to his attitude in regard to the war. An inquiry into his case has been ordered.
– That was six weeks ago.
– The necessary instructions were sent to the Commandant in Tasmania to select a magistrate to conduct the inquiry.
– ‘Seven weeks ago.
– The instructions were forwarded on the 14th November. The Commandant was advised to fix a date for the inquiry and to arrange for Kiely to be sent down from Sydney to attend the hearing. Senator O’Keefe will understand, of course, that the inquiry could not take place in Sydney. It must be held in Tasmania, and, therefore, arrangements must be made to bring Kiely down from New South Wales to Tasmania for that purpose. Itmay be that any delay that has occurred has been due to the fact that, as stated in the letter read by ‘Senator O’Keefe, the man’s health is unsatisfactory. Possibly owing to the operation which he had to undergo, the authorities thought fit to delay his removal. However, I am not in a position to say what caused the delay. I only know that instructions were given to the Commandant to make arrangements for the inquiry.
I do not propose to discuss the merits or demerits of Kiely’s internment here. It would not be proper to do so; but I can assure the Senate that his arrest was not carried out in a haphazard way. His case was fully considered. As Senator O’Keefe himself has correctly stated, the District Commandant took action on evidence which apparently he thought fully justified that course. The evidence was forwarded to Melbourne and considered by the General Staff, which recommended his internment. It was then considered by myself, and by me taken to Cabinet, which approved of the course recommended.
– Can the Minister say if the man was given a chance to give evidence, or was his internment decided on the evidence of a number of other people?
– I am not going to discuss the meritsor demerits of his case here. I am telling the honorable senator just what happened and the procedure adopted, so that he may understand that his. internment was not ordered merely on the fiat ofthe military authorities, but that his case was fully considered by the civilian Government of this country.
– Do you not think that, before this time the man ought either to be, liberated or shot?
– No, I do not. There is a half-way course, and wethink we took the right action.
– But he should have had a fair trial.
– If we were satisfied - sand I say the Government were satisfied - that there was a danger to the community in time of war with this man at large, we had a right to detain him until such time as the danger had passed. There is no necessity for the drastic course suggested by Senator Long.
I do not propose to discuss this matter further than to say that Kiely’s case and the case of one or two other men who are British subjects are not in the same category as those interned subjects of enemy origin.
– But how does the Minister justify the detention of this man so long without a trial ? . .
– Because the question of trial must be determined by the Minister. That right is deliberately taken away from the subject concerned by the War Precautions Act, because it is clear that there are some cases which, if brought to trial while the country is at war, would reveal to the enemy the internal provision’s made for the defence of the Commonwealth.
– In other words, he was arrested because he dared to speak in defence of Dr. Mannix.
– No. That is merely the ex parte statement of the man himself. That was not the ground upon which he was arrested.
– But I do not see why five months should elapse since his arrest without informing him of the nature of the charge.
– In the case of some such internees four years have elapsed.
– So much the worse then for the Department.
– So much the worse for this country that the war has lasted so long.
It is the element of war that determines when these men may be safely released. If the war had not occurred, none of them would have been arrested and interned, and apparently it is this existence of a stateof war which the honorable senator refuses to realize.
– I have never forgotten it.
– The 25th November is- the time fixed for the fulfilment of the -conditions of the armistice, which is the first step in the direction of peace ; but it is not peace. Until the 25th of this month we shall not know whether the enemy are prepared to carry out the conditions of the armistice or not, and not till then shall we be able to. contemplate changing our attitude in regard to certain matters connected with the war. To-day there is an armed truce, and until the German and Austrian Empires indicate that they are going to carry out the conditions that have been laid down,it would be foolish on our part to throw down our arms, because this authority to intern’ certain subjects is one- of the measures for the internal defence, of the Commonwealth. Until we have ascertained definitely that the enemy intend to fulfil the conditions of the armistice we shall not be justified in assuming that we are at peace.
Kiely’s case, with a number of others, is not exactly on all-fours with those of interned British subjects of enemy origin, but the time is now approaching when we shall be able to review the whole of them. When the conditions under which they were arrested and interned have passed away, it will be possible for .the Government to say there is no longer any necessity to detain these men - I am speaking of British subjects. That time is approaching, and the Government are already considering and discussing what action they shall take in regard” to this class of cases, of which Kiely’s is one, although he is in a somewhat different category, since he is a British subject of British birth, whilst others in the same class are British subjects of enemy origin. In all these cases She action taken has been with a view to ‘precaution.
There was an alternative course which the Government might have pursued in many of these cases. They might “have instituted prosecutions under the War Precautions Act.
– Hear, hear!
– There are some cases in which, no doubt, that would be advisable, but I remind Senator O’Keefe that while that might result in the punishment cf an offender, it might not remove the danger. In deciding the course to be pursued, it was necessary to consider whether a particular case was one in which the person charged might have acted, possibly impulsively, but wrongly, and whether, if he were punished for his wrong action, that would be sufficient to prevent the commission of similar offences, and thereby secure the safety of the Commonwealth. It had to be considered also whether a case was of such a character that though the man’- charged might be punished, .the danger arising from his offence would continue to exist. Those are matters which the Government had’ to take into account in deciding in particular cases whether they would proceed by internment or by punishment through the Courts of the land. In this case the Government took the course which they believed to be right,, and in view of the circumstances decided that it was a case for internment. That was the. step taken, and it was taken as a precaution for the defence of the .Commonwealth.
Senator O’Keefe and honorable senators generally may feel sure that no Government of this country will lightly, and without due reason, intern a British subject without trial and without going through the ordinary processes of the Courts. The Government had to be assured that the evidence was such that, if presented to a Court, there would be no doubt that it. would secure conviction and punishment, and, perhaps, imprisonment.
– How could the Government know that without having heard the evidence of the other side?
– I say, judging by the evidence submitted, and in considering that evidence, regard must be had for the persons- who give it.
– The Government accept the word of people on one side, and do not give the offender a chance.
– We do not accept the word of’ people in such matters without taking into consideration the circumstances in which their evidence is given, the position they hold, and” whether they may be actuated by improper motives.
It is not an agreeable thing for any person in this community to give evidence which he knows will result in depriving another person of his liberty, and especially in the case of an entire stranger. If we take the case of this man Kiely, he was travelling about the country, and what motive could people in Tasmania have in swearing falsely against him ? He was nothing to them. There was no. business consideration which might induce them, for instance, to endeavour to put a possible rival out of their way. There was no improper motives of that kind prompting them to take action.
– The man’s statements show that he thinks that the persons responsible for his internment had a motive, and that it was not a proper motive.
– In his letter the man quotes evidence that I never heard of.
– Because the Minister never gave the man a hearing. .
– He says that that was the evidence on which he was interned.
– No; he says that that was the evidence which might have led to his internment - that he does not know of any other reason.
– Let me assure this man, through Senator O’Keefe, that if he thinks that he was interned because he defended Dr. Mannix he is altogether mistaken. He was not interned for that at all. That is not the evidence on which lie wa3 interned, and it had no bearing whatever upon his internment.
All I can say, further, is that an inquiry is to be held into his case. I shall inquire why it is delayed, but I expect, after hearing the man’s letter read, that I shall be told that the reason for the delay is that the man is not in a fit state of health t6 travel, owing to. the operation performed upon him. ‘
May I direct attention to this man’s letters to show the treatment he has received whilst he ha’s been interned.’ I venture to say that no one can urge that he has been badly treated. The loss of a man’s liberty is, of course, a serious thing, but I doubt very much whether prisoners interned in .Germany would be allowed to have a specialist called in to consider their case, in addition to the medical officer provided by the prison. ‘
– The facts show the necessity for calling in a specialist in this case. The specialist called in said that an operation should be performed, whilst the medical officer had denied that there was any necessity for it.
– What I am saying is that the evidence supplied by this man himself shows that he has received every consideration from the Commonwealth authorities in the way of giving him the advantage of medical skill.
– He paid for the specialist himself.
– Probably he did, but his own evidence shows that he had the best possible .medical attendance provided for him.
– I do not think that is anything about which the Department should boast. . It was only failtreatment.
– I am not boasting about it; but I want the honorable senator not to assume that this ‘man was badly treated, as is sometimes said outside for the sake of gaining the applause of a small :and unthinking section of this community.
I have nothing further to add. In this case the Commonwealth Government, after a full review of the evidence submitted to them by the police authorities in Tasmania, took action which they believed to be necessary in the interests of the safety of the country. I have said that an inquiry has been ordered, unci that the delay in connexion with it has probably taken place because of the illhealth of the man himself. As regards the class of cases, of which this is one, I have said that the time is arriving when we shall be able to review them, and decide whether the conditions, under which men) pf this class have been arrested have passed away. If we find that they have, and. that we can with safety release these people, they will be released.
– I shall not delay the Senate at any length in discussing this matter. I do not think the question has cropped up as to’ whether this man was given good or had treatment > in the internment camp. There has been no complaint on the score of his treatment. But even the ordinary fair treatment of internees might not be considered very suitable for a man suffering from an internal complaint, as this man ^appears to have suffered, since it was necessary that he should undergo an operation. It may be true,, as the Minister for Defence (Senator Pearce) suggests, that the delay in inquiring into the case i3 due to the ill-health of this man-
I quite agree with the Minister that, for the safety of the realm, it may be necessary to imprison people upon suspicion, but I do say that, in cases where the person charged claims to be absolutely innocent, and particularly if he is a person not of enemy origin but Australian born, there should be an immediate prosecution and trial. I recognise the difference between internment and imprisonment. If after a trial a man is convicted on the evidence, and sent to prison, that carries with it a certain disgrace which does not attach to internment, which is due merely to the fact that the Government suspects that the freedom of the particular individual for the time being may affect the safety of the country. There must be a distinction drawn between a man who is merely interned and a .man charged and found guilty of interfering with the Government in such a way as to prevent them safely conducting the war. Senator O’Keefe was good enough to let me read this man’s letter, and I am bound to say that- there is something in its tone and in the connected record it gives that convey to my mind the impression of innocence. If Kiely is an innocent man, and also an ailing man, surely five months in an internment camp is a very grievous infliction to impose upon him. If his ill-health is the cause of the delay of the inquiry into the case it is quite time that the Minister expedited that inquiry.
I am aware that , the Minister has many opportunities of knowing both sides of a case, and I recognise that if there is to be an inquiry this is not the place in which the honorable senator should make statements as to the reasons for which the Government interned - this man. But I am deliberately of the opinion that within the last .two years quite a number of men have been interned for insufficient reasons.
– And improper reasons, too.
– I may go to that extent. Although these men have the protection of a Cabinet inquiry I ask’ what time or opportunity have the members of the Cabinet to inquire into the rights or wrongs of the charges alleged against these men ? They have none. The statements of their officials must be ac*cepted by them as proofs strong as Holy “Writ. It is merely a matter of the Cabinet deciding that the charge appears to be sufficiently well founded when there is created in their minds a suspicion that .the safety of the country requires the -internment of the person charged. But the very conditions of wai- should render it necessary when there is an assertion of innocence, and a demand for an inquiry, that a fair investigation should take place into every case brought before the Minister. I have myself to-day received a letter complaining of the internment- of a certain person, but until I know more of the facts of the case I shall not take the action which Senator O’Keefe has been warranted in taking in view of the letter in his possession in this case. I am convinced from that letter that this man has nothing to be ashamed of, and need not be afraid of an inquiry.
– -Does the honorable senator not think that the Government would be silly to intern any man on the evidence given in that letter.
– I might have had a better opinion of this Government a week ago, but from recent events I am perfectly satisfied that the finer feelings such as consideration for others, are not to be found in the breasts of the representatives of the Government in the Senate. I say that seriously, because it is possible to judge men by little things.
– If a man makes a false statement on oath he renders himself liable to prosecution for perjury, and this man is willing to make a sworn declaration.
– Here is a man who writes a letter which bears on the face of it the impress of truth. He may be an expert in deceiving people, and he may have misled Senator O’Keefe, as well as myself, but I say that the impression conveyed to my mind after reading the letter, not in the spirit ‘ of one desirous of championing his cause, but critically and. closely, is that the Department and the Government have been at fault in this case. Judging only by that letter, I urge the Minister for Defence to take a personal interest in this matter, and have an inquiry into the case made as rapidly as possible. If -this man is innocent, not only should he be released, tout I think he should be compensated for having been detained for five months under conditions’ which must have been intolerable for & person in ill-health.
-Colonel ‘ O’LOGHLIN (South Australia) [4.4]. - Several cases of this kind have been brought under the notice of the Minister for Defence (Senator Pearce), and in connexion with them all he ‘has taken up the position that the evidence submitted justified the internment of the men. But I put it to hon?orable senators to say whether any evidence is sufficient to justify a man being deprived of his liberty when he has had no opportunity of stating his case, and rebutting the evidence brought against him. The weakness of the position taken up by the Minister in every case is that he assumes that an ex . -parte statement of those responsible for having the. persons interned . is sufficient to justify him in’ taking this arbitrary action without giving the accused any opportunity whatever of stating his defence, or put-, ting a different construction upon the evidence brought against him. We have arrived . at a time, fortunately, when peace is assured. We are all rejoicing over that result, and all feel in a magnanimous and generous frame of mind, even to those who may have differed from us in regard to the war. Would it not have been more in ‘Consonance with the jubilant feeling experienced throughout the country if the Government had declared, whilst Ave were celebrating the victory of the Allied Forces, that all persons who had been interned during the war should, as an act 6”f grace, be immediately released?
I shall conclude my remarks by quoting a. few. lines published in to-day’s newspapers from a speech delivered by the late Prime Minister of England, Mr. Asquith, in which he is thus reported -
Finally, he deprecated, in the strongest language, the conditions now forced upon the country. Restrictions on personal .liberty freedom of speech, and even compulsory service, for which he was largely responsible, must end. We must get back as soon as possible to the old atmosphere of freedom.
I commend those words to the attention of the Minister and of honorable senators. “We ought- immediately to get back to the old atmosphere of freedom which the exigencies of the war have prevented us from : enjoying during the past four . years.
Upon a few occasions I have found it necessary to bring under the notice of the Minister for Defence cases of internment in which I believed injustice had been done. One case was that of a man named Gailet, who was arrested at Port Pirie, removed to Adelaide, and placed under surveillance’ there. When he obtained employment, he was obliged,’ during his working hours, to report himself to the military authorities every three or four days. If. it was neces-sary for him so frequently to report himself, surely a time might have been fixed for him to do so, when he would not have been obliged to forgo a portion of hia wages by reason of the sacrifice of his ‘ working hours. .The last I heard of this man -was that, without having been afforded an opportunity of even seeing his friends prior to his departure, he had been removed to New South Wales with a view to his deportation.
– He must have been arrested under the Unlawful Associations Act. It could not have been a military arrest.
– I cannot understand why he was not allowed to see his friends before being removed to Sydney.
– The military law does not provide for the deportation of anybody, and consequently he must have been arrested under the Unlawful Associations Act.
– I think that Mr. Asquith’s words are extremely applicable to our own position to-day. “We are supposed to be living in a country where -
Girt by friend or foe,
A man may speak the thing he will.
If the necessity for these restrictions existed during the past four years, certainly it does not exist to-day. I repeat that the men who have been interned ought to be immediately released, if only as an act of grace.
– The reply of the Minister for Defence (Senator Pearce) evaded the main point connected with this case which is that, especially in the case of a British subject, it should have been easy to prove whether any of Kiely’s actions or utterances were a menace to the safety of the Commonwealth. It surely ought to have been very easy to determine this matter in open Court. At any rate, there is no justification for the Department having withheld for so long an investigation into his case. Particularly is this so in view of the fact that from the very beginning Kiely has expressed his willingness to make a sworn declaration of the truth of his statements. A man who can write such a connected letter as he has written is certainly no fool, and he must know that if he made a false declaration he would im- mediately render himself liable to a prosecution for perjury. In the circumstances, it would surely have been a fair thing to have taken him at his word.
– And have given publicity to that which it was undesirable to publish.
– Had Kiely deliberately attempted to use the opportunity thus afforded him of establishing his innocence, to make statements which were calculated to endanger the safety of the Commonwealth, he would have been immediately stopped by the presiding officer. Had he continued to disobey, he would have been punished for contempt of Court.
– Then a cry would have been raised that free speech was being denied him.
– No. People who are not traitors would recognise that, in such circumstances, freedom of speech had degenerated into licence. But the whole of . this man’s life is open to the public, and upon the merits of evidence adduced before an open tribunal, it ought surely to have been possible either to punish him or to acquit him. His claim to have his case heard is only a just one. Of course, I realize that the Minister must make out the best case he can for his Department. But his reply to-day convincingly shows that his case is a very weak one indeed: I ask leave to withdraw the motion.
Motion, by leave, withdrawn.
Bill returned from the House of Representatives with a message intimating that it had agreed to the amendments made by the Senate.
Bill returned from the House of Representativeswithout amendment.
Bill received” from the House of Representatives.
.- I move -
That so much of the Standing and Sessional Orders be suspended as will prevent the Bill being passed through all its stages without delay.
In submitting this motion, my desire is to get the measure on the business-paper, and then to proceed with the Income Tax Bill.
– Will the Minister be good enough to say what time he proposes to allow us to look through the Income Tax Bill?
– I should like to conclude the debate upon the first reading of the measure to-lay, to make my second-reading speech upon it, and then to adjourn the debate till Wednesday next.
– I cannot approve of the method that is being adopted by the Government in connexion with the transaction of our business here. We have had an Electoral Bill, consisting of 220 clauses and a number of schedules, rushed through both Houses of Parliament.
– Order! Our Standing Orders distinctly prevent the honorable senator from making any reference to a Bill which has already been passed.
– I am merely remarking that the measure was rushed through both branches of the Legislature.
– I am not proposing to rush the Land Tax Bill through Parliament, seeing that we have no desire to pass it until next week.
– If this is one of the Bills with which we have a right to deal at length on the motion for its first reading, we ought to have that right reserved to us.
– I am not proposing to disturb that right at all.
– Is it the intention of the Minister for Repatriation to deal with the Land Tax Bill first?
– No. .
– Is the honorable gentleman willing to postpone the consideration of that measure until next week? I do not wish to see the first reading of it dealt with, until I have had an opportunity of making a few remarks upon it.
– The honorable senator will have the opportunity of doing that.
– I will have a more extensive opportunity if the Leader of the Senate postpones the motion for the first reading until next week. Senator Millen. - I will not do that.
– Then I shall have to make my remarks on the measure next week. I Save the strongest, objection to the suspension of the Standing Orders. Such procedure does not conduce to smooth working. The opposition exhibited . in regard to the ‘ Electoral Bill was the more protracted because of the Government insisting upon the suspension of the Standing Orders. I hope the Leader of the Senate will not pursue a similar course now. Although we are getting towards the later stages of the session, there is no need for great hurry in connexion with the business im- ‘ mediately in prospect. . I understand, that the measures to be dealt with are not urgent. There is no reason to push them forward, as was the case with respect to the tax on kiddies’ pictureshow tickets. Honorable senators have the right at least to have the Bills in their possession for perusal for a limited time before those measures are- debated.
– There appears to be some misapprehension in the mind of Senator Grant. Whether the Standing Orders are suspended or not, his opportunity to speak at full length on the first reading will not be impaired. And, if the Standing Orders are not suspended, that debate can,- by the Senate following the Standing Orders, be conducted straight away. The only effect of the suspension of the Standing Orders would be that, after the conclusion of the first-reading debate - upon which honorable senators may travel far and wide - I would be permitted to- make my second-reading speech, and that was all I sought. If that course is not now adopted, the debate on the first reading having been concluded, the second reading would be made an Order of the Day for the next day of sitting, when I would then speak upon it. Thereafter, honorable senators opposite would ask for an adjournment, and that would put me in the position of being forced to say, “ You have had an adjournment over the weekend, and I cannot grant another.” All I ask is that I may be placed in a position now to deliver my remarks on the second readings of both the Bills about to be dealt with, instead of next week.
– *We would- then have to-day and to-morrow’s sittings to discuss the first readings of those measures.
– By the action which I am taking, I am not impairing honorable senator’s rights in the slightest degree; but I ask, if between the present moment and the rising of the Senate at 4 o’clock p.m. to-morrow, there is still time, that theSenate will permit me this week rather than next week to make my second-reading speeches.
Question put. The. Senate divided.
Majority . . . . 10
Question so resolved in the affirmative.
Bill’ received from the House of Representatives, and (on motion by Senator Millen) read a first time.
asked the Minister representing the Acting ‘Prime Minister, upon notice -
– The answers are : -
Carriage of Wheat
asked the Min ister representing the Acting Prime Minister, upon notice -
– The answers are:-
asked the Minister representing the Acting Prime Minister, upon notice -
– The answers are : -
Privileges of Employees
asked the Minister for Defence, upon notice -
Do military printing offices (manned by civilian employees) enjoy the same privileges, rates of pay, and holiday concessions as the State Government Printing Offices?
– Printers are employed by the Defence Department in New South Wales only, and the rates of pay are in accordance with the State Arbitration award. Holiday concessions and privileges are governed by regulations under the Defence Act, and in this regard they are treated in the same way as other civilian employees of the Department.
asked the Minister representing the Minister for Trade and Customs, upon notice -
– The information is being obtained, and will be supplied at a later date.
Taxation of Sweep Prizes - Revenue and Expenditure - War Prices and War Profits Taxation - Recoup of Expenditure on Munitions - War Loans in Canada and Australia - Parliamentary Control of Finance: Commonwealth and State Expenditure - Commonwealth Offices : “Australia House “ : Commonwealth Bank - Amalgamation of Commonwealth and State Departments - Government Control of Business Activities - Commonwealth and State Indebtedness : War Indemnity : Resolution of Perth Labour Conference - Land and Wealth Taxation - Cash Transactions,1918-19 - Loans ‘ to States and Transferred Properties - Additional War Taxation - War and International Finance-loss of Life by War - War Prosperity : Increase of Private Wealth-Wealth Census and Taxable Incomes.
– I move -
That this Bill be now read a first time.
Honorable senators know the privileges they have in connexion with the first reading of a Bill of this character. I therefore do not propose to deal with the Bill itself until I move the second reading, at a later stage.
– I direct the attention of the Minister to a very harassing practice which is giving people cause for a good deal of complaint, and bringing, so far as I can judge, no corresponding financial advantage to the’ Government. I refer to the collecting of arrears of tax upon prizes won in Tattersall’s sweeps. People who won very small prizes,I believe two or three years ago, now find themselves suddenly called upon to pay, in the shape of income tax, amount’s which seem to them most unfair and unreasonable. While they are called on to pay taxes on their winnings’ in Tattersall’s, however small, they are allowed no set-off for the amounts they have lost.
– Is the honorable senator complaining of the smallness of the prizes or the largeness of the tax?
– I am complaining of a practice which is causing the people a good deal of irritation, annoyance, and inconvenience. Many very poor people are called on to pay what to them are substantial amounts. One case brought before me involves a matter of 11s., which to us may not seem of much consequence, but it is a serious matter to a poor person, who won a small prize in Tattersall’s two or three years ago, to find himself suddenly called on to pay 11s. out of his present earnings: When the Senate agreed to the taxation of prizes in Tattersall’s sweeps it certainly had in its mind the taxation of the win- nings of people in a position to pay income tax. A person who , put in a shilling with a number of others, two or three years ago, and won a small prize, when he now finds the Department setting to work to tax him on his share of that prize, cannot help thinking that he is being imposed upon. I am sure Parliament would not have agreed to that retrospective form of taxation when the Bill was going through if it had been known that it was the intention of the Department to impose it.
– I am not quite clear now what the honorable senator is objecting to.
– I object to all taxes that are retrospective. I also object to the collection of arrears’ of tax, on small prizes from persons who ordinarily are exempt from income taxation. I am not objecting to people paying a tax on Tattersall’s prizes which they win after the passing of the law.
– They cannot be taxed if they won the prizes before the Act came into operation.
– Apparently they are being taxed.
– Only where the fact that they had won a prize was not disclosed until afterwards.
SenatorGARDINER.- I shall be glad ifthe Minister will look into the matter. I shall say no more about the Bill now., because I shall have an opportunity to speak on the second reading, that is, if the Minister is not going to do what he did with the Electoral Bill - saying that he was going to put only a certain stage through, and then putting the whole Bill through at one sitting.
– I. said nothing . of the kind.
– The Hansard report of my speech shows that, at one stage the Minister did make that promise.
– If the honorable senator and his friends set out to block business, I shall use . all the powers given by the Standing Orders to get it through.
– I have never blocked business, although the honorable senator has fooled his followers into be- lieving that I have. I have spoken at length only when I have found the forms of the Senate being used for an improper purpose:
– Reading the electoral rolls, for instance.
– That was the fault, of the Minister’s discourtesy in refusing to reply when an amendment was moved from this side. It was- the first time 1 had ever seen a Minister take that attitude.
There are thousands of cases where I understand the Department is collecting tax on Tattersall’s prizes won two or three years ago. People whose income is not sufficiently large for them to be taxed directly should not be taxed, for the sake of 2s. or 3s., on prizes they won some years’ back. I shall call attention to several provisions in the Bill as they are reached at a later stage.
– I am pleased that we have at last time to discuss the financial outlook of the Commonwealth. We were promised that this would be a session largely devoted to finance, but there are only a” few weeks between now and Christmas. I hope that a good deal of the intervening time will be given to the consideration of the financial outlook, because now that the war is happily in course of being ended, the most important question before the country is the repatriation of our soldiers, and that will demand enormous sums. Withthe present financial . outlook, the greatest possible care is needed in the expenditure of our Commonwealth income to make it possible to do what we should like to do for our soldiers alone. We should, therefore, offer no apology for giving every thought to the most important matter of our financial prospects.
To boil the Budget figures down, and make them easily comprehensible, I find that the estimated Federal expenditure “for the” current . financial year is £45,344,595, while the estimated revenue, including extra taxation to the amount of £5,356,000, totals only £40,670,000, leaving a deficiency on the year of £4,674,595. That gap is to be made up by surplus revenue brought forward from last year, and by various odds and ends, but the fact remains that we are not paying our way even with the additional taxation now before us, which ‘ I am assuming will be passed. One way to make our cloth fit our coat is to see that it is properly cut.
People do not sufficiently recognise how hard Australia has been hit financially by the war. Apart from the enormous expenditure which the war itself has involved, there is no doubt that, because of our isolated position, practically in a backwater, the want of freight has hit us very hard indeed. In comparison with other nations which have been at war, and with neutrals, we have not received war prices for Australian commodities. I do not blame the Old Country, because she had important duties with which even our financial stability cannot be compared. She had to save her people from starvation, and to bring the American troops across the Atlantic to win the war. No one will -deny that those matters are infinitely more important than even the financial stability of Australia. The Old Country has treated us remarkably well, but we have to look facts in the face, and the facts show that Australia has not received anything like war prices for her goods.’ We have received for our wool ls. 3 1/2d. per lb., which would be a’ very high price in ordinary times, but in America they are receiving 2s. 7£d., and in Canada over 2s. 7d. per lb. Australia is receiving for her wheat crop only 4s. 6d. per bushel as a’ general rule, with a little more for small shipments to other parts, whereas in Canada and America nearly 10s. per bushel is being paid. Before the war the enormous American cotton crop brought about 5d. per lb.. The Americans are selling their cotton now at, ls. 94d.. per lb., and that brings in enormous quantities of money to the United States. I do not claim that the wool-grower, or the wheat-grower, or the producer of butter in Australia ought to get the extra money, but if we had been “ paid what I call really war prices for our products we should have been freed, by the use of our War-time Profits Act, from all financial trouble in Australia. The British Government received for ten months only from their war profits tax the immense sum of £221,000,000. With one-tenth of the population of the Old Country, if we had received a corresponding amount from our tax the Treasury would have obtained a revenue of £22,000,000, instead -of the £1,000,000 that it has actually received.
– Most of the British profits come from shipping and munitions.
– If the honorable senator traces the matter out he will see that the shipping is a part of the commodities which they sell. They sell the shipping to Australia at very high unrestricted prices. Here we have restricted prices for everything we produce. It will be found that a good deal of Australian money went into tlie £221,000,000 receive’d by the British Government under the war profits tax. When things settle down somewhat, and the Government of the Old Country can look round, we ought to bring before them the question of whether Australia should not have some share of the receipts from that tax. It would be only a fair thing.
Take, also, the question of munitions. Australia pays for all her munitions. The Old Country gets its munitions from a number of private firms, such as Armstrongs. Those -firms are making fabulous war profits. Australia is paying those, war profits, and the British Government take 80 per cent, of them. That money goes into the War Profits Tax Fund.
– Did Australia have to pay for the munitions that she used in the war?
– Yes. for every shell, cartridge, and gun received. She pays every farthing, not of the cost price, but of whatever price the private firms; like to charge, and that price has been enormous.
– The shareholders in those firms are. patriots !
– The British Government’ get 80 per cent, of it back.
– It would be only - fair to Australia if representations were made to the British Government for some return to this country in regard ‘ to expenditure on munitions used in the war.
– There should be no private profits in the manufacture of munitions.
– I quite agree with the honorable senator.
– And no profits in the manufacture of armaments of war, or anything of that nature.
– I am entirely of that opinion, and we all hope that this war, which has placed an enormous strain upon Australia, may be the last.
I do not say that the individual woolgrower, the wheat farmer, or the butter producer ought to get more than he has been getting for his products, but if our producers do not get full war prices Australia will be placed at a disadvantage with the other nations of the world that have been carrying on this war. I think the question I have raised is well worthy of serious consideration. I do not for a moment blame the British Government. They behaved magnificently towards us; as, in addition to standing an enormous financial strain to maintain their own forces in the field, they have actually bolstered up other Allied Powers, and have bought a great deal of our wheat and our wool, much of which is still lying here. This is something which no other nation on the face of the earth would have done. We might have been left to stew in our own juice had theMother Country chosen to overlook us, but I think, as a matter of equity, the question I have raised should be fairly and courteously placed before the British Government, so that Australia may get a fair proportion of the war-time profits obtained from the manufacture of munitions, which, no doubt, is. now rolling into. . the British Treasury. Everybody should be treated on fair and proper lines. If Australian producers had had the benefit of war prices, our woolgrowers ought to have got at least 2s. 5d. for their wool. I do not say they wanted any more than ls. 3id., which they have received, because- at that price they are well paid, so long as it is not all taken away, as I think it will have to.be, in taxation. The wheatgrower is in the same position. No doubt he is feeling the effect of this taxation, although 4s. 6d. is a payable price when taxation is at a reasonable amount. In view of these facts I think that if some arrangement could be arrived at on the lines I have suggested, we would be doing no injustice to the Old Country, while, at the same time, we would certainly be doing justice to Australia. We must remember that very many of our boys have died,’ we are sorry to say, more in proportion than those from any other part of the Empire. We have done our fair share in the fighting, and- we ought to see that we get a proper deal in the distribution of finances after the war, chiefly that we -may treat our returned soldiers in a thoroughly satisfactorymanner.
Canada has been in a favorable position in this war. Owing to her geographical situation she has been able to get tremendous prices for her products; and she has manufactured an enormous amount of war munitions. With all these advantages Canada borrows money at’ 5^ per cent., and the other day a loan of 100,000,000 dollars was largely oversubscribed. The interest rate - - per cent. - is free of income tax, whereas Australia pays only 4-^ per cent, free of this obligation and 5 per cent, less Federal income tax. Evidently the Canadian Government desires to attract capital to the Dominion by offering liberal terms. However, that is not a matter which I desire to stress to any great extent. So far we have keen able to get all the money asked for, but we should realize that Australians who have contributed to the Commonwealth loan on a basis of 5 per cent., less Federal income tax, which will probably reduce the interest to 3 per cent., have shown considerably more patriotism than- Canadians, who get 5^ per cent, for the money they advance to their Government.
I have seen it stated in the Old Country, and I have no doubt that honorable senators will agree with the statement as applied to Australia, that Parliament has pretty well lost control of the finances. One can easily realize how this might be when one peruses our bulky Estimates, about 1 inch thick, of foolscap paper simply smothered with figures. It is impossible for any honorable senator to take even a proportion of the Estimates and be to some extent responsible for them. During the war, also, Ministers had an enormous amount of work to do. Ministers come and go. There have been about twelve or fourteen’ changes in the Government since the inauguration of the Commonwealth. Ministers have to attend Parliament, answer questions, make speeches, ‘ attend Cabinet meetings, as well as numerous outside functions, and then they are supposed to control their Departments. This is absolutely impossible in the circumstances, so we shall have to think how we are going to meet the situation, with estimates of expenditure swelling from year to year in a most remarkable way. ‘The Stales, I think, are beginning to realize that they are coming to the end of their tether! They have been told that there is to be no more borrowing in the Old Country, and it is getting harder for them to obtain money out of the Commonwealth” Government nowadays. This shows that they are approaching the end of their spending time, ‘and I think it is well that.it should be so. From 1901 to 1914 the States were spending, principally on new works, £9,000,000 a year, and during the first two years of the war, when everybody expected that they would cut down expenditure, they managed to spend £20,000,000 of borrowed money. It is just about time, therefore, that the States realized that they must > cut down expenditure. There is no getting away from this fact, because our obligations in regard to repatriation will take all the money available. State Government expenditure increased by £3,231,488 in the first two years of the war. It is astounding that iri a time of war, witu which the State Governments had nothing to do, their expenditure should have increased by that amount. I express the hope, also, ‘ that the Commonwealth Government will -try to curb their energies in this direction, because the extravagance of the . States is simply a flea-bite compared with the extravagance of the Commonwealth, although, of course, we have the excuse that Commonwealth Departments are -affected by the war, and, therefore, it could not be expected that Ministers should be able of late years to give such close attention to -the operations of” their, several Departments. But now that we are getting to the end of the war, we shall have to take the utmost care.
One thing that has always struck me, as a business man, when I ‘look round and see how Government money is spent, is the unsatisfactory condition of our Government offices. I make exception, however, in regard to the ‘RepatriationOffices in Jolimont. . These have been erected on good business lines. Unfortunately the same cannot be said of all the other offices which have been built at an earlier period. If on© visits the Vic’torian Lands Office, for instance, one finds that every man has a place to himself.’ Good business cannot be done in this way. In all modern banking institutions or other large private business establishments, the whole of the officers are readily- available, and accordingly the work is done economically.
– The honorable senator must recognise that the State offices to which he refers were built many years ago, and ideas have changed since then.
– Yes, and I think it would be wise to remodel many of the earlier ‘ Government offices. I do not know whether the Minister has had the same experience as I have, but whenever I visit some of these offices, although I have a certain amount of prestige, I generally go to the inquiry office, to find that the man who is supposed to .be there is absent, being away on some message, I presume. So, after looking around helplessly for some time, I have to seek directions from somebody else before .1 can transact the business that takes me there. Imagine the’ position of ordinary citizens, people perhaps from the country, when they find themselves in these offices, and how much time is lost by them before finally they seek the assistance of members of Parliament? These offices ought to be remodelled- and conducted for the convenience of the public. In any big commercial establishment the aim is to attract the public to ‘the various departments, but unfortunately if one visits some Government offices one has a feeling that the principal desire is to repel the public. We have splendid men in the Civil Service, but they should be provided with convenient offices for the transaction of their business. I do make exception, of course, to the Repatriation Office, which has been built on up-to-date lines.
– And those offices cost only £8,000.
– That is another feather in their cap. All the different Departments are properly ticketed so that any visitor to the building may find his way about at once.
We have a fully up-to-date office in London known as “Australia House.”
– And one in Sydney, the Commonwealth Bank.
– I think that both of those buildings might have been done without for many years. The Commonwealth Bank building, in Sydney, is, in myopinion, a most extravagantly expensive building.
– It is a marble palace.
– Yes; it is a perfect palace. I want to call special -attention to the tremendous extravagance of Australia House. I am sure that our High Commissioner in London is housed better than ever Solomon was “ in all his glory.”
– Wecould get our money back for it at any time owing to the position.
– I am glad to hear the honorable senator say that, and if that be so, I think that the sooner we sell Australia House the better. It cost over £1,000,000, and we are now paying interest upon it to the extent of some £30 000 or £40,000 a year.
– It is on one of the finest sites in the Strand.
– It is on a beautiful site in every way, and it may be a good advertisement for the Comjnonwealth.
– I think that it should have been erected in Trafalgar Square.
– It is done with now anyway, and I think that we should sell it. because we shall certainly want the money which its sale would bring. It is a good advertisement, no doubt, but a most expensive one, and I think its construction should never have been undertaken.
I am not at all satisfied with the fact that nothing has so far’ been achieved in the matter of the amalgamation of certain Federal and State Departments. The Treasurer (Mr. Watt) told us in his Budget statement what he had done in connexion with this matter, which, in my view, is of the utmost importance. We want our citizens to increase production, and to carry on their various businesses well, and yet I assure Ministers that half their time is occupied in preparing returns of one sort and another. I had hoped that the amalgamation of these Federal and State Departments would have been completed some time ago. Mr. Watt calls the State Premiers together in conference, and they have two or three hours talk, and then separate, and nothing is done. I do not wish to criticise without offering a suggestion, which I hope Ministers will give favorable consideration to.
– It is to be hoped the honorable senator will not make a suggestion which would rob State Ministers of their little trips.
– I am not concerned about their trips, but about the financial position of Australia, and the necessity for getting out of the financial mess in which we now find ourselves. Mr. Watt and the State Premiers are very busy men, and the amalgamation of the Federal and State Departments presents many serious difficulties, and cannot be solved by a little chat between Ministers. I do not care how able are the men who tackle this work, it cannot be performed in a few hours talk. It requires continuous . application, and thinking how continuous work might be applied to the solution of this great difficulty, it occurred to me that wehave a Committee of Public Accounts who might give the question continuous attention. I think that the amalgamation of the Departments might be referred to that Committee, with the request that they should give it continual attention until it is completed.
– To what Departments does the honorable senator particularly refer ?
– I believe that some amalgamation has already taken place of the State and Federal Electoral Departments, and Ispecially refer to the amalgamation of State and Federal Income Tax Departments. Land Tax Departments, and Probate Departments. As things stand at present, a man is compelled to make out two income tax schedules.
– Worse still, he has to pay two taxes.
– I am not sure that it is worse still. We have reached such a pass now that I assure honorable senators that when I learn that any estate with which I am connected has made big profits it almost makes me “ shud’der, because I know I must part with so much. It makes me shudder, because, if the profit be in lambs or calves, though they may be dead next year, I have to pay income tax in respect of them.
– It should console the honorable senator to reflect that he would have to make out the same return if he made a loss.
– That is so. Let me inform the honorable senator that the public are becoming fractious .about this matter. Those who returned the National party to power believed that these Departments would be amalgamated long ago. We might save vast expenditure in this way, and their amalgamation would certainly relieve our citizens of a tremendous amount of unnecessary work and worry. That should appeal to the Government as a desirable object to attain.
– The returns required for both Federal and State authorities are the same.
– They are practically the same. If the Government would request the Public Accounts Committee to go into this matter, and keep on worrying Commonwealth and State authorities until it is. completed, good, results would follow. Senator Earle is a member of the Public Accounts Committee, and I know that the honorable senator would worry the officials to death if they did’ not get this matter fixed up. If the Public Accounts Committee could bring about the amalgamation of these Departments they would deserve the gratitude of the whole of the business people of Australia. The heads of Commonwealth and State Departments have framed n Bill to give effect to this purpose, which, with a little revision, might be found .to act very well. If such a mensure were passed by the Commonwealth and State Parliaments, I think the difficulty would be practically solved. Under the Electoral Bill, which we considered so briefly this week, I believe there is provision for some amalgamation of the Federal and State Electoral Departments. The work cannot be done by an occasional conference with State Premiers. It must be taken in hand and attended to continuously until it is .completed.- If we do not do something in this matter before long I believe that the people will call for a change of Government.
– That would be a blessing.
– I do not say that the change of Government would result in honorable senators opposite getting into power. l am one of those who hope that before very long we shall do away to a very great extent with the existing control of the business of the community by the Commonwealth Government. I think that Senator Needham on a previous occasion read a list of the various Committees that have been appointed, but it might be of advantage to refer to them again. There is the Central Wool Committee, the State Wool Committee, the Sheep Skin Sub-committee, the Metal Exchange, the Shipping Board, Control of Shipping, Interestate Central Shipping Committee, Sydney Committee Metal Exchange. Naval Board, Naval Contract and Purchase Board, Central Coal Board, State Coal Board. Commonwealth Flax Industries Committee, Price Fixing Department, Council of Finance, War Savings Council, Central Stores Supply and Tender Board, Military Board. Board, of Business Administration, War Railway Council, Munitions Directorate, Commonwealth Repatriation Commission, State Repatriation Board, Commonwealth Board of Trade Bureau of Commerce and Industry, Institute of Science and Industry, State Committees of Science and Industry, Australian Wheat Board, Wheat Storage Commission. Commonwealth Winter Butter Pool - I wonder whether that will go on with its work in the summer - Federal Butter Committees and State secretaries, Leather Industries Board, Sulphate of Ammonia Board, Paper Control - I believe that is done away with-
– I could suggest still another Committee - a Committee of Public Safety to save the country from the, present Government.
– We have the Opposition in this Parliament for that purpose. An enormous number of Boards have been created to deal with war-time conditions, but I hope that the majority of them will be brought to an end as soon as possible.
– The honorable senator referred to the Repatriation Commission, which must continue its work. It is an honorary Commission associated with the Minister for Repatriation.
– That is so, and I am not objecting to it. I quite, understand that some of the Boards and Committees appointed must for’ some time continue their work.
– Most of the Boards and Committees are honorary.
– I hope that they are. They should all he honorary. It is, in my view, an honour to any’ man at such a time to be asked to serve his country on one of these Boards.
One of the best managed of these Boards has been the Central Wool Committee.
– Hear, hear ! They gave the honorable senator a big profit - 50 per cent, more for his wool than ever he got before.
– And all the profit is taken back in taxation.- It is not correct to say that we get 50 per cent’, more for our wool to-day than ever we did before. We did get more on one occasion. I have already said that no one can object to the present price paid for wool, but in America wool-growers get double the price that we get in Australia.
– Our wool was sent to America last year.
-Yes, where we got 2s. 7d. per lb. for it.
– Fifty per cent more than was ever received before.
– That is absolutely not the case j but it is not the matter with which I am dealing at the present time. If we wish to carry on the industries of this country and encourage the establishment of new industries, we must do away with the greater number of these Committees. I have said that the Central Wool Committee has been a most valuable Committee, and has carried out its work in a very capable manner. It is constituted of some of the most successful’ men in the wool trade. They are buyers, and know wool thoroughly, and have had to make their living by dealing in wool. The Committee has been a splendid body of business men. But after the war is over these men will not continue to give their services for the small pittance they now receive as members of the Central Wool Committee. If we should again revert to the public auction system in dealing with wool they wi:l leave the Committee, and we may have men from the Government offices filling their positions who may deal with the great wool industry which has been the backbone of Australia in such a way ss to bring it to a standstill. Already there are extraordinary restrictions imposed. When I visited a wool store the other day for the purpose of seeing some wool that I had up for sale, I was told by the valuer of it- that he was not allowed to speak to me. I asked him the reason why, and he replied. “ Look at the notice on the door.” I did so, and found that’ it stated that wool-owners were not allowed on the floor while wool was being valued. It appears that there had been a. case in which a wool dealer had approached one of the valuers with a view to bribing him. Had the reason urged been that while wool was being valued nobody was wanted on’ the floor of the wool store I could have understood it. But it was astonishing to me to learn that bribery was already creeping into these operations. If the present employees were to leave, and fresh men. with small salaries, were put in their places, I fear that the bribery which would spring up would be something staggering. ,
I think that we ought to follow what Mr. Lloyd George has pointed out is to be ….V procedure of the British Government. According to a press report of the 3rd August last, that gentleman spoke thus -
No one had ever dreamed of continuing the present system of Government control after the war. He agreed that this country’s strength before the war had lain very largely in ingenuity,’ self-reliance, adaptability, and resource of individual effort. At the same time, there was a “lesson of the war of good . work by the State in assisting and encouraging industries, coupledwith combined effort on the part of many industrialists.
I entirely agree with his statement. Great good can be accomplished by the Government in aiding any industry, but the continuance of State control of industries in the future will have a very bad effect upon them.
– Is the honorable senator prepared to take away control of the shipping to-day ?
– Certainly not.
– When will the honorable senator say that we should do it?
– As soon as possible after things have settled down.
– We should have a £20 freight to pay if we did. Where would be the wool profits in such conditions? Shipping must be controlled.
– We must control it until the laws of supply and demand again assert themselves - until all our troops have been repatriated, and the world has settled down.
– When will the world settle down?
– I do not think it will be very long. Mr. Lloyd George’ continues -
Magnificently as the business and industrial communities had shown capacity to organize before the war, he quite agreed that when the war was over the present absolutely necessary interference in business by the State must disappear .
Honorable senators who are not in business do not, perhaps, realize . the interference which is taking place. I hope that as soon as possible we shall get rid’ of many of these Boards of control, and particularly of the Board which is controlling shipping.
– And the Wheat and Metal Boards. .
– I hope we shall get rid of the Wheat Board as soon as possible, because the farmers would like to control their own supplies, and to transact their own business through the old channels.
– There is no hope of gettingour wheat away from Australia.
– But in another twelve months I imagine we shall have plenty of ships.
– There will not be plenty of ships available in less than three years.
– I am sorry to hear that. We do not wish to hamper people in the conduct of their business any more than is unavoidable.
The war-time profits tax is intended to apply only to the duration of the war. I hope that that will not be very long now. No man objects to paying his fair share of taxation ; but he feels the position very acutely if he is singled out to pay a tax whilst his neighbours are not placed in the same category. My great objection to the war-time profits tax is that it falls upon comparatively few individuals, who are making only small profits.
– War profits.
– Yes., But now that the war has practically ceased, the measure in question should cease to operate. It is a great deterrent to private enterprise. A friend of mine told me the other day that before the war he purchased a station in the interior of Australia. During the first year of his operations there he lost £12,000, and during several subsequent years he made a profit of £3,000 annually. Last year he made a profit of £12,000, thus recouping his first loss. His pre-war profits amounted only to £3,000 annually, and he now has to hand back to the Government, under the War-time Profits Tax Act. 75 per cent. of the £12,000 to which I have referred. Of course, I recognise that it is very difficult to deal with individual cases. It would be far better, therefore, to impose a straight-out income tax - to levy taxation upon all persons alike.
– Had there been no war, the honorable senator’s friend would not have made that £12,000 profit, because, during the war, he has received 50 per cent. more for his wool.
– I suppose that he had to pay about £6,000 in taxation alone. I know that the tax amounted to 64 per cent. of his profits.
– Still, he was better off than he would have been. in the absence of the war.
– And he saved his skin, too.
– I am surprised at that remark bySenator Guthrie. The gentleman of whom I am speaking is very old.Why, I ask, did ‘Senator Guthrie not go to the war?
– I did all that I could for it.
– And so did the gentleman of whom I have been speaking. I resent the honorable senator’s observation, because this gentleman has rendered an immense amount of public service. If I could give his name,
I am sure that Senator Guthrie would feel ashamed of his remark.
– Nevertheless he is alive to-day.
– And is he not better off, having made a profit of £12,000 during one year as the result of the war, than he would have been if he had made £3,000’ a year profit in the absence of the war ?
– But during the first years of the war he made a profit of only £3,000 annually, because he was engaged in building up his stock. ‘ Having built it up, he made a profit of £12,000 during one year. Had his capital been invested in any ordinary business he would have been taxed only to the extent that his neighbours were taxed, and naturally he feels a certain amount of resentment that he should have been singled out for special taxation.
– But he is still better off than is the man who gets a wage of £3 per week, and has a family to keep.
– According to the Commonwealth Statistician, there has been an increase in the cost of living of 74 per cent.
– Yet the people of Australia are better off in that regard than are those in any other part of the world.
– That does not help them.
– We are better off than are the people of any part of the world so far as necessary commodities are concerned. There are no food taxes in Australia. Moreover, the whole of our war expenditure is being paid out of direct taxation.
– Does the honorable senator not think that the man who makes £3,000 a year profit during the war is better off than is the man who gets a wage of only £3 per week, and has a family to keep?
– It all depends. One would have to ascertain what the” former individual owes.
– At any rate he will be able to get a little more in the form of luxury than will the man who receives only £3 per week. The latter cannot get any luxury, and very often lacks even necessities.
– That is a position which I would be glad to co-operate with the honorable senator in endeavouringto put right in any way that I can. We all want to see the people of this country able to maintain a fair standard of living.
The debts of Australia to-day aggregate £663,972,578.
– Those are State and Commonwealth debts?
– Yes. The indebtedness of the Commonwealth amounts to £284,220,072.
– That was on the 30th June last?
– Germany will pay that.
– hope that the honorable senator is right, and, in my opinion, Germany should be made to paysome of it.
– That was not the idea of the Perth Labour Conference, which proclaimed that there should be no indemnities.
– To give the members of that body the credit which belongs to them I may mention that they affirmed that there should be no “ penal indemnities.” I understand that to mean that even the Labour party stands for an indemnity of some sort.
– They declared that there should be no indemnities - not no “ penal “ indemnities.
– I do not often defend the Labour party, but I can assure Senator Guthrie that he is wrong, I happen to know how the word “ penal “ gotinto the resolution of the Perth Conference.
– Was the honorable senator there?
– No, but I have seen some one who was there. I understand that by “penal” indemnities the Perth Labour Conference meant that it would be quite fair for Australia to get back from’ Germany the money which she has expended on this- war. That was why it declared that there should be no annexations and no penal indemnities. In my judgment it would be a fair thing if Germany were called upon to pay interest on the £300,000,000 which the war will have cost the Commonwealth before it is over. That would represent about £12,000,000 annually.
– The Perth Labour Conference meant, then, that we should be recouped our ‘expenditure upon the war, but should not make any profit out of it?
– Exactly. A “ penal “ indemnity, means a punishing indemnity, and I understand that the Conference in question did not desire to punish Germany.
– Then I am surprised at its language. I think the honorable senator ought to have been a barrister.
– Senator Fairbairn is a lot closer to the truth than is the Minister for Repatriation.
– I shall accept the interpretation which Senator Fairbairn has placed on the resolution” of the Perth Labour Conference when that explanation is offered officially.
– I am glad to have thrown a little light on the matter, because it would be well that Australia should be represented as being unanimous in her desire that Germany should pay part, if not the whole, of our war debt. I hope that she will pay all. She went to war with us absolutely unprovoked.
– Does not the press blame Mr. Hughes for talking like that?
– I do not blame him, at any rate. But we should get back from the Germans the money which this war has cost us. If a man knocks me down in the street and takes my watch, I do not regard it as a penal indemnity if the law forces him to return my watch and pay my doctor’s bill; and I think that the Labour party should be, and would be, prepared to go with us that far. at least in applying the same principle as between nations. I am not sure that the Germans are not camouflaging the whole business as to their ability to feed themselves and to pay for the damage they have done and the expenditure they have necessitated. I believe that they are well off, and have plenty of food as well. . They are screaming about the millions of lives that will be lost if we throw obstacles in the way of their provisioning themselves; but I note that the American Food Controller, Mr. Hoover, says that such agitation on the part of Germany does not concern him, but that they have plenty of money, and should be made to pay for the food with which the Allies intend to supply them.
It is serious that Australia’s borrowings should now amount to sohuge a sum as £663,000,000.
– Against ‘ that it should be remembered that there are sub- . stantial income-earning assets.
– That is so, of course. During the next ten years Australia will be required to renew loans to the extent of £390,000,000.
– Germany will be paying that for us.
– She ought to do so, but whether our weak-kneed representatives of the Empire will insist upon it at the proper time and place is another matter. However, it is a grave position, and I emphasize it” so that Australians should not lightly regard the financial situation. That we should be spending more than £50,000,000 . among 5,000,000 people onwar work and war pay must lead eventually to great financial turmoil. The Australian people are prosperous now, and we want to keep them prosperous. In our positions as representatives of the people, therefore, we should give that objective our most earnest attention. Soon our war borrowings must cease, partly for the reason that war expenditure will not require to be continued, and partly also for the reason that the source of supply must be getting drained. Our war work must be turned into peaceful channels, and it will be a very difficult problem.
-There willbe plenty of work in the world to do. The whole of Belgium and of the north of France has to be rebuilt; and there is the world’s shipbuilding.
– The rebuilding of the shattered portions of Europe will probably not so much affect Australians. 1 hope, at any rate, that we shall not lose any of our population thereby. We do not want our fighting men to remain away, or more men to go away, in order to rebuild Belgium. Australia is the place for Australians, and Australia needs more population. We have a tremendous liability upon us; and it is our responsibility, as legislators, to do all that is possible to keep our people fully and happily employed. I hope the Government will make every effort to see that our money shall not be wasted, and that all our resources shall be conserved.
I am aware that another Land Tax Bill is to come before the Senate. I do not think that that is a right and proper tax to impose. It is a tax upon wealth. Both political parties, at the last Federal elections, pledged themselves that there would be no wealth tax. The Labour manifesto stated -
It is not the intention of the Australian Labour party to make a compulsory levy upon wealth for any . purpose. Further consideration has shown that such a levy is not necessary, and that it is Bounder finance to obtain revenue . by way of income tax upon the inoomes derived from wealth.
The wealth tax was referred to by the Labour party as long ago as June, 1915,
A motion for its imposition was rejected at the Labour Conference, in Adelaide. I quote the following report from the press at that time: -
Another taxing proposal, having as its object the raising of greater revenue for the Com- monwealth, was a wealth tax. It contemplated agraduated tax on all incomes over £1,000 a year, the rate to be higher on incomes from rent, interest, or dividends than on incomes from personal exertion.
The motion covering that proposition was defeated without discussion, and, no doubt, was responsible for the reference in the manifesto of the Labour party at the last general elections. Labour mem- , bers, therefore, are bound not to advocate the imposition of any wealth tax. So far as our party is concerned, the same assurance was given that there would be no wealth taxation. But what is this land tax proposition except a wealth tax ? It singles out one portion of the community, and it imposes a special levy on that particular class of wealth which has been put into land. It is a breach of a pledge to introduce such a Bill.
– Following the . honorable senator’s line of argument, every form of taxation is a tax on wealth.
– Then, why not impose it on all wealth? Why single . out wealth put into land ?
– The wealth tax is understood practically to mean a tax on capital, while other forms of taxation are upon income derived from land and from personal exertion.
– The honorable senator is entirely wrong. At present each £1 of wealth derived from land is taxed 6d. The suggestion in the Bill to which I have referred is to add 2d. to that. Land taxation is not a tax on income, but on the capital value of the land. Had Senator Grant been present, it was my intention to” point out to him that I quite sympathized with the object of bursting up large estates. A man who holds half the countryside should be compelled, at any rate, to pay for what he holds. But if I were to put money into land, and Senator Grant were to lend me some of his capital to improve and develop that land, I. would be. paying him interest, say, at the rate of 6 per cent. He would be sitting back and receiving his percentage on the money borrowed by me, and he would be doing nothing while T did all the work.
The PRESIDENT (Senator the Hon. . T. Givens). - I would point out that the honorable senator is anticipating discussion upon another Bill which is. to come before the Senate. In debating the motion for the first reading of a money Bill honorable senators may cover a wide field of discussion. That is permitted under certain Standing Orders; but, at the same time, there are others which limit discussion and do not permit of reference to other measures before the Senate, or about to be brought before it. I have already allowed the honorable senator very considerable latitude.
– I shall not follow up that line of argument:
With regard to the cash transactions of 1918-19, the estimated amount required is £100,044,411 for war expenditure. That is a fabulous sum. From the total should be deducted the amount to be paid from revenue, namely, £21,129,602. That leaves a sum ‘ of £78,914,809. From that total let us take moneys in hand, or in sight, which include balance brought forward from 1917-18, £23,710,662; and instalments to be received in respect to the sixth war loan, namely, £12,943,901; making, to- ‘gether, a total of £36,654,563. A balance is left to be raised to meet actual payments up to the 30th June, 1919, amounting to £42,260,246. The Government have already received £43,000,000 by the last loan, no that I hope that by the real application of good business principles, we may avoid the necessity of raising any further loans. T_he only thing that makes me doubtful is the fact that we owe, in deferred pay to the soldiers, £10,309,908. That will be a maturing liability very shortly, and must be met as our soldiers return. Adding that to the £42,000,000 which we have to meet in cash makes a total of £52,000,000 that we shall have to find. Against that, we have £43,000,000 from the last loan, and therefore I hope the end of borrowing for war purposes is near. One expenditure set down this year in the £100,000,000 referred to is £27,155,000 for money provided by the British Government for munitions and various other things. I trust that air that will not be required, and that “the Minister for Defence (Senator Pearce) will, cut the estimates down considerably,, perhaps saving enough to pay the £10,000,000 odd due to .the returning, soldiers.
– We cannot cut it down until we are absolutely safe.
– Certainly, we must be out of the wood before we begin to crow.
Our accounts should be made as simple as possible. On one side appears the item, “ “Valuation of properties transferred from the States, £11,202,516,” and on the other side of the ledger, under the note fund, appears the item, “ Loans made to States before . the war, £2,634,000,” and! also another item, “ Loans made to States since the ‘war began, £18,000,000,” . or £20,000,000 in, all. Why not take over the transferred, properties at the valuation, and writethe amount off the other side of theledger? That would greatly simplify our accounts, and make them more understandable to the public. I do not know, whether there is any objection to that, suggestion; personally, I can see none-
– What will the States say?
– It will be as. broad as it is long. We pay the Statesinterest on. the valuation of the transferred properties, and they pay us- interest on the money we have lent tothem. Why not practically buy their buildings, for £11,000,000 odd, and reduce their liability to us correspondingly I
– As a financial transaction it has this disadvantage, that’ we are paying the States,, on the amount we owe them, interest at a lower rate thanthey are paying us on the money we have lent to them.
– After all’, a* both States arid Commonwealth represent the same people, I do not see that that need be a fatal objection.
I look with the gravest concern: on the financial outlook, not only here, but in other p arts * of the world. We are faced with very serious problems, and if we want a happy community, living in the comfort that we should like to see -them all enjoying, we must give our financial affairs the closest study. It is for that reason that I have spoken to-day.
– It is fortunate that, in this Chamber, honorable senators have an opportunity of discussing, on the first reading of a Bill like this, rather wider and more general finance than is set out in the Bill itself. -There is a tendency in another place to keep money Bills hung up till the last moment, and then send them to this Chamber of review, where due consideration is supposed to be given to them, at such a time that, owing to the exigencies, perhaps, of the payment of public servants, or for other reasons, it becomes necessary for the Minister . in charge to move the suspension of the Standing “Orders, so that they may be put through in one sitting. I am glad that this Bill, allows some latitude on the question of finance, particularly in the absence of the Budget papers, which are so voluminous and interesting just now.
I agree with the preceding speaker that Australia has not yet faced -up its liabilities. The Minister for Defence (Senator Pearce), in this chamber, and the Treasurer (Mr. Watt), in another place, have forecast the necessity for additional taxation next year, -so far as the administration of the Commonwealth is concerned. Those statements were made before the conclusion of the armistice. It is a matter for much regret that the maximum of taxation was. not imposed by the Treasurer in the previous Budge’t, because now. the war is over the taxpayers will have to face the payment of additional taxation probably six months after the conclusion of peace. I do not think they will face it then with any pleasure. It was therefore a strategic mistake, so far as the policy of the Administration is concerned, not to have imposed even more taxation during the war, so that our burden after the war could be lightened. For that reason, I shall most heartily support this Bill. I support it because I believe the income-tax payers can pay the money, because it is not unreasonable in view of the taxation in other countries, and because we want the maximum of taxation while the war is on and while our expenditure is at a maximum.
Much to the surprise pf political economists of the old school, of the magnates who so largely controlled the socalled money market before the war, and of international Jewish financiers, more than four years of- war have passed over our heads, and it has not yet been seriously suggested that any nation engaged in the straggle has had to submit on account of a shortage of money. It was forecast very early in the history of the war that the complications of international finance, and the complexities of modern trade and commerce, would bring’ any possible world-catastrophe such as has been hanging over our heads for more than four years to a very speedy conclusion, and that months, and not years, would see the end of the struggle.
– Was that not Norman Angell’s theory?
– I am not quoting him in particular. I am referring to what I believe was largely the opinion in world financial circles.
– Can you mention “ the name of one political economist of any standing who held that view?
– I am referring to many international financiers and men in trade and commerce whose wellrecognised .opinion it was that the war would probably be over by the Christmas of 1914.
– As you have mentioned Norman Angell, why not mention the name of some political economist?
– I am not talking of Norman Angell or political economists, the whole of whose theories have gone overboard as the result of the war. I am speaking of men who were deeply engaged in international finance and whose opinions at that time were worth having. The war could have gone on indefinitely, and need not have stopped for a considerable time for want of money. That is the point that the general trend- of the war has shown to be true. Although no nation has been stopped by want of money, every nation engaged in the. struggle will have to face the aftermath. That aftermath will involve not only the restoration of our soldiers to their civilian employment, restitution and rehabilitation for damages done, responsibility to the families of those who have, died for us, and to the maimed and crippled, but also a huge load of indebtedness which may hang like a millstone round the necks of this and succeeding generations, and may, if not wisely handled, be productive of very grave and general unrest and uncertainty, in. our social state.
Probably from 8,000,000 to 10,000,000 of the world’s manhood have been cut off in the prime of life, either by casualties in ‘the war itself or by disease directly or indirectly caused by the war. So far as statistics show, the Empire has lost approximately 750,000 men.
– Very much less than that.
– The number that we know to have been actually killed is perhaps considerably less, but there are tens of thousands of missing that we fear have been killed, and only time will show us the total number. We all know that Australia, unfortunately, has lost 55,000 men killed. Canada has lost nearly the same number, and at Passchendaele alone 24,000 Canadians were ‘killed and wounded. It is probable that between 3,000,000 and 4,000,000 men have been permanently crippled and maimed as a result of the war, and in addition, cities have been destroyed, towns’ and villages, farms and homes, ships and live stock have disappeared, with consequent immense losses in production, agriculture, and mining. These things cannot be estimated in pounds, shillings, and pence, so I will confine myself to quoting figures as to the actual financial cost incurred through naval, military, and other operations directly connected with the war.
I have seen from time to time various estimates that have been made all over the world regarding the total financial cost of this world war. A careful analysis of the figures will show that the cost of the first four years of war to all the countries engaged in it has been about £30,000,000,000, and it is estimated that of this huge sum the cost to the Allies will be about two-thirds, and to the enemy one-third. In other words, the war has cost the Entente £2 for every £1 spent by the Central Powers’. This huge sum of £30,000,000,000 seems to be a reasonable estimate when we analyze the amounts spent bv the various belligerents, as disclosed by their financial budgets from year to year. The United Kingdom has spent about £7,000,000,000, of which about £1,100,000,000 has been paid for out of revenue. France’s total war debt now approaches £4,000,000,000’ and her taxation has been nearly doubled. Italy’s debt is, approximately, £2,000,000,000. Russia has issued nearly £2,000,000,000 of paper money alone, has received about £800,000,000 in the form of advances from England, France, and the United States of America, and her total debt is probably in the region of £5,000,000,000. . The United States of America has spent a sum approaching; £2,000,000,000, and the Dominions, in-, eluding Australia and Canada, have already spent, or owe, considerably over £500,000,000. . Then there is the unascertainable expenditure of Belgium, Servia, Rumania, and japan, which, should be added to these enormous sums in order to arrive at the total Allied expenditure, in which there is a sum of about £3,000,000,000 representing duplications. Up to the close of 1917, Germany raised by war loans from amongst the German people, the sum of about £5,000,000,000, and in April last Mr. Bonar Law estimated Germany’s war debt at £6,200,000,000. Austria-Hungary has probably raised nearly £3,000,000,000. The figures for Turkey and Bulgaria would, of course, be much smaller, but the aggregate expenditure of the Central Powers cannot have been much less than the £10,000,000,000 mentioned. Honorable senators will find, therefore, that the approximate total net cost to the whole of the belligerents up to 30th June of this year has been about £30,000,000,000, and, as I have stated, it represents an expenditure of about £2 on the part of the Allies as against £1 on the part of our enemies. In the expenditure by the
Mother Country on the war is included the sum of £1,500,000,000 lent to our Allies, including “about £180,000,000 lent to the Dominions. The United States of America, too, had advanced to the Allies tip to 19th July last a sum of £1,300,000,000.
These figures represent the approximate expenditure of the belligerents up to 30th June of this year, and I think we must add to the total ‘ a sum of at least £5,000;000,000, representing the expenditure from that date, and to cover all other considerations not already set out. Consequently, the total cost to the world will probably be not less than £35,000,000,000 altogether.’ If this huge amount were represented in sovereigns there would be enough to put twenty golden bracelets round the earth at the equator and forty of the largest cargo ships in the world would, be required to convey it.
It will be seen’ that if the war is going to cost the whole of the- belligerents £35,000,000,000, and if the Allies have spent £2 for every £1 expended by the enemy Powers, the total cost to the Allies will “be not less than £23,000,000,000, as compared with that of not less than £12,000,000,000 to the Central Powers. According to the latest British Budget, five years of war would have cost the United Kingdom £9,000,000,000, out of which the British Government proposed to pay. from revenue £1,700,000,000 if .the war had lasted for five ‘years, and that would have left the Mother Country with a net war debt of £7,300,000,000, which, added to her pre-war ‘ debt of £670,000,000, would have imposed on the taxpayers of the Mother Country a yearly sum in interest alone of nearly £400,000,000- double the amount of the greatest pre-war budget for all purposes of government, and one-fourth of the total gross amount of income brought under the review of the Inland Revenue Department, of the whole of the people of the United Kingdom.
But I do not think that we should regard these huge figures of expenditure by the various countries as net deductions to be made from the wealth of the countries at war, True, the destruction of wealth has been going on. Every cartridge and shell exploded, every hamletlevelled to the ground, every ship with her valuable cargo sunk, every bit of equipment worn out, the innumerable special manufactures required for modern war, and war only, have been so much waste. “War is waste, but in considering the financial aspect of this world catastrophe, we must bear in mind that a large amount . of the war costs have been distributed amongst the people of the country engaged in it, and every country at war - not excluding even Germany and Austria - has had great manufacturing activity and economic stimulation. Never before in England was the country so prosperous; never before was there such an absence of pauperism. Australia, too, has had a great share of the prosperity directly caused by war expenditure, while America, most travellers say who have returned from that country, is “ wallowing “ in money. Therefore, any theory that the tens of thousands of millions which the war has cost have all gone to waste does not seem to be. reasonable. I do not think any accurate analysis has been made as to how much of this total, of £35,000,000,000 is waste; but. if one were asked to’, make a hasty guess, as to the cost of substituting manufacturing and economic activity during war time for war purposes; of the greater concentration of the energies of the people on war work ; and of the waste and destruction caused, one would be inclined to estimate that certainly not more than half the total gross cost of this war was absolutely wasted, and that the other half had contributed to making many of the people richer. And there is a good deal of accumulating evidence, too. of a rapid diffusion of wealth as a result of the war. Some of those who have given careful thought to this question as to what percentage of the cost of war is actually waste, will not agree that more than 40” per cent, of the gross expenditure can be placed in that category, and that 60 per cent, goes into the pockets of the people, thereby making them richer. Oneauthority well placed in the commercial and economic world of Australia, and for whom I have very much respect, goes so far as to ‘say that very little more than one-third of the war cost is “waste, and that two-thirds of such gross expenditure goes into the pockets of the people. There is some evidence that private wealth has been largely increased during war, and in this connexion the figures regarding income tax assessments for the United Kingdom are valuable. The gross-amount of the income brought under the review of the Inland Revenue- Department in the United Kingdom during recent years is as follows : - In- 1913-14 the total was £1,167,000,000.
– Is that the amount of taxable income?
– No, the gross amount of income brought under review. In 1914-15, the total amount had increased to £1,238,000,000. In 1915-16 it was £1,320,000,000, and in. 1916-17 the gross amount of income estimated to be brought under review of the Inland Revenue Department was £1,670,000,000, as against £1,167,000,000 for the last pre-war year. . The increase for 1916-17, in the amount estimated to be brought under review, was nearly 50 per cent. more than the amount in the year just prior to the war.
Honorable senators will admit that these figures give some evidence that war is not all waste, and that the huge expenditure in the many ramifications of governmental activities results in a great diffusion of wealth throughout the community, so that it cannot be said that the world- will be some £35,000,000,000 poorer as the result of the war.
-Can the honorable senator give us some idea of the permanent wealth that has been increased as the result of- the war ?
– I am trying to deal . with a subject that is very intricate. I have endeavoured to cull from various sources some evidence that private wealth has increased as the result of the war, and I hope to. prove a little later on that wealth in Australia has increased as the result of the war, and that, consequently, the additional taxation imposed by this Bill is not such a burden upon the public as some of the objectors to the measure would have us believe.
– Do the total figures of income quoted by the honorable senator include theincomes of. those who are exempt from income tax in the United Kingdom ?
– No, they represent the gross amount of income brought, under review for taxation purposes. It might be interesting for a moment to dissect these figures, and show how the taxable income brought under review for the year 1915-16 was made up. Of the total amount of £1,320,000,000 the sum. of £285,000,000 was from the ownership of lands and houses; £4,000,000 was from British, Imperial, and foreign securities; £724,000,000 was from businesses, professions, trades, and employment; and £157,000,000 was from salaries in Government and public employment; the remainder being from occupations of land and many miscellaneous headings,- none of which ‘in the aggregate amount exceeded 2 per cent. of the total.
I think further proof of the increase of private wealth as the result of the war, apart from governmental obligations, is given -when we consider the number of persons in receipt of incomes within the taxable ambit in the United Kingdom as. shown by the assessment papers sent out. I find that in 1913-14, when the amount of income exempt from income tax in the United Kingdom was £160, though in 1916-17 it was reduced to £130, the number of persons in receipt of income in excess of the exemption was 1,200,000. In 1916-17, after over two years of war, the. number of persons in receipt of incomes above the . exemption had increased to 3,200,000. An increase of nearly three times the number of persons paying income tax cannot be putdown altogether to the small decrease of £30 in the amount- of the income exempt from taxation, and it must be due very largely to the increased earning powers of the people.
The Treasurer, in another place, supplied a comparative table showing what the Government are asking the people of Australia to pay as compared to what the people of the United Kingdom are actually paying. That comparative table,, with the addition, of the State taxes already in operation, shows that the taxation imposed under this . Bill is not unreasonable at the present time, in view of the obligations we have to face, and it certainly is not unreasonable in view of our future commitments. I ask leave to continue my remarks on a resumption of the debate.
Leave granted ; debate adjourned.
Sitting suspended from 6.30 to 8 p.m.
– Before we proceed with Government business, I desire to know whether the items relating to private members’ business which were called on just now, and the postponement of which . was not moved, will disappear from the notice-paper?
– They will drop off the businesspaper.
.- When the sitting -was suspended, I was. pointing out that the total cost of the war to the whole of the belligerents engaged in it is likely to approximate £35,000,000,000. I was endeavouring to make it quite clear that this enormous sum does not represent all waste, for, according to those who are best able to form a sound judgment on the matter, not more than 50 per cent. of it may be accounted waste, whilst other authorities set the wastage down at not more than one-third of the total expenditure. I had stated, too, that, in my opinion, the result of the war had been ‘a greater diffusion of wealth throughout thecommunity, so that, although Governments will owe enormous sums at the conclusion of the struggle, private individuals will have benefited considerably, whilst the aggregations of private wealth will also have been largely increased.
Coming to Australia, there is very conclusive evidence that individual wealth has substantially increased by reason of the war. Therehas been a striking war prosperity throughout the Commonwealth. The total deposits in banks increased by nearly £45,000,000 during the first three years of the struggle, and during no similar . period have bank deposits increased so” much. The deposits in cheque-bearing banks in Australia, including interest-bearing and noninterestbearing deposits, increased during the decade from 1907 . to 1916 by over £80,000,000. In’ the Savings Banks of ‘ this country during the same decade, there was an increase in the number of depositors from 1,258,000 to 2,420,000, and’ the- number of depositors -per 1,000 of population increased from 308 to 494. In addition to the figures quoted in relation to the deposits in cheque-bearing banks, there was an increase in the net amounts to the credit of depositors in our Savings Banks from £42,000,000 in 1907 to £97,000,000 in 1916. Per head of depositors, the increase was £7, whilst per head of population it was from £10 to £20. The largest, of these increases have been made during the second’ half of this decade, more than two years of which have been years of war.
Following out that argument, I assert without fear of contradiction, that the Commonwealth statistics collected by the Commonwealth Statistician, Mr. Knibbs, in connexion with the wealth census of 1915 considerably understate the real position in regard, to what are the incomes and capitalwealth of this continent. In fairness to the Government Statistician, however, he has never affirmed that the census figures in question were accurate, or indeed that they were anything . more than a rough’ approximate aggregate of the position, based upon thereturns that were sent to him. I am quite convinced, and I intend to quote some figures which,’ I hope, will convince honorable senators that, at . all events, the income, if not the wealth, of the people of the Commonwealth is very much more than Mr. Knibbs has collected, and, consequently, that the amount to be derived from the present Federal income taxation is much more than his figures suggest. Indeed, if all the people who ought to pay existing taxation were made to pay, there would be an amount received greatly in excess of the Federal Treasurer’s estimate.
The latest New South “Wales figures in connexion with the assessments ‘ made in that ‘State for income tax .purposes aTe as follow: -
– The New South Wales income tax does- not, in it.3 incidence, reach out in the same way as does the Commonwealth law, because in the mother State income’ derived from companies is taxed at its source, and is not included in the schedules of individual taxpayers.
– It is not taxed twice.
– That is so. Consequently, the taxable income of companies in New South Wales is very large. If the Income Tax Act of that State were administered in the same way as is the Commonwealth Income Tax Act, the taxation borne by companies would be very much less than it is, whilst that borne by individuals would be very considerably more. According to the latest assessment, the total number of companies taxed in New South Wales was 2,308, their taxable income representing £16,503,575. From the summary to> the table which I have quoted, ‘ it will, be . seen that the number of assessments ,. made by the New South. Wales Taxation Department was 48,322, whilst the taxable income aggregated £38,529,893. In other words, that is the amount of income actually taxed after allowing for the statutory deduction of £250 in each private assessment, and. after making further deductions on account of children and insurance. Now I think it is fair to assume that, on ari average, each taxpayer deducts £50 on> account of one child, and £10 on account of insurance, so that in New South Wales every private income that is taxable under the State Income Tax Act represents ari income in excess of £300 per year. The wealth census figures compiled by Mr, Knibbs in 1915 set down the total yearly income of all individuals and companies: in the Commonwealth at £257,000,000, and of this sum £101,000,000 can be credited to New “South Wales. The proportion of the total incomes of that State _ to the total incomes of the Commonwealth, according to this census, is, therefore, 40 per cent!, or two-fifths - a proportion that I have previously adopted, and one which is sustained by the fixed contribution of £16,000,000 by New South .Wales to the recent war loan of £40,000,000. It is, therefore, a proportion which we may accept for our guidance in connexion with the calculations that I am about to submit.
Knibbs gives the number of people, inAustralia enjoying incomes of £300 or over per annum as 94,000. There are more than 46,000 persons in New South. Wales receiving incomes of £300- a year and over - altogether outside of companies and those persons who derive the whole of their income from companies, and consequently are not assessed ; and, if we take again as the basis of calculationNew South Wales? being in population, in wealth, in trade, taxation, and most, other comparisons, two-fifths of the Federation, it is reasonable that if there arenearly 50,000 persons in that State enjoying incomes of £300 or over per an11Unl, there are at least 125,000 persons: in the Commonwealth having the same income, instead of 94,000 persons tabulated -by Knibbs. Those figures are buttressed by the fact that the wealth census returns showed 12,384 persons enjoying incomes of £1,000 and over, while New South Wales assessments show that over 6,670 persons. in New South Wales, individually, and without company assessments, pay income tax on these figures - more than half the figures given by Knibbs for the total of all incomes of this amount in Australia. Knibbs’ wealth census returns again show that only 2,026 persons enjoyed incomes of £3,000 and over throughout the. Commonwealth, while 1,300 persons at least are paying income tax on this amount to the State of New South Wales alone. And, on the same basis of comparison, there are more likely to be 3,250 persons throughout the Commonwealth enjoying this large income rather than the 2,026 given by Knibbs. The New South Wales returns again show that persons paying on incomes of £5,000 and over number about 500. Knibbs gives only 832 for the whole of Australia. The experience is that in this figure, as in most others, New South Wales totals can be multiplied by two and a half, which would give 1,250 persons, instead of 832 as stated in the wealth census to be in the enjoyment of incomes of £5,000 or more yearly, throughout the Commonwealth.
I shall now take my analysis of the wealth census figures for the whole of the Commonwealth as against New South Wales a step ‘or two further. The total amount of private taxable income represented in the most recent New South Wales taxation figures is a sum of £22,000,000 odd. To this must be added the average for the deduction made by 46,000 taxpayers of £310 each, say, £14,260,000 altogether; or a total of income represented upon which taxation is paid, before deductions are made, of £36,260,000-. If this figure is multiplied by two and a half, we get an approximate sum for the Commonwealth of £90,650,000, which com-‘ pares reasonably with the £83,700,000 of the total incomes of £300 per annum and over, including that of companies, given in the wealth census figures of 1915. But the latter -figures give statistics for companies as being only £16,413,000 in all. In . New South Wales alone, in addition to the figures I have already given of taxable income of individuals, there are 2,308 companies assessed with a taxable income of £16,500,000, so that the total incomes over £300’ in New South Wales are: - Individuals, £22,000,000 ; companies, £16,500,000 ; exemptions on private incomes, £14,250,000; making a total of £52,750,000 altogether. If we multiply this by two and a half, we get a total for ‘the Commonwealth of nearly £132,000,000, instead .of under £100,000,000 as given in the wealth statistics. Therefore, the total incomes, of £300 and over in the Commonwealth, including all companies, on a computation of the latest New South Wale? taxation figures of actual assessments, is likely to be £132,000,000, and not under £100,000,000, as given in the Commonwealth statistics.
Another test that the Commonwealth census figures are only partial and not complete, and do not show the total of the wealth or incomes of ‘the people of Australia to-day, is the fact that the wealth census gives 12,3S4 persons in receipt of total incomes of £1,000 per annum or more. In 1915-1.6, 13,372 persons paid- Federal income tax on incomes, after exemption, of £1,000 or more; and in 1916-17, 14,718 persons paid .on this amount and over. In New South Wales alone, where there is certainly more efficient income tax collection, the figures 3 have given show that there are nearly 7,000 persons assessed whose incomes an actually, without exemptions, £1,000 pei year or more - not including the addition to the incomes of those persons of amounts they collect from company dividends. So it is, to my mind, clear that as the figures I quote for New South Wales are for the year just assessed, an< assuming that the Federal income tax im proves in the same ratio as ‘between th. figures I have quoted and this year, in stead of there being 12,384 persons in thi enjoyment of incomes of £1,000 or more, as given in the Commonwealth census, there are at least- 16,000 to 17,000 persons in Australia actually in receipt of this income now; and. that represents^ an increase on the wealth census figures given of at least 33 per cent. Therefore, on these figures, there is a* very much greater income received by the people’ of Australia earning £300 a year and more than any figures which have hitherto been given indicate; and, that all arguments which have been and are being based upon the war census figures of 1915, are much below the actual; and that it is likely that the private wealth of Australia today is at least £2,000,000,000. For, clearly, the figures of incomes given by Knibbs are at least 33 per cent, less than the actual -taxable amounts that are being paid to State Treasurers by taxpayers throughout the Commonwealth. And it is likely that the wealth figures will show the same proportionate increase.
The war, then, has not interfered with the continued prosperity of Australia so far as these figures show; and the amount now within the ambit of taxation of incomes of £300 and over has been proved by the figures I have given to be at least £130,000,000 per annum. The total private wealth, of Australia is certainly at least the sum of £2,000,000>000, if not £2,250,000,000. The amount subscribed to war loans, including that just* closed, is £190,000,000- not 10 per cent, of the total wealth of the Commonwealth, as against the very high ‘figures of England and France. The position, therefore, is that probably half of those who can reasonably be asked to subscribe to loans have subscribed 15 per cent, to 20 per cent, of their total assets. The other half of the wealthy people have subscribed very little.
The Bill before the Senate, although it imposes a very stiff increase this year on the income tax payers of Australia, is not going further than the present financial position of Australia justifies. Although the increase of the income tax under this measure will be 62£ per cent, upon the income tax first brought -down by the Fisher Government a few years ago, it is not even now nearly so great as some of the increases made in the Mother Country. The Treasurer, in his secondreading speech upon the Bill, quoted a number of comparisons as between the taxation of Australia in this direction, and of the Mother Country. Most of those comparisons were favorable to Australia; and I hold that we have greatly prospered as a result of the war, and are very well able to bear the war burdens imposed, and to be imposed, by the Government. Great Britain’s income tax for 1917-18 is five “ times the total of 1913-14, and has jumped from £48,000,000 to £225,000,000. In 1913-14, £93,000,000, or 58 per cent, of the total taxation, was raised by direct taxation, as against £69,000,000, or 42 per cent., raised from indirect taxation. In 1916-17, the figures were £466,000,000 from direct taxation, or 82 per cent., as against £102,000,000 from indirect taxation’, or 18 per cent. It is true that probably about half of the huge total derived from direct taxation was raised by means of the> war profits tax, and was paid principally by the ship-owners and the munition makers; but, even so, the increase in income tax imposed upon the people of the Mother Country as the result of the war is very much greater than that imposed on the people of Australia, including the Bill now before .us.
Australia’s public debt, of which Senator Fairbairn spoke, can be put briefly into a few figures. Approximately. Australia owes to-day a total sum, . State and Federal, “of about. £700,000,000. Of this £200,000,000 is set off by productive assets. Approximately, the non-productive debt of the Commonwealth and States to-day is in the region of £500,000,000, and that huge amount 5,000,000 people have to bear. It is clear, therefore, that one of the great problems, if not the greatest problem, of the future is how best to carry our load of debt without imposing almost restrictive obligations upon production, how best to finance the future so that production may increase, and that our people may not be loaded with- an unduly heavy taxation burden. I should have liked to see the Government exploit other avenues to meet our huge obligations. I should have liked to hear something of a luxury tax and of a primage duty through the Customs, or something about one or two other avenues that still remain open to them. We have heard from one or two responsible Ministers that additional taxation will be required next years and, so far as we can’ see, with the additional and heavier obligations of repatriation and pensions, that additional taxation will be required. Further loans will certainly require to be raised here if we wish to pay our debts. I am heartily in accord with the principle of raising loans from our own people. Those we have raised so far represent only 10 per cent, of the amount of our national wealth. England has raised a sum nearer 25 per cent, of her national wealth.
The figures I have quoted and the circumstances of the day show that Australia has not suffered financially so far as the result of the war.’ We should be able to bear fairly easily the comparatively heavy taxation which is now necessarily being imposed upon us by the Government, if we. set about increasing production and population. The people of the Commonwealth must .not expect the burden of taxation now . imposed on us as a result of the war to be decreased in the near future. Heavy taxation will last, our time, and. we ought to face up the financial position during the next ten years so as not to pass too heavy a load on to posterity. I hope that Germany some day will pay part of the money that we have expended in helping to defend the rights of civilization,- but I am assuming in my argument that Germany will pay nothing so far as ‘ Australia’s expenditure” is concerned. Consequently I forecast a Budget next year of at least £50,000,000. with no reduction in taxation for some years to come. If we wish, to face up matters in a’ way worthy of the present generation and of the efforts of our soldiers during the war, we shall have to continue to impose heavy taxation, and give the taxpayers to understand that during the next five or ten years the obligation is theirs of facing up this debt and paying part of it off.
I commend the Government for imposing additional income tax. One of the traditions of British government is that the income tax shall pay the bulk of the cost of war. The people of the Mother Country are doing it to-day. The people of Australia must also take upon themselves their share of the burden. .On the figures I have quoted, I do not think there is very much, to grumble about. Our average taxation to-day is not so great as the average in the Mother Country, because the averagethere for the interest alone upon the money she has raised for war purposes will mean a permanent obligation upon her income-tax payers, as disclosed by the last British assessment, of at least 25 percent, of their income, or 5s. in the £1. In the circumstances, . therefore, I support the Bill now before the ‘Senate. It is fair under all circumstances that the rate should be as it is to-day. I hope to speak in Committee about the curves, the position of the Income Tax Department, and the almost superhuman obliga- tions imposed upon the officers to carry out the duties of the Department. I have endeavoured to-day to show honorable senators that any arguments based upon the war census figures as collected in 1915 are fallacious, and that the figures are under-estimated.
– Listening - to Senator Pratten, one would come to the conclusion that, instead of rejoicing as we have been doing’ lately at what we believed to be the end of the war, we ought to be in sackcloth and ashes. According to the honorable senator, the war is really one of our great industries and great wealth producers. If we go into the matter properly we shall find, when we impose the full amount of taxation necessary to meet the responsibilities of the war, that our wealth, instead of showing the enormous increase indicated by the honorable senator, is less than it was before. The apparent prosperity that Australia has been enjoying will not stand very much examination. There is ‘very little, “if any, solid increase in our wealth. I cannot understand where the honorable senator got his figures to prove that the war, instead of wasting, has actually increased it.
– I did not say that. I said the war expenditure was hot all waste.
– The honorable senator said that only one-third of the expenditure on the war was waste.
– I said from onethird to 50 per cent., according to varying authorities.
– When the honorable senator was referring to the great economists, and the deductions that we should draw from their writings that the war, instead of being a waster of wealth, was actually a producer of it, I asked the honorable “senator, by interjection where he got such ideas from.
– Do you call the destruction of 12,000,000 lives an increase of wealth,?
– Would that be the logical deduction from Senator Pratten’s argument?
– Not at all.
-I was referring, not to human life, but to wealth as such. While Senator Pratten was addressing himself to that portion of his subject, I asked him how a nation could possibly incur such an enormous waste of wealth as the war undoubtedly meant and still end up so happily as his figures would lead us to believe. He very wisely, for his argument, refrained from answering. When I askedhim if any other writer than Norman Angell, whose name was suggested by Senator Needham-
– I repudiated Norman Angell.
– Did the honorable senator repudiate Norman Angell’s arguments? . No other great writer that I am acquainted with, or have read or heard of, would advance that argument in any shape or form.
– Do you know anything that Angell has written except the one book?
SenatorDE LARGIE.- I know enough of that book to satisfy me that a good deal of his argument is fallacious.
– Do you know that book was written before the war?
– Yes, long before. .
– Do you know he’ has not written on the war?
– He has written another book lately.
-What is it?
– I will . supply the honorable senator with the book itself. So far as I could understand the honorable senator, the whole of his argument was that, instead of the war wasting our wealth, it had actually increased it.
– No; I said it had diffused it.
– I hope that before the Bill leaves the Senate the honorable senator will take the opportunity to enlighten those of us who have not been able to understand him.
Question resolved in the affirmative.
Bill read a first time.
Bill returned from the House of Representatives without amendment.
Bill read a first time.
– I move -
That this Bill be now read a second time.
The measure hardly requires any explanation from me, as its simple purpose is to increase the land tax by an additional 20 per cent. As honorable senators are well aware of the principles underlying the parent Act, it is unnecessary forme to do anything more than direct attention to its one purpose, namely, to add to the revenue of the Treasury.
-Is the additional impost limited to any period?
-Forthe current financial year. I should like to add that the amounts obtained by the Treasury under the heading of land taxation since the imposition of this form of tax have been as follows .-1910-11, £1,370,345; 3911-12, £1,366,457; 1912-13, £1,564,794; 1913-14, £1,609,836; 1914-15, £1,953,696; 1915-16, £2,040,436; 1916-17, £2,121,952; 1917-18,. £2,123,778;. 1918 (estimated), £2,380,000. It is estimated that the last- named amount will be’ increased by £380,000 by the operation of the proposed additional tax.
Debate (on motion by Senator Needham) adjourned.
Motion (toy Senator Millen) agreed to -
That the Senate, at its rising, adjourn till 3 o’clock, on Wednesday next.
Senate adjourned at 8.49 p.m.
Cite as: Australia, Senate, Debates, 21 November 1918, viewed 22 October 2017, <http://historichansard.net/senate/1918/19181121_senate_7_87/>.