Senate
24 August 1923

9th Parliament · 2nd Session



The President (Senator the Hon. T. Givens) took the choir at 11 a.m., and read prayers.

page 3422

QUESTION

EMPIRE DAY

Petition

Senator LYNCH presented a petition signed by 152 electors of Western Australia, including returned soldiers and sailors, and praying that such action as the Senate might deem fit should be taken to recognise the fact that Empire Day was originated in Australia, and to give effect to the suggestion of the petitioners that Empire Day should be celebrated throughout the Empire on the birthday of our reigning Sovereign.

Petition received.

Senator LYNCH (Western Australia)

That the petitionbe printed.

I shall move later that Empire Day be celebrated on the birthday of our reigning Sovereign. A similar petition, the signatories to which represented 200,000 citizens, has been presented to the Legislative Council ofWestern Australia. If there had been sufficient time available on the present occasion an equal or greater number of signatures could have been obtained to this petition. I also desire the petition to be printed for general information, to have the fact proclaimed that the idea of Empire Day was conceived in Australia ; and to secure greater historical accuracy in Western Australia. When we consider the origion of Empire Day-

The PRESIDENT (Senator the Hon T Givens:
QUEENSLAND

– The honorable senator is not in order in debating the question.

Senator GARDINER:
New South Wales

– On the motion for the printing of this petition, I desire to say

The PRESIDENT:

– A motion for the printing of the paper cannot be debated. The mover of it is allowed to give an assurance that the printing of it is necessary, because he intends to take subsequent action on the petition, but no debate is permissible.

Senator GARDINER:

- Senator Lynch has been permitted to speak, but you will not permit me to do so.

The PRESIDENT:

– I ask Senator Gardiner to withdraw that reflection on the Chair.

Senator GARDINER:

– You can do what you like. All I said was that Senator Lynch was permitted to speak, and I was not.

The PRESIDENT:

– The honorable senator must obey my ruling and withdraw that reflection on the Chair.

Senator GARDINER:

Senator Lynch was-

The PRESIDENT:

– The honorable senator must not argue. I ask him to withdraw.

Senator GARDINER:

– I can only withdraw by stating the facts. I am willing to withdraw, but not if I am not permitted to explain the position. Senator Lynch moved that the paper be printed, and I rose to make a few remarks. You ordered me to discontinue those remarks, and I then said that he was permitted to speak, but I was not. If that is offensive to you, I withdraw it.

Question resolved in the affirmative.

page 3423

QUESTION

WAR SERVICE HOMES

SenatorFINDLEY.- Has the Government yet decided to move for the appointment of a Royal Commission to inquire into a certain contract entered into in connexion with the War Service Homes?

Senator PEARCE:
Minister of Home and Territories · WESTERN AUSTRALIA · NAT

– I shall endeavour to reply to that question before the close of the session.

page 3423

QUESTION

DEFENCE DEPARTMENT EMPLOYEES

Wages Paid at Swan Bay.

Senator GUTHRIE:
VICTORIA

– Is there any truth in the statement that, at Swan Bay, near Queenscliff, the Defence Department is paying certain employees less than the basic wage?

Senator WILSON:
Honorary Minister · SOUTH AUSTRALIA · NAT

– I shall endeavour to reply to the honorable senator before the close of the session.

page 3423

QUESTION

TOBACCO INDUSTRY

Senator GRANT:
NEW SOUTH WALES · ALP

– Has the attention of the Minister representing the Minister for Trade and Customs been drawn to a recent statement that, owing to action by the local tobacco manufacturing companies, the industry of growing tobaccoleaf in Australia is almost certain to be extinguished? In order to assist the local tobacco-leaf growers, will the Minister recommend to the Tariff Board the imposition of a duty of a prohibitive character on all imported tobacco-leaf and manufactured tobacco ?

Senator WILSON:
NAT

– I shall bring the matter under the notice of the Minister for Trade and Customs (Mr. Austin Chapman) .

page 3423

QUESTION

DUTY ON “ KRAFT “ PAPER

Senator GRANT:
NEW SOUTH WALES · ALP

– Is it a fact that officers, under the control of the Minister for Trade and Customs (Mr. Austin Chapman), have suddenly increased the duty on imported “ Kraft “ paper to such an extent that the local bag manufacturers are in imminent danger of having their industry extinguished ? If that is so, will the Minister take the necessary steps to revert to the previous rate of duty?

Senator WILSON:
NAT

– This matter was brought under the notice of several honorable senators by telegram yesterday. I immediately consulted with the Department, which has sent me the following reply : -

The matter the honorable senator refers to caine under the notice of the Department through telegrams forwarded to several honorable members. Official information with regard to the transaction, which involves the imposition of damping duty, is not yet to hand, but the Collector of Customs for Queensland has been requested to furnish an immediate report on the matter.

If I receive any further information today I shall make it available to honorable senators.

page 3424

PAPERS

The following papers were presented : -

First Report by Munitions Supply Board, for period ended 30th June, 1922.

League of Nations - A Selection of Papers printed by the League relating to the Mandatory System (especially those relating to “C” Mandates), 1920-1922.

Naval Defence Act - Regulations amended - Statutory Rule3 1923, No. 106.

Railways Act - Report on Commonwealth railways operations for year ended 30th June, 1923.

Superannuation Act - First Report of the Superannuation Fund Management Board,, for period ended 30th June, 1923.

War Service Homes Act - Land acquired at Manly, New South Wales.

page 3424

QUESTION

PARLIAMENTARY ROOMS

Alleged Misuse

Senator LYNCH:
WESTERN AUSTRALIA

– I desire to ask you, Mr. President, in your capacity of Chairman of the House Committee, whether the- Parliamentary dining-room is a place to which members of this Parliament, without regard to party, can retire to have their meals. Is it reserved for that purpose exclusively, or is it a place to which members of a party can repair to sing rabid party political songs, such as “ The Red Flag,” and “ Solidarity for Ever,” to the discomfort and annoyance of other members there?

The PRESIDENT:

– I have noticed the incident referred to by Senator Lynch, and representations on the subject have been made to me by members of the House Committee and the Senate. I assure honorable senators that the question will be carefully considered by the House Committee.

Senator GARDINER:

– Will you also take care, Mr. President, that no rooms in this building, particularly your own, are used for gambling?

The PRESIDENT:

– The honorable senator is quite wrong in his facts. As far as I know no rooms in this building, much less my own are used for the purposes of gambling, and, as far as I can prevent it, no room will be used for that purpose. It is not seemly to raise in this Senate a question relating to occurrences in those rooms which are not allotted to members generally, but are for the private use of the Leader of the Government, party leaders, Ministers or others.

page 3424

TAXATION OP LOANS BILL

Bill received from House of Representatives

Standing and Sessional Orders suspended, and Bill (on motion by Senator Pearce) read a first time.

page 3424

AGREEMENTS VALIDATION BILL

Bill received from House of Representatives

Standing and Sessional Orders suspended, and Bill (on motion by Senator Pearce) read a first time.

page 3424

LOAN BILL

Debate resumed from 22nd August (vide page 3335), on motion by Senator PEARCE -

That the Bill be now read a second time.

Senator PEARCE:
Minister for Home and Territories · Western Australia · NAT

– All I desire to say in addition, to the remarks I made last evening, in moving the second reading of this Bill, is that in order to have clarity of discussion, the major part of the debate should, I suggest, take place in the Committee stage. There are certain distinct works provided for, and the discussion would naturally centre round those works.

Senator GARDINER:
New South Wales

.- Whilst I quite agree that this is largely a measure for the Committee, it is also one on which the minds of honorable senators should be prepared before it reaches that stage. It provides money, among other purposes, for building at a huge cost a provisional Parliament House at Canberra. This building has been designed by the departmental architects, and, according to the evidence given before the Public Works Committee, it is to take the place of the monumental building that has been talked of ever since ;the construction of the Federal Capital has been under contemplation. I see no reason why hundreds of thousands of pounds should be spent on a make-shift Parliament House. If the proposal was for a temporary structure costing £10,000, or even £20,000, 1 should have no great objection to it, provided that the erection of the permanent building was proceeded with without delay. I regard the attempts made to depart from the original plan of Mr. Griffin as the muddling efforts of amateurs. One of the designs for a temporary building has been declared by experts to be an abomination. I am not criticising the Chief Architect, Mr. Murdoch, personally. He states that the proposed provisional building would be very different from a purely temporary structure. He knows the Australian so well that he believes that once the Parliament is comfortably housed in a provisional building the requirements for, perhaps, fifty years would be satisfied. I object to any deviation from the original plan. The capital should be built to the best design that the people of Australia can afford. A committee of architects called for competitive designs from all parts of the world, and the best plan received was to have been adopted. Although I should have awarded Mr. Griffin the first prize, I should have built the capital according to the best design submitted by an Australian architect.

Senator Lynch:

– Although it might not have been the best?

Senator GARDINER:

– Yes, because my idea is that the capital should be a monument to the intelligence and capacity of the Australian people at this particular stage of their history. According to the report of the Public Works Committee, a purely temporary building would cost at least £148,000. “What, then, would be the cost of a provisional Parliament House which, according to

Mr. Murdoch, would last for fifty years? Paragraph 26 of the report states -

Those who favoured the nucleus of the permanent ‘building argued that in any expenditure in that direction the Commonwealth would be getting permanent value for its money in the way of something which would be available to the people of Australia in the future, while money spent on a provisional building would be so much dead loss. It was claimed that a nucleus or shell would be the finest possible incentive to the people to aim at the fulfilment of an architectural monument, which would be the central feature of the Capital city, and that it could be built in approximately three years at a cost of about £250,000.

I take the report of the Committee to mean that a provisional building would cost £250,000. If we added to that another £100,000, I should say we could erect a monumental building that would be worthy of Australia. If it would take three years to make a provisional building ready for occupation, a monumental structure could probably be advanced sufficiently far to enable Parliament to meet in it within four or five years. As soon as we commence to depart from the original design we are sure to mar the work from the artist’s point of view, and the danger is that we may mar the whole project. I fear that the proposed provisional building will take the place of something in the original plan that is a necessary feature of the City Beautiful where the Australian Parliament is to be accommodated. I am a New South Welshman, and it may be said that my attitude will tend to delay the construction of the parliamentary edifice; but, just as I have opposed the wasting of the people’s money by way of special grants to Queensland and Tasmania, so I object to waste in another direction in my own State. This is not the time for the Government to consider the construction of a provisional Parliamentary building. A great responsibility is resting upon the Federal Parliament, and we should decide to proceed with the construction of a permanent building at the earliest possible moment. It is not my intention to assist to mar the magnificent lay-out by altering the original design or position in which the buildings should be placed, as suggested by the designer when the original plans were prepared. I do not know whether or not the design is the best that could be obtained. I wish to quote from the evidence of Mr. J. S. Murdoch, who said -

I am responsible under the Department for the sketch plan of the proposed Parliamentary buildings at Canberra. The plan has been submitted .to, and generally adopted by, the Advisory Committee appointed by the Government to deal with Canberra. It has been drawn up to meet the wishes of the Government, and to comply with the recommendations of the Advisory Committee, and is designed to provide accommodation for the legislative activities of Parliament. The provisional building will be of more or less temporary character. Before reaching the stage presented to the Committee in the sketch plan, many sketches were prepared and consultations held with the President and Speaker, as well as the administrative staffs of Parliament. It is only a sketch plan. The permanent drawings have not yet been made, so the entire scheme is capable ‘ of alteration and modification in any way which the Committee might think advisable, without putting the Government to any great expense. My definition of a temporary building, as distinct from a provisional structure, is a place designed to last for, say, twenty years. The sketch plan makes provision for something better than that - something between a temporary structure as I have described it and the monumental buildings which, no doubt, will be erected some day. The first Houses of Parliament will probably be sufficient for the legislative activities of the Commonwealth for the next fifty years. At all events, the buildings are expected to be able to meet the needs for that period. I have seen various permanent Parliament Houses in different parts of the world. I can say that the proposed building, although called a provisional structure, will prove so comfortable that there will be no great haste exhibited by me to erect and occupy an ornate permanent building. In my opinion the temperament of the average Australian is such that he would not be any happier in one of those extremely elaborate structures to be found elsewhere in the world than in the proposed building.

The evidence I have quoted clearly indicates what is in the mind of the Commonwealth architect. A provisional building will doubtless mar the original design, and even at the risk of what my action may entail, I intend to do my duty by opposing a change which will involve an interference witE the lay-out of what should be the most beautiful city in Australia. I do not intend to vote loan money to the extent of £250,000 for the construction of a provisional Parliamentary building, because that amount could be spent to better advantage in constructing a permanent building. The architect refers to an ornate design. Why should not we have the best that can be designed ? I am not questioning Mr, Murdoch’s ability, but I suggest that there should be an open competition be- tween our architects. Let the best man win, and the best building be erected. Parliament should be the judge of what is the most suitable and what amount should be spent.

Senator Lynch:

– In New South Wales the people are in too much of a hurry.

Senator GARDINER:

– Such an interjection comes very well from Senator

Lynch. Under, the Constitution, Senator Lynch and his friends pledged themselves to enter into an arrangement to provide a Federal Capital within ten years, and although over twenty-two years have passed by, practically nothing has been done. Ten years ago, when Senator Lynch voted for a railway to link South Australia with Western Australia, and because of the demands made by the Western Australian people a line was constructed which cost more than the proposed building will involve, I did not say that the Western Australians were in too much of a hurry to have the line constructed. I supported the proposal.

Senator Pearce:

– The Western Australian people are in favour of the Federal Capital.

Senator GARDINER:

– Yes.’ When the promises made to Western Australia have been fulfilled, it is unfair of Senator Lynch to charge the New South Wales people with being in too much of a hurry. We are not in a hurry, but the Federal Parliament has disregarded its pledges for such a long time that the people in that State have come to the conclusion that it is’ an institution which does not keep its promises. It is said that very little notice is taken of Parliamentary promises, and there is some justification for adopting such an attitude, because, although over twenty years have elapsed, the Capital which was to be established within ten years of the inauguration of Federation is not yet ready for1 occupation. Those promises are as mere scraps of paper. With the valuable assistance which the press is rendering, the Parliaments of the world are being dragged down to such an extent that they may yet be submerged. I do not know how they are doing it, but it is being done. Instead of charging New South Wales with being, in too much of a hurry, I think it should be said that we are too patient.

Senator Lynch:

– The establishment of the Capital is provided for in the Constitution.

Senator GARDINER:

– Yes, in the agreement made at the second Convention, when it was agreed that the Capital should be established in New South Wales but not within 100 miles of Sydney. That pledge of the Australian people has not been honoured.

Senator Pearce:

– That is not altogether correct, as a certain amount of work has been done.

Senator GARDINER:

– The Minister is most impatient. He should not say that it is not correct, because the Capital has not yet been established.

Senator Pearce:

– The site and lay-out have been decided upon.

Senator GARDINER:

– But very little work has been done. I have no desire to debate the matter at further length. If honorable senators are prepared to vote money on a provisional Parliament House which may mar the future design and beauty of what was originally intended it will be their responsibility. As a New South Wales senator, I do not intend to take that risk, and although I may be charged with delaying construction, I intend to do my duty to the people of New South Wales by refusing to accept the design of a provisional building in place of a monumental structure which would be a credit to Australia.

Senator GRANT:
NEW SOUTH WALES · ALP

– I wish to offer my objection to the expenditure of the proposed vote of £500,000 on passage-money in connexion with immigration. This is the proper time to bring before the Government the complete inability on the part of all Governments to deal effectively with the question of immigration, which has been more muddled, perhaps, than any other important subject. A considerable number of members, including the present Minister for Home and Territories (Senator Pearce) could put their fingers on the weak spots in our system, and if they did what they knew to be right, a stream of migrants would voluntarily be moving towards Australia. Nothing is being done in any of the States to remedy the difficulty. We are always being told that this is a land of sunshine, and one inwhich the climate is unequalled in any part of the world.

The soil is capable of producing almost anything, and whilst Great Britain and other countries are overcrowded, the surplus population is going to the United States of America, Canada, and the Argentine instead of to Australia.From the information placed at their disposal through the press, possible migrants know that it is most difficult, if not almost impossible, for a man to secure a home for himself or to obtain suitable areas of land onwhich he could proceed with the work of production, unless he possesses a substantial hanking account. I was in conversationwith a gentleman the other day who said that no man could expect to undertake rural development on his own account in Australia unless he possessed £1,500. There are tens of thousands of capable Australians who would be only too pleased to commence primary production without being in the possession of a sum approximating that amount, but they cannot get access to the land. That is the real trouble. It is quite an education for one to go to a State Lands Office and endeavour to secure information as towhere suitable land can be obtained for settlement. I referred the other day to a casewhich occurred in New South Wales which is typical of hundreds in that and other States. This case was cited at length in the Sydney Evening News and other newspapers of a recent date. In close proximity to the town of Henty, on the main line between Albury and Wagga, the Government of New South Wales in a fit of generosity made available five farming blocks, each of 560 acres. For those blocks no fewer than 1,112 persons made application and lodged deposits.

Senator Guthrie:

– The land at Henty is very rich.

Senator GRANT:
NEW SOUTH WALES · ALP

– It is not better than the land in the Riverina generally. Riverina also is typical of very many areas in the Commonwealth. The land is fertile, and there is a good rainfall.

Senator Pearce:

– Does the honorable senator assume that all of those applications were received from men who did not hold land ?

Senator GRANT:
NEW SOUTH WALES · ALP

– The Government of New South Wales in its wisdom at one period appointed a Land Board. Those 1,112 persons believed that they were qualified to apply for the blocks, but the

Land Board of New South Wales reduced the number of applicants to 1,087.

Senator PEARCE:

– Half of that number of persons may have held land in other parts.

Senator GRANT:
NEW SOUTH WALES · ALP

– They could not, or the Land Board would not have agreed to their entering the ballot.

Senator McDougall:

– There were 876 bond fide prospective settlers.

Senator PEARCE:

– The possession of other land is not a disqualification.

Senator GRANT:
NEW SOUTH WALES · ALP

– When the Government of’ Great Britain a few years ago presented the whole of the lands of the Commonwealth as a gift to a handful of Australians, it was probably the most magnificent gift in its history. Yet despite our boasted education and other advantages, Australia is following so closely the practice adopted’ by Great Britain that to-day it is impossible for native-born Australians to obtain land in their own country. The case at Henty is typical of hundreds in that and other States. The Government of the Commonwealth declines to step into the breach and, by means of a straight-out land values tax-

The PRESIDENT (Senator the Hon T Givens:

– Order! I have allowed the honorable senator very considerable latitude. The land policy of the States may not be discussed under cover of this Bill. I ask him now to confine himself to the subject-matter of the Bill.

Senator GRANT:
NEW SOUTH WALES · ALP

– I thought that I was quite in order. We are being asked to vote money for the purpose of bringing more farmers to Australia. The advocates of immigration almost invariably claim that their intention is to bring persons to Australia to work on the land and not to engage in occupations in the cities and towns. I think that this is the proper time and place to point out to the Government that it is not acting honestly or straightforwardly. If the States decline to take action, the Commonwealth should use the full powers given it by the Constitution to see that persons who have the experience, the capital, and the desire, to enter into useful productive work, shall have the opportunity to do so. Until that is done we ought not to assist to bring immigrants to Australia. The Commonwealth Government year after year has deliberately prevented settlement at Canberra. It has not so far made available a single building block for either residential or business purposes in the whole of the Federal Capital area. How can any one expect progress to be made until the Government gives private enterprise the opportunity of acquiring building sites? If the Government were prepared to erect homes and business premises, the position would be entirely different; but for one reason and another absolutely nothing has been done. Had that policy been followed in the case of cities like Hobart, Launceston, or any of the capital cities of the Commonwealth, no advance whatever would have been made. In all the capital cities to-day private enterprise is quickly unloading, at fabulous prices, microscopic building blocks. At Canberra the Government is holding on. In my opinion that is being done in order to prevent settlement taking place. I took a very keen interest in the proposal to bring about the Federation of. the Australian States, and I was particularly hostile to small States like Tasmania being given equal representation in the Senate with the large and populous States. I still think that that principle is entirely wrong. The States ought to he represented on a population, not a territorial, basis. It is claimed that a definite time was fixed for establishing the Seat of Government at Canberra. I have not been able to find such a provision in the Constitution, and I do not believe it is there. If it is, I shall be glad if any honorable senator will point it out to me. Some of the prominent public men at the time, in order to deceive the electors, may have made the statement that no doubt in ten years or twenty years the Federal Capital would be established at Canberra.

Senator Pearce:

– There is no such provision in the Constitution.

Senator GRANT:
NEW SOUTH WALES · ALP

– I think it is a mistake, therefore, to do other than endeavour to give effect to what was the general impression at the time - that at the earliest possible moment the Federal Capital should be established at Canberra. A fair interpretation of the position is that it ought to have been established within a reasonable time. That reasonable time lias already elapsed. Now we are faced with the difficulty of deciding whether to have a temporary or a permanent Parliament House.

Senator Guthrie:

– Either it should be permanent, or we should not have one at all.

Senator GRANT:
NEW SOUTH WALES · ALP

– I agree that this is a vexed question. I am exceedingly anxious to get to Canberra as soon as possible. Because I believe it will expedite the removal of the Parliament to Canberra I am inclined to vote for the erection of a temporary building. My mind is not fully made up on this question, but it is fully made up on one point, that if we are to wait until what is termed the monumental and permanent building is designed and constructed, the removal of Parliament to Canberra will not take place for many years. What are the difficulties in the way to-day? We are informed, and we know, as a matter of fact, that a temporary building of a fairly satisfactory character has been designed. The plan of it appears in the report of the Public Works Committee, but, in my opinion, it would be well if the Government could be induced to provide better lighting for the Senate chamber.

Senator NEWLANDS:
SOUTH AUSTRALIA · ALP; NAT from 1917

– There will be natural light in both chambers all day long.

Senator GRANT:
NEW SOUTH WALES · ALP

– As originally designed both” chambers were to be surrounded by corridors, excluding the daylight for a considerable height. In a modern building we ought to adopt modern methods. It is useless building in Australia a structure suitable for Finland, or other countries in northern Europe. In northern Queensland can be found a style of building that does not exist in the northern temperate zone. The people in northern Queensland almost universally surround their houses -with wide verandahs, and put the floor level well above the ground. Further south the comfortable bungalow idea disappears until, in Tasmania, the verandah is abolished altogether, and houses are built on lines suitable for northern Europe, but entirely unsuitable for Australia. We ought not to build a structure of that kind for a temporary Parliament House at Canberra, and I would like to see the design altered so that the lavatories, officers’ quarters, and Committee rooms, surrounding the Senate, may be removed, and the chamber may be open to the fresh air on three sides, and exposed directly to the sunlight. It would be wise to get the best plan possible for a permanent House of Parliament at the

Federal Capital site, but to do so would take a long number of years.. If a temporary House is erected in brick it should last for fifty years, and in the meantime, or probably long before the fifty years expires, the permanent buildings should be completed, making a temporary structure available for quite a variety of other purposes.

Senator NEWLANDS:
SOUTH AUSTRALIA · ALP; NAT from 1917

– I should not be doing my duty to my former colleagues on the Public Works Committee if I did not put Senator Grant right. It must be remembered that Parliament irresponsible for the type of Parliament House proposed to be constructed at Canberra. The Public Works Committee, recognising that there was a difference of opinion as to whether a provisional building or the nucleus of a permanent Parliament House should be erected, referred the matter to Parliament, and another place has already decided on the erection of a provisional’ Parliament House.

Senator Elliott:

– Has another place any authority to decide the matter for us?

Senator NEWLANDS:
SOUTH AUSTRALIA · ALP; NAT from 1917

– Under a very strange arrangement the Senate has no voice in regard to the erection of this building.

Senator PEARCE:

– It has absolutely the: same voice as another place.

Senator NEWLANDS:
SOUTH AUSTRALIA · ALP; NAT from 1917

– The question of the erection of a Parliament House at Canberra has never been discussed by the Senate.

Senator PEARCE:

– It is before us in this Bill.

Senator NEWLANDS:
SOUTH AUSTRALIA · ALP; NAT from 1917

– I admit that in this Hill we can refuse to vote the money for the work. We have either to accept the Bill before us or to reject it.

Senator PEARCE:

– That is not correct. The honorable senator has been here long enough to know that there ‘are other courses open to the Senate under this Bill.

Senator NEWLANDS:
SOUTH AUSTRALIA · ALP; NAT from 1917

– -I am quite aware that there are many ways pf getting round a question of this kind, but another place has had a direct vote on the question of whether the one class, of building or the other should be erected.

Senator Pearce:

– That was in order to carry out the provisions of the Public Works Committee Act.

Senator NEWLANDS:
SOUTH AUSTRALIA · ALP; NAT from 1917

– The honorable the Minister must not assume that I am blaming the Government in this regard. I know the Public Works Committee Act, to which the Senate agreed, does not provide the same facilities for the Senate to deal with public works as are provided for another place, and the sooner that defect is remedied the better. The Public Works Committee were very painstaking in their inquiry, and they were most careful to see that they did not force on Parliament anything with which honorable members might not be disposed to agree. Some members of that Committee were anxious to get to Canberra. In fact, some were prepared to let Parliament meet there in a wood and iron building, little knowing what would lie ahead of them in that regard. However, the majority of the Committee decided that whether a temporary structure or the nucleus of a permanent Parliament House were erected the building should contain reasonable comforts for members of Parliament and others who were required to carry on their work in the building. The Committee’s recommendation was as follows: -

  1. After giving this matter careful and prolonged attention, the Committee decided that, as opinions of experts and laymen were so divided on the question, it would be well, after setting out the facts as above, to leave the final decision to Parliament. It therefore submits two alternatives, either of which would, in the opinion of the Committee, meet all needs for many years: -

    1. The erection of a nucleus of the permanent building on Camp Hill,
    2. The erection of the provisional building on the site below Camp Hill, as recommended by the Federal Capital Advisory Committee.

I heard an honorable senator say that there is no hurry to get to Canberra ; but Mr. Blakeley, a member of the Public Works Committee, who is very anxious to get there, has recommended the erection of a provisional building. The majority of the Committee recommended the erection of the nucleus of a permanent building on Camp Hill. It has been suggested that the original Canberra plan has been interfered with and spoilt by the proposal of the Committee, but nothing of the kind has been done. The Advisory Committee at Canberra, the present Government, and the Public Works Committee are agreed that the original plan of Canberra should be adopted without alteration. It is true that the provisional Parliament House is to be erected on a site where the plan provides for an ornamental lake, but it will be very many years before the enormous expense of providing such ornamental lakes at Canberra is undertaken, and there is no doubt that when the Commonwealth has enough money to spend on providing such things, the life of the provisional Parliament House will be pretty well exhausted. This is, the second occasion on which Senator Grant has returned to the charge with regard to the lighting of the chambers in the provisional Parliament House at Canberra. The matter of lighting the chambers received more attention from the Public Works Committee than did almost anything else. Both chambers will be as well lighted and ventilated as human ingenuity can provide.

Senator GRANT:
NEW SOUTH WALES · ALP

– Will it be necessary to use artificial light on an ordinary day?

Senator NEWLANDS:
SOUTH AUSTRALIA · ALP; NAT from 1917

– No. Both chambers will be open, above a certain height, to the daylight. Designing a legislative chamber’ is a very different proposition from designinga five-roomed cottage in Queensland or Tasmania. One of the principal difficulties in the erection of a building of this character relates to its acoustic properties. Senator Grant has suggested that the windows should be open. If the windows were open, has the honorable senator any idea of what the acoustic properties of the chamber would be?

Senator GRANT:
NEW SOUTH WALES · ALP

– I could make myself heard anywhere.

Senator NEWLANDS:
SOUTH AUSTRALIA · ALP; NAT from 1917

– Of course, the honorable senator knows all about it, but the Public Works Committee did not know anything about it, and therefore they sought evidence on the point from quite a number of professional gentlemen, who we thought ought to know all about this subject. These gentlemen told us it would be quite impossible to get proper acoustic properties in a large hall if the windows were allowed to be opened and closed at the sweet will of legislators. For that reason, they have been placed high up where a perfect system of lighting during the day can be secured. In a climate such as that at Canberra, with varying temperatures during the summer and winter, it is impossible to provide healthy and wholesome temperatures for the men who are compelled to work in the chambers. Therefore, it has been found necessary to resort to artificial ventilation. If Senator Grant would read the evidence taken by the Public Works Committee he would appreciate what difficulties there are in. ventilating legislative chambers. Parliament has decided upon a temporary building, because it has been shown that if the nucleus of a permanent building were determined upon it would be a long time before the work could be started. I believe it will be ultimately’ decided to place the permanent Parliament House on -the top of Kurrajong Hill. That is the principal landmark, and there the Chambers of the Legislature of the future should stand. Mr. Griffin suggested a capitol on that site. The capitol should be the Parliament House, and it should dominate the city. I doubt whether any one could suggest a better ornamental finish to a city than that suggested in the sketches already submitted. I have been a “ Canberra-ite “ from the day I entered this Chamber. Although I signed the Committee’s recommendation for the nucleus of a permanent structure, I am satisfied that the decision of Parliament is wise. I object to members of the Committee being slighted or blamed for anything that appeared in their report.

Senator Graham:

– Will the temporary building form part of the permanent building ?

Senator NEWLANDS:
SOUTH AUSTRALIA · ALP; NAT from 1917

– No.

Senator Graham:

– How far away will it be from the proposed site of the permanent building?

Senator NEWLANDS:
SOUTH AUSTRALIA · ALP; NAT from 1917

– About 300 or 400 yards.

Senator REID:
Queensland

. - The other day I asked the Leader of the Government (Senator Pearce) a question regarding benefits to Indians who have resided in Australia since Federation. The answer I received was very unsatisfactory. The question was -

Has the Government any intention of fulfilling the resolution agreed to at the Imperial Conference of 1921, and to which we were a party, that the franchise and other benefits under our law should be granted to Indians who are British subjects and domiciled-

The PRESIDENT (Senator the Hon T Givens:

– What has that to do with this Loan Bill?

Senator REID:

– I wish to bring the question under the notice of the Minister representing the Prime Minister.

The PRESIDENT:

– The honorable senator must know that he cannot do that on this Loan Bill, which has nothing to do with the franchise. There will be other opportunities for him to debate that question.

Question resolved in the affirmative.

Bill read a second time.

In Committee:

Clauses 1 .to 3 agreed to.

Clause 4 postponed.

Clauses ‘ 5 and 6 agreed to.

Schedule :

Prime Minister’s Department, proposed vote, £499,483, agreed to.

Department of the Treasury.

Proposed vote, £1,265,712.

Senator GARDINER:
New South Wales

.- It is well that I should indicate to the electors the change in the attitude of the Treasurer (Dr. Earle Page) on the question of loan expenditure. In this Loan Bill money is proposed to be voted for the purposes for which Dr. Earle Page said that it should not be used. Speaking in 1921 on the-. Budget, he said - . . and he proposes to spend from the Loan Fund instead of Revenue £162,000 on passage money for assisted immigrants, which, under no consideration, can be considered a charge against loan.

The same honorable gentleman is now using loan money for the purpose against which he then protested.

Senator Lynch:

– He was wrong in his first statement.

Senator GARDINER:

– I am pleased to know that he is still learning. On another occasion he said -

Why is the £162,000 for assisted passages to immigrants paid out of loans instead of out of revenue?

This year’s Budget presented by Dr. Earle Page contained the following: -

Those quotations disclose a remarkable change of front by the Treasurer. They show that his chief objective was office, and that when he found he could not hold office except by adapting himself to certain conditions, he decided upon this remarkable change of front. Senator Lynch may be right in his contentention that the Treasurer was wrong when he made the first statement. I doubt whether he is justified in spending loan money on immigration. I would rather have it spent upon public works to provide employment for the people already in Australia. The best way to induce immigrants to come here is to make the conditions of employment in Australia better than they are in any other country.

Senator Guthrie:

– They are better.

Senator GARDINER:

– Then there is no need to borrow money to bring out immigrants. That becomes obvious if one considers the tide of immigration that has flowed to America during the past century, and observes how it has been stopped automatically by recent legislation. America has legislated to take a small percentage of emigrants from certain countries.

Senator Elliott:

– Australia does not want some of those people.

Senator GARDINER:

– I realize that Senator Elliott does not want immigrants, except those of a certain class.

Senator Guthrie:

– We want. Britishers first.

Senator GARDINER:

– Narrow Australian as I am, I nevertheless have an idea that there is room in Australia for the best members of the European races. They can play a very useful part in the development of this country, I do not subscribe1 to the view that we want only Britishers. From an admixture of the blood of the best races of Europe there will develop in this country a nation which will probably be better than any other, particularly in view of our climate, open spaces, and upbringing. If I could take Senator Elliott and Senator Guthrie round Australia in a flying machine-

Senator Pearce:

– I shall be pleased to supply the honorable senator with one if he will go this afternoon.

Senator GARDINER:

– I could show the honorable senator many progressive settlements of non-British people.

Proposed vote agreed to.

Federal Capital Territory.

Proposed vote (under control of Home and Territories Department and Department of Works and Railways), £166,500.

Senator GUTHRIE:
Victoria

– I move -

That the item, “ Works, services, and acquisition of land in Federal Capital Territory, £165,000,” be’ left out.

I take exception to the expenditure of £165,000 on the construction of a temporary Parliament House at Canberra. The taxpayers’ money should not be wasted on the erection of any temporary structures, at the Federal Capital. I realize that, under the Constitution, the Parliament will ultimately be transferred to Canberra, but the proper procedure is to commence the building of a permanent Parliament House. We can ill-afford to waste money on the erection of a temporary building, which would be located 200 or 300 yards in front of the site for the permanent structure. If that were agreed to, the permanent building would have for its outlook the backyard, as it were, of the temporary Parliament House. I emphatically protest against this proposed waste of public money.

Senator NEEDHAM:
Western Australia

– I support Senator Guthrie, although I wish it to be distinctly understood that I desire the Parliament to be transferred to Canberra at the earliest possible moment. We should have a Parliament House that will be worthy of Australia, and the work should be proceeded with at once. I do not think it is the honorable senator’s intention to delay the transfer of the Parliament to Canberra. If I thought that would be the result of the request, I should not support him. I cannot agree to the expenditure of public money on a purely temporary building.

Senator PEARCE:
Minister for Home and Territories · Western Australia · NAT

– It is a mistake to refer to this structure as a temporary building; that term is apt to be misleading. The Public Works Committee had before it three proposals. One was for a temporary building, estimated to cost less than £100,000. Its life would be only twenty years, and it would ultimately have to be removed. Then the Committee considered the erection of a provisional building of brick and reinforced concrete. The building that the Government contemplate erecting will be the provisional home of the Parliament, and the structure will be of a semipermanent > character. It is estimated that it will be suitable for the housing of Parliament for a period of fifty years. It can in no sense be regarded as a temporary building. It, will be constructed of brick and ‘concrete, the walls will be of hardwood, and there will be reinforced concrete floors.

Senator GUTHRIE:

– Hardwood? The building will be a sort of hybrid!

Senator PEARCE:

– It will be the strongest class of building that we could have. The Public Works Committee placed two proposals before the Parliament. One was that we should proceed with the provision of the nucleus of the permanent building on the site selected for it.

Senator Guthrie:

– That is all right; but I object to wasting money on a temporary structure.

Senator PEARCE:

- Senator Guthrie has at various times objected to any expenditure on the Federal Capital at Canberra, but the majority of honorable senators want to see that work expedited. The Committee, by a majority - there was only one member in the minority - recommended that the nucleus of the permanent building should be erected. The Committee, however, recommended that, if Parliament decided not to adopt that scheme, the next best thing would be to erect a provisional Parliament House on Camp Hill, at a lower level than the site of the permanent building.

Senator Guthrie:

– The outlook from the permanent building would then be into the backyard of the temporary one.

Senator PEARCE:

– No. The provisional building would be on a lower level than the other, and it could be used subsequently for Government offices. The Director-General of Works state that even if immediate action were taken, the nucleus of. the permanent building could not be made habitable for members of Parliament in less than six years.

Senator Foll:

– Other experts disagree with him.

Senator PEARCE:

– Other witnesses before the Committee were asked how long they thought it would take to build the nucleus of a permanent structure, and they expressed merely their own personal opinion; but the Director-General of Works is a most experienced officer, and he did not give his answer on the spur- of the moment. His evidence, therefore, is very valuable, and speaking from his wide experience in connexion with public works, he stated emphatically that the shortest possible time in which Parliament could be housed in such a nucleus was six years. From my experience as a Minister acquainted with the delays that occur in these matters, I can safely say that we should add several months, at least, to that estimate.

Senator Guthrie:

– If we wasted money on a provisional building, when would it be ready for occupation?

Senator PEARCE:

– I understand that the Public Works Committee reports that it could be made habitable within three years.

Senator GUTHRIE:

– Then we should save only three years by wasting money on an unnecessary building.

Senator PEARCE:

– In my opinion, more than three years would be saved.

Senator Elliott:

– Yet the Government, without waiting for the decision of the Senate, is going on with these arrangements.

Senator PEARCE:

– No ; the Government has made no arrangements.

Senator Guthrie:

– Why this unseemly haste ?

Senator PEARCE:

– The Government stands to its decision to go on with the construction of the provisional building; but, of course, it does not deny honorable senators the right to express their views. Ministers hope that the Senate in its wisdom will agree to the Government proceeding with the construction of a provisional Parliament House. The Government does not desire the Senate to follow it blindly. Much money has already been absorbed at Canberra, and, in the next few years, we shall be spending several million pounds more. Every year that the new Capital is lying idle, huge city rents must be paid for the Commonwealth’s administrative offices, and we shall be delaying the time when the Federal Capital will become a payable proposition. I am satisfied in my own mind, that when the Parliament and the administration are removed to Canberra, the Capital will show a return for the outlay. From that point of view, it is most undesirable that the transfer should be delayed for three years longer than necessary. The adoption of Senator Guthrie’s amendment would not mean that no more money would be spent at Canberra, but it would delay the removal of Parliament to Canberra for a further three years. In that event private enterprise would decline to take any active interest in the Capital for some time to come. So long as there is any doubt concerning the removal of the Parliament and the Commonwealth Administration to Canberra, the value of the land will not appreciate, as persons who intend establishing businesses in the Federal Territory will always have in their minds the possibility of Parliament not removing to Canberra for six years. There would also be a fear that the whole question might eventually be reconsidered, and while that doubt existed, the land which is the property of the nation, would not have the value it otherwise would.

Senator Elliott:

– Would greater interest be taken if a provisional building instead of the nucleus of a permanent building were constructed?

Senator PEARCE:

– Yes, because Parliament would be meeting at Canberra three years earlier. This is not a party question, but one which should be considered in a cool and dispassionate way. It should be our endeavour to do our best in the interests of the people, and in view of the Committee’s report, general approval should be given to the construction of the provisional building. I ask the Committee not to accept the amendment.

Senator FOLL:
Queensland

– The Public Works Committee, of which I was a member, when this question was under consideration, said that if its suggestion were carried out it would, to a certain extent, delay the time when Parliament could meet at Canberra. The question was thoroughly investigated, and information was obtained from every witness who could give advice of any value on the two principal phases of the project. The Committee considered whether it would be more advantageous to expend money on the nucleus of the permanent building or to construct a provisional building, which could later be utilized by different Government Departments. Apart from the Commonwealth Architect and the members of the Advisory Committee, there was not a witness of any consequence who was in favour of the suggestion submitted by the Government. The Committee sought the advice of the grand president of the Australasian Institute of Architects, and other leading architects in Australia, every one of whom stated that even though the construction of the nucleus of a permanent building would delay our removal to Canberra, it would be far more economical and satisfactory to the nation to undertake the construction of a permanent Parliament House.

Senator Duncan:

– The Australian architects were not given an opportunity to submit designs.

Senator FOLL:

– Australian architects should have that opportunity.

Senator McDougall:

– They have.

Senator FOLL:

– They have not. Previous Commonwealth Governments have committed a serious breach of contract with the architects within the British Empire, as it was definitely promised by a previous Administration that they would have an opportunity of submitting a design for the building.

Senator Thompson:

– That undertaking can still be honoured.

Senator FOLL:

– I do not agree with the honorable senator, because I am convinced that if a provisional Parliament House is erected it will serve for at least fifty years. The Public Works Committee did not arrive at its decision hurriedly, and there was not the slightest prejudice on the part of the members of the Committee against the transfer of the Seat of Government to Canberra.

Senator Cox:

– Were they not all Victorians ?

Senator FOLL:

– No, the members of the Committee who favoured the erection of the nucleus of a permanent structure included Senator Newland, who has always (strongly advocated a removal to Canberra at the earliest possible date. Senator Plain was also a member, andI have not heard him offering objection to the scheme. The other members of the

Committee were the honorable member for Swan (Mr. Gregory), the honorable member for Bass (Mr. Jackson), and the honorable member for Lilley (Mr. Mac kay) . The last mentioned is a representative of Queensland, and has always supported the proposal. The Leader of the Opposition (Senator Gardiner), who pave evidence before the Committee in Sydney, ‘ favoured the money being spent on the nucleus of a permanent structure. Senator Gardiner’s attitude was somewhat different from that of other witnesses, inasmuch as he said, “ Let us get there, even if wo have to be accommodated in tents. We might get temporary accommodation and hold a session at Duntroon.” He was not in favour of a provisional structure.

Senator GARDINER:

– I am not in favour of it now, as I shall show by my vote.

Senator FOLL:

– The Government definitely promised the architects in the British Empire that before a permanent Parliament House was erected in the Federal Territory they should have an opportunity to submit designs. The offer was withdrawn, and the question has not been re-opened; but before anything further is done, either in connexion with a provisional or permanent building, architects should have the opportunity of submitting designs. According to the evidence taken by the Committee, construction would be delayed for more than eighteen months if outside architects were given the opportunity to submit designs, but eighteen months is very little in the life of a nation. It would be better to delay construction for six years than have a building unworthy of the Commonwealth. When a member of the Committee, I moved the following motion : -

That to enable the construction ‘ of the nucleus of the permanent Parliament House to b’e proceeded with, it is advisable that competitive designs be invited by the Commonwealth Government for the permanent Parliament House, returnable at the earliest possible time compatible with the undertaking, but not to exceed twelve months; the nucleus of the building to contain such portions as will be enumerated later - remaining portions required to enable the business of Parliament to be carried to be of a temporary nature.

Senator Lynch:

– What would i the nucleus of a permanent structure cost?

Senator FOLL:

– Approximately £300,000, or about £100,000 more than the estimated cost of the provisional structure. I contend that it would be far better to spend £300,000 than £200,000 on the construction of the building that may possibly have to be demolished some years hence. The Minister (Senator Pearce) stated that a provisional building could be used for administrative purposes. If the present suggestion is adopted, Mr. Griffin’s plan, as accepted by the Commonwealth, will be upset, as it was not intended to construct offices in front of the Houses of Parliament. I intend to adhere to the decision I arrived at when a member of the Public Works Committee, after having listened to all the evidence and spending hours in consultation in Committee on the matter. Careful consideration should be given to the evidence tendered by architects and builders who know their business.

Senator Duncan:

– Did the Committee consider the situation which would later arise if 200 or 300 men were engaged on the work of construction when Parliament was sitting?

Senator FOLL:

– That point was raised by various witnesses and carefully considered by the Committee. A witness in Sydney pointed to a huge retail building which was practically being re-constructed while business was still being carried, on. Parliament is usually in recess for five or six months in the year and a contractor should be able to carry on the work of extension at specified periods without causing any inconvenience to members.

Sitting suspended from 1 to 2.30 p.m.

Senator PEARCE:
Minister for Home and Territories · Western Australia · NAT

– I thank Senator Foll for giving way to me and allowing me to bring before the Committee, at this stage, certain facts of which honorable senators may not be aware. I was under the. impression - I think all honorable senators were - that this Bill contained a vote for the building of the provisional Parliament House at Canberra. On perusing the schedule of the works for which this vote is required, however, I find that there is no item dealing with the erection of that provisional Parliament House, the idea being that the commission will be charged with the work and will be authorized to raise money for the purpose. It is the intention of the Government to proceed with the erection of the provisional Parliament House. Therefore,, this is the only Bill on which the

Committee, if it wishes to do so, can state its views to the Government. If Senator Guthrie wishes to test the matter he will not achieve his object by seeking to have this item struck out. It makes provision for all the works that are proceeding at Canberra, and if the vote were disallowed all those works would come to a stop. I understand that Senator Guthrie, and those supporting him, wish to give a direction that the nucleus of the permanent building shall be erected. That can best be achieved by moving that the item be reduced by £1.

Senator GUTHRIE:
Victoria

.- I ask leave to withdraw my amendment and to substitute a new one.

Senator FINDLEY:
Victoria

– Before that is done I want to know what my position will be if I adopt a certain course. Do I understand, from the Leader of the Government, that if Senator Guthrie’s amendment goes to a division, and the division proves to be against the Government’s intentions, all work that is at present proceeding at the Federal Capital site will be stopped ?

Senator PEARCE:

– If the amendment at present before the Committee is carried, that will be the case.

Senator FINDLEY:

– Suppose that Senator Guthrie is granted leave to withdraw his amendment and substitute another. If the Committee votes in favour of the later amendment, will that be a direction to the Government, and can the Government, if it wishes, accede to the desire of honorable senators ?

Senator Pearce:

– The Government would have to obtain the view of honorable members in another place. Any direction must be given by Parliament, and not by one House only.

Amendment, by leave, withdrawn.

Senator GUTHRIE:
Victoria

.- I move -

That the item “ Works, services, and acquisition of land in Federal Capital Territory, £165,000, be reduced by £1.” aa an instruction to the Government not to proceed with the building of a provisional Parliament House. I have always been an opponent of what I have called the “ Bush Capital “ at Canberra, believing that by proceeding with the work we will be incurring the unnecessary expenditure of a huge sum of public money on non-productive work at a time when this young country urgently requires that money be made available for reproductive works. I do not approach this matter in a provincial spirit. My action is not dictated by a desire to keep the Parliament in Melbourne. I have been in the past, and I still am, prepared to support a motion directing that the location of the capital be shifted to Sydney. However, we have given our word that the Federal Capital shall be established at Canberra, although the Constitution does not lay it down when the change is to take place. The Government is displaying an unseemly haste in proceeding with the proposal to erect a provisional building. I believe that the money available should be spent on the nucleus of the permanent structure. It is estimated that that would take six.years to complete, whereas it is thought that the provisional building would be ready for occupation in three years. After all, what is three years in the life of a nation?

Senator FOLL:
Queensland

.- I am glad that Senator Pearce pointed out that if we had voted for the previous amendment, we should have stopped the carrying on of all work at Canberra. That, I think, is not the desire of the Committee. When the outlay on the Federal Capital was decided upon, Mr. Walter Burly Griffin’s scheme was accepted as being the most suitable, and the most likely to fulfil the requirements of Australia. If the present proposal of the Government is persisted in, the provisional House will be erected on the bed of one of Mr. Griffin’s artificial lakes. Far better would it be if it were erected on the site recommended by the Public Works Committee. The report of the Committee states -

It was claimed that a nucleus or shell would be the finest possible incentive to the people to aim at the fulfilment of an architectural monument, which would be the central feature of the Capital City, and that it could be built in approximately three years at a cost of about £250,000.

This building in which the Parliament at present meets has never been completed, and the chances are that if we go into a provisional building it will remain provisional for the next hundred years. That will not be in. the best interests of Australia. I value the opinion of Mr. Griffin. He won the competition for the best lay-out of the city, against architects from all over the world. Many persons who have not now kind things to say about Mr. Griffin, a little while ago. were quite willing to admit that he is probably one of the greatest men in his profession in the world. His winning of the competition demonstrated that. Giving evidence before the Public Works Committee, Mr. Griffin said that his estimate of £250,000 for the nucleus of the permanent building still held good. . Other architects varied in their estimates. The Federal President of the Institute of Architects, Mr. Godsell, said that his Council had gone into the matter fairly closely, and had estimated that something like the same amount would be required. In order to be absolutely on the safe side, the Public Works Committee recommended an expenditure of £300,000 in erecting the nucleus of the permanent building. These are the two alternatives which we are being asked to consider - either to agree to the expenditure of £200,000 on the provisional building, or to recommend the expenditure of £300,000 on the erection of a nucleus of the permanent Parliament House, which eventually will become one of Australia’s greatest monuments. I want to see Canberra finished. I think we are more likely to get what we are aiming at - the Capital City beautiful - by erecting the nucleus of the permanent structure rather than by spending £200,000 on a building which, even though it lasts for 50 years, will not fulfil what is required of it. The completion of the permanent building) will be delayed if the provisional building is gone on with. We know what happens in the case of temporary buildings; each succeeding Government and Parliament adopts the attitude of postponing the permanent work.

Senator GARDINER:
New South Wales

.- Senator Foll has referred in a friendly way to certain evidence given by me before the Public Works Committee concerning the proposal to build a provisional Parliament House at Canberra, but I am afraid his references may be misconstrued elsewhere. The attitude I take up to-day is exactly the same that I took up when giving evidence before the Committee. As a trustee of the people’s money I am opposed to wasteful expen diture at Canberra just as I am opposed to it anywhere else in the. Commonwealth. In giving evidence before the Committee I said -

I favour not a provisional Parliament House but a temporary structure built in such a position at Canberra that it could be used afterwards as a university, school, city hall, or administrative building….. Such a building could be built for £30,000. . . . The time occupied in making a monumental building ready for occupation would depend upon the amount of money available, and the design if constructed, and good management, it could be ready in three years; under easier going management in five years, and at the rate of speed displayed by Parliament during the last twenty-two years, 500 years.

If the Government were in earnest a monumental building could be completed in three years. The question of. time could ‘be eliminated by the number of men employed, and the amount of money available.

Senator Pearce:

– The six years’ estimate allows a little over two years for construction.

Senator GARDINER:

– I do not know why it should require four years of preparation. If the conditions of the competition were cabled to the great cities of the world the designs could be procured within twelve months.

Senator Pearce:

– How could we cable the contour of the country?

Senator GARDINER:

– The designers would need only the specification of the class of building required. In any case, a mail from Australia would reach any part of the world within six weeks. I understand that designs were called for in 1914. The world’s architects are prepared for this competition.

Senator Foll:

– They have all the necessary information, because the competition was well in hand when it was stopped.

Senator Pearce:

– That is’ not correct.

Senator GARDINER:

– The world’s architects have had their minds directed to this particular competition, realizing that it will be a monument for all time to the man whose design is chosen. I realize that I would be in strange company if I supported Senator Guthrie in his opposition to the building of a permanent Parliament House.

Senator Guthrie:

– I have given way on that point.

Senator GARDINER:

– The honorable senator has given way in his opposition to the permanent building, but not in his opposition to a provisional building, and I am prepared to join him in opposing a provisional building. As Senator Foll has pointed out, the nucleus of a permanent building should be ready for occupation before a provisional building could be completed, and, subsequently, the permanent building could be proceeded with without interfering with the sittings of Parliament. Parliament has never had a more important measure to consider. Had it been brought forward at the commencement of the session, our deliberative judgment could have been obtained on every detail. It is not a matter of housing’ the Australian Parliament for a little while. We are concerned in housing it for all time, and yet here, in the closing hours of the session, we are asked to consider the proposal, and shall probably drift into parties, some of us voting with Senator Guthrie against the Government, and others voting with the Government. It is slurring the business.

Senator Guthrie:

– It is not a party question.

Senator Cox:

– It is a Victorian question.

Senator Guthrie:

– It is an Australian question.

Senator GARDINER:

– Unfortunately, it was made a party question at the first Convention. It has been a New South Wales and anti-New South Wales question in every Commonwealth Parliament. But gradually the people of Australia have been won over to the belief that the compact with New South Wales must be kept and the Capital built. The people of New South Wales want that Capital built as it was intended to be built, even if it takes ten years to do so, rather than have a smudge that would be df no value, and would really be a disgrace to the nation. I have every sympathy with those honorable senators who must vote for the interests of their own constituents, and for what their people require. But above all those things which may be regarded of great importance to individual States, is the question of whether the expenditure on a provisional Parliament House would not be a waste of public money. In my judgment it would be. A permanent building can be built within a reasonable time. I am prepared to prophesy that the Federal Parliament will be sitting at Canberra within three _years. When the Labour party comes into power the Governor-General will be instructed to summon Parliament to meet there. When I was before the Public Works Committee I suggested that temporary halls could be built at Duntroon, in which the Senate and the House of Representatives could meet.

Senator Pearce:

– There are as many Labour men anti-Canberra as there are Nationalists.

Senator GARDINER:

– I realize that, but fortunately for the State of New South Wales, it has seventeen representatives of labour in the Labour party who are tired of waiting for the building (of the Federal Capital. When the pendulum swings, and our turn comes along, I would not care to be associated with any Government that did not immediately call Parliament together at Canberra. The expenditure of a couple of thousands of pounds in providing halls at Duntroon would enable Parliament to meet where it could watch the progress of the permanent buildings. I was shocked when Senator Foll said that the proposed provisional Parliament House is to be built in the bed of one of Mr. Griffin’s proposed lakes. At an earlier stage to-day I referred to the fact that the proposal of the Government would mar the original lay-out, as prepared by Mr. Griffin. It would be worse1 than a crime to do so. It would be a blunder. A Government that deliberately lays itself out to mar the magnificent plan prepared by Mr. Griffin is doing something that will not be to its credit in the years to come.

Senator Foll:

Mr. Sulman, in giving evidence, said that had Mr. Griffin’s plan been carried out, the lower Camp Hill site would have been used for a reservoir or shrubbery.

Senator GARDINER:

– Of course, I understand that every New South Welshman should vote against a Victorian ! I would not care to have a snapshot of myself voting alongside Senator Guthrie and Senator Elliott; but on this occasion I shall take the risk of voting with those honorable senators against ‘the building of a provisional Parliament House in the basin of a lake. I want the stepbystep programme for the building of Canberra carried out; I want the Government to advertise for the best design, and I want the building pushed on with ali Baste, but I shall never vote to waste £200,000 on a building which, after all, would mar the original design of the gentleman who designed this great city.

Senator FINDLEY:
Victoria

.- I am a Federalist. I believe in having a Federal city, and I realize that Canberra has been definitely chosen as the site for housing future Australian Parliaments. It is true that some Victorians have vigorously opposed any proposal that the Federal Parliament should meet in New South Wales. I cannot understand the attitude of those honorable senators and members of another place who oppose the establishment of the Seat of Government at Canberra, and hold the view that the people would be as well served if Parliament met in Melbourne or in Sydney. The people of Australia, in exercising their votes on the Constitution Bill, voted in favour of it. In that measure there was a provision that the Seat of Government should be in New South Wales, at least one hundred miles from Sydney. Therefore, we are all faced with the solid fact that, a compact, or treaty, was entered into seriously and solemnly by the people of Australia for the building of the Seat of Government in New South Wales, at least one hundred miles from Sydney, and any one who would suggest that that treaty or compact should not be carried out is np respecter of treaties or contracts. The” remarks made by Senator Guthrie would lead one to assume that he does not believe that the Federal Parliament should meet at Canberra.

Senator Guthrie:

– I realize that it must do so.

Senator FINDLEY:

– Speaking on the motion for the adoption of the AddressinRepIy early this session, Senator Guthrie said -

Some foundation-stones have been laid at Canberra - quite a setting of them - and I have heard that they are at the present time nicely covered with .moss. This serves to hide their crudity, and I personally hope that the moss will be allowed to grow. I have always contended that we can make quite as good, or as bad, laws in Sydney, or in Melbourne, as we could if this Parliament were transferred to the bush.

Here he seriously .asked us to entertain the view that the Federal Parliament should meet either here or in Sydney for an indefinite period.

Senator Guthrie:

– Not for an indefinite period.

Senator FINDLEY:

– The honorable senator said that we could make quite as good, or as bad, laws in Melbourne as we could if this Parliament were transferred to the bush. On the other hand, the people of Australia have decided that these laws should at some time or other be made at the Federal Capital, and pot in Melbourne or Sydney. I doubt whether that could be done, even with an alteration of the Constitution. Senator Guthrie said that he did not believe in wasteful expenditure. Nor do I. He also said that expenditure on a Capital site would be unproductive. I admit that at present it is unproductive, but I am convinced that if the undertaking is proceeded with on a business-like basis, the Federal Capital site will within a reasonable period be a highly profitable proposition. The land belongs to the people of Australia for all time. With every increase of population, there will be an increase in rentals, which, however, will not go to private landlords.

Senator Elliott:

– What kind of buildings does the honorable senator think would be erected on leasehold land ?

Senator FINDLEY:

– That will be determined by the Government in power. If the Labour party is in power, it will take steps to insure that no jerrybuilding is done. I make bold to say that influences have been operating during the last year or two to push on the work of building a Parliament House at Canberra regardless of whether the building would be to the advantage of Australia and those who will have to assemble in it. What is worth doing at all is worth doing well. Believing wholeheartedly in the establishment of a Federal city, and having voted for a Capital site when to do so was unpopular, I shall now be consistent, first by speaking, and afterwards by voting, in favour of a proposal for erecting a building which will be a credit to the designers of the city and the people of Australia. I am not in favour of a temporary structure, or of -the expenditure of a large sum of money on a building which will not be satisfactory, and will not meet the wishes of the people who sent us here. I am not like some Victorian honorable senators, who do not want to leave Melbourne in any circumstances. If I looked at the matter from a personal point of view, I should say, “ Stay here for years.” I live here, and can go home every evening. I believe in a Federal city, and I want the building of Parliament House to be proceeded with. I look forward to the time when Parliament will assemble there in a suitable building, but I hope it will not go there before such a building is available. What is the reason for the present undue haste?

Senator Cox:

– There has not been any undue haste during the last twenty years, and there never will be if we listen to the honorable senator.

Senator FINDLEY:

– There is no jealousy in this matter as far as I am concerned.

Senator Cox:

– The honorable senator would go there to-morrow if he had a chance.

Senator FINDLEY:

– I would not like to go there to-morrow if the buildings were of the kind that some honorable senators suggest. I am in favour of the amendment, not because I am opposed to the erection of a Federal Parliament House at Canberra, but because I am in favour of a building such as was suggested by the original designer. It has been stated that when we lay the foundation stone of a permanent building, we shall be able to assemble there within a period of six years, but if we have a temporary building we shall be able to go there in three years. The difference between throe and six years is very small. It would be difficult for the most ardent advocate of an early removal to Canberra to prove that spending money on a temporary building would be in the interests of the people of Australia.

Senator THOMPSON:
Queensland

– As I come from Queensland, I cannot be accused of holding partisan views in this matter. As a business man I looked very much askance at the proposal of the Government, but I took the trouble to read the papers relating to it, and have come to the conclusion that it is expedient and wise. I look farther than a few years ahead. I look forward to the time when we shall have not merely 5,500,000 people in Australia, but 50,000,000. If we build a temporary structure, substantial enough to last for fifty years, we shall have ample time in which to build a permanent House of Parliament, with a Capitol that will be worthy of the Australian nation. We shall be able to make other use of the temporary building, which will not, I understand, interfere with the aspect of the permanent building. Furthermore, we shall be able to keep faith with the architects of the world, to whom we are largely committed, by asking them to supply plans for a building. If ample time is taken to carry out the work and it is properly supervized, a building should result which will be a credit to Australia, not as she is to-day, but as she will be many years hence.

Senator Foll:

– I regret that when discussing this matter a few moments ago, I became confused in regard to the Camp Hill site and the Knoll site. I had no intention of misleading the Committee. A vote was taken in the Public Works Committee on the question of the Knoll site, which was defeated by four to three. The site adopted was on the lower part of Camp Hill, on which the permanent House will eventually be built. It is not in the bed of a lake.

Senator McDOUGALL:
New South Wales

– On this occasion, I am opposed to my Leader (Senator Gardiner). He said he would have difficulty in explaining his position to the electors if he sat between Senator Guthrie and Senator Elliott during the division. He is big enough and able enough to explain anything; but how can I explain when they see me sandwiched between Senator Cox and Senator Duncan? I shall have to do my duty now, and face the consequences? The question was referred to the Public Works Committee, whose decision I intend to respect.

Senator GRAHAM:
Western Australia

– I am opposed to the erection of a temporary Parliament House. I was informed this morning by an honorable senator, who should know the facts, that the temporary building would be 300 yards in front of the permanent building. If we are to build a National Parliament House, why not have a permanent structure from the start? I am very pleased that Senator Foll has corrected his misstatement, and that the building will not be a Noah’s Ark floating in a lake.. I should like to see the Canberra Parliament an accomplished fact. As I come from Western Australia, I can- ‘ not be accused of parochialism. It would not matter to me whether this Parliament sat in Melbourne or. Queensland. The sooner we get to work on the job the better it will be from the point of view of the employment of labour. If the erection of the nucleus of a permanent building delayed the transfer of the Seat of Government to Canberra for two or three years, it would not be a very serious matter. The argument has been used that a temporary building could be converted into Government offices, but I object to departmental offices being scattered here and there. At Canberra they should all be in one compact building.

Senator GUTHRIE:

– I take it that you support my amendment?

Senator GRAHAM:

– Yes.

Senator LYNCH:
Western Australia

– I have always supported the idea of Parliament being transferred to Canberra at the earliest possible moment, and if there is one thing more than another that has strengthened me in that view it is the antagonistic attitude of certain Melbourne newspapers towards the proposal. Two of those journals have their offices in. Collins-street, and they eclipse Nero of old in their tyrannical methods. If Senator Guthrie wishes to conserve the money of the taxpayers, the best thing he can do is to vote for the provisional building. The Canadian Parliament House cost $10,000,000, and the building is not yet completed.’ Is Senator Guthrie prepared to commit the Commonwealth to an expenditure of that magnitude? The New Zealand Parliament House has, so far, cost £360,000, and it is estimated that its final cost will be £600,000. The building in which this Parliament now meets cost something like £600,000.

Senator Pearce:

– £750,000.

Senator LYNCH:

– To-day, it could not be built, with all its inconveniences, for less than £1,000,000. I quite agree that the Commonwealth should have a Parliament House at Canberra worthy of the; growing importance of Australia. One of the alternative proposals submitted by the Public Works Committee was that we should erect the nucleus of a permanent structure; but that would cost much more than a provisional building. Although the proposed provisional building has been referred to as a temporary one, it would last for at least fifty years, and probably for nearly 100 years. The cost of the nucleus of a permanent building is estimated to be £300,000, plus £50,000 for additions. I have no doubt that the total cost would eventually be well over £400,000. A provisional building that would last at least fifty years would, it is estimated, cost £180,000, and the difference between that amount and, say, £350,000 for the nucleus of a permanent structure would, if capitalized, amount at the end of fifty years to £1,000,000. I suggest that we should agree to the construction of a provisional building. Fifty years hence a monumental building could be erected according to the latest ideas at that time, and then the country would have saved the sum of £1,000;000 with which to begin the work. A fragmentary building, such as the suggested nucleus would be, has no- thing to recommend it. There is no justification for voting for the erection of part of a permanent Parliament House.

Senator Ogden:

– That is only the hon’orable senator’s opinion.

Senator LYNCH:

– I challenge the honorable senator to disprove my figures. Looking at the matter both from the financial and the aesthetic point of view, the Government’s proposal is the better of the two.

Senator COX:
New South Wales

– I am surprised at the miserable attitude of honorable senators from Victoria. Senator Elliott has submitted a notice of motion that Parliament should not meet at Canberra until the construction of the Canberra- Yass railway has been completed by the New South Wales Government, and until adequate accommodation has been provided, not only for members of this Parliament, but for the parliamentary and administrative staffs of the Commonwealth. Now we have a most contemptible amendment by Senator Guthrie, who is trying to block the Government’s proposal. It is pitiful to see a business man taking up such an attitude. The two honorable senators I have referred to are supposed to be men above suspicion. If ever there was evidence of attempted repudiation in connexion with the building of the Federal Capital, we have it here. It ia repudiation of the worst description, and such tactics are beneath contempt. These honorable senators want to put off indefinitely the work of building the Federal Capital. They realize that the day of judgment will be a pretty busy time, and they want this work postponed until the subsequent day. Honorable senators who will go as far as that are capable of using any miserable excuse for delaying a work to which this Parliament is committed. I am sorry that Victoria is represented by men of this description. . I wish to make a suggestion as to how the meeting of Parliament at Canberra could be expedited. If there are not sufficient buildings already in Canberra for the purpose, the Duntroon College could be used to accommodate the Parliament. Failing that, I think there are enough tents in Australia.

Senator Ogden:

– We have got past tent life.

Senator COX:

– It is the best life that one could wish to lead. If the Government were in earnest, they would erect tents at the new Capital, and, without begging the pardon of members of Parliament, would say, “Next session we shall meet at Canberra.”

Senator OGDEN:
Tasmania

.- In expressing my own views on this question I believe I am voicing the opinions of Tasmanians generally, because we realize that although it was rather selfish on the part of New South Wales to insist that the Federal Capital should be established1 in that State, (before it would join the Federation, it is embodied in the Constitution, and the compact must be honoured. I cannot be regarded as one who is opposed to the establishment of a Federal Capital, but when the transfer is made we ought to be accommodated in a building worthy of a National Parliament. By some extraordinary process Senator Lynch endeavoured to prove that it would be cheaper to build two structures than one. The honorable senator is usually logical, but if his proposal meant anything at all it was that we should be prepared to be accommodated in a provisional building for all time. Did he mean that? If he did not, his intention must be that we should occupy a temporary building and commence the construction of a permanent building and add £250,000 to the cost. I do not think that even Senator Lynch believes that a provisional building will suffice. We should lay down the foundation of a permanent structure, as the difference between three years and six years in transferring the Seat of Government does not justify Parliament in virtually throwing away £250,000.

Senator ELLIOTT:
Victoria

.- In view of what had been said I . did not consider it necessary to express my views, which are already very well known, and i would not have spoken now but for the uncalled-for remarks of Senator Cox.

Senator Cox:

– It is a deliberate conspiracy.

Senator ELLIOTT:

– Not at all. One has only to mention Canberra and Senator Cox boils over and delivers a foaming torrent of incoherent speech. If honorable senators will examine the notice of motion which I have given regarding this matter, and a copy of which Senator Cox holds in his hands at this moment, they will, as reasonable men, see nothing objectionable in it - I expressly except Senator Cox from that observation, for every one. knows that in regard to Canberra he never can be reasonable. The reason for my motion may be briefly put. It is utterly impossible for an important Legislature such as this to properly function unless the accommodation is adequate. In the present circumstances, Ministers and members can readily secure the services of responsible officers, yet great delays often occur when information is required regarding any matter. The difficulties would be intensified to an intolerable degree if the Seat of Government were transferred to Canberra before proper provision had been made for the accommodation of the Parliamentary and Administrative staffs. If a transfer is made before that accommodation is, available I suppose we, as well as they, would, I suppose, be housed, in bark mia.mias, and important official documents lodged in dug-outs in” the bank of, the creek. Senator Cox has endeavoured to ridicule the motion which I have on the notice-paper relating to the construction of a railway to facilitate travelling to the Capital, and the provision of adequate accommodation, not only for the members, but, also, for the Departmental staffs. Is there anything in that proposal to which a reasonable man could object. Business ought to be carried on in a proper way, and adequate accommodation provided for officers who would not pay flying visits to Canberra, as senators do, but would be compelled to remain there throughout the year. In common with Senator Ogden, I am considerably puzzled as to how Senator Lynch arrives at his figures. Apparently, his contention is that, if we spend ?200,000 - or, at the lowest figure, ?180,000 - on a temporary building, instead of ?350,000 on the erection of the provisional building, then in fifty years we would save ?1,000,000, and this, although we should, in the meantime, continue to spend thousands on the permanent structure, thus conferring a benefit on the Australian people. I do not profess to be a financial genius, but I think the honorable senator will find on examination that there is something radically wrong with his figures. Further, in regard to the motion which Senator Cox says is so objectionable-

The CHAIRMAN:

– (Senator Newland). - The honorable senator must not discuss that motion.

Senator ELLIOTT:

– If another place presumes to ignore the existence of this Chamber, and directs the Government to immediately proceed to Canberra, should we not protest?

Senator Pearce:

– That is not correct.

Senator ELLIOTT:

– This is the time to preserve our rights. The importance of the Senate has been steadily undermined since the first Labour Government came into power.

Senator Pearce:

– I rise to order. I submit, Mr. Chairman, that reference to a motion submitted in another Chamber is irrelevant.

The CHAIRMAN:

– The honorable senator will not be in order in further discussing that matter.

Senator ELLIOTT:

-Without any reference to the Senate, the Government have made arrangements to lay the foundation stone of a provisional Parliament House at Canberra on the assumption that we will submit to the slight.

The CHAIRMAN:

– I direct Senator Guthrie’s attention to the fact that there is nothing in the Bill referring to the erection of a provisional Parliament House at Canberra, therefore, I cannot submit to the Committee the additional words he has proposed as an instruction to the Government. I shall simply put the question “ That the item be reduced by ?1 “.

Senator Pearce:

– That will have the effect which Senator Guthrie desires. If the amendment should be carried, I shall, of course, bring the matter under the notice of the Cabinet.

Senator Guthrie:

– I am quite agreeable if my intention is clearly understood.

Question - That the item be reduced by ?1 (Senator Guthrie’s amendment) put - . The Senate divided.

AYES: 19

NOES: 13

Majority . . . . 6

AYES

NOES

Question so resolved in the affirmative.

Amendment agreed to.

Proposed vote, as amended, agreed to.

Home and Territories Department.

Proposed vote under control of Home and Territories Department (excepting Federal Capital Territory), ?120,976.

Senator GRANT:
NEW SOUTH WALES · ALP

.- There is an item of ?3,991 for the purchase of land at Fairy Meadow. The Commonwealth has already spent nearly ?750,000 on land in the Territory. Why is it necessary to purchase further land there?

Senator Pearce:

– Considerable litigation has taken place in connexion with this matter, which is still undecided. Provision has to be made for legal and current expenses, including the amount which has to be paid for the resumption of the land.

Proposed vote agreed to.

Department of Defence.

Proposed vote, £24,695.

Senator OGDEN:
Tasmania

.- I am forcibly struck by the fact that the Government is drifting into the very bad habit of spending from loans money which ought to be provided out of revenue. Many years ago a Labour Government went to the other extreme. It endeavoured to provide for all the ordinary services, and also for public works, out of revenue. A Nationalist Government was formed after the war had started, and it was necessary to borrow considerable sums of money. The war is over, and there is an accumulated surplus of over £7,000,000. The Commonwealth should, therefore, now pay its way out of revenue. No one will contend that expenditure in connexion with the distribution of medals should be metout of loan money. It is extraordinary, also, to notice that the loan fund is to be drawn on in connexion with the employment of a temporary staff, and to meet miscellaneous ex- penditure in connexion with the Australian Imperial Force, including special expenditure by the High Commissioner’s office. It is time the Government returned to the principles of sound finance. I move -

That the figures £24,695 be left out.

Senator PEARCE:
Minister for Home and Territories · Western Australia · NAT

– The Government is following the policy which was inaugurated by the Labour party, and carried out during the whole period of its administration while the war was on, that so much of the expenditure on the war as cannot be met out of the ordinary annual revenue shall be borne by the Loan Fund. A. certain class of expenditure has been met all through out of loan money, including items such as these. This year, in addition to the amount provided by special appropriation for war services, over £700,000 is to be met out of revenue. There is not sufficient revenue to meet all the charges connected with the cleaning up of the war services. If this amendment is carried by the Committee, and is subsequently approved by another place, it will mean the defeat of the Government on its main financial proposal, and the Budget will have to be re-shaped. In such a contingency the Government would have to resign. As much of the expendi ture as it is possible to meet out of revenue is so provided for. I ask the Committee to reject the amendment.

Senator PAYNE:
Tasmania

.- I am sorry that Senator Ogden has raised such a point on this particular item. Some time ago I drew the honorable senator’s attention to the fact that Australia has established a wonderful record, in that more than 20 per cent, of her total war expenditure has been met out of revenue. About eighteen months ago I went into the matter, and 1 found that up to that date £107,000,000 had been paid out of revenue for war services. If the honorable senator looks up the Estimates he will find that a certain amount of revenue has been allocated this year for expenditure connected with the war. I have always contended that our war obligations can reasonably be spread over a lengthy period, in order that the present generation shall not have to bear the whole burden. Ample provision, I think, is made by funding portion of the debt and establishing a sinking fund. If this were expenditure which had not a permanent effect on Australia, I should support the honorable senator. In the circumstances, I cannot.

Question - That the figures proposed to be left out (Senator Ogden’s amendment) be left out - put. The Committee divided.

AYES: 6

NOES: 19

Majority ..13

AYES

NOES

Question so resolved in the negative.

Proposed vote agreed to.

Department of Trade and Customs. Proposed vote, £33,426, agreed to.

Department of WORKS and Railways.

Proposed vote under control of Department of Works and Railways (excepting Federal Capital Territory), £1,288,648.

Senator MCDOUGALL:
New South Wales

– For the Port AugustaOodnadatta Railway, £215,997 is to be provided. A Committee of this Parliament which reported on the condition of this railway some years ago showed that some things were very detrimental to the best interests of the Commonwealth and favorable to the State of South Australia, and that for twelve months before the line was handed over to the Commonwealth, the South Australian Government had neglected the necessary repair work, practically necessitating the replacement of the permanent way by the Commonwealth- authorities. Is this money to be spent in carrying out the desire of the Commonwealth to have a uniform” railway gauge - the adopted gauge of the Commonwealth - of 4 ft. 8£ in. ? Australia’s breaks of gauge hold it up to ridicule all over the. world. They are not only an inconvenience to passengers and a source of extra cost in transporting goods, but also a danger from a defence point of view. One of Britain’s greatest military experts who was asked to give an opinion on the defence of Australia laughed at these breaks, and said that something would have to be done in the direction of bringing about a uniform gauge before he could even venture to express an opinion upon Australia’s preparedness in defence matters. A few days ago I stood out for a 4-ft. 8J-in. gauge at the northern end of the NorthSouth railway, and I must stand out for the same gauge at the southern end of this line. The Port Augusta-Oodnadatta line was a heavy burden on the people of South Australia, which from a national stand-point they were not entitled to bear, and unless the line is extended there will be no possible hope of reducing the heavy annual loss incurred upon it. However, if we are to do anything with the line it should be in the direction of broadening the gauge. Sometimes a sand-storm cavers the rails to a depth of a foot or more. Perhaps this money is to he used for the purpose of preventing this damage being done. I move -

That the item “ Port Augusta-Oodnadatta Railway, £215,997,” be left out.

My purpose in moving in this way is to insure that no further money shall be spent on the Port Augusta-Oodnadatta railway until its gauge is made 4 ft. 8$ in.

Senator PEARCE:
Minister for Home and Territories · Western Australia · NAT

– This railway is the property of the Commonwealth Government, but is controlled and run by the South Australian Government. It is now proposed to control and run it as a part of the Commonwealth railway system. Before this can be done provision will have to be made for the expenditure of at least £215,997 made up as follows :- £200,000 for rolling-stock, £5,000 for strengthening bridges between Port Augusta and Quorn, £4,000 for strengthening certain sections of the permanent way, £4,000 for employees’ residential accommodation, £1,500 for telegraphic and telephonic installations, £1,200 for the purchase of tractors, and the balance for various other small items. It is estimated that by assuming control of the line the annual saving to the Commonwealth will be £20,000. If we can save £20,000 annually for an expenditure of £200,000, it will be good interest on our money. I know from my own knowledge certain things which indicate that the control of this line by another authority has not proved satisfactory. It will be more satisfactory, I think, to have it run by the Commonwealth Railways Department, and the money provided in this Bill is to enable that to be done.

Senator FINDLEY:
Victoria

– The agreement between the Commonwealth Government and the South Australian Government in respect to the running of the Port Augusta-Oodnadatta railway will expire very shortly, and the Treasurer (Dr. Earle Page) in his Budget speech made some very serious statements against the South Australian Government indicating that that Government, to put it mildly, had not been too considerate in respect of interest and other charges passed on to the Commonwealth Government. No doubt the Government contemplate manning the railway with a Commonwealth staff, and I should say that they will have their own rolling-stock, but I should like to know if the Government contemplate establishing workshops for the purpose of making their own rollingstock. I am sure that the South Australian Government are not likely to dispose of any of their rolling-stock. They possibly require all they have at the present time.We know that in the running of all railways there are certain periods of the year when the rolling-stock is not sufficient ‘to meet the demands made upon it. That difficulty arises in the Railway Departments of all the States. On this railway there will, no doubt, be one period of the year when a very large amount of rolling-stock will be required. Can the Governmentafford to supply rolling-stock sufficient for the busy season if much of it will be lying idle for the rest of the year?

Senator Crawford:

– All those facts have been taken into consideration in framing the estimate.

Senator FINDLEY:

– The Railway Commissioner may have taken them into consideration, but I, as a layman, am endeavouring to consider them. It is much easier to distribute the rolling-stock when a large number of railways are controlled by the one authority than when only one line is being operated. I am not opposed to the Commonwealth taking over and running this line. I want the Government not only to run this line, but also to build more lines and run them as railways should be run. I am asking for more particulars than are supplied in the Budget speech.

Senator LYNCH:
Western Australia

– I am glad that the railway authorities have at length realized the wisdom of saving money by placing under one control two railway systems so close together as the transcontinental railway and the line to Oodnadatta. The railway authorities have come to the conclusion that it is folly to have two workshops only twenty-five miles apart, with a railway running between them, as they have at Quorn and Port Augusta. I presume that provision is made in the item for the renewal of sleepers. Apart from the merits of the proposals for a line through the heart of the continent, and a detour through Queensland, there will at some time be a necessity for the standard gauge as far as Marree. Whichever route is taken, the point of junction will be at Marree, and the road, at least to that point, should be prepared for the standard gauge of 4 ft. 8½ in. Longer sleepers should be used, and the culverts designed in such a way as to permit of a wider road being put down without the necessity for altering them. The advocates of both propositions have an interest in the line as far as Marree. By using the longer sleepers now, that much of the work will be done before the line goes through. It would be folly to lay sleepers, which have a life of fifteen or twenty years, and pull them up and throw them aside in ten or twelve years.

SenatorFoll. - They are provisional sleepers.

Senator LYNCH:

– When we have more progressive men in this Parliament of the type of Senator Foll, we may put the road through. Senator Foll favours the proposal for a road through Queensland, and at the first opportunity will go at it like a shark at a piece of pork. I suggest to him that the road should be prepared as far as Marree.

Senator McDOUGALL (New South Wales [4.25]. - The Minister’s explanation has satisfied me, and I ask for permission to withdraw my amendment. I could not, like Senator Foll, vote against my own recommendation. When I put my signature to a document I stand by it. I was one of a committee which investigated the working of this railway, and recommended that the Commonwealth should take it over. This was regarded as the lesser of two evils. It does not matter to me whether or not the Commonwealth takes over the rolling-stock. The price asked for the rolling-stock by South Australia was out of the question. That State wanted more for worn-out equipment than was paid for it, and, what is more, it wanted compensation for the taking over of the railway. In other words, it asked to be paid because a burden was removed from its back. The Committee’s report although tabled, was never adopted, but the Government’s proposal is the practical outcome of the Committee’s recommendation. It has taken a long time to mature. It is the only way of minimizing the losses the Commonwealth will have to bear. I am sorry that information on the subject was not given earlier. That is on© of the objections to “ rush “ legislation, for in such circumstances one has not an opportunity even to ask questions. I do not suppose that any one else in the Senate knew that there was a report upon this railway. Had I not known something about it, the Senate would not have obtained the information. I (am quite satisfied that the proposal is right, and is the only way out of the difficulty. I hope that before the Commonwealth takes over the railway it will see that it is put into proper order by the South Australian Government. The claim for compensation is most impertinent. We are asked to PaY too large a price for the rolling-stock - in fact, more than it cost - and also heavy compensation for the ground upon which the rails are laid and for certain other pieces of land. South Australia appears to be out, all the time, for what it can get from the Commonwealth. Sand is liable to drift along the line, and if precautionary measures are not taken, it may involve the Commonwealth in heavy expenditure.

Amendment, by leave, withdrawn.

Senator GRANT:
NEW SOUTH WALES · ALP

will shortly leave Australia to attend the Imperial and Economic Conferences, the expenditure should be reduced to a minimum. On the same page, taking the three columns together, there is an item of £714,800 in connexion with the River Murray Waters Act, 1915-20. The Committee is entitled to detailed information with regard to the expenditure of this enormous sum of money. It may be within the knowledge of some honorable senators that the Government intend to set aside the original provision of the River Murray Waters Act. There is-

Senator Pearce:

– I rise to a point of order.’ I submit that the honorable senator >is not in order in discussing this matter on the Loan Estimates, seeing that there is a Bill on the notice-paper that deals with it.

The CHAIRMAN (Senator Newland:

– An appropriation’ of loan money to the extent of £17,321 is contemplated in this Bill in connexion with the River Murray Waters Act.

Senator Needham:

– May I ask, on another point of order, whether you, as Chairman, should wait for advice from the Minister before giving a ruling?

The CHAIRMAN:

– The honorable senator will resume his seat. I am con ducting the proceedings of the Committee.

Senator Pearce:

– I find that I was under a misapprehension.

Senator GRANT:
NEW SOUTH WALES · ALP

– I have always regarded State boundaries as purely imaginary lines, but I am painfully aware of the fact that there is a secret combination, amongst the smaller States to “ rook “ the larger ones. If the mouth of the River Murray were navigable, the development of the Commonwealth would have proceeded on lines very different from those it has taken. Owing to there being no port at the mouth of the Murray, that splendid water-way between the Murray mouth and Albury is only now coming into its own. This Parliament Kas voted a considerable sum to assist in the ‘erection of expensive dams for both irrigation and navigation purposes. While I regard that as money well spent, this Bill will, to some extent, set aside the provisions of the River Murray Waters Act.

Senator Needham:

– I direct attention to the state of the Committee. [Quorum formed.]

Senator GRANT:
NEW SOUTH WALES · ALP

– It is now intended to relieve South Australia of the duty of constructing the necessary works below the confluence of the Darling and the Murray at Wentworth, and to ask Victoria and New South Wales to undertake it. It is clearly laid down in the original Act that the locks and weirs below the junction of the Darling and the Murray shall be constructed by South Australia. Apparently, the Government do not intend to proceed with the Bill dealing with this subject.

Senator Pearce:

– It is the next on the business-paper.

Senator GRANT:
NEW SOUTH WALES · ALP

– I was not aware of that. In that case I shall reserve my remarks until the Bill is before us. Have I the assurance of the Minister that New South Wales and Victoria will not have to bear the expenditure of the necessary work below the junction of the Darling and the Murray ?

Senator Pearce:

– The expenditure will be incurred only in accordance with the agreement between the three States concerned and the Commonwealth.

Senator GRANT:
NEW SOUTH WALES · ALP

– I am glad to have that assurance, because it is provided in the Act that that expenditure is to be borne by South Australia.

Senator GARDINER:
New South Wales

– There are one or two matters on which I would like an explanation. The schedule contains votes towards the cost of Commonwealth offices in Sydney, Brisbane, and Adelaide. Will the Minister (Senator Pearce) give the Committee details of those items?

Senator PEARCE:
Minister for Home and Territories · Western Australia · NAT

– The projected building in Sydney was intended primarily to accommodate the increasing operations of the Taxation Department of the Treasury, which is now located in comparatively unsuitable rented premises in the commercial centre of Sydney. Incidentally, also, the new building was intended to provide offices in which to concentrate the work of, perhaps, other Commonwealth Departments now occupying relatively unsuitable and scattered rented premises. The intended location of the building is in Phillipstreet, being that part of the city wherein are located most of the Government offices. A site has been acquired. The building is proposed to be of ten stories, of simple design and modern construction, adapted for alteration and subdivision to meet the varying requirements at a minimum cost. The floor space, exclusive of corridors, lifts, &c, is 91,275 square feet. Possible surplus accommodation could, it is considered, be profitably rented until such time as the expansion of Federal requirements demands the space. The estimated cost , as submitted to the Public Works Committee, including incidental engineering services, but exclusive of site, is about £145,000. In Brisbane, the Commonwealth is at present paying about £9,000 for rented premises for Commonwealth Departments, which sum is equal to a capital value of £180,000. The proposed expenditure in this instance is for the erection of a building between Adelaide and Annestreets, and will provide adequate accommodation for the various Government Departments. In Adelaide, the proposal is to utilize valuable vacant land adjoining the General Post Office, by erecting thereon a suitable building, which will be occupied by the local branches of the Taxation Department and other Commonwealth offices. Economy will be effected by saving the rents now paid for privately-owned premises, and in concentrating Departments. I think it will be admitted that it is a wise policy to have our own buildings, instead of renting widely separated buildings, and thus save a considerable sum of money.

Proposed vote agreed to.

Postmaster-General’s Department.

Proposed vote, under control of PostmasterGeneral’s Department, £2,739,986.

Senator GRANT:
NEW SOUTH WALES · ALP

.- The sum of £1,000 is included for the present financial year, and a similar amount is already available under appropriations made by previous Acts, towards the cost of the William-street Post Office, Sydney. Is this Money to be expended in removing the post-office, for the erection of a new post-office, or for both purposes?

Senator PEARCE:
Minister for Home and Territories · Western Australia · NAT

– The demolition of the present structure cannot be proceeded with until the telephone exchange is removed to Liverpool-street exchange building, which is in course of construction. It was not originally intended to remove the telephone exchange from William-street, but owing to rapid telephonic developments in Sydney it was found necessary to do so. The question of temporarily transferring the Exchange from Williamstreet to other premises, pending the completion of the buildings in Liverpoolstreet, has received full consideration, but it has been found impracticable. The building at Liverpool-street is being proceeded with as rapidly as possible, to enable the demolition of the Williamstreet Post Office to be undertaken at the earliest practicable date. I am familiar with the situation, because representations have been made to me, when in Sydney, that the existing structure is an eyesore, and I frankly admit that it is desirable to have it removed at the earliest possible moment. The Postal Department is not opposed to its removal, and the work will be undertaken as soon as the telephone exchange can be removed to Liverpool-street. The Government would not be justified in expending a large sum of money in making temporary arrangements.

Senator GARDINER:
New South Wales

– We are indebted to the Minister (Senator Pearce) for the information he has given concerning the delay in this matter, but there is a limit to the patience of even the Sydney people. I do not know how long it is since the other buildings in the same street were removed to the new alignment, but the William-street Post Office has been frequently commented upon for some time. Attention has been directed to the building by a number of business men, who have seriously suggested that an effort should be made to demolish the building, even in defiance of the Federal authorities. The Government could sell the land on which it stands at a considerable profit, as sales effected recently in the immediate locality show a hundred per cent, increase in price. This indicates that there is either a marvellous demand for city property, or that a considerable time has elapsed since sales have been effected. Land which was sold at£40 a foot when some of the buildings were demolished, has recently been disposed of at £80 a foot. The Minister will admit that we are not making an unreasonable request in suggesting the earliest possible demolition of the building, and I trust that the Department, notwithstanding the Minister’s statement, will do everything possible to facilitate its removal.

Senator McDOUGALL:
New South Wales

. - I am pleased to have the Minister’s assurance that every effort is being made to demolish the Williamstreet Post Office, which projects beyond the new street alignment. I was pleased also to hear his explanation as to the real reason for the delay, because there is a general impression in the minds of the people that the old building is being allowed to remain simply because the Government are too stubborn to authorize its removal.

Senator DUNCAN:
New South Wales

– Some weeks ago I asked the Minister representing the Postmaster-General certain questions in regard to cable rates. The answers which I received bore out the impressions and opinions I had formed. It is absolutely essential that the Senate and the Government should realize the position into which we have drifted, because the Government has failed to stand up to its responsibilities. The Government has declared, as a settled part of its policy, that the Post Office shall not be a taxing machine. With that, I feel sure, all honorable senators will agree. The Government has indicated that it has a desire to institute certain reforms in a number of directions. So far it has not taken any action to have the cable rates reduced. The charge for full-rate cable messages has not been reduced for more than twenty years, and it continues to be a serious burden upon the whole of the commercial community. Press rates, also, are much too high. We have been repeatedly told that rapid, cheap communication is one of the means by which the bonds of Empire may be cemented, and the isolation from which Australia suffers reduced. As a Government supporter, I regret very much that, in regard to cable communications, it has done nothing to attain that end. Immediate action is important, because the agreement with the Amalgamated Wireless Company provides that the wireless rates between Australia and other parts of the world shall not exceed two-thirds of the cable rates for the time being. If a reduction of one-fourth of the present cable rates were obtained before the inauguration of the direct wireless service, the wireless rates would be only onehalf of the existing cable rates. A full rate wireless message to the United Kingdom would then cost1s. 6d., as against 3s. which is the present cost by cable. That is a very substantial difference, which the commercial community especially, would appreciate. I desire to refer to the agreement made between the Commonwealth Government and the Eastern Extension Telegraph Company for the inaugurationof the cable service. The Postmaster-General has given no adequate reason why the agreement with the Eastern Extension Telegraph Company has not been enforced. Where an agreement is made between the Commonwealth Government for the time being, and any private concern, such as the Eastern Extension Telegraph Company, it is very important from the point of view of the people of Australia that it should be enforced by the Government. The agreement provides specifically that the cable rates shall be reduced to 2s. 6d. per word on full rate traffic when the profits of the company from its Australasian traffic reach £330,000 per year. That point was reached five years ago, on the PostmasterGeneral’s own admission in the answers which he has given to my questions. Yet the public has been deprived of the reduction of one-sixth in the rates, because of the inaction of the Government, and the Company has been permitted to retain excessive profits. ‘ It would be interesting to know just why this handsome gift has been made to the Eastern Extension Telegraph Company. Perhaps the PostmasterGeneral’s Department has overlooked the matter. It is very hard, however, to believe that that is the real reason. Certain it is that the PostmasterGeneral’s Department has made a very handsome gift to the Eastern Extension Telegraph Company by not enforcing the agreement. Successive PostmasterGenerals have shown very little desire to make cable communication cheaper for the commercial community, the press, and all other users of the service. The excuse given by the PostmasterGeneral for the non-enforcement of the agreement looks like a deliberate attempt to deceive the Senate and the public. In his answers, he referred to two additional classes of traffic - deferred messages and cable letters. He should know that cable letters have not been available by the eastern route for many years. He claims that in this respect the public is reaping a benefit, because of the action taken by the Department, but he does hot tell the Senate and the public that that method has not been available by the eastern route for many years, and that not until 1st September next will the Eastern Extension Telegraph Company follow the lead of the Pacific Cable Board and re-introduce this class of traffic. Commercial men, however, are chiefly interested in the full rate class of traffic. They want their messages - quotations, orders, and so on - to reach England on the day of their despatch from Australia, and to receive cables on the day of their despatch from the United Kingdom. In the ordinary course they cannot afford to wait even twenty-four hours for a deferred message. The statistics of the Pacific Cable Board show that the full rate traffic exceeds the deferred and week-end traffic combined. In the case of the Eastern Extension Telegraph Company the full rate traffic is, probably, at least four times as heavy as the deferred traffic. Moreover, coded messages are permitted only at full rates. In deferred and week-end messages, plain lan- guage must be used. These classes of traffic are, therefore, of very small service to the commercial firms who wish to secure the economy and secrecy provided by the use of codes. The business man, in the circumstances, is not grateful for the institution of either of these classes of traffic, because he cannot afford to wait for the .week-end to send cables which deal with urgent matters. Has the financial position of the Pacific Cable Board prevented its making reductions, in accordance with, the terms of the agreement, because of the fear that such action would endanger its existence? I claim that that is not the case. The Pacific Cable Board is obviously in a position to reduce rates immediately. That can be clearly seen from its published financial statements. According to the last available report, its reserve and renewal fund exceed £1,800,000- which, I am told, is far more than is necessary to pay for. the complete duplication of the cable. The Board has also paid off nearly onethird of the capital cost of the cable. For the year 1921-22, after making the statutory payments for re-payment of capital and reserve fund, the Board made a profit of upwards of £150,000. The surplus is at present devoted to replacement of capital and reserve fund. As, however, these accounts are in a very sound condition, the Board should not be allowed to continue to pile up enormous profits ; the public should reap the benefit by a reduction in the cable rates. If the Board reduced its rates by, say, 6d. a word the Eastern Extension Telegraph Company would be compelled to follow automatically, and so the public would receive an all-round benefit. As the Commonwealth has a one-third interest in the cable, its representatives on the Board should be instructed to press for an immediate reduction of rates. 7 do not say that rates should be reduced simply because certain profits have been made without suggesting means by which thev may be reduced. There are three distinct methods by which a reduction in cable rates can be immediately secured : (1) By enforcing an agreement with the Eastern Extension Company, providing for a reduction on full rate traffic from 3s. to 2s. 6d. a word. I have shown that this reduction of 6d. a word could be made without causing any great loss to the Commonwealth. (2) By reducing the present grossly excessive terminal charges levied by the Commonwealth, which are 400 per cent, higher than in New Zealand, and 350 per cent, higher than in the “United Kingdom”. These are extraordinary figures, but on the showing of the Department of the PostmasterGeneral, the rates paid by the cable unions in Australia are 400 per cent, higher than those paid in New Zealand, and 350 per cent, higher than those paid in the United Kingdom. The charge in Australia is 5d. a word, against Id. in New Zealand, and 1-^d. in the United Kingdom. That is to say, the Commonwealth charge is five times that of New Zealand and more than three times that of the United Kingdom, and strange to say the Department of the Postmaster-General seems to take a delight in imposing this high charge on Government business.

The CHAIRMAN (Senator Newland:

– The honorable senator has exhausted his time.

Senator GRANT:
NEW SOUTH WALES · ALP

– The matter raised by Senator Duncan merits considerable attention from honorable senators. It is of vital importance to the people of Australia that they should be supplied with quick and cheap means of communicating with other parts of the world. The rates now charged by the various cable companies are very high. In my opinion, if they were substantially reduced, the companies would be recouped by the extra volume of business brought to them.

Senator DUNCAN:
New South Wales

– The peculiar standing order which prevented me from concluding my remarks fortunately gives me a further opportunity to do so now that another honorable senator has intervened. I was, pointing out, when interrupted, that there are at least three methods by which a reduction in cable rates can be immediately secured. I have given two. The final one is - (3) By diverting the large profits of the Pacific Cable Board to a reduction of rates. I have already indicated what these huge profits are. I want now to proceed to an examination Of the terminal charges to which I have made frequent reference. It is a matter which comes directly within the province of the Postmaster-General. These charges are levied in a most unfair way, almost in a dishonest way, because the users of the cables are charged for a ser vice which the Department of the PostmasterGeneral does not render to them in any way. The revenue from this source in 1921-22 according to the PostmasterGeneral was £216,559. As the receipts from cable traffic are included in the revenue of the telegraphic branch it is obvious that the sum of £1,808 shown in the last annual report as the profit on the telegraphic branch would have been converted into a loss of more than £200,000 if the cable traffic were eliminated. In other words, the PostmasterGeneral is concealing a large loss on inland telegraphic work by taxing cables excessively. This constitutes bad finance and injustice to cable users, and a deceptive presentation of public documents. The Postmaster-General tells us that the total amount of receipts in respect of cable terminal charges since the inception of the Pacific cable is not available. I should have thought that the records of the Department and of the Treasury would have shown these figures. On a conservative basis, however, they must have amounted to at least £2,000,000 in the last twenty years. No adequate services have been rendered by the Post Office in return for this large revenue, which constitutes one of the worst instances of indirect taxation which has been introduced in the Commonwealth. This was never intended, and should be abolished without delay. The Postmaster-General states that the approximate proportion of international cable traffic, passing over telegraph lines operated exclusively by his Department is not available. It is hard to believe that there are no figures in the Department which would make this information available to the public. In my mind the Department knows the true facts of the case, but does not wish the public to know them. I have been able, with the limited information at my disposal, to arrive at what I believe to be a pretty fair basis of the position. I am told on the, very best authority, and as a result of the investigations I have made, that the proportion is not more than 20 per cent. That is to say, the Pacific Cable Board in Sydney, and Melbourne, and the Eastern Extension Company in Adelaide, Melbourne, and Sydney, receive at, or deliver from, their own offices 80 per cent, of the whole volume of international cable traffic originating or received in Australia. Irrespective of the

Government, these companies deliver from, or receive at, their offices 80 per cent, of the total cables received in or despatched from Australia, and yet the commercial community, and cable users generally, are charged by the PostmasterGeneral excessive terminal charges upon all cables, although only 20 per cent, of them are handled by his Department. It is most unreasonable and unfair. It means that the Melbourne business man who hands in a full-rate message at the Eastern Extension office in Collins-street, which is despatched over its leased line to Adelaide by the company’s officers, and is never handled by the Post Office at any stage whatever, is taxed 5d. per word by a Government Department which does nothing for him. The Sydney newspaper which receives cables from England, delivered by messengers employed and paid by the Pacific Cable Board, is similarly taxed. If the Post Office were to charge reasonably for the work it performs, its revenue from cable traffic would possibly not exceed £25,000, about oneninth of the present receipts. The remainder constitutes an unwarranted tax on all cable users. One of the excuses usually given for the retention of the high terminal charges - in the Commonwealth, is the cost of the land lines used by the cable administrations. The answers given by the Minister completely dispose of this argument. The four lines now in regular use cost altogether less than £55,000. The annual interest bill cannot be much more than £3,000. Yet the revenue from terminal charges in the year 1921-22 was £216,559, or more than seventy times this sum. The Darwin to Adelaide line is not now used ‘for the main volume of eastern traffic, and in any case would have had to be built for telegraphic purposes; but even if the value placed on this line by the Department, namely, £239,370, is included, the annual revenue from terminal charges amounts to about three-fourths of the capital cost of all these lines. The inclusion of Che Darwin to Adelaide line would increase the interest bill to about £15,000’ a year - one-fourteenth of the annual revenue from terminal charges. Since the inception of the Commonwealth the terminal charges must have paid for all these lines at least six, and probably many more times. It is a most astounding position. These lines are, of course, still the property of the Commonwealth, and can always be used for telegraphic purposes if no’ longer required for the transmission of cables. A proper businesslike method of dealing with these lines would be to charge the administrations using them a reasonable rental based on the capital cost and upkeep. As the cable administrations employ their own operators - at any rate, between Adelaide, Melbourne, and Sydney - the Government are not put to much expense for maintenance. If this were done the Pacific Cable Board would not bear any of the expense of maintaining the AdelaideDarwin line, which is used exclusively by the Eastern Extension Company. Turning from the actual position as disclosed by what I have related to the Senate, I come to the steps that I think should be taken immediately to remedy this state of affairs. They are as follows : -

  1. The Commonwealth should reduce its terminal charge to Id. a word as in New Zealand, and at the same time charge the cable administrations a reasonable rental for the use of the land lines at present employed for cable traffic.
  2. The agreement with the Eastern Company should be immediately enforced.

Alternatively the Pacific Cable Board should reduce its charge by, say, 6d. a word on full rate traffic, other charging rates being reduced proportionately. By these combined steps there is no reason why the existing rates should not be immediately reduced by lOd. a word, thus conferring a great boon en every one who has occasion to communicate with other parts of the world upon private business or financial and commercial matters generally. The present Commonwealth terminal charge is in any case a reproach on honest government, and should be abolished forthwith. It should not be tolerated by any Government that sets itself up as a business Administration. I have placed these facts before the Committee because they are of great importance to the commercial interests of Australia and to the people generally, and because they indicate . that this cable business, so far as the Commonwealth Government are concerned, is not being conducted in an entirely honest way. That is shown by the fact that we are charging users of the cables for services which are not rendered by the Depart- ment of the Postmaster-General. The facts I have disclosed are also of importance because they show that our terminal charges are excessive .compared with those charged in the Dominion of New Zealand. I urge upon the Minister representing the Postmaster-General, the obvious necessity of bringing ‘ under the notice of the Postmaster-General the facts I have mentioned, so that steps may be taken to remedy a grievance under which the whole community is suffering. x

Senator Crawford:

– I shall bring Senator Duncan’s remarks under the notice of the Postmaster-General.

Proposed vote agreed to.

Schedule as amended agreed to.

Postponed clause 4 consequentially amended and agreed to.

Preamble and title agreed to.

Bill reported with amendments; report adopted.

Bill read a third time.

page 3453

ADVANCES TO SETTLERS BILL

Message received from the Blouse of Representatives intimating that it had agreed to the amendments made by the Senate in this Bill.

page 3453

RIVER MURRAY WATERS BILL

Second Reading

Senator CRAWFORD:
QueenslandHonorary Minister · NAT

– I move -

That the Bill :be read a second time. The purpose of this Bill is “ to ratify an agreement for the variation of the agreement entered into between the Prime Minister of the Commonwealth and the Premiers of the States of New South Wales, Victoria, and South Australia, respecting the River Murray, and Lake Victoria, and other waters, and for other purposes.” The original agreement was made in 1914, and was ratified by a Bill passed by the Commonwealth Parliament in the following year. Under that agreement it was estimated that the necessary work could be carried out at a total cost of £4,663,000, towards which the Commonwealth . was to contribute £1,000,000. It -has since been ascertained that, it will cost between £8,000,000 and £10,000,000 to complete the undertaking. It is provided in the amended agreement that the Commonwealth shall con- tribute one-fourth of the total cost, and there is a provision in the original agreement that certain work shall be completed within seven years.” It has been found impossible to do that within the time fixed, and under clause 9 of the Bill the period has been extended to twelve years. Those are the principal amendments proposed in the agreement, and I have nc doubt they will meet with the approval of honorable senators.

Senator GRANT:
NEW SOUTH WALES · ALP

– I have listened with very close attention to the explanation given by the Minister (Senator Crawford). His speech should cause honorable senators to make themselves acquainted with the provisions of all Bills instead of accepting the explanatory notes of Ministers. Time is limited, and possibly on that account the Minister has not dipped so far into details as he otherwise would have done. I have taken a great interest in this subject for many years. The Senate should give it very careful consideration. The work is of national importance. It will involve the expenditure of a large sum of money which, I hope, will be fully justified. It is the largest work of its kind in the Commonwealth, and one of the largest in the world. I am not in the least appalled or disconcerted by the statement of the Minister that the estimated original cost of it will be considerably exceeded, and I dare say that if this matter is reviewed in five or six years we shall discover that the increased cost now indicated will have to be exceeded. We have to consider the result of this proposed expenditure. The task of harnessing Australia’s greatest river is a work of the very first magnitude. It has involved, and will continue to involve, engineering skill of a very high order. On the effectiveness of the work of the engineers will depend to a large extent the success of the scheme. I have not the slightest doubt that the work will be substantial and satisfactory, and that there need be no fear as to its durability. The River Murray is not the only great river in Australia, but it is by far our greatest river. It drains an enormous watershed area covering 414,253 square miles, or one-seventh of the Australian continent. I would remind the Senate, and particularly those honorable senators who ‘ are never tired of decrying the quality of the work done by Australian workmen, that only ninety-eight years have elapsed since Hamilton Hume first crossed the Murray. In that brief period, numerous large towns have been built upon its banks, and many others are in course of erection. It is not a very long river when compared with some great streams of the world, but it boasts a length of 1,500 miles, and is in many respects a very noble one. It has one peculiarity which should make the work pf constructing locks and weirs very much easier than it would be on other rivers. From the city of Albury to where the Murray * crosses the bar at its mouth is a distance of 1,266 miles, in the whole of which length the fall of the river is only a little over 21 inches. It is a very slowmoving river over the whole of that distance, and in normal years is suitable for navigation, even without artificial aids. In order to increase its usefulness still further, the Commonwealth has very wisely taken into consideration the question of the conservation of its waters for irrigation and navigation, and I am glad to see that those States which abut upon the river have heartily co-operated with the Commonwealth. Those honorable senators who have had the advantage of travelling along £he Murray, especially in flood time, must have been astonished at its extraordinary width. At places during flood time I have not been able to see across it, and whether its banks were 5 or 50 miles apart I was unable to say. It is intended, first of all, to construct a dam below the junction of the Mitta Mitta River with the Murray. It would be an eye-opener to honorable senators for them to inspect, both during construction and after completion, works such as the Burrinjuck and Hume reservoirs. The Sydney Harbor is 17 square miles in extent, and the Burrinjuck dam comprises 20 square miles, but the Hume reservoir will cover 47 square miles. It will completely prevent the occurrence of floods in the River Murray, excepting under most unusual conditions, and it will conserve a sufficient supply of water to keep the river at a normal level’ throughout the year. At the same time it will be enormously beneficial to the whole of the River Murray Valley from Albury .to the mouth of the river. I had no hesitation in voting to commit the Commonwealth to the expenditure of £1,000,000 as its contribution towards the cost of these great national works. The first agreement provided for the construction of nine locks and weirs below Wentworth, seventeen from Wentworth to Echuca, and nine on the Murrumbidgee, and also the Lake Victoria and Hume reservoirs. A limited number of these works, including the Hume reservoir, are now in hand, and it has been found that the total cost will greatly exceed the’ money voted. I am pleased to know that a Conference is to be held at Mildura on the 13th September next with respect to this matter, and I hope that as many honorable senators as can attend will do so. It is a great pity that the settlement of Australia did not begin at the Murray mouth and follow the Murray Valley. That would have resulted in opening up the rich lands both on the Victorian and New South Wales sides of the river. The great success that has attended the efforts of the fruit-growers at such places as Mildura and Merbein affords a striking illustration of the remarkable fertility of the Murray Valley for intense culture. When the Hume reservoir is completed there will be enough water for miles on either side of the river to meet all reasonable requirements.

Senator Payne:

– Honorable senators ought to have a look at that scheme.

Senator GRANT:
NEW SOUTH WALES · ALP

– Yes. We should endeavour to obtain first-hand information, preferably prior to, and failing that, subsequent to, the voting of money for big national works of this nature. Whilst I appreciate the action of the Government in asking Parliament to vote another substantial sum for works in connexion wish the locking of the Murray, I think that there are one or two clauses of the Bill to which exception might be taken. Clause 21 of the Agreement under thf original Act states -

All of the works provided for in the next preceding clause to be constructed at points between the mouth of the River Murray and Wenthworth shall be constructed by the Government of South . Australia. . . . .

Senator Crawford:

– But at the joint cost of all the contracting parties.

Senator GRANT:
NEW SOUTH WALES · ALP

– I was very much interested in the easy manner in which the Minister glided over this particular phase of the matter. The Agreement continues -

The works on the River Murrumbidgee or on the River Darling above Wentworth (as the case may be), shall be constructed by the Government of New South Wales. The works on the River Murray above its junction with the River Darling shall be constructed by the Governments of New South Wales and Victoria severally or jointly, as may be mutually agreed upon by those Governments, or as in default of such’ agreement may be determined by the Commission.

Senator Crawford:

– This Bill does not amend that clause.

Senator GRANT:
NEW SOUTH WALES · ALP

– That is precisely what it does.

Senator Crawford:

– Clause 32 provides for financing the scheme.

Senator GRANT:
NEW SOUTH WALES · ALP

– Clause 21 of the original agreement relates to the responsibility for construction.

Senator Crawford:

– For the supervision of the work. Provision is made for the financial undertaking in clause 32. .

Senator GRANT:
NEW SOUTH WALES · ALP

– Clause 21 of the second schedule of the Bill, which amends the clause I have just quoted, reads -

All of the works provided for in the next preceding clause to be constructed at points between the mouth of the River Murray and Wentworth (excepting the weir and lock to be constructed on the River Murray below its junction with the River Darling by the Government of New South Wales or by the Government of Victoria or by both those Governments jointly) shall be constructed by the Government of South Australia. The works on the River Murrumbidgee or on the River Darling above Wentworth (as the case may be) shall be constructed by the Government of New South Wales. The works on the River Murray above its junction with the River Darling and one weir and lock below the said junction shall be constructed by the Governments of New South Wale’s and Victoria severally or jointly as may be mutually agreed upon by those Governments or as in default of such agreement may be determined by the Commission.

I should like to know why an alteration has been made, and why the Government of New South Wales is to be asked to assume responsibility which was not provided forin the original agreement.

Senator Crawford:

-Because the new site is considered more suitable.

Senator GRANT:
NEW SOUTH WALES · ALP

– It was originally provided that all locks and weirs to be constructed below the junction of the Darling and the Murray were to be built by South Australia. The Government, so ably supported by South Australian senators, is now proposing to throw the responsibility of this work on New South Wales.

Senator Crawford:

-New South Wales would not be responsible for the cost, but will undertake the supervision of the work.

Senator GRANT:
NEW SOUTH WALES · ALP

– I am not sure that the cost will not have to be borne by New South Wales.

Senator Lynch:

– But New South Wales Government has agreed to this.

Senator GRANT:
NEW SOUTH WALES · ALP

– That does not affect the position in the slightest, because the present Government in New South Wales does not represent a majority of the people in that State. If, as the Minister suggests, New South Wales will not have to bear the cost, why has the original agreement not been adhered to?

Senator Crawford:

– Probably New South Wales would not agree.

Senator GRANT:
NEW SOUTH WALES · ALP

– New South Wales signed the first agreement, and the Minister has not given any explanation of the altered policy. Under the original agreement it was provided that the Commonwealth should pay £1,000,000, and New South Wales, Victoria, and South Australia each £1,221,000 towards the cost; but it is now proposed to alter the system of financing the undertaking, and the Common wealth, is to contribute onequarter of the total expense involved, and the balance will be paid by the States. I do not offer any strong objection to that proposal, but I am very pleased to learn that Tasmania, which recently received £85,000 from the Commonwealth Government, will have to return some of that amount, as that State has to contribute 2 per cent, towards the cost. New South Wales will contribute £450,000; Victoria, £300,000; Queensland,. £100,000; South Australia, £80,000; Western Australia, £50,000; and Tasmania, about £20,000. The Minister has not explained why section 21 of the original agreement is to be amended, and it is useless endeavouring to convince him that the original arrangement should stand. Doubtless, the Government have come to the decision that the Bill is to be passed, . but so far as I can see, the proposal now submitted should not be countenanced. I am not prepared to see the State I represent saddled with the responsibility of constructing four weirs, although they are to be in New South Wales and Victoria.

A very large proportion of this expenditure will be incurred chiefly for the benefit of South Australia. It will benefit all lands on both sides of the river. Probably the Commonwealth will be asked later to open up the bar which prevents steamers from entering Lake Victoria, and we shall be called upon to spend no end of money. The idea behind the Bill is a good one, and with the exception of this one blemish I support it.

Senator GARDINER:
New South Wales

.- I think that Senator Grant has dealt excellently with this measure, and has not left much for me to say. The Bill would have gone through more quickly if the Minister had taken a little extra trouble withhis explanation of it. I felt so little interest in it that I was disposed not to speak on it. Just as I was becoming interested in the Minister’s remarks, he sat down. There are one or two matters which are worth looking into. Take the agreement which was entered into in 1914. It provided for nine locks and weirs on the River Murray belowWentworth, 17 locks and weirs from Wentworth to Echuca, nine locks and weirs on the Murrumbidgee River, the Lake Victoria reservoir, and the Hume reservoir. I heard the Minister interject that the construction of all those works would provide employment for workmen. I gladly assist to pass legislation for the carrying out of a national work which will stand as a monument to Australia and provide the employment which is so badly needed. The building of these weirs, and the impounding of the water, will make ten times more productive the soil along the river banks. Sometimes one becomes a little uneasy as to who is to reap the immediate benefit. I sometimes think that the arrangement which has been made will give first preference to people outside Australia. There are reasonable grounds for that suspicion. Senator Grant was quite right in his contention that the provisions of this Bill are different from the conditions which were signed four years ago, and that they adversely affect New South Wales and Victoria. In the future, the large States must work together as a team in the same manner that Queensland, South Australia, Western Australia, and Tasmania do. On the figures mentioned by Senator Grant, it appears that New South Wales and Victoria will have a mighty heavy bill to meet. There will also be heavy contributions by the other States. To call upon Tasmania to pay towards this scheme savours of injustice. Tasmania cannot benefit by the carrying out of the work, except indirectly.

Senator Thompson:

– What about Queensland ?

Senator GARDINER:

– Queensland will have the pleasure of knowing that much of its tropical rainfall will find its way into reservoirs in South Australia, and will bring a greater amount of fertility to the lands along the banks of the Murray. I think that we ought to exempt Tasmania from contributing towards the cost of this work. If I am permitted to do so in Committee I shall make some provision by which Tasmania will be exempt.

Senator Drake-Brockman:

– The honorable senator will not get any “ bites with that bait.”

Senator GARDINER:

– I am, unfortunately, so constituted that, when I indulge in a little levity, I am taken seriously. Last night, unfortunately, Senator Drake-Brockman regarded seriously some remarks that I made in a humorous way. I had no intention of being offensive to the honorable senator. When I deal with a matter seriously, my remarks are treated humorously. I am serious in this matter. When it comes to dealing out even-handed justice to Tasmania, I do not view with satisfaction the prospect of getting from that State, by its contribution to the construction of this work, a return of portion of the £85,000, which recently was granted to it. I vigorously opposed the making of the grant. However, my view was not shared by a sufficient number of honorable senators to enable me to prevent the measure from being passed. Although this River Murray scheme is a national work, we cannot say that it will confer any benefit upon the people of Tasmania. . I may not be able to induce honorable senators to accept an amendment to exempt Tasmania from contributing to the scheme; and there is a lot to be said for the contention that an amendment is like a revolution, in that one is justified in bringing it on only if there is a reasonable chance of meeting with success.

Senator Drake-Brockman:

– How would the honorable senator propose to give practical effect to the amendment, seeing that no direct contribution will be made by Tasmania?

Senator GARDINER:

– I should estimate the amount of Tasmania’s contribution at about 2 per cent. Tasmania ought to receive a direct payment, to reimburse it for its share of the expenditure on an irrigation scheme which will benefit only Victoria, South Australia, and New South Wales. Unlike the other States, Tasmania is not part of the mainland. In Committee, therefore, I intend to move an amendment to exempt Tasmania.

The PRESIDENT (Senator the Hon.

  1. Givens). - The honorable senator has repeated that statement over and over again. I ask him not to continue along those lines. The question of making a grant to Tasmania does not enter into the consideration of this Bill. I have allowed him to make full reference to that matter, and he has repeated it over and over again. The Standing Orders provide that speeches must be .relevant to’ the subject under discussion, and that there must not be tedious repetition.
Senator GARDINER:

– If, Mr. President, you are going to take up that attitude, the best thing you can do is to put’ me out now.

The PRESIDENT:

– It is not my desire or intention to put any honorable senator out. I have, however, to see that the rules relating to procedure are properly carried out, and I intend to do so.

Senator GARDINER:

– I do not know how often you are going to persist in insulting me when I am addressing the Chair.

The PRESIDENT:

– I did not insult the honorable senator. I called his attention to the fact that he was repeating his argument over and over again.

Senator GARDINER:

– Do you rule that I cannot make any further reference to an amendment which I intend to move in Committee? If you so rule directly, I shall dissent from your ruling and let the Senate decide between us.

The PRESIDENT:

– I do so rule.

Senator GARDINER:

– I submit the following dissent in writing from your ruling : -

Having several times referred to an amendment that I proposed to move in Committee to have Tasmania exempted from contribution towards the Murray Waters Conservation work, Mr. President ruled I could not again refer to it. I dissent from such ruling.

I shall leave it to the Senate to say whether I am to be permitted to make any further reference to that matter, and-, therefore, T move -

That the Senate dissents from the ruling of the President. ,

Senator GRANT:
NEW SOUTH WALES · ALP

– I second the motion.

The PRESIDENT:

– Unless the Senate decides that the motion to dissent from my ruling requires immediate determination, the motion will, stand over until tomorrow.

Motion (by Senator Pearce) agreed to-

That the question of dissent requires immediate determination.

Question - That the Sen’ate dissents from the ruling of the President - put The Senate divided.

AYES: 10

NOES: 10

AYES

NOES

Sitting suspended from 6- 40 to 8 p.rn

The four Commissioners shall be a quorum, and the concurrence of all of them shall be necessary for the transaction of the business of the Commission….. the words “ subject to clause 44 of this agreement “ are to be inserted so that the. clause will read -

The four Commissioners shall be a quorum, and, subject to clause 44 of this agreement, the concurrence…..

It is evidently an alteration for the convenience of the Commissioners. Then we come to something of more importance. Clause 21 of the original agreement reads as follows : -

All of the works provided for in the next preceding clause to be constructed at points between the mouth of the River -Murray and Wentworth shall be constructed by the Government of South Australia. The works on the River Murrumbidgee or on the River Darling above Wentworth (as the case may be) shall be constructed by the Government of New South Wales. The works on the River Murray above the junction with the River Darling shall be constructed by the Governments of New South Wales and Victoria, severally or jointly as may be mutually agreed upon by those Governments, or as, in default of such agreement, may be determined by the Commission.

It is proposed to insert in this clause after the word “ Wentworth “- (excepting the weir and lock to be constructed on the River “Murray below its junction with the River Darling, by the Government of New South Wales, or by the Government of Victoria, or by both these Governments’ jointly.)

And in the last sentence of this clause, after the word “Darling” it is proposed to insert - and one weir. and lock below the said junction.

It would appear to me that there is in the minds of the Commissioners a rapidly developing opinion that the States particularly, benefiting from any work should undertake its construction. That is to say, the idea evidently is to throw the direct responsibility on the particular State or States concerned for the construction of these works, either separately or conjointly. But where we are amending an agreement we must be careful to see exactly what effect the amendment will have. I am inclined to think that this amendment has no reference to the method of meeting the cost of the particular undertakings mentioned, but I imagine that if I had not been debarred from moving the amendment I intended to submit, this alteration to the agreement would have buttressed my argument for a more equitable distribution of the cost of this work among the States. I imagine that the purpose of the amended agreement is to redistribute the work of construction among the various States concerned. No great benefit can attach to the work of construction. The States will not get so much percentage on the labour of each man employed which private firms would get. They are simply to be held responsible for the work to be done, and apparently the cost is to be paid from the joint fund controlled by the Commission. I can see nothing objectionable in any of the proposed amendments, but I should like to draw attention to the vast importance of the work that is now being undertaken. I have always held the view that in a country like this no man able to work should be unemployed. This scheme may afford employment to hundreds of men, but there are thousands of other opportunities for the conservation of water by schemes which would provide ample employment, and which, when once completed, should last for ever, provided that those who follow us are prepared to keep, them in order. I look upon the work that is being undertaken on the River Murray as but the forerunner of many immense irrigation works throughout Australia. We are now providing for the irrigation of two very narrow strips of land in Victoria and New South Wales, and running into South Australia, but the real irrigation scheme for Australia- will be taken in hand when science has been linked .to common sense, and when Parliament abandons the old idea of leaving the development of the country to the spasmodic efforts of a few settlers here and there. I look forward to the time when what is now being done in the Murray valley will be attempted in regard to the rivers of Queensland, and when steps will be taken to conserve the heavy rainfall of the north of the continent to irrigate! that low-lying plain country in Central Australia which in some seasons is described -as a desert. There should be no great engineering difficulties in the way of such a work. It should simply be a case of sane Parliaments developing a scheme and finding the means to bring water to those parched plains -in seasons of drought. Then, we should have canals of running water instead of wire fences enclosing each holding, and hundreds of settlers earning a living in the driest part of Australia.

Senator HAYS:
Tasmania

.- During the debate on the AddressinReply, I referred to Tasmania’s position under the Murray River Waters agreement.

Senator Cox:

– Tasmania is not connected with the Murray.

Senator HAYS:

– It is, inasmuch as we have to pay our per capita share towards the work. I stated months ago in my election campaign, and I have said later in this Chamber, that by no stretch of the imagination can it be claimed that this work directly or indirectly benefits Tasmania. It is a desirable work in the interests of the mainland, and particularly in .the interests of those States which have a frontage to the river. In Tasmania we have our own work to do. We are to-day spending a relatively large sum of money in draining a vast area - vast in proportion to the size of our State - and we are doing it with our own money.

Senator Duncan:

– Is Tasmania not spending the money of the other States when she receives a grant of £80,000 1

Senator HAYS:

– That is another question. We are throwing open for closer settlement and soldier settlement an immense area of land. If it is a national work to irrigate the Murray River lands, then the work Tasmania has undertaken is also a national undertaking. Both are serving the same purpose. As we cannot participate in any of the advantages connected with this work, I appeal to honorable senators, in fairness, to relieve Tasmania from contributing towards its cost. The annual grant to Tasmania is reduced by the amount contributed to this work. Tasmania has spent £3,000,000 on a big water scheme, which is a national work and a war work.

Senator Guthrie:

– That is for your own advantage.

Senator HAYS:

– It is for the advantage of the whole Commonwealth. I assume that we are here as a National

Parliament to consider national problems. Tasmania is developing its natural resources, and is spending as much as any State in the Commonwealth in developing its territory, and in handling similar problems to the Murray Waters scheme. It is a fair request that Tasmania should not be called upon to make any contribution to this work.

Question resolved in the affirmative.

Bill read a second time.

In Committee:

Clauses 1 to 5 agreed to.

Clause 6 (Amendment of Preamble to principal Act).

Senator CRAWFORD:
QueenslandHonorary Minister · NAT

– There appears to be some misunderstanding regarding the meaning of the provision relating to the Wentworth Weir. The Act provided that South Australia should be tha constructing authority for all the weirs, which number nine, below Wentworth, and that New South Wales and Victoria, either jointly or separately, should be the constructing authorities for. the weirs above Wentworth. At the request of New South Wales the site of one weir that was to have been built above Wentworth has been removed below Wentworth. The effect of that alteration will be to throw the water an additional forty miles up the River Darling. The Bill expressly provides that although the site of this weir will be below, instead of above, Wentworth, New South Wales shall still remain the constructing authority for it.

Senator Barnes:

– South Australia is now constructing a weir to the north ofWentworth.

Senator CRAWFORD:

– That is not so. I have received an assurance to that effect from an officer of the Commission.

Senator GARDINER:
New South Wales

.- I thank the Minister (Senator Crawford) for his explanation, which would have been more appropriate on the second reading. Senator Grant’s speech confused me a little as to how the clause would operate. I admit that in the pressure of business I have not- been giving enough attention to all the Bills before us, and have not been able to understand them without asking questions about them. I -had intended to move an amendment to exempt Tasmania from the payment of a contribution; but I now understand that Senator Ogden will take that action. The Northern Territory and Queensland will benefit from this work by reason of the fact that they send large numbers of cattle to Melbourne markets. The future is with Queensland. Weirs “will eventually be thrown across the great rivers of that State. Tasmania is in a very’ different position from any of the mainland States. Western Australia has benefited more than any other State has done by reason of the construction of the East- West railway, and Tasmania never complains about having had to contribute towards the cost of that work. Senator Hays, in reply to my remarks in connexion with the Tasmanian grant, made a direct reference to this matter, and I drafted . an amendment which I should have put before the Committee had I been per.mitted to do so. I thought it was my duty to submit the proposed amendment to the Tasmanian senators, and that is what I have done. I have no doubt that Ministers will have a sufficient majority to enable them to please themselves in the matter, but I shall insist upon a division being taken.

Clause agreed to.

Clauses 7 to 9 agreed ‘to.

Clause 10- ‘

The principal Act is amended by adding at the end thereof the following schedule: -

  1. Notwithstanding anything contained in clause 32 of the principal agreement, the Commonwealth Government agrees to increase to onequarter the proportion of the cost of carrying out the works mentioned in clause 20 of the principal agreement to bc borne by the Commonwealth Government. .
Senator OGDEN:
Tasmania

– I am glad that Senator Gardiner has suggested an amendment in the interests of Tasmania. I was” rather diffident about asking the Committee for any further, favours, in view of the attitude adopted by some honorable senators behind me in regard to the grant to Tasmania. But as my State is not connected with the mainland, it should receive some consideration. Large sums are being spent by the Commonwealth in the development of the larger States. Tasmania has always endeavoured to cultivate the true Federal spirit, and its representatives have supported such national undertakings as the construction of the East- West railway and the Federal Capital. The Commonwealth

Government will probably spend about £1,000,000 in connexion with the River Murray works, and as Tasmania has 5 per cent, of the total population of the Commonwealth, its share of that expenditure would be, say, £50,000. Tho. representatives * of Tasmania do not ask for a cash payment if the Governmentwills otherwise. The island State needs assistance with its hydro-electric scheme, and there is urgent need for development of its northern ports. We also have a big drainage scheme in hand, so that there are ample avenues in which we should be glad of Commonwealth assistance. I admit that Western Australia cannot benefit except in an indirect way from the conservation of the waters of the River Murray, but it must benefit to a greater extent than Tasmania will, because Western Australia is linked with the mainland States. I move -

That the following words be added at the end of paragraph 11 - “ Provided that the Commonwealth Government reimburse Tasmania by a direct payment of an amount equal to the estimated amount that Tasmania contributes to this agreement.”

Senator Drake-Brockman:

– I draw attention to the wording of the amendment, and also to the purpose of this measure. Tt is a Bill to ratify an agreement for the variation of the agreement entered into between the Prime Minister of the Commonwealth and the Premiers of the States of New South Wales, Victoria and South Australia respecting the River Murray and Lake Victoria, and other waters, and for other purposes. I submit that the amendment is not relevant to the Bill. If the Committee desires to benefit Tasmania in the direction indicated it must be done by way of a separate Bill, and not by an amendment of the present measure. I also draw attention to standing order 201, which reads -

Any amendment may be made to any part of the Bill, provided the same be relevant to the subject-matter of the Bill, and be otherwise in conformity with the rules and orders of the Senate.

Senator Kingsmill:

– I rise to a further point of order which may be considered in connexion with the point already raised. I submit that the amendment is out of order, because it means the appropriation of moneys other from the Consolidated Revenue or from loan. Such a proposal can be intro duced only on a message from His Excellency the Governor-General.

Senator Drake-Brockman:

– Hear, hear ! I meant also to take that point.

The CHAIRMAN (Senator Newland:

-Apart from the points of order raised, I intended to rule the amendment out of order, mainly for the reason mentioned by Senator Kingsmill, but also because clause 32 of the original agreement apportions the cost of the work between the Commonwealth, New South Wales, Victoria, and South Australia; no mention being made of Tasmania.

Senator Gardiner:

– May I point out that this is not a money Bill ?

Senator Pearce:

– It is a money proposal.

Senator Gardiner:

– It is not a money Bill, and the proposal is not one to appropriate money.

Senator Pearce:

– Yes, it is.

Senator Gardiner:

– To test of whether or not it is a money Bill is the procedure followed in this Chamber. Honorable Senators are permitted to discuss a money Bill on the first reading. . This is purely a machinery measure to ratify an agreement. If the Committee adopted the amendment, it would not mean taxing the community to the extent of ls. The Government could introduce an Appropriation Bill and pay the money to Tasmania. On money matters the rights of the Senate are clearly defined, and there cannot be any misunderstanding as to the direction in which our powers are limited.

Senator Pearce:

– That is not the only point.

Senator Gardiner. - I said I would deal first with the point raised by Senator Kingsmill because of its importance. To rule the amendment out of order would be to disregard the usual practice, as this is not a money Bill. If the amendment is carried, it will not involve the appropriating by this Bill ls. of Commonwealth money, and, therefore, a message is unnecessary. This is a Bill we can amend. Senator Drake-Brockman urged that the amendment was not relevant to the Bill. We can limit our power and narrow our rights, but our procedure should be in the direction of extending instead of restricting our rights. Honorable senators should note the words in the agreement under which the Commonwealth, New South Wales, Victoria, and South Australia enter into an agreement to contribute certain stipulated amounts. The intention of the amendment is that the proportion which it is estimated that Tasmania will pay shall be directly repaid to it. If that is out of order, Tasmania is very much out of the Commonwealth, because this is a special agreement, that Commonwealth money, partly contributed by Tasmania, shall be expended. I think it is quite clear that, under this agreement, the Commonwealth, Tasmania, Western Australia, South Australia, Queensland, New South Wales, and Victoria are to contribute certain amounts. In view of the geographical position of Tasmania, the amount Tasmania is paying should be reimbursed. I am anxious that we should keep to the procedure hitherto followed in this Chamber, and I always want, whenever possible, to extend the powers of the Senate.

Senator Kingsmill:

– Does the honorable senator wish to give this House the power to initiate money Bills?

Senator Gardiner:

– The amendment does not suggest that. It is not a question of seeking the power of initiation, but one of whether the Commonwealth is exceeding its powers. I am assuming that Tasmania’s share is paid under this agreement, and I consider that Tasmania should be reimbursed.

Senator Drake-Brockman:

– If the amount were reimbursed, Tasmania would not pay anything to the cost of this scheme.

Senator Gardiner:

– I realize that Tasmania, which is a sovereign State, is to contribute, but does not receive any direct benefit. I submit that the amendment is relevant, and would not involve an appropriation of money. It would be merely an instruction to the Government that it should reimburse Tasmania.

Senator GRANT:
NEW SOUTH WALES · ALP

– Would I be in order, Mr. Chairman, in moving a further amendment to the effect that Queensland and Western Australia also be reimbused ?

The CHAIRMAN (Senator Newland:

– Notwithstanding what Senator Gardiner has said, I rule that the amendment is out of order on the ground that it is irrelevant to the subject-matter of the Bill; as Tasmania is not mentioned in it, and also out of order because it would mean an appropriation of money.

Senator Gardiner:

– Would I be in order, Mr. Chairman, in moving the same amendment after clause 10, where it would stand as a separate clause, and on which a ruling could then be taken ?

The CHAIRMAN:

– I cannot permit the honorable senator to move the amendment at any stage, as I have already ruled that it is out of order.

Senator Gardiner:

– I dissent from your ruling, sir, on the grounds that I have already stated.

Senator Ogden:

– I understand that you have ruled the amendment out of order on the ground of irrelevancy, and that it would be an appropriation of money.

The CHAIRMAN:

– As Senator Gardiner has intimated his intention of disputing my ruling, the honorable senator will not be in order in proceeding.

Senator Gardiner:

– If Senator Ogden intends to dissent from your ruling, Mr. Chairman, I shall not proceed further, but, if he does not, I shall.

Senator Ogden:

– I do not intend to do so.

Senator Gardiner:

– Then I shall persist in my dissent.

In the Senate:

The CHAIRMAN (Senator Newland:

– I have to report that in Committee, while considering clause 10, Senator Ogden moved the insertion of the following words at the end of paragraph 11 of the schedule embodied in that clause: -

Provided that the Commonwealth Government reimburse Tasmania by a direct payment of an amount equal to the estimated amount that Tasmania contributes to this agreement.

I ruled this amendment out of order, because I considered that it was both irrelevant and contradictory to the subjectmatter of the Bill generally, and particularly to the clause to which it was intended to apply. Senator Gardiner has dissented from my ruling. In my opinion the amendment is both irrelevant and contradictory.

Senator Gardiner:

– This amendment was submitted by Senator Ogden. It is an amendment which I drafted myself, and which I intended to move. Two points of order were taken against it. The Chairman’s ruling was as stated by him. The reason for the amendment is that there is an agreement in existence between the Commonwealth - which includes Tasmania - and New South Wales, Victoria, and South Australia. The amendment was intended to be a sort of instruction to the Commonwealth Government to reimburse Tasmania its estimated share of the Commonwealth’s contribution to this work on the Murray waters. I dissented from the Chairman’s ruling because I thought that Tasmania, as a part of the Commonwealth, would be called upon to contribute towards this work, and because I believed that the scope of this Bill would permit of a new clause being inserted in it, giving an instruction to the Government to reimburse Tasmania the proportion of the cost which it is estimated that State will be called upon to bear. Tasmania, as a part of the Commonwealth, will be called upon to contribute indirectly towards .this work, from which it will receive no direct benefit. Believing that, I considered that the amendment could be moved, and that it was within the province of the Committee to discuss it.

The PRESIDENT:

– (Senator the Hon. T. Givens). - I think the matter is quite clear. In the first place, as ruled by the Chairman, the proposed amendment is irrelevant and contradictory, and, in addition, it must be remembered that Tasmania, as such, contributes nothing to this or to any other Commonwealth work. For this purpose the Commonwealth is one and indivisible. The Commonwealth revenue is a consolidated revenue. Tasmania contributes nothing as Tasmania, although as a part of the Commonwealth she contributes her due share to the revenue of the Commonwealth. I do not presume to be an interpreter of the Constitution, nor do I think that I should be called upon to decide constitutional questions ; but there are in the Constitution specific provisions as to what this Parliament may and may not do. One of the things which it may not do is to differentiate between the States. If the Committee were to make this provision in the Bill, it would amount to a differentiation between the States. It would mean that because none of this work was to be performed in Tasmania, Tasmania should be reimbursed; that because it was not to be performed in Western Australia, Western Australia should be reimbursed; and because it was not to be performed in Queensland, Queensland should be reimbursed. That would .be a differentiation between the States. In addition, it would amount to a direction as to future legislation and action by this Parliament. No Bill should contain any direction to Parliament as to what it might or might not do in the future. Therefore, I uphold the Chairman’s ruling. It is quite plain that the amendment is contrary to the provisions of the Constitution as well as irrelevant.

In Committee:

Clause agreed to.

Preamble’ and title agreed to.

Bill reported without amendment.

Motion (by Senator Crawford) proposed -

That the report he now adopted.

Motion (by Senator Pearce) proposed -

That the Senate do now divide.

Senator Needham:

– Why did you not wait for the proper time to move it?

The PRESIDENT:

– Order !

Senator Needham:

– What is the matter?

The PRESIDENT:

– Order! The honorable senator must obey the Chair.

Senator Needham:

– I am obeying the Chair. What does the - -

The PRESIDENT:

– I name Senator Needham for continued disobedience to the Chair. Before calling on the Minister to take the necessary action, I give Senator Needham the opportunity to put himself right with- the Senate.

Senator Needham:

– I want to know how I can do that?

The PRESIDENT:

– The honorable senator knows quite well.

Senator Needham:

– I was simply making a remark to the Minister (Senator ‘ Pearce) when you intervened, . and did not allow the conversation to end.

The PRESIDENT:

– The honorable senator has failed to take the proper course. I therefore call upon the Minister to take the necessary action;

Senator Needham:

– I had no intention of causing any trouble. If I have been disrespectful to the .Chair, I ‘apologize for it. That is all I can do.

Question– That the Senate do now divide - put. The Senate divided.

AYES: 16

NOES: 8

Majority . . . . 8

AYES

NOES

Question so resolved in the affirmative.

Original question resolved in the affirmative.

Report adopted.

Motion (by Senator Pearce) proposed -

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

Senator GARDINER:
New South Wales

– I do not know why the motion “ That the Senate do now divide “ should have been moved at the report stage of this Bill. I am trying, under the most difficult circumstances, to extend opportunities to the Government to get through a reasonable amount of legislation in a reasonable manner.

Senator Pearce:

– Was it reasonable to spend four hours on a small Bill like this ?

Senator GARDINER:

– I want the honorable senator not to put the blame on the Opposition. I should like to know whether I would be in order in moving an amendment to this effect -

That the Standing Orders be suspended until such time as Government business is finished.

The PRESIDENT (Senator the Hon T Givens:

– The only person who has a right to move for the suspension of the Standing Orders is the Minister in whose name the contingent notice of motion appears on the notice-paper.

Senator Needham:

– The Standing Orders are a farce. There are no Standing Orders now.

The PRESIDENT:

– Order! The Standing Orders have been adopted by the Senate, and by the express will of the Senate. No honorable senator is entitled to speak disrespectfully or abusively of any act of the Senate. I therefore ask Senator Needham to withdraw his remark unconditionally, and to apologize for having made use of the term he employed.

Senator Needham:

– I withdraw again.

Senator GARDINER:

Senator Pearce cannot expect the Opposition to agree to the suspension of the Standing Orders, seeing that on another Bill he seemed to go out of his way to anticipate that some one wanted to say something he did not want to hear, and made use of the power given to him under the Standing Orders to apply the closure. I am not allowed to discuss the length of time occupied in discussing the Bill, but, I suppose that I did not speak for more than twentyfive minutes altogether. At any rate, in Committee eight clauses were passed without a word being said. There was no wilful attempt to delay its passage. I do not suppose the Government would regard it as generous treatment. I do not suppose that they regard honorable senators opposed to the Government as being capable of generosity. It struck me that a certain amendment was very applicable to the measure, but as it was ruled out of order, I bowed to the ruling of the Chair, and made only a brief reference to it in the Committee stage. On reaching the report stage, Senator Pearce, being unduly nervous, decided that we should not be given an opportunity to be heard. Well and good. Immediately after applying the closure again, he has asked for the suspension of the Standing Orders in order to enable the Bill to be passed through its remaining stages without delay. If he looks through Hansard next week and reads the speeches delivered on this Bill he will find that there was no delay. At certain stages in Committee, no honorable senator of the Opposition said a word, and as a matter of fact, the only members of the Opposition who spoke at all at that stage were Senator Ogden and myself. It is true that Senator Grant spoke upon the second reading, but his utterance was well worthy of the occasion, and if it did nothing else it brought from the Minister in charge of the Bill (Senator Crawford) an explanation that was immediately accepted. In the interests of that harmony and accord that should prevail at the termination of a session I propose to let the Minister have the Bill without wasting any further time. I do not know how much longer I can stand the treatment that is being meted out to me. I am still in a normal condition, and I have not allowed the strenuous work of the session and the long sittings to carry me, over the balance as yet, but I do not know what may happen when the Government com- mence dealing with Bills at the ‘rate of one a minute. I also recognise the strain that is imposed on Senator Pearce. His health and comfort are of as much concern to me as they are to the honorable senator himself. He may have the assistance of other Ministers, but he is compelled to have a knowledge of every measure going through. I take it that it is intended to sit continuously until the business is finished, and if the sausage machine rate at which Bills are being dealt with and sent on to us by another place is maintained, we shall be sitting’ here until midnight tomorrow. The Minister can have the suspension of the Standing Orders, because I realize that if the full programme is to be got through at one sitting, it is necessary ,to suspend them; but the honorable senator will give me credit for rising on many occasions to voice my protest against this procedure. I consent to his proposal now, because I do not want honorable senators to be overwhelmed at the last hour with the flood of measures that will come down to us from another place in the closing hours of the session. I do not want to have Bills passed at the rate of a dozen in a dozen minutes.

Senator Lynch:

– They are nearly all leaflet measures.

Senator GARDINER:

– The honorable senator knows that the measure which is most discussed is often that which is of least importance. We are. anxious to improve what we often imagine to be some little blemish. But why all this hurry? The Prime Minister and Senator Wilson are not going away until next month. We could adjourn to-night, and still have a week, before their departure, in which to pass legislation. Notwith standing the fact that this Bill was hardly discussed by us during the Committee stage, the Minister still claims that he is justified in having the poor satisfaction of showing that a majority can prevent the minority from -talking. My combative spirit rises in rebellion against such a proposal. If he persists in submitting the motion, “ That the Senate do now divide,” honorable senators of the Opposition will see how thoroughly they can discuss measures without getting outside the Standing Orders. I, for one, will not lose my temper, or say one unnecessary word. I have never done so, unless the Government have attempted to make us sit unnecessary hours. I hope that the Minister will realize that it is a huge task to get thirty additional Bills through the Senate in the few hours at our disposal, and that he will not get them through by first insulting honorable senators, and then asking them to acquiesce in suspending the Standing Orders. We shall acquiesce on this occasion, but if he still persists in the most abominable system of “gagging” us, we shall take it as a declaration of war, and meet him at his own game.

Senator MCDOUGALL:
New South Wales

– I do not wish to waste time, but I rise on this occasion, as 1 have always done since I have been in this Senate, to protest against the unnecessary suspension of the Standing Orders. The Government should have so arranged their programme that it would be unnecessary to move for the suspension of the Standing Orders. It is not honorable senators of the Opposition who have wasted time on this or any other Bill. I am at liberty to address myself to anything that comes before the Senate, and, if I choose, .can speak to the full length of time allowed under the Standing Orders. I made a sporting offer to the Government yesterday that I would be prepared to sit right on and help them to clear up the business-sheet. We had already been sitting a considerable time when I made that offer, but it was not accepted. Now I have missed my train to Sydney, and will not get home in time to attend church on Sunday morning. I shall thus have to break away from the habit of a lifetime, simply because the Government have nob had the foresight to see what was reasonably possible to pass in the time available prior to Mr. Bruce’ s departure. The blame for any delay that has taken place does not lie with the Opposition. The fault is that the Government have not been able to control their own supporters. I remind the Senate how Senator Cox, “the silent,” roared at all and sundry this afternoon. Senator Hays has also occupied time, and even the usually silent Senator Kingsmill spoke while I was sitting here assisting the Government to get the business through.

Question resolved in the affirmative.

Standing and Sessional Orders suspended.

Bill read a third time.

page 3466

SULPHUR BOUNTY BILL

Second Reading

Senator WILSON:
South AustraliaHonorary Minister · NAT

– I move -

That the Bill be now read a second time.

This Bill provides for a bounty on sulphur produced in Australia from Australian pyrites and sulphide ores. Sulphur is used for the manufacture of sulphuric acid, which is in turn extensively used for making superphosphate, sulphate of ammonia, explosives, and a number of other commodities. Free sulphur is used, with other things, in the manufacture of sheep-dip and orchard sprays. At the present time the duty on sulphur is : British preferential, 15s. ; intermediate, 20s. ; and general tariff, 50s. per ton. The revenue derived from imported sulphur in 1922-23 was very large. The bounty is being substituted for the present duty on sulphur. The rate of bounty is£2 5s. per ton of sulphur produced. The Government has given this question very careful consideration, and has decided, in view of the vital necessity for cheap fertilizers for agricultural production, and of the equally vital necessity for encouraging the increased use of fertilizers, to remove the duty. On the other hand, in consequence of the imposition of the duty, Australian sulphur producers have incurred heavy expenditure in laying down plants for the extraction of sulphur from Australian ores, and it is necessary that encouragement in the form of a bounty should be given to enable the industry to continue operations. The Tariff Board has investigated the costs of production of sulphur from local ores, and has ascertained and reported that a bounty of £2 5s. per ton is the minimum that would enable the industry to be established. The cost of producing sulphuric acid from local sulphur-bearing ores exceeds the cost ofproducing sulphuric acid from imported sulphur by 43s. per ton. In view of the greater cost of sulphur extraction from ore, and of the much more expensive plant required as compared with the treatment of imported sulphur, and especially in view of the difficulties attending the establishment of a new industry, the rate of £2 5s. per ton is absolutely necessary. A yearly amount of £100,000 is provided for the payment of the bounty. This figure is based on a production of 40,000 to 45,000 tons of sulphur. With the plants in operation and those which are in course of erection it is estimated that production will reach this figure. It has therefore been decided, in the interests of Australia as a whole, to remove the duty on sulphur, and substitute a bounty. Later, I hope to move a small Bill to provide for the abolition of the dutyon sulphur during the period in which the bounty will be paid.

Senator Findley:

– What quantity of sulphur was imported last year?

Senator WILSON:

– 37,829 tons.

Senator McDougall:

– How many factories are making sulphur in Australia?

Senator WILSON:

– About a dozen.

Senator Findley:

– What is their output?

Senator WILSON:

– Twenty-five thousand to 35,000 tons a year. As a result of the bounty, it is hoped that this quantity will be increased to 45,000 tons. Honorable senators know what this industry means to Australia from a national point of view, and we cannot disregard that aspect of the matter.

Senator FINDLEY:
Victoria

– Ever since I commenced to take an active interest in the politics of this country, I have been a Protectionist. I have become convinced during recent years that some members of the community believe in absolute Protection for their own industries, but unrestricted Free Trade for labour. For them I have very little time or consideration. There is, however, another section which, when it receives the Protec- tion afforded by the Australian people, is prepared to act fairly to the workers. As a Protectionist, I do not like the Bill. Parliament, in its wisdom, decided that there should be a duty on sulphur of 15s. British preferential,. 20s. intermediate, and 50s. general. According to the Minister’s statement, nearly £38,000 was received last year from the duty . on imported sulphur. In addition, from 25,000 to 35,000 tons were manufactured in Australia. Why is it considered necessary to remove the duty and substitute a bounty? Is it intended to apply the bounty system to other industries, and ultimately to substitute it for the import duties? If that is intended it is a distinct departure from the policy approved by the people of Australia. I admit that sulphur is important to a large section of the people of Australia.

Senator Hays:

– To all of them.

Senator FINDLEY:

– It is more important to certain sections than to the whole of the people.

Senator Hays:

– It is essential to the wheat-growing industry.

Senator FINDLEY:

– I admit that it is essential to agricultural development. Nothing has been said to convince me that the bounty system is preferable to the Protectionist system. I do not oppose the Bill, but I rose mainly to obtain more information. If the production of sulphur in Australia increases to the extent estimated by the Government, the people will have to provide a sum of £100,000 to pay the bounty. The Minister stated that in a few years Australia would be manufacturing from 40,000 to 45,000 tons a year. Last year we imported 38,000 tons, and in the course of time no doubt the whole of the sulphur required here will be manufactured in the Commonwealth ; but I cannot see how the Australian manufacturers can capture the local market if the imported article is to be admitted free.

Senator Guthrie:

– The bounty would encourage the establishment of a big industry.

Senator FINDLEY:

– That is the object of it, but the probability is that in a short space of time the various manufacturers will put their heads together and the industry will become a monopoly.

Senator Ogden:

– Protection has the same effect:

Senator FINDLEY:

– If the principle is laid down that we should depart from levying Customs duties and extend th9 bounty system, we might as well entirely re-open the Tariff. As I see a great danger in a departure of this nature, I want- the Minister to state the real reason for it.

Senator GARDINER:
New South Wales

– I have always entered my protest against the whole of the people putting their hands into their pockets to assist a few people who cannot manage their own business. My experience is that the bounty system helps only the companies and the individuals who have a “ pull.”

Senator Ogden:

– So does a protective duty.

Senator GARDINER:

– I shall not be found quarrelling with that argument. About 50 years ago in Australia, 100 years ago in the United States of America, and 75 years ago in Great Britain, there was fierce party warfare over the advisability of trying to make a country rich by means of a protective tariff.

Senator GRANT:
NEW SOUTH WALES · ALP

– I rise on a point of order. In view of the fact that I am frequently prevented from discussing the subject of land taxation, I should like to know if Senator Gardiner is in order in discussing, on this Bill, our glorious Protectionist policy ?

The PRESIDENT (Senator the Hon T Givens:

– The subjects of bounties and tariffs are so closely related that I think the honorable senator is quite in order.

Senator GARDINER:

– About halfadozen firms will participate in the benefit of this bounty, and the rest of the people of Australia will have the privilege of paying for it. About 80 per cent, of the members of the party to which I belong believe that industries should be assisted, either by bounties or tariffs. Of the two evils I prefer bounties, although I think that we could get along very well if we dispensed with both. The proposal will mean that we shall pay the producer of sulphur a bounty of £2 5s. on every ton of sulphur manufactured. There is a Customs duty of 15s. per ton against sulphur coming from Great Britain.

Senator Thompson:

– It mostly comes from other countries.

Senator GARDINER:

– That possibly is the reason why the British duty is so light. The general tariff is 50s. per ton, and that gives protection against sulphur from foreign countries. If it is imported from such countries as New Zealand and Canada, we impose a duty of 20s. per ton. The selling price of sulphur is about £6 per ton, and a bounty of £2 5s., in addition to the duty on the imported article, represents an enormous concession to the local manufacturers.

Senator Wilson:

– Immediately this bounty is agreed to, the duty will be removed.

Senator Guthrie:

– The object is to make sulphur free.

Senator GARDINER:

– That makes a great difference to my attitude.

Senator Wilson:

– The next Bill to be introduced will remove the duty on sulphur.

Senator GARDINER:

– I prefer a bounty of £2 5s. to a duty of 20 per cent. I want our people to trade with other countries irrespective of nationality. I know of stone carrying a very high percentageof arsenical pyrites, and, seeing that such special consideration is being given to the producers of sulphur, I shall at the first opportunity endeavour to ascertain the sulphur content. The payment of a bounty of 45s. per ton, instead of the imposition of a duty, will materially assist the fruitgrowers and others who use a large quantity of sulphur, and it will perhaps materially assist those who use fertilizers in connexion with the cultivation of the land. If sulphur is made available at a lower price, perhaps phosphatic rock, shipped from Nauru, where we are spending a good deal of money, will be available at a lower price. I think the time has arrived when the system of bounties should be so extended as to benefit those who are now contributing towards the bounties received by those who do not need them. If I introduced into the Senate a Bill to provide that the coal miners, who now receive 3s. a ton for the coal they hew, should receive a bounty of at least 3d. per ton to enable them to meet their obligations owing to the high cost of living, I wonder how it would be received. Many of these men, with large families, are on the bread line, while those who are single, or who have only small families to support, may be in a little better condition. In supporting such a measure, I could, with a good deal ‘of emphasis, direct attention to the fact that assistance was being given in the form of bounties to many successfully engaged in production, and who do not need assistance. A bounty of 3d. per ton on coal would perhaps be the means of making the coal miners produce a little more, and thus enable our industries to extend. What support would I receive? I can quite imagine honorable senators opposite, and the Minister in charge of this measure, offering their strongest opposition. Although they will vote for the payment of hundreds of thousands of pounds to assist men engaged in big industries, they would not vote one penny to assist the coal miners, who, with others, have to contribute towards the amounts we are paying to wealthy men. Why would such a proposal be met with opposition? Merely because we have not yet arrived at that stage where all men should be treated as equals. In all the legislation we pass, we draw a distinct line in favour of the men who have, but we do not consider those who have not. Of course, it will be said the Arbitration Courts have been established for the purpose of adjusting wages ; but while the awards of the Courts have improved the conditions of some, the. payment of bounties and the imposition of high Tariff duties have counteracted any slight benefits so received. It will not be long before the representatives of some industrial union will say that they have been fighting on the wrong lines, and that, as they do not intend to enter into further controversy with their employers, they will establish a new principle by asking for a bounty. Surely the workers have as much right to consideration as any other section of the community. I intend to adhere to the principles I have always supported, and in this, as in similar instances, I shall do what I can to prevent the exploitation of the people by the payment of bounties and the imposition of high Tariff duties.

Questionresolved in the affirmative.

Bill read a second time.

In Committee:

Clauses 1 to 4 agreed to.

Clause 5 (Certificate to be supplied by claimant in support of claim).

Senator GARDINER:
New South Wales

– Is there a provision in the Bill which makes it impossible for the Government to refuse to pay a bounty to any one actually producing sulphur? I would like to know if all producers are on the same basis. If it can be proved that a person is producing sulphur, will he be eligible to collect the bounty ?

Senator Ogden:

– Under regulations to be framed, a minimum will be prescribed which will have to be reached before the bounty can be claimed.

Senator GARDINER:

– I think it would be better if it were definitely stated in the Bill that the Government shall pay a bounty to any one producing sulphur. We have been told that a differentiation cannot be made between the States in matters of legislation, and we therefore should not differentiate between man and man.

Senator Pearce:

– Has the honorable senator ever known of an instance of a bounty being refused ?

Senator GARDINER:

– I do not know to whom they have been paid; but I believe that a bounty of £211,000 was paid to Hoskins Limited on iron or steel produced. It should be clearly understood that any man who produces sulphur can claim the bounty.

Senator Pearce:

– A man who was producing sulphur would submit an application, and if payment were refused he could go to law.

Clause agreed to.

Clause 6 (Persons entitled to bounty).

Senator GARDINER:
New South Wales

.- The total amount to be paid is limited to £100,000 per annum. The assistance offered may be the means of quite a number of persons undertaking the manufacture of sulphur, and the amount provided may not be sufficient. Perhaps the first applicant would receive the full amount.It should be distributed on a pro rata basis.

Senator Wilson:

– That is dealt with in clause 13.

Clause agreed to.

Clauses 7 to 12 agreed to.

Clause 13 (Regulations).

Senator JOHN D MILLEN:
TASMANIA · NAT; UAP from 1931

.- Can the Minister (Senator Wilson) give an assurance that in the regulations the minimum quantity to be produced will be made reasonably low so as to enable all producers to benefit?’

Senator Wilson:

– I assure the honorable senator that as long as they are legitimate producers of sulphur they will be entitled to the bounty.

Clause agreed to.

Preamble and title agreed to.

Bill reported without amendment.

Standing and Sessional Orders suspended; report adopted.

Bill read a third time.

page 3469

CUSTOMS TARIFF (SULPHUR) BILL

Second. Reading.

Senator WILSON:
South AustraliaHonorary Minister · NAT

– I move -

That the Bill be now read a second time.

This Bill deals with the duty on sulphur, and it is necessary to pass it in order to make operative the provisions of the Bill which the Senate has just passed. Whilst enjoying the privilege of a bounty, the producers of sulphur are not to be entitled to the benefit of a duty on importations of that article.

Senator FINDLEY:
Victoria

– The fact that the Senate has just passed a Bill granting a bounty on the production of sulphur renders it necessary for us to pass this Bill. When the Minister (Senator Wilson) was introducing the previous measure, I asked why the Government had found it necessary to depart from the principle that had been followed since the establishment of Federation. The people of Australia have declared in favour of a Protectionist policy in preference to any other form of fiscalism. Parliament having decided that the imposition of certain duties on sulphur is in the interests of the people of Australia, and at the same time is helpful to the establishment of the sulphur industry, why should the Government, in the closing hours of the session, introduce two Bills which represent a departure from that well-established principle ? A revenue of between £70,000 and £80,000 is obtained to-day through the Customs Department from the sulphur duties. We are to lose that revenue, and, inaddition, will have to find £100,000 by way of bounty.

Senator Ogden:

– We have to pass this, or the bounty will be lost.

Senator FINDLEY:

– The Government has become inconsistent and somewhat paradoxical in its attitude. If the Customs duties are to be taken off sulphur, later on similar action may be taken in regard to other commodities. It is the general impression that these Bills are the result of pressure by a section of the present Cabinet which represents country interests. The tendency of that section is in the direction of Free Trade, and it will do anything it can to weaken the Protectionist policy of Australia. I am a little suspicious, because I understand that it is intended to placate a certain section of the community. Naturally those who are interested in the industry in Australia will not object to the payment of the bounty, because it is said - whether rightly or wrongly I do not know - that they will be better placed under a bounty of £-2 5s. a ton than they are at present by the imposition of Customs duties.

Senator Ogden:

– They shift the load.

Senator FINDLEY:

– The load is shifted on to the community.. It is proposed to give one section what no other section enjoys.

Senator JOHN D MILLEN:
TASMANIA · NAT; UAP from 1931

– The honorable senator may not know that the companies da not desire this alteration.

Senator FINDLEY:

– That confirms the impression which is abroad, that the request has come not from those who are interested in the industry, not from the section that I and others of my party represent, but from a section that is represented in the present Ministry - a section which, it is said, is opposed tooth and nail to the Protectionist policy of Australia, and is determined, if possible, to weaken that policy whenever it gets the opportunity. I have never shown any inconsistency in my attitude towards the Protectionist policy of Australia. 1 hesitated to vote for the previous Bill, and I have some hesitation in this case, because I dislike such a departure from an established practice without knowing the real reason for it.

Senator Lynch:

– The honorable senator used to claim to be a Himalayan Protectionist; he had his head in the clouds.

Senator FINDLEY:

– I have always voted consistently in regard to Protectionist duties. I have never sought to apply Free Trade to my own State and Protection to other States. If Protection is a good principle;, it ought to be general in its application. I intend to watch very carefully every move made by the present Government in relation to fiscal matters. I am disposed to think that the section in the Cabinet which is said to be essentially Free Trade in its ideas, is to-day exercising, and will continue to exercise, a strong influence in the direction df weakening the declared fiscal policy of Australia.

Senator NEEDHAM:
“Western Australia

– I had made up my mind that I would not speak on this measure.

I thought it was an innocent little Bill. But Senator John D. Millen certainly “ let the cat out of the bag.” As a matter of fact, he has given away the whole show. Like my colleague, Senator Findley, I claim to be a Protectionist, believing that to be the accepted fiscal policy of Australia. The Commonwealth has determined time and time again that it will have a Protectionist Tariff. During the last election, Dr. Earle Page, the Leader of the Country party, said that there were many anomalies in the Customs Tariff, which would be removed if his party held the reins of power. His party has now one-half of the reins of government, the other half being in the hands of the Liberal section, and I am beginning to think, as Senator Findley has suggested, that we have in this Bill an insidious attempt to undermine the protective policy. My policy is to give effective protection . to Australian industries, and where I ‘ find an industry languishing, as many of them are at the present time, I would add a bounty to the protective duty. The sting of this Bill is in its tail, where it is proposed to amend the- Tariff by providing that as long as a bounty is payable on sulphur, the importation of sulphur shall be free of duty. Senator John D. Millen has told us that the people interested in the manufacture of sulphur are not seeking a bounty. When any Bounty Bill has been under discussion* in this Parliament, honorable senators have been besieged by representatives of the industries seeking assistance. One could scarcely emerge from the Chamber without being waylaid in the corridors by them. I was about to vote for this Bill, but I can see in it an insidious attempt to undermine the present Tariff, and realizing that it is only one of the many attempts that may be made to undermine that Tariff between now and the time when another Government will replace the present Ministry, I propose to vote against it.

Senator GRANT:
NEW SOUTH WALES · ALP

.- I think that the Minister should have supplied a number of details which are missing. I should like to know bow much sulphur there is in Australia to-day, and whether those who possess it will, on the passing of the Bill, be able to inform the Government that they have so many hundred tons of locally mann- factored sulphur, and thereby secure a bounty upon it. I am not concerned at the fact that our “ glorious policy of protection “ under which we have made such magnificent strides, and under which “ there are no unemployed in Australia,” may be undermined by legislation of this character. But I am concerned, just as every level-headed man should be concerned, at the fact that if this policy is pursued to any great extent, our greatest source of public revenue, the Customs House, will fail us, and in order to secure revenue from other sources, certain interests which have hitherto been exempted from taxation will be called upon to make up the deficiency. That phase of the question has not been stressed by the Minister (Senator Wilson) or by other honorable senators. Those who have expressed themselves as being concerned at the abolition of the duty on sulphur, may rest assured that there is not much likelihood of its being removed. The Protectionists in this Senate are sufficiently numerous, courageous and free to act as they think best to see that not even a splinter or a lath in our “ glorious policy of protection “ is disturbed.

Senator Gardiner:

– The honorable senator had better explain that that is sarcasm, otherwise his speech will read like a protectionist utterance.

Senator GRANT:
NEW SOUTH WALES · ALP

– The honorable senator may regard it as sarcasm, and it may be so, but it is the established policy, not only of Australia, but of the whole” civilized world; and we know that wherever this “glorious policy” is in existence, we’ have soup kitchens, destitution, unemployment, and all the other evils we are trying to remedy. It would be far better to pay more attention to matters of grave concern, and less attention to questions of this kind. There is not much in this Bill, and if a few interests do suffer, we should not overlook the fact that the object of the Government, if I interpret their intention correctly, is to enable the fertilizers required by the men who are engaged in primary production to be secured at a cheaper rate. That is the objective behind this proposed remission of duty. It must be remembered that, although it is proposed to remit the duty, the bounty will remain. At the same time,, it is to be hoped that while the duty is paid, the necessary in gredients for the manufacture, locally, of fertilizers required by the man on the land will be available, at as cheap a rate as they are to-day. In these circumstances I shall await with interest the division on this Bill.

Senator GARDINER:
New South Wales

. - The Minister seemed to infer that this Bill was the fruit of some attack I had made in a previous session. It was in 1920 that we made the attack on the heavy duties imposed on primary producers, and it has taken all this time for it to bear fruit. However, I always say, “ I fear the Greeks even when they bring gifts.” This remission of duty is not a gift to the Free Traders. Senator Grant put his finger on the spot when he suggested that the sulphur manufacturers want to make a little more out of some one else. Evidently that is why this Bill has been introduced. It does not repeal the duties on sulphur; it merely suspends them. For how long? Perhaps not for a month.

Senator Needham:

– They are to be suspended until there is no more bounty to be paid.

Senator GARDINER:

– When bounty has been paid on about 40,000 tons of manufactured sulphur, the heavy duties on sulphur will be re-imposed. That is not a fair deal. One fixed principle in legislation to which we should adhere, is that before anything is repealed it should be replaced by something else. We have already passed a Bounty Bill, and it would be quite possible under the provisions of the Bill now before us for halfadozen firms, who are manufacturing sulphur in Australia, to produce at least 50,000 tons of sulphur during the next two months and receive the bounty on that amount. The bounty will then cease to exist, and the men who have to import sulphur will be obliged to pay the same old duties again. I shall oppose the Bill, because the bounty on sulphur may be exhausted within a month or two months. It will certainly be exhausted within six months.’ Quite a number of people, notably members of the Country party, have taken credit to themselves for what they call this “ triumph in legislation.” They said that objectionable duties would be removed, and now we have that policy translated into a Bill. I like the Minister’s candour in this case, for he said the duties would be suspended Only while the bounty was being paid. Had the Government intended merely to repeal the duties on sulphur, it would have done so in much simpler words.

Question resolved in the affirmative.

Bill read a second time.

In Committee:

Clauses 1 and 2 agreed to.

Clause 3 -

The Customs Tariff 1921-1922 is amended by inserting in item 275 of the Schedule, after sub-item A (1), the following proviso: - “ Provided that, so long as a bounty is payable on sulphur under any law of the Commonwealth, the importation of sulphur to which this sub-item applies shall be free of duty.”.

Senator PEARCE:
Minister for Home and Territories · “Western Australia · NAT

– I wish to direct Senator Gardiner’s attention to paragraph b, clause 13, of the Sulphur Bounty Bill which the Senate has just passed. It is there provided that the regulations shall prescribe the proportion of the bounty payable to the claimants where the total quantity of sulphur produced is too great for the full rate of bounty to be paid upon it. Let us assume that a bounty paid at the full rate on 50,000 tons of sulphur would exhaust the amount of money voted. If 100,000 tons of sulphur were produced in that year the bounty would still be payable On the total quantity, but at the rate of fi 2s. 6d. instead of £2 5s. per ton. In no year for which the bounty is provided can the import duties be levied. To reimpose the duties would require an act of Parliament, and that act would be the non-voting of the annual amount of the bounty. So long as the yearly amount of money is provided for the bounty the quantity of sulphur produced will not affect the import duties.

Senator GARDINER:
New South Wales

Senator Pearce states the case as it appears to him, but the clause does not state the case as it appears to me. I intend to move an amendment, although I know I cannot get -it carried. The clause, according to my interpretation, says that as soon as £100,000 has been paid out in bounty, no more money will be available until thefollowing year, and in the interval the duty will be reimposed.

Senator Pearce:

– There will be no interval.

Senator GARDINER:

– The Minister says there will be no interval, but he will not mind my saying that there may be an interval. The intention of the clause is good. The previous Bill provided for a maximum bounty of £2 5s. per ton, but the maximum becomes the minimum if a sufficiently, large quantity of sulphur is produced. If a company produced, in the first month or two of the year, 50,000 tons of sulphur, and submitted its books correct in every detail to the Treasury, it would surely get the .bounty.

Senator Pearce:

– It would not necessarily get the bounty when it made the claim. The bounty would be divided proportionately at the end of the year.

Senator GARDINER:

– I do not think that if I were in the sulphur business I should have sold much sulphur since the promise of this Bill was made.

Senator J D MILLEN:
TASMANIA · NAT; UAP from 1931

– Sulphur cannot be stored foi- any length of time.

Senator GARDINER:
NEW SOUTH WALES · ALP; PROG LAB from 1928

– I welcomed this Bill because I thought it was convincing proof that in the stronghold of Protection a failure had been discovered, and that the Protectionists, although they had not surrendered, had given the people at least a taste of Free Trade. I find, however, that they are not proposing to remove the Protectionist duties, but merely suspended them for two or three months in the year. I move -

That the House of Representatives be re- quested to leave out the words, “ so long as a bounty is payable on sulphur under any law of the Commonwealth.”

I shall also move a request for the omission of the words “ to which this sub-item applies.” The proviso will then read -

Provided that the importation) of sulphur shall be free of duty.

The amendment will cause the clause to read in accordance with the clearly expressed intentions of the Minister (Senator Pearce). The clause will then be concise and unmistakable.

Senator FINDLEY:
Victoria

.- I did not oppose the Bounty Bill, and I am not, for the moment, opposing this measure. I wish to be perfectly satisfied that no section of the community is to be specially favoured at the expense of the taxpayers. It has been freely stated for some time past that, because of certain influences that were at work, the duties on sulphur would be removed, and a bounty would be payable to those engaged in that industry in different parts of Australia. If the manufacturers have been made aware of the proposals of the Government - and, no doubt, they are fully cognisant of them - it may be that in anticipation of the passage of the Bounty Bill they have been accumulating large stocks of sulphur on which they will be entitled to a bounty of £2 5s. a ton.

Senator Pearce:

– Clause 3 of the Bounty Bill should satisfy the honorable senator on that point.

Senator FINDLEY:

– How shall we know whether the sulphur was produced before or after the passing of the Bounty Bill?

Senator Pearce:

– We have Customs inspectors who periodically visit such works.

Senator FINDLEY:

– But this is an age of commercialism, and some manufacturers are not too scrupulous as to the methods they employ. A bad Act properlyadministered is better than a good Act badly administered.

Senator Pearce:

– The Act will be properly administered. The Customs Department has a fairly good record.

Senator FINDLEY:

– I know it has highly efficient officers, but there are some people who are not above taking advantage of the laws of the country. I wish to be certain that no bounty will be paid on any sulphur manufactured prior to the measure becoming operative. Can I have an assurance that no unfair advantage will be given to the manufacturers ?

Senator Wilson:

– I am prepared to give that assurance.

Senator LYNCH:
Western Australia

.- The Bill stipulates that the duties are to be removed, and are not to be re-imposed so long as the bounty is payable, but there is no provision in the Bounty Bill to say that the bounty shall not be payable when the duties are revived.

Senator Pearce:

– The duties could be revived only by the introduction of another Bill, and the bounty could be repealed only by another Bill being brought in.

Senator LYNCH:

– Although the intention is that the bounty shall not re main if the duties are revived, there is nothing to prevent people like Senator Findley, if they happen to get into power in the Commonwealth Parliament, from keeping both the bounty and the duties in operation. I suppose that the Minister will take care that both cannot be kept in operation at the one time.

Senator Wilson:

– That is so.

Senator FINDLEY:
Victoria

.- The remarks of Senator Lynch are quite uncalled for and unjust. He stated that I - and he emphasized my name - would probably be willing, not only to grant the bounty, but also to make the duties and the bounty operative simultaneously. I would not be so foolish as to put forward such a proposition. I am a Protectionist, and I favour a Customs Tariff as against bounties. I am still somewhat bewildered as to the real intention of the Government. Apparently this is only a tentative measure, and after six or twelve months the bounty will cease and the duties will be revived.

Senator Wilson:

– Parliament will decide that matter.

Senator FINDLEY:

– We should have a definite statement from the Minister. I shall not be a party to playing fast and loose with our fiscal policy.

Question put. The Committee divided.

AYES: 7

NOES: 17

Majority . . . . 10

AYES

NOES

Question so resolved in the negative.

Request negatived.

Senator GARDINER:
New South Wales

.- I move-

That the House of Representatives be requested to add the following words at the end of the clause : - “ until Parliament otherwise provides.”

Senator Wilson:

– I am informed that the insertion of those words is quite unnecessary.

Request negatived.

Clause agreed to.

Title agreed to.

Bill reported without request.

Motion (by Senator Pearce) proposed -

Thatso much of the Standing and Sessional Orders be suspended as would prevent the Bill being passed through its remaining stages without delay.

Senator GARDINER:
New South Wales

– Although we have been here since 11 o’clock this morning, the Minister (Senator Pearce) has not given any indication as to the time he expects us to sit. A reasonable amount of business has already been transacted, and if he would state the intentions of the Government perhaps we should be able to proceed with the work more expeditiously. If he says that we are to finish before rising I shall be quite happy; but it may mean a change in tactics.

Senator NEEDHAM:
Western Australia

– The Standing Orders have been suspended so often that I was under the impression that they were not now operative. We have about reached the limit of human endurance, and as there are only two or three unimportant measures on the business-paper, perhaps the Minister (Senator Pearce) will state how long he expects us to sit.

Senator PEARCE:
Minister for Home and Territories · Western Australia · NAT

– I believe honorable senators who live in other States would prefer to return home to-morrow, and not be asked to come back next week. We intend to finish the business this week, instead of asking honorable senators to return next week to deal with perhaps only two or three measures. Frequent reference has been made to the motion I have submitted from time to time for the suspension of the Standing Orders. The criticism of my action in that respect is most unfair. There are honorable senators in this Chamber who have been members of State Parliaments, and who know that in the popular House in every State, towards the end of a session, a motion for the suspension of the Standing Orders is moved only once, and covers all Bills. That cannot be done here, as our Standing Orders differ somewhat from those under which the State Parliaments work.

Question resolved in the affirmative.

Report adopted.

Bill read a third time.

page 3474

SHALE OIL BOUNTY BILL

Second Reading

Senator WILSON (South Australia-

Honorary Minister) [11.23]. - I move -

That the Bill be now read a second time.

The Shale Oil Bounty Act 1917-1922 has been in operation since 1st September, 1917. Unless extended the Act will expire on the thirty-first of the present month. The Bill amends the Act by extending payment of the bounty for a further three years. The whole effect of the Bill is to continue the payment of the bounty for three years from 1st September next. No other alteration is proposed. It is essential that the bounty should be continued for three years. A shorter period would be useless as it would not give the producers sufficient security to justify the expenditure necessary to continue operations. The rate of bounty is 3½d. for each gallon up to a yearly production of 3,500,000 gallons, with reduced rates for greater output. The rate of 3½d. was decided upon and inserted in. the Act last year after full investigation by the Tariff Board. Of the £270,000 appropriated for payment of the bounty the sum of £145,000 remains unexpended. This amount will be sufficient for the further three years proposed in the Bill.

Senator WILSON:
NAT

– One company is operating in the Blue Mountains, and new companies are starting operations in Tasmania.

Senator Guthrie:

– Every one knows that attempts are being made to establish the industry on a sound basis.

SenatorMcDougall.- Yes, and the honorable senator is a big shareholder in the company.

Senator Guthrie:

– That is not so.

Senator McDougall:

– We were in- formed by Senator Plain, when advocating the development of certain deposits in Tasmania, that the honorable senator was a shareholder.

Senator Guthrie:

– Yes; I hold a few shares.

Senator McDougall:

– This is another instance in which assistance is being given to Tasmania.

Senator WILSON:

– Most of the money paid in bounties has gone to New South Wales.

Senator McDOUGALL:
New South Wales

– I strongly protest against payment of a bounty on shale oil, particularly to Tasmania, which State is always coming, cap in hand, to the Commonwealth for assistance. A company operating in New South Wales, which has expended a very large sum of money, offered the whole undertaking to the Commonwealth Government for £36,000, and the offer was declined, merely because the Government would not interfere with private enterprise. I know a good deal about the industry in New South Wales. It is of little benefit to the State or to any one else, and it would not matter if operations were suspended to-morrow. I have been to the works in an endeavour to settle some of the labour difficulties, and know that those in control will not pay the men reasonable wages.

Senator Guthrie:

– Do not they work under an award?

Senator McDOUGALL:

– The honorable senator should consult Fell and other interested parties to ascertain what is actually being done. Every one seems to be coming to the Government for bounties, and little information is given as to whom the money is paid.

Senator FINDLEY:
Victoria

– The representatives of the people should know to whom bounties are being paid, as the taxpayers, whose interests we have to protect, have to contribute the money. The people interested in the Wolgan Valley proposition expended over £1,000,000, and, although they constructed a railway line which cost £30,000 to place the industry on a businesslike basis, when they offered the whole concern to the Government for £36,000 the offer was declined. That is sufficient to prove that it is not a paying proposition. I have read in the press that a number of companies are being started in Tasmania, and probably this money will be spent in assisting “ wildcat” propositions.

Senator Payne:

– If shale oil is not produced, the bounty will not be paid.

Senator FINDLEY:

– I know some honorable gentlemen interested in these propositions are somewhat optimistic.

Senator Hays:

– What is the Government offering for the discovery of oil ?

Senator FINDLEY:

– Some thousands of pounds, but that is for well, and not for shale oil. They cannot compete against the other oil. If it is merely to give an impetus to “ wild-cat “ propositions it- will not do much good.

Senator Payne:

– How can they be “ wild-cat “ propositions if they are producing oil?

Senator FINDLEY:

– It all depends upon whether they are commercial propositions. We know how some people can manipulate the market, and make money out of the flotation of companies. There are company promoters all over the city. [ do nob think I shall oppose the Bill. The Minister(Senator Pearce) has, however, a free and easy way of introducing a Bill. He takes it for granted that Government supporters will offer no objection, and as the Opposition are numerically the weaker party, the Bill is bound to be passed.

Senator GARDINER:
New South Wales

– I intend to oppose the Bill, one of my reasons being that I have been asked to do so by the Australian Labour party in New South Wales. They have very good grounds, or they would not make a request of that nature. I believe that magnificent shale oil can be produced in the Wolgan Valley. I understand that machinery to the value of nearly £1,500,000 has been placed there. Beautiful though the spot is, important though it is, and notwithstanding that it is in my electorate, I have not yet been able to get there. I have, however, heard adverse critics say what happened to those valuable shale oil deposits. The American companies bought out the local companies, and put in obsolete machinery, which is absolutely useless, in order to make quite sure that it would not be a payable concern. It seems remarkable that, although shale oil could be produced many years ago in that valley, or a little farther along in the Hartley Valley, now the oil is becoming so valuable the production there has ceased. An extension of the bounty for three years is being sought. I think the bounty is paid only to those who produce 250,000 gallons “or more a year. It might be as well to move an amendment in that connexion. A ruling has been given that there cannot be differentiation between the States. Can there be differentiation in the payment of bounties between one individual and another? Can it be fairly said that a bounty may be paid only to persons who produce. 250,000 gallons of oil a year ?

Senator Wilson:

– That is only a regulation, and it can be altered.

Senator GARDINER:

– I want to be quite sure whether only the big companies will get this bounty, or whether the smaller companies, which turn out only 100,000 gallons a year, will participate in the bounty. According to a statement made in another place, the amount of £145,000, which already has been appropriated for the payment of this bounty, is still available. It seems a strange thing that, although we encourage the production of oil by means of a bounty, the production, after four years of encouragement, has not increased.

Senator Hays:

– The efforts to obtain the oil have been increased. ‘

Senator GARDINER:

– Tasmania may be more successful in its efforts. I am quite sure that it does not possess better shale than is to be found in the Wolgan Valley. There is no better proposition for those who are in earnest in their endeavours, and are not overloaded with obsolete machinery. I hope that Tasmania will collect .the bounty by producing the quantity required. I do not know what is the output of Tasmania. In New South Wales the production of oil shale in 1S6S was 17,000 tons, valued at £48,000. In 1919 the production was 25,453 tons, and the value £37,968. In 1920, 21,004 tons were produced, the value being £46,082. In 1920 practically the whole of the production came from the Wolgan Valley. Those figures have been taken from the Commonwealth YearBook. Let us look at the effect which the payment of the bounty has had on production. In 1918-19 - I take it that that was the first year in which the bounty was paid- £26,407 was paid on 2,816,718 gallons of crude oil. In 1919-20 the payment dropped to £16,292, and the quantity produced to 1,737,845 gallons. That is not very encouraging.

Senator Lynch:

– The bounty killed it.

Senator GARDINER:

– The bounty did not give the industry any impetus. They collected the money but did not produce any more oil. In 1920-21 a spurtwas put on and the production rose, the consequence being that £24,406 was paid on 2,603,287 gallons of crude oil. In 1921-22, £24,643 was paid on 2,628,614 gallons. After four years the production was lower than when the bounty was first paid. Many honorable senators say that a bounty gives an impetus to production. In the Wolgan Valley they are not producing any greater quantity than they produced before the bounty was paid, but the Commonwealth is presenting them with over £20,000 a year.

Senator Guthrie:

– The concern is not profitable, even with the bounty.

Senator GARDINER:

– Why should we keep going an unprofitable concern? I believe that the parties concerned do not want to make it profitable. They have probably come under the influence of the big Oil Trust, which finds it more profitable to send oil to Australia.

Senator Guthrie:

– I think that that is quite probable.

Senator GARDINER:

– When the regulation is drafted the Government should secretly take steps to send a mines inspector to look at the mine, examine the books, and make a thorough inquiry to ascertain whether this is a part of the big Oil Combine. If it is, and if they are taking our bounty without having any intention of improving the production, a halt should be called in the payment of the bounty. There is a magnificent supply of shale oil there which could be profitably worked if some influence were not at work to prevent it. The gentleman in charge of those works has never been a friend to labour. I am not spiteful towards men who are managing their businesses in their own way, but I am inclined to think that the labour troubles on the field were worked up deliberately in order to prevent the concern from paying. The figures disclose the fact that they are merely holding the land and preventing the valuable shale deposits from being put to their proper use. If they were bent on increasing the production, the payment of £25,000 or £26,000 by way of bounty ought to have enabled them to produce better results. I have no confidence in the integrity of the com,- pany. I do not believe that they are working the deposits to the best advantage. If Tasmania has a good asset, it will be very lucky if it escapes the fate which has overtaken this company. It is very simple to obtain a sufficient interest in a company to stop production. The pioneers in an industry invariably go down, and others come along and reap the benefit. I intend to call for a division at every stage of the Bill.

Senator GRANT:
NEW SOUTH WALES · ALP

– Does the Minister believe that it is necessary to pass this Bill before the Parliament reassembles next year?

Senator Wilson:

– I have already stated that the bounty runs out at the end of this month.

Senator GRANT:
NEW SOUTH WALES · ALP

– I was under the impression that the Minister said that a large sum of money was still available.

Question - That the Bill be now read a second time - put. The Senate divided.

AYES: 15

NOES: 7

Majority … … 8

AYES

NOES

Question so resolved in the affirmative.

Bill read a second time.

In Committee :

Clause 1 agreed to.

Clause 2 (Period during which bounty payable).

Senator McDOUGALL:
New South Wales

– I am anxious to have the following proviso inserted in this Bill : -

Providing that Federal award rates and conditions are carried out at the mines.

Senator WILSON:
South AustraliaHonorary Minister · NAT

– The original Act contains a provision the same as that in clause 10 of the Sulphur Bounty Bill just passedby the Senate. It provides that the Minister may withhold the payment of the bounty if he finds that the rates of wages and conditions of employment are below the standard rates and conditions of employment.

Senator Findley:

– Are similar provisions to those in clause 11 (Offence against Act) and clause 12 (Return to be laid before Parliament) of the Sulphur Bounty Bill also to be found in the Shale Oil Bounty Act?

Senator WILSON:

– Yes.

Senator McDOUGALL:
New South Wales

– I accept the Minister’s assurance that the provision in’ the Sulphur Bounty Bill is included in the Shale Oil Bounty Act. This provision reads as follows: -

  1. If the Minister finds that the rates of wages and conditions of employment, or any of them -

    1. are below the standard rates and conditions of employment prescribed by any Commonwealth or State Industrial Authority; or
    2. are below the standard rates and conditions applicable to the locality and agreed upon between representatives of associations of employers and employees registered under any Com- monwealth or State Act; or
    3. are below the rates and conditions declared, as in the first sub-section of this section mentioned, to be fair andreasonable; the Minister may withhold the whole or any part of the bounty payable.

I have had a painful experienceof the Wolgan Valley, the rates paid for labour there, and the conditions under which men are employed. Unfortunately, many people were misled and robbed by those who put down the plant. A man was sent out here, and paid a percentage on the money he spent. He made no mistake about spending it. Time after time the local management sent Home for further capital. One unfortunate family which had sunk its money in this venture sent out a son who was given a job as accountant on this property, but because he joined a Labour League, and stood for selection as the Labour candidate, he was told that he must resign from the League or lose the job in which he was watching the interests of his family, who had been betrayed into putting their money into the venture. There is a mountain of shale there, enough to supply the Commonwealth with oil forever, but these people started on the wrong side of the mountain, and the seam petered out. It is no wonder the company sold out for £36,000 to the gentleman who had been running the Little Hartley Shale Mine, which had also petered out after producing splendid oil, and also candles, and everything capable of being manufactured out of the byproducts of oil. I do not think this gentleman has lost anything in his venture, but he is always quarrelling with the workmen. I shall always oppose the granting of these bounties to people who will not pay fair wages if they can avoid doing so. Hates of wages in Tasmania are lower than they’ are in New South Wales. When I was there, strong young men were earning only 4s. a day. I do not know exactly what rate is being paid now, except that it is not that which another company receiving the bounty is called upon to pay in New South Wales. Although Tasmanians have made a start with the finest oil proposition in the world, they are the slowest people in the world. A visitor has to wake them up in the morning to get his newspaper. They are all asleep over there. My object in bringing this matter forward was to see that people who get this bounty shall be obliged to pay as good a wage as is paid in other parts of Australia. However, I am satisfied with the Minister’s assurance that provision has already been made in this regard in the original Act.

Senator GARDINER:
New South Wales

– I find that no more oil is being produced now than before the bounty was granted. Is it fair that we should go on paying the bounty when the people in receipt of it are doing no more than they were doing before it became payable? Is the Government willing to allow the bounty to expire? If it expired next month, what injury would it do? The original Act provides that a company must produce 250,000 gallons in a year before it can receive the bounty. Suppose there is a struggling company in Tasmania with a real intention of developing. In its developmental stages it might produce only 200,000 gallons of oil in a year, in which event it would not be entitled to the bounty.

Senator PEARCE:
NAT

– The minimum of 250,000 gallons is fixed by regulation, which can be altered, and the Minister for Trade and Customs ‘ (Mr. Austin Chapman) has given an assurance that the regulations will be so amended that no genuine producer will be shut out.

Senator GARDINER:

– I am pleased to have that assurance. I do not think that every company which puts down a shaft and produces a gallon of oil should be entitled to claim 3£d., but where a genuine, progressive7 concern is operating, a shortage in the quantity of oil produced should not interfere with the granting of the bounty. I am satisfied with the assurance given by the Minister. I feel no ill-will towards the company to which I have referred because of its antiLabour proclivities. I oppose them because I do not believe they are legitimately working . their lease. I believe they could produce 4,000,000 or 5,000,000 gallons just as easily as the 2,000,000 gallons they are now producing.

Senator LYNCH:
Western Australia

– I am glad to have the assurance of the Minister (Senator Pearce) regarding small, struggling oil companies. I have a trifling interest in one of those concerns, but it would require a powerful microscope to enable any one to see it. If Senator Gardiner would read a report by Mr. Thwaites, an officer of the Institute of Science and Industry, he would see that the supply of well oil in the United States of America is expected to be exhausted in seven or eight years. That country will then be thrown back upon the method of recovering oil from sedimentary rocks. When that happens, the’ back will be broken of the huge financial organization to which Senator Gardiner has directed attention. In that connexion, I believe that there is some justification for his remarks, especially when we recall the origin of the combine and the complete lack of scruple displayed by it in its early days in crushing out any one who opposed it. As it has grown, its habits have grown. By taking the matter in hand now, we could get a start on America. The extraction of oil from rock had its - origin in Scotland. We should demonstrate that we can extract from rock in this country all the oil we require, and so render ourselves independent of foreign supplies.

Clause agreed to.

Clauses 3 and 4 agreed to.

Preamble and title agreed to.

Bill reported without amendment.

Standing and Sessional Orders suspended; report adopted.

Thirdreading.

Motion (by Senator Wilson) proposed -

That the Bill be now read a third time.

Senator GRANT:
NEW SOUTH WALES · ALP

– I cannot become enthusiastic over bounties for the production of shale oil or anything else. The Commonwealth is proceeding along entirely wrong lines, and is not getting value for its money. If we continue the present policy it will be necessary in the near future to appoint a Committee of inquiry to. ascertain what value we are receiving for the bounties paid. I claim that I would be justified in asking - and the request would be as justifiable as that made on behalf of the producers of oil from shale - that builders and contractors should receive a bonus of £50 or £60 for every house they built. Such a bonus is absolutely necessary, because we find to-day that builders and contractors will not engage in this industry on account of the difficulty of disposing of their productions at satisfactory prices.

Question resolved in the affirmative.

Bill read a third time.

page 3479

LAND TAX ASSESSMENT BILL

Second Reading

Senator PEARCE:
Minister for Home and Territories · Western Australia · NAT

– Imove -

That the Bill be now read a second time.

I would remind honorable senators of the intention of the original Land Tax Act. The tax was first imposed with the idea of breaking up bigestates, and not as a means of raising revenue. .

Senator Kingsmill:

– It never should have been imposed.

Senator PEARCE:

– Perhaps the honorable senator is right. It is well that we should bear in mind the intention of the Parliament that imposed it. In the original Act the taxation of Crown leases was not provided for; that principle was introduced in 1914, four years after the passing of the original Act. Another point to which I direct attention is that there is certain machinery laid down in the Act for assessing land values. That procedure had in view the assessing of freehold land values. It is also a fact that Crown leases in Australia are almost entirely pastoral leases. They obtain, for the most part, in the distant and most inaccessible parts of the Commonwealth, where there is the greatest difficulty in encouraging settlement. When it was decided to impose a tax on Crown leases, the lessees first of all were asked to assess the value, and they did so. Later on, the Department commenced the assessment, applying the principle and the procedure laid down for the purpose of valuing freehold land. The result of those assessments, when they came to be operated upon, was to show such tremendous inconsistencies and injustices that the then Treasurer, the Right Honorable W. A Watt, in March, 1918, suspended the collection of the tax. In order to determine the value of the leasehold interest, the law required its. administrators to first ascertain the fee-simple value of the land. This was obviously impossible in districts where not a single acre of land had been alienated, or where there had never been a market transaction in freehold land. It was not possible to determine the fee-simple value of, 1,000,000 acres of leasehold in the Northern Territory, which is rented at1s. or1s. 6d. per square mile; or, in the 6-in. rainfall belt in the north-west of Western Australia, rented at 5s. per 1,000 acres; or the vast stretches of dry country in the north-west of Queensland, rented at 5s. per square mile, because none had ever been sold.

Let me give a few instances of the result of this assessment. Up to the present there has been assessed, roughly, £2,037,000 of tax, of which £690,000 has been collected. The balance outstanding is £1,300,000, but it is largely mythical. I do not intend, however, to follow this matter, because the proposal to remit that outstanding taxation was not acceptable to another place.

Senator Needham:

– Owing to the opposition of the Labour party in the other Chamber.

Senator PEARCE:

– For the” purpose of enabling honorable senators to consider the advisableness of the collection of this tax in future, let me give a few typical instances of actual sales that show how unfair is an assessment based on freehold values when applied to leaseholds. In 1911, at Kyabra, Queensland, a sale was made of one-third interest in a property for £12,000, making the full value df the property at that date, together with stock and improvements, £36,000. The stock on the property at that date was 30,000 * sheep, 400 horses, and 1,000 cattle. Taking the sheep at 10s., the horses at £5, and the cattle at £3, the total value of the stock would have been £20,000. It is claimed that the improvements on the run are worth fully £20,000. This means that the place was sold on the basis of the market value of the stock, plus the value of the improvements. In other words, nothing was allowed in the transaction for any good-will value of the lease. The Department values the goodwill of the lease at’ £61,619. State’d another way: The market value of the property at the date of the sale was £36,000. If the Department’s value of the good-will be correct, the property would have been worth £97,619, instead of £36,000, the price at which the sale was made. Thylundra was bought in 1907 for £10,000, being the estimated value of 4;he stock on the run, nothing being allowed for either value of lease or improvements. Bulgroo was bought in 1912 for £53,000, the stock consisting of 40,000 sheep in the wool, together with horses and cattle, the stock in the aggregate being valued at £23,000.- The improvements were estimated to be worth the balance of the purchase money, nothing being allowed for the value of the lease. In the drought of 1914-15, 90,000 sheep were lost on these two properties and Kyabra. The Department has valued the good-will of these two leases at £109,893. In other words, if the Department’s valuation be correct, instead of the combined values of the properties being £63,000, the sum paid for them, they were really worth £172,893. In 1909, at Redford, Queensland, a property was purchased for £21,000, with 6,000 cattle. The estimated value of the improvements is £23,500. Since then three transactions have taken place on the basis of a value of £20,000 for the property, unstosked The Department’s value of the leasehold interest is £34,000. Adding to this the value of the improvements, £23,500, the improved value of the property is shown to be £57,500, yet the owners would be pleased to accept £25,000 for that property.

It will be argued that two Royal Commissions have been appointed to consider this subject, and they have favoured a continuance of the tax. The second Royal Commission’s recommendations were, hedged round by so many qualifications that if the tax had been put into operation its collection would have cost £80 for every £100 of tax, and the total sum collectable would have been comparatively insignificant. .The Government takes the view that the taxation of Crown leases is an interference with the States’ policy of land settlement. The States have deliberately fixed low rentals with a viewto encouraging the settlement of these lands.

I shall now deal with the allegations made as to the gigantic sums that will be left in the hands of certain people if this Bill is passed. I have a statement before me prepared by the Commissioner of Taxation, who states that when payment of the tax on Crown leaseholds was suspended in 1918 the assessment of the tax was not suspended, but it proceeded each year in conjunction with the assessment of the land tax on freeholds. When the main assessment of all the land in a return was being prepared a calculation was made in the case of each taxpayer concerned of the additional amount of tax payable by reason of the inclusion of the leasehold. Upon the completion of the assessment, the returns on which the assessment was based were filed until the next assessment was due, when the same procedure as in the preceding year was followed. It has never been necessary hitherto to compile a statement showing the names of persons assessed for tax on Crown leases and the tax due by them. Such a statement would involve reference to all the land tax returns in order to extract particulars from those containing the leases in question, and that would’ occupy Several weeks. Various figures have been quoted as to the amount of the tax that would be payable by certain individuals and companies. With regard to the companies these figures may or may not be correct, but presumably they have been taken from the published statements of the affairs of the companies. With regard to individuals there can be no information available as to the amounts for which they are liable. As far as the Government is concerned, it has not now, nor has it had at any time, information as to the amounts payable by individuals or companies. The action of the Government has been solely dictated by the equity and justice of the case, and what is in the best interests of the development of Australia. It Was only when allegations were made as to the persons liable for tax that steps were taken to ascertain if this information could be obtained I think it is clear that the allegations made are not based on official information. Nor could the information be obtained from the returns in the Land Tax Office unless a special search were made by officials, and that search would take several weeks. From the present year, we do not propose to collect land tax in respect of Crown leases, and I ask the Senate to assent to that proposal by agreeing to the second reading of this Bill.

Sitting suspended from ‘12.30 to 1.30 a.m. (Saturday) .

Senator GARDINER:
New South Wales

– We have practically reached the end of the debatable measures with which we have to deal, and I think the Minister (Senator Pearce), according to the great care he took to explain this measure, realizes that this is, at least, one on which much may be said on both sides. I think, however, that he will admit that it would be better if his supporters were here in greater numbers, because it is possible that I shall be able to secure their support. I call attention to the state of the Senate. [Quorum formed.] I have not the slightest doubt that, if measured - by the difficulties of finding money with which to pay taxation and the hardships surrounding the operations, in some instances a good case could be made out for the remission of ‘taxation on Crown leaseholds. But the same . could be said in connexion, with freehold land. There is a difference between freehold and leasehold land, but I cannot see any difference in the income earned from freehold or leasehold land. Money is needed; every one in the community is heavily taxed, and I cannot see why a leaseholder should be exempt from taxation while his neighbour, who has freehold, should have to contribute. The principle of taxing leaseholds is as justifiable as that of taxing freeholds. A number of capable gentlemen who comprised two Royal Commissions inquired into this matter. These bodies did not merely take a glance at a few documents, and casually cross-examine several witnesses, and then come to a decision. They spread their inquiries over a number of years, and after investigating the question of taxation generally, and the. taxation of leaseholds in particular, favoured the system of continuing the taxation of leaseholds. The Minister in an expiring Parliament introduces a measure which he is anxious to pass. What does it provide? Merely that the men who are in a large way, and in possession of enormous tracts of country, shall be free from taxation. These are the friends of the Government, and this is their way of escaping taxation. They are to be relieved of their obligation. There will be no occasion for them to contribute any more money in the form of land tax towards the cost of governing this country, and thus assist in meeting the heavy interest bills which we have to pay on our war debt. Up to 1917, about £690,000 had been collected in taxation from Crown lessees, and the. large land-holders then agitated for the appointment of a Royal Commission which was eventually appointed, and inquiries were made to ascertain if the impost were fair and reasonable. The Commission comprised three gentlemen, two of whom recommended that taxation on Crown leaseholds should be continued, and the third member of the Commission, who was a large land-holder, dissented. Notwithstanding this, the tax has not been collected. Annual assessments were made, but the money was not demanded. Later, another Commission was appointed, which inquired into the whole incidence of taxation, and six of the seven members declared that the taxation of Crown leases was fair, and the money should be paid. I do’ not wish to unnecessarily thresh out this matter, but I ask if it is just, when money is required for the government of the country, to absolve one particular section of its responsibility to pay taxation. After a most patient and careful investigation - not by partisans, because some of the members of this Government were also members of the Government which appointed a Royal Commission - the Commissioners recommended the continuance of the tax on Crown leaseholds. After all, this is a Chamber of review, and I ask honorable senators if we can allow ohe section of the community, to be exempt from this taxation and at the same, time not extend a similar concession to other sections. The agitation on the part of the friends of the Government for the abolition of the taxing of Crown leaseholds was so strong that the Government suspended the collection of the tax until an inquiry was made. Investigations extended over several years, and the tax has been allowed to accumulate. When a similar Bill was introduced in another place it was the intention of the Government to make it retrospective, so that an amount of over £1,300,000, which was owing, should not be collected; but I understand that the retrospective provisions have now been deleted. It is not necessary to comment on that aspect of the proposal further than to say that it is a clear indication of what was in the minds of the Government when they introduced the Bill. The opposition in another place to such an iniquitous proposal was so strong that as far as that little bit of “ looting “ was concerned, they were compelled, in the historical words of the Treasurer (Dr. Earle Page) to “ drop the loot “ to the extent of agreeing to the deletion of that provision of the Bill. Even if this measure passes, the Government which introduced it will not call up the money which should have been paid years ago. The Government, of course, will say that the- legislation under which it was imposed has been repealed, and that there is now no necessity to call up this money. The Crown lessees are, therefore, to be” presented with a very substantial sum. Is .not the person in pos session of freehold land confronted with the difficulty of raising sufficient to pay his taxation? He, however, has not agitated for the appointment of a Royal Commission to inquire into the disabilities under which he is compelled to carry on, with a view to relief from land taxation. There are one or two paragraphs in the

Commission’s report which should ‘ be placed on record in Hansard, where, at least, some people will be able to read them. The following is taken from the report of the Royal Commission on the taxation of leasehold estates in Crown lands : -

Throughout the inquiry your Commissioners have kept in view the fact that the pastoral industry is of fundamental importance to the economic well-being of Australia, and in their review of conditions they have not lost sight of the fact that the recent advance in its prosperity needs to be allowed for in connexion with their decisions.

In the synopsis hereunder the scope of the report and the various subjects, the consideration of which was involved by the questions submitted to your Commissioners, are indicated.

One of your Commissioners (Mr. H. A. G. Curry) is of opinion that there should be no taxation of Crown leaseholds, and that the difficulties of assigning freehold values to leasehold lands - with a reasonable degree of precision - are very great. Your other Commissioners (Messrs. E. O. Allan and Gr. H. Knibbs) do not concur in these views.

Subject to the dissent expressed on the points mentioned, all three Commissioners are in accord throughout, and if the Commonwealth Government decides not to abandon the taxation of Crown leaseholds, or to change the freehold basis of valuation, it is desired that the report shall be taken to express the unanimous opinion of all your Commissioners.

That makes it clear that the Commission has gone thoroughly into the matter before it came to a ‘decision. Another portion of the same report reads -

The effect of arriving at taxable value by a capitalization of Crown rent would be that the lessee who paid a high rent would have to pay a correspondingly high tax, which is the reverse of the correct position.

The following extract from the report is very interesting when we are informed of the heavy burden these people have to carry -

  1. Is the Land Tax on Crown Leaseholds Burdensome? - From available data your Commissioners are satisfied that, on the whole, the Crown leaseholders are not subject to greater hardships than freeholders in regard to land taxation See, for example, the table in Q. 3126, which shows for ordinary taxpayers of Queensland the following, viz.: -

In those areas it will be seen that the pastoral industry was not remaining altogether stationary; the profits, measured by the amount of income tax paid, were gradually increasing. In 1916 there was a decrease in the number of pastoralists in Queensland to 1,826, and they paid income tax to the amount of £157,000. Although their numbers were reduced by 400, they actually paid £40,000 more in income tax; so that it does not appear that there was any very great decrease in the values of their properties. The number of companies also decreased. In 1916 there were 51 companies, and the income tax paid was £68,855, as against £62,065 in the previous year. In 1917 the number of pastoralists was 2,522, and the income tax paid amounted to £231,013. The companies numbered 63, and the amount paid in income tax was £78,376. In 1918 the number of pastoralists had increased to 3,193, and the income tax paid totalled £329,142. The number of companies was 61, and they paid in income tax a total of £96,000 - an increase of about £18,000 on the previous year, and of about £28,000 compared with 1916. Measured by the income tax paid by the pastoralists, it appears that the pastoral industry in Queensland during those years was running on a fairly even keel, and that there was not much about which to complain. I am running through these quotations in order to get into my speech as much as possible of the substance of the reports of these men. I hold the view that unless very ample reasons are given by the Government for making the alterations, those alterations should not be made. If the Government has those reasons it should put them before the Senate to justify the action it is taking in relieving from this taxation a large number of persons. The recommendations of the Commissioners show the inadvisability of flinging away money in the manner proposed by the Government.

Senator Lynch:

– Has the honorable senator studied the reasons for those recommendations ?

Senator GARDINER:

– I am in a hesitating frame of mind. I am afraid that if I quote too much I may lay myself open to the charge of merely wanting to little I may lay myself open to the charge of not having read fairly from the report. There are one or two passages which help my argument. Honorable senators know me well enough to admit that I will not go out of my way to quote anything that is good and leave that which is bad from my point of view. Here is one of the recommendations of the Commission -

Your Commissioners ore of opinion that owing to the difficulty of correctly ascertaining the freehold value of leasehold lands, the incidence of the tax is at present sometimes inequitable, notwithstanding that the Commissioner of Taxation has carefully developed a system of valuation which - based upon known freehold values - has attempted to deduce the value of the subject lands, by making wellconsidered allowances . for any disabilities and onerous conditions, &c, of the subject lands as compared with the basic lands.

I realize that there are difficulties in valuing lands anywhere, but I cannot imagine that they are insuperable.

Senator Guthrie:

– They made a horrible hash of it.

Senator GARDINER:

– I have no doubt they did not do it to the satisfaction of the big land-holders and companies. Is there any more difficulty in putting a value upon leasehold than upon freehold land? I cannot see that there is. As leasehold never has been, and cannot be, sold, I can understand that there is a difficulty in arriving at comparative values between leasehold and freehold. Any gentleman who was fit to sit on that Commission would be sufficiently equipped mentally to value laud upon its merits. The carrying capacity of land can be measured by any man of ordinary judgment. Where freeholds are valued, very rarely is the value fixed at the price which they will bring in the open market. If I had my way in drafting the laws of the Commonwealth, I should see that every land-owner valued his own land; with the saving clause that the Government should have the right to resume the land at, say, 1Q per cent, above the valuation. I think that that would be the means of saving a lot of money. The man who owned a block of land would not under-value it very greatly, for fear that the Government might take it from him at his own valuation, plus 10 per cent.

Senator Guthrie:

– On one occasion I put in a truthful valuation of a property in the Northern Territory. T fixed the value at £1,000, and I was assessed on £88,640 - a price that the place would not bring with all the stock, improvements, and everything else on it.

Senator GARDINER:

– Broadly speaking, the value of a thing is the price it will fetch. There are times when a concern will not realize anything near its value. We had an instance of that in the Geelong Woollen Mill, which in my opinion was worth £1,000,000, and was sold to a company for a very small amount. However, I am getting away from the report of these gentlemen whose business it was to inquire into and value Crown leaseholds, I quote para. graph 663, from page 189 of the report of 1923-

The present Commission in its first report (paragraph 178), referring to the matter, whilst stating that there are substantial grounds for not discriminating in taxation between interest in freeholds and interest in leaseholds, postponed fuller discussion of that issue until the question of land taxation as a whole could be dealt with. The arguments adduced ‘before the Royal Commission on the taxation of Crown .leaseholds have been to a large extent repeated with amplifications and added emphasis during the present inquiry.

Now let us see where they got. In paragraph 674 they say -

After careful consideration of the question of the taxation of lessees’ interests in Crown leaseholds, we are unable to discover any principle of taxation upon which such interests should be relieved of land tax, if other interests in land are taxed. We are, therefore, of opinion that the question of exempting lessees’ interests in Crown leaseholds from taxation must be considered wholly from the point of view of policy as between the Commonwealth and the States.

I think it only fair to say that there may be occasions when the Commonwealth taxation bears unjustly on persons in one State, while it is perfectly equitable in another State. This may occur where the State is exercising its function to tax the carrying capacity of land, rather .than, in the more legitimate way, its unimproved value, without taking into consideration the value of the improvements effected by a lessee.

Senator Guthrie:

– That would be quite right. These properties have no value until they are improved. Without improvements they would not carry a bandicoot.

Senator GARDINER:

– If the method of taxation I advocate were carried out property that would not carry a bandicoot would not pay any taxation. No one would be so insane as to want a man to pay a tax on land worth nothing.

Senator Guthrie:

– It is worth something when it is improved.

Senator GARDINER:

– In my opinion, the improvements effected on a Crown lease are the property of the man who makes them, and the Crown has no right to tax him upon them. In paragraph 675 the Commissioners say -

Segregation of Lessees’ Interests. - We ore also unable to recommend the assessment of lessees’ interests in Crown leaseholds separately from other interests in land of a taxpayer, and the allowance of the statutory exemption in both assessments. Such a course would, as has been indicated, not only involve a heavy loss of revenue, and create new anomalies, but would, in our opinion, be inconsistent .with the general scheme of a progressive or graduated tax.

Again, in paragraph 676 they say -

We may add in this connexion that, in view of the evidence as to the demand for Crown leaseholds (see paragraph 670), it does not appear that the imposition of the Commonwealth land tax upon lessees’ interests in such leases can be regarded as having had any sensibly adverse effect upon the States’ policy of settling Crown lands.

Senator Lynch:

– I wonder if they took evidence from any State Minister?

Senator GARDINER:

– I have not the evidence with me. The recommendations, of the Commission are fairly numerous, and there may be some of them which do not support my contention as well as does the one which I am about to read. It is as follows: -

Your Commissioners are further of the opinion that the principles underlying this system, and the Taxation Commissioners’ mode of taking the disabilities, onerous conditions, &c… into account, is on the whole excellent, and merely requires .relatively slight modification and a better method of reviewing the results.

The Commissioners realized that the methods adopted by the Commissioner of Taxation in taking into consideration all the difficulties and onerous conditions under which lessees carry on their operations were excellent. From one end of this report to the other the fact stands out that the gentlemen who were appointed to make a searching inquiry into the grievances of the leaseholders found that their grievances did not differ from those of freeholders. Their finding is very definite. They say -

Subject to these changes -

They made a number of suggestions, and I am not skipping any of them in order to aid my own argument - your Commissioners recommend that the taxation of Crown leaseholds should be continued, and we are of opinion that - as previously indicated - it will in general be not more intrinsically burdensome than the taxation of freehold lands, and sometimes it will be much less burdensome.

In view of the fact that the gentlemen appointed by the Government to make a thorough investigation into the grievances of these leaseholders have reported in the way I have indicated, there is no justification for this Bill.

Senator Guthrie:

– Does the honorable senator propose that an inspector should bo sent to all the leaseholds of Australia to value them, or would he have them valued as they are to-day from Melbourne ?

Senator GARDINER:

– I do not propose anything of the kind. I say that the valuations should be made by the leaseholders themselves, with the proviso that the land can be taken from them at a fair percentage over their valuations. Generally speaking, the gentlemen who comprised this Commission could not be classed as opponents of leaseholders. They were selected by a Government that could not be considered as opponents of leaseholders. If I had quoted from a Commission appointed by the Theodore Government, no doubt honorable senators from Queensland would have declared that the Commission had been appointed by a Government opposed to leaseholders. But this Taxation Commission was appointed by the Nationalist Government, possibly in the hope that some truth would be found in the piteous wailing of the taxpaying leaseholders, and that the Commission would provide the Government with some ground for repealing the tax on leaseholds. The very reverse happened. These gentlemen of high character and integrity justified the taxation, and proved conclusively that there were no reasonable grounds for remitting it. They showed unmistakably that the burdens on the leasehold tax payerswere no more onerous than those on freeholders.

Senator Lynch:

– Did the honorable senator find a reference to an isolated case in the north-western portion of New South Wales?

Senator GARDINER:

– No, I should be glad if Senator Lynch would turn it up for me. I hope to finish my time in this Parliament without discriminating between States. When I am quoting anything affecting the leaseholders of my State I do not want them to think that I am hiding anything that may be quoted to their advantage. I know of nothing in the condition of the lessees of the western portion of New South Wales that should exempt them from taxation. The tax may bear heavily on some for a special reason, but if a person is taxed on an over-valuation, surely the Courts of this country can be trusted to do the fair thing when he appeals against his assessment. It is quite extraordinary how taxation works out differently under different Governments. For instance, on one property the Taxation Department of the State of New South Wales may arrive at a different conclusion from that of the Commonwealth taxation authorities, but the taxpayer’s safeguard is recourse to the Courts of the country. The Courts, in dealing with matters of that kind, will never give us very much cause for complaint. The Government has dropped the most objectionable part of the Bill since it was introduced in another place, but it is persisting with the proposal to single out one particular class in the community and relieve it of taxation at a time when money is very badly needed for national purposes. We have to pay every year from £16,000,000 to £20,000,000 for interest on war debts. If the tax on leaseholds were added to the other taxes on land, and placed in a sinking fund, the amount would wipe out the war debt ten years earlier than it is proposed to wipe it out. I have never heard of the Government bringing down a proposal to relieve the working classes of taxation. I have mentioned the enormous amount of tax paid by working people on the tobacco that they smoke. The Government is forcing the Bill through Parliament under conditions which make reasonable discussion absolutely impossible, for even if an honorable senator is sufficiently strong to continue to speak, others, owing to the strain imposed upon them during tha week, are not able to weigh his arguments and attempt to refute themIt is a case of physical endurance. I condemn the Government for introducing this biased, class, unfair legislation, which will benefit only one section in the community, and that the section which consists of its friends. At the same time it has, in the most cruel and hardhearted manner, robbed a large section of the community of an altogether disproportionate amount of its earnings. The average working man pays heavy taxation on almost everything that he uses. The Government takes from him as much as possible, and the remarkable thing about him is that he will not listen to me when I tell him he ought to complain of the way he is treated. These men are so generous, so patriotic, and pay their taxation so willingly, that’ they have no time for ‘ one of their own class who tries to ‘make them discontented. They are in striking contrast to the rich, powerful men, with the big banking accounts and great motor cars, who take annual trips round the world. From now until next November these men will be swarming down in their motor cars from the uttermost parts of Australia to Melbourne. Relieved of taxation, they will make the Melbourne racing carnival one of the best that has ever been held. They enjoy themselves in Melbourne for months at a stretch, and the very Government which relieves them of taxation takes from the working man more than 2½d. on every pint of beer he drinks. The leaseholders, while they were growing richer, created an agitation to show how harsh the tax -was, and how impossible it was for them to continue in their occupation. The Government thought they were telling the truth. It sent out a Commission, the members of which did not consist of enemies of the wealthholding class, but of friends of that class. The members of the Commission did their duty in a way that leaves it absolutely impossible for any honest Government to reduce the tax. Their findings were such, on every point submitted to them, that nothing but the desire of the Government to hand money out to some one could have prompted the introduction of this Bill. It is nothing to the Government’s credit that it is forcing the Bill through Parliament by a process of physical exhaustion. Its action in that respect is deplorable. It has threshed the matter out in secret Cabinet conferences^ - I recognise that Cabinetconferences must be secret - and the Minister (Senator Pearce) knows the reason for the action taken. I blame the supporters of the Government who, with no personal ends to serve, but by force of a slavish habit, respond to the division bells and, without knowing whether they are doing right or wrong, walk over to the Ministerial trio.

Senator Thompson:

– As Gilbert says, “ I never thought of thinking for myself at all.”

Senator GARDINER:

– And that reminds me of another quotation -

A marciful providunce fashioned us holler O’ purpose thet we might our principles swaller

That fits the Government supporters very well, especially when they are called upon to do justice to the people they represent. , The ‘working man pays exorbitant taxes on everything he uses. On spirits the duty is almost prohibitive, on beer it is 2£d. a glass, on tobacco 5s. 4d. a lb., and on cigarettes lis. a lb. Yet, these open, honest, hard-working, generous men never complain. They realize that the Government wants money, and they pay it; but the wealthy people whine, cry, and “ smoodge “ to the Government until the whole burden is placed on the shoulders of the toilers. If the Government does not intend to make the repeal of the tax retrospective, will it call up the money owing? “Will Ministers carry out their oath of office and enforce the law by making those people who are indebted to the Government pay ? When a - working man owes 2s. or 3s. by way of income taxation he has to pay it. I knew a case in which a working man, owing to a change of which he was not aware, in the system, had to pay 6s. instead of 4s. He thought it was an injustice, and he said he would see the Department in a warmer place before he would pay. He was taken to the Court, and before the Government had done with him he had to pay more than £6. There was no waiting for years for his money. I have no doubt that in that case members of the Government prided themselves on the fact that they were sworn to ad- minister the laws of this country, and that legally that man ought to have paid those few shillings. Every honorable senator knows how the money came to be owing by the leaseholders. Commissions were appointed to inquire whether the hardships of paying the tax were too great, for the leaseholders to bear. The Government meanwhile relieved these men of the responsibility of paying the tax, and has tried to sneak through this Parliament a Bill to relieve them from paying it at all. There were a few honest supporters of the Government in another place, and they prevented the Government from going to the extreme contemplated. The object of the Government is to carry on the government of the country for the benefit, not of the country, but of its wealthy supporters outside. Nearly every piece of legislation passed during the last six weeks has been for the benefit of some wealthy section of the community. The Minister made out a better case than anyone else on that side could have invented. I suggest to honorable senators that, in the recess, they should compare the Minister’s speech with the reports of the Royal Commissions, and should then come back to this Senate and see whether their consciences permit them to follow the directions of a man who has so misled them. He had no case, but he smothered up the defects of the Bill in an admirable manner. He almost led us to believe that the Commissioners had made a recommendation exactly the opposite of that which they actually did make. I have no hope of any one from the other side supporting me. Only squatters’ friends and ‘ handers-out “ to the wealthy classes will be found supporting the Government on this Bill. Even if they are not prepared to vote against the Government, one would think that honorable senators opposite at least would not be willing to keep a quorum in the Senate to assist the Government to pass this Bill for the benefit of a few wealthy men and still fewer wealthy companies. I quoted a paragraph from the Financial News some time ago, stating that the Labour party in Queensland would be defeated by- the Nationalists-

The PRESIDENT (Senator the Hon T Givens:

– The honorable senator’s time has expired.

Senator NEEDHAM:
Western Australia

.- Had I thought that the Minister (Senator Pearce) would agree to an adjournment of the debate, I should have been glad to ask for it; but, as he has been candid enough to tell us that he intends to go full steam ahead, and test the physical and mental endurance of honorable senators on this side of the Chamber, as well as of the Hansard staff, I intend to continue the debate. Senator Gardiner, in the concluding part of his speech, was about to refer to the anticipation of the Financial News that as a result of the recent elections in Queensland the Labour Government would be defeated, and that those things which the Labour Government had refused to do would be done by its successors. That Government was not defeated, but the Financial News can thank God that there is at present a Commonwealth Government that is now going to try to do for its rich friends what that journal thought its rich friends would do had they succeeded in capturing the. reins of government in Queensland. I have heard it said during this very short but most strenuous session that the rich are becoming richer and the poor are getting poorer. I believe that that is true, and that there is a Government now in charge of the destinies of the Commonwealth that is assisting the’ rich to grow richer, and keeping the poor in a povertystricken condition. I know of no instance where the manual or clerical worker, having failed to pay a tax that the law compels him to pay, has been relieved of his responsibility. Senator Gardiner mentioned the case of a working mau that came under his notice in which the tax owing was about 4s. This Government pursued the man, and compelled him to’ pay that sum. I remember a man coming into my office, in the Perth Trades Hall, and asking my advice concerning the payment of his tax. The amount in dispute was 10s., and I told him to obey the law. That is the attitude I always adopt. This gentleman said he would fight the matter Out, and it cost him a few shillings over and above the 10s. due before the Commonwealth Government had done with the matter. I am beginning to wonder, since we are now asked to abolish the tax on Crown leaseholds, whether we should not bring in a law to prevent the appointment of Royal Commissions. The more I see of the work of Royal Commissions, the more I realize that their appointment results in an absolute waste of money. I do not contend that the work they do is bad, nor do I say that they have not on all occasions inquired assiduously into the matters referred to them ; but time after time their recommendations are not put into effect. The Bill under review provides a glaring instance of the refusal of a Government to carry out a Royal Commission’s recommendation. A Commission was appointed to inquire whether or not it was equitable for Crown lessees to pay a land tax. As Senator Gardiner has rightly said, the members of the Commission were not chosen from among the holders of these leases ; they were men competent to judge, and they collated evidence from different parts of Australia. Their verdict was that it was right to impose this tax. Despite that fact, this Government set out, not only to repeal the law, but to remit taxation that was due, the total amount outstanding being £1,300,000. When the Leader of the Senate (Senator Pearce) was trying, to put the best case possible for this Bill, he said that the retrospective feature of the measure had been withdrawn while the Bill was under discussion in another place. As I remarked by way of interjection, this was due to the vigilance of the Labour party in the other House. I know that some Government supporters in another place felt that the proposal ‘ was outrageous, but had it not been for the attitude of the Labour Opposition we should have had the Bill presented to this Chamber with that objectionable feature in it. Had that provision become law, it would certainly have been a sop to wealth, because it would have relieved many wealthy landholders of the payment of a just tax that was due. A tax on Crown leaseholds is just as equitable as a tax on freeholds. Among the companies and individuals who would have been relieved of this taxation are - the Australian Estates Limited, Peel River Land and Mineral Company, Scottish Australian Investment Company, Northern Pastoral Company, T. B. Norton and Company, Australian Pastoral Company, Australian Land and Mortgage Company, New Zealand Mercantile Company, Mr. A. T.

Creswick, Sir Sidney Kidman, and Mr. Edmund Jowett. No one can truthfully say that the two last-named gentlemen are impecunious. Had the Bill, as it was first introduced, become law, these two gentlemen would have benefited to the extent of £200,000. Thus the original intention of the Bill was to give a sop to wealth. In other words, this Government set out to prove that it was faithful to its creators - the big business men of the Commonwealth. Of course, Ministers had to do something in return for the support accorded them by the wealthy section, and this was one of the ways in which they were going to do it. Had I the time, I should like to read the speeches delivered by the Minister (Senator Pearce) when he was a member of the Labour Ministry that in- .troduced the Land Tax Assessment Bill. I remember hearing him make a speech on 6th September, 1911, a portion of which reads -

We said that, under the conditions existing up to the time the Labour party got into power, immigration [ had simply been a policy to bring in cheap labour. It was a policy which, on the one hand, locked up the lands of Australia, and therefore prevented the access of labour thereto, and which, on the other hand, -would flood the country .with labour in an overstocked labour market, and thereby bring about a decrease in wages and worse labour conditions. We always said, whether in the Federal or the State Labour party, that if we had the .power to deal with the land question, and «ould apply our remedy, in our opinion there was room in Australia for millions of -white people. When we obtained the power we did place on the statute-book a measure to open up the lands of Australia, and we are proud to say - and we ‘have made the statement in the opening Speech - that it is having that effect. It is doing more than that, for it is the best immigration agent which Australia has had for many a long year, as is shown by the immigration returns. Senator Millen spoke of cheap land for the farmers of Australia. Which party stands for cheap land for the farmers? Is it the party with which the honorable senator is now associated ? It is notorious that that party, whether in the State or the Federal sphere, has always been the one which has been prepared to give land in huge blocks to big corporations, and which has never taken any step to give the land to the people who wanted to -use it.

If the Bill now under consideration is passed, the corporations which the right honorable gentleman then objected to, so strongly will materially benefit. In reading from the Minister’s speech I am quoting the right honorable gentleman against himself, as his statement this morning is entirely at variance with what he said on the Address-in-Reply when a member of the Labour Government, on the date mentioned. It is exceedingly difficult to imagine that the same gentleman is now a member of this composite Government, and that he is now totally opposed to the principles which he then espoused. The quotation from Hansard continues -

Senator MILLEN:
NEW SOUTH WALES · FT; ANTI-SOC from 1910; LP from 1913; NAT from 1917

– That is not correct.

Senator PEARCE:

– It is absolutely correct. It is the Labour party throughout the States and in the Federation which has been fighting always for land for the man who wanted to use it. Our endeavour has always been to burst up the big estates, which prevented farmers from getting areas, and nobetter weapon to that end has ever been forged thanthe progressive land tax which was passed last session.

The PRESIDENT (Senator the Hon T Givens:

– I have been following the honorable senator very closely. If the speech he is quoting related to leaseholds, the honorable senator would be quite in order in quoting it; but so far as I have been able to gather it is on the question of the taxation of freeholds. I direct his attention to the title of the Bill, which is - “ To amend Section Twenty-nine of the Land Tax Assessment Act, 1910-16.” It has been ruled, over and over again, that only the sections mentioned in an amending Bill can be discussed, and not the whole of the sections in the Act, which the Bill is to amend.

Senator Needham:

– Do you rule, Mr. President, that I cannot quote further from the speech?

The PRESIDENT:

– If the honorable senator can show that the speech delivered by Senator Pearce was in reference to leaseholds, he will be quite in order in quoting it. I followed the honorable senator’s remarks, and I could not gather that in the quotation he read there was any advocacy or discussion of leaseholds.

Senator NEEDHAM:

– This Bill relates to land taxation, and if you say that I cannot proceed further in quoting the speech of the right honorable gentleman, I shall obey your ruling.

The PRESIDENT:

– I did not give a ruling. I said the honorable senator would be in order in quoting from a speech on the taxation of leaseholds. He may even make an extended reference to land taxation, but he is not entitled to quote speeches on matters which are irrelevant.

Senator NEEDHAM:

– I was about to conclude the quotation, which reads-

Senator PEARCE:

– The Labour Government in South Australia is also making land available. One of the planks on which the Labour party in Western Australia is fighting the elections is “ cheaper land for the people.” Its contention is that, for some time, the Government hasbeen raising the price of land to the genuinesettler, and has inaugurated a policy which I referred toa little while ago, and by which certain men are able to get huge blocks to the detriment’ of the genuine settler.

The quotation is relevant. The Bill provides for the relief of certain wealthy people, and one naturally wonders why the poorer section of the community should not have similar relief. The Government is relieving lessees from their responsibilities, whilst, at the same time, it is refusing to grant adequate assistance to the invalid and old-aged people, who badly need it. If there has ever been a scandalous piece of legislation introduced into any Parliament this is surely an example. I cannot imagine a Government having such solicitude for the wealthy few and no respect whatever for the many poor.Why should not the Government introduce a measure increasing the income tax exemption, so that every individual in Australia would benefit ? If it were to do that, I would give it every assistance to pass its legislation, because it would be an attempt to alleviate the conditions under which the poor in Australia are living to-day. I decline to assist in passing a Billto remit a tax on Crown leaseholds, many of the holders of which are very wealthy. I said a little while ago that I doubted whether any good purpose was served by appointing Royal Commissions. In nine cases out of ten the money spent on ‘them is wasted. It would be very difficult for me at this hour of the morning to recall any whose recommendations have been acted upon. Take the Basic Wage Commission. If its recommendations had been acted upon, hundreds of thousands of workers in Australia would have benefited. Although it was unanimous in its recommendations, those recommendations were ignored. Here is another Commission which has said that a tax on Crown leaseholds is just and equitable. The Government pays no heed to that recommendation. A striking feature of the whole business is that the last two names I mentioned are those of two of the wealthiest men in Australia - Sir Sidney Kidman and Mr. Edmund Jowett. Had the objectionable feature originally included in the measure escaped the vigilance of the Labour Opposition in another place, those two gentlemen would have shared between them £200,000. I shall certainly vote against the second reading of the Bill.

Senator McDOUGALL:
New SouthWales

– I cannot allow the measure to go through without entering my protest against the proposal to release from their just debts the wealthy class in the community. This is a purely class measure. The Government has shown ineptitude and cowardice by accepting defeat in its efforts to collect the tax. There is a way by which it could collect it. Tattersall’s are made agents for the collection of income tax on the prizes that are distributed. The tax was made retrospective, and some persons were compelled to borrow’ money in order to pay it. No sympathy was displayed towards those persons. But those companies, which made huge sums during the war, and never failed to pay a fat dividend to their shareholders, are to be relieved of their just responsibilities in respect of the tax on leaseholds. The real sting was taken out of the measure in another place, which struck out of the Bill the retrospective clause, under which taxation duty to £1,300,000 would have been remitted. For a taxing authority to say that it cannot collect a tax is arrant nonsense and humbug. The way in which to collect the tax is to nationalize banking. The banks could then be made to collect. A few days ago a woman won a £5 prize in the “ Golden Casket.” Not being able to collect the money herself, she asked me to do it for her. The Commonwealth Government took from the prize 12s. 6d. Exchange cost1s., and duty stamp 2d. Such persons as that are not given any relief, but the big companies, which are the curse of Australia, and which spend the nation’s wealth in foreign lands, have their taxation remitted. During the past year they have handled huge sums of money and have paid big dividends. They are not in the future to be asked to pay taxation in respect of their leaseholds. There may be many hard cases, but that difficulty caN be overcome by each case being re viewed separately. The action of the Government has been condemned from one end of Australia to the other. There is not a company which has failed to pay dividends, yet they say that they cannot pay their just proportion of the cost of governing the country they profess to love so much. The big trading concerns are again attempting to open up trade with our former enemies, although very little time has elapsed since they asked the manhood of Australia to go across the seas to fight them. I enter my protest against the action of the Government, and shall vote against the Bill. For actions like this the Government will get the reward it deserves. Justice must be meted out to the worker as well as to the big companies and landholders. Taxation must be distributed fairly. It is said that income tax is to be collected at the source of the income. That policy could be followed with this tax. The Government does not want to collect it; it is by this means relieving its friends from the payment of a huge sum of money. I have heard honorable senators opposite quarrelling among themselves, calling one another all sorts of hard names, and saying that they were not fit to represent the great State of Victoria. All their short-comings will be recorded, and when the time comes we shall retaliate against the party that has not been courageous enough to stand up against those huge concerns that are not prepared to pay their just share of the cost of the war.

Senator FINDLEY:
Victoria

.I cannot allow a Bill of this nature to pass without briefly entering my protest. A few years ago a Bill specifically designed to impose taxation on leaseholds was passed by this Parliament. Leaseholders in possession of immense areas of land were called upon to pay, and did, for a certain period of time, pay the tax imposed. Later on, as the result of certain influences, two Royal Commissions were appointed to inquire into the position of these leaseholders, and their recommendations were in favour of the continuance of the tax. The Commissioners were not biased. They were representative men appointed because of their special fitness to carry out this investigation, and if their recommendations were to be at all effective, surely it was the duty of the Government in power to carry them out. I realize that no Government is compelled to carry out the recommendations of a Royal Commission; but since the recommendations in this regard were almost unanimous, I cannot see what excuse the present Government can offer for not carrying out what has been recommended. I suppose that these Commissions cost from £10,000 to £20,000, yet apparently their recommendations have been thrown into the waste-paper basket, and the provisions of the Act which imposed the tax on these leaseholds have not been carried out by this or the previous Government. As a matter of fact, in 1918, the then Treasurer (Mr. Watt) suspended the operation of the tax, possibly pending the report of a Royal Commission. At any rate, from that date until now not a single penny of the £1,300,000 owing by leaseholders has been paid. Had this big sum of money been collected it would have more than paid the suggested increase in the old-age pension from 17s. 6d. to 20s. a week. We are informed that the financial position of the Government is such that the money for the suggested increase is not now, and will not be during the next financial year, available. Senator Pearce, in moving the second reading of this Bill, said that at the outset leaseholders were called upon ‘to assess the values of their own holdings, and that subsequently departmental officers assessed them. I did not doubt the honorable senator when he said that there was a big disparity between the two valuations. I would rather take the assessments of the departmental officers than those of leaseholders, who naturally would not feel disposed to overvalue their lands. When we speak of Crown lands, we must remember that all lands are in a measure Crown lands. The Crown owns all the land in Australia. It is true that it has parted with the fee-simple of certain lands, but it can resume any land anywhere at any time in any part of Australia. How, then, can we differentiate between Crown lands and freehold lands? Land is the source of all wealth. Everything we wear or consume comes from the land, whether it be so-called freehold or Crown land. The desire of the Labour party is that all land in Australia shall belong to the people. There are, fortunately, extensive areas of valuable coun try still belonging to the Crown. They are held under lease, and these lease-: holders are to be specially favored by a Government which extends the highest consideration to its friends and supporters, but will not extend a helping hand to the aged and infirm. I am aware that some of its friends and supporters are in arrears with their payments. But as these gentlemen are also subscribers to a fund totalling many thousands of pounds which strengthens the party in office to-day, and militates against the party in Opposition, the Government proposed in the Bill as originally introduced in another place to give them .relief to the extent of £1,300,000. It is a public scandal. It is an outrage not to collect’ moneys that should long ago have been paid into the Consolidated Revenue.

The PRESIDENT (Senator the Hon T Givens:

– The Bill contains no reference to such matter.

Senator FINDLEY:

– No, but the money, “if collected, would have been paid into the Consolidated Revenue. When Senator Pearce was speaking on the valuations, he said that when some people were anxious to dispose of their interests they did not receive the amounts at which those interests were valued. He spoke of one holding which was valued at approximately £60,000, and he told us that a one-third interest in that property was disposed of for £12,000. I do not doubt his statement for a moment, but it does not prove anything. We know that in Australia at certain periods men have been obliged to sacrifice very big propositions. Many squatters in possession even of freehold land have been almost on the verge of bankruptcy at certain times, particularly when the banks have found it necessary to call upon them to meet their liabilities. On some occasions some- of them hae had to realize at a sacrifice, and scarcely any time has passed before the men who purchased the holdings have had the satisfaction of becoming among the wealthiest men in Australia. One or two big squatters who reside in Victoria were more or less financially ruined a few years ago; they had to sacrifice almost everything; but, being optimistic, they came up again, the seasons turned in their favour, and to-day they are men of affluence.

Senator Guthrie:

– Do they not deserve it?

Senator FINDLEY:

– I give every credit to courageous men. Sir Sidney Kidman was a comparatively poor man a few years ago. It is said that he bought stations for a “ mere song,” and that those from whom he bought them were, at the time, financially embarrassed. He, apparently, took some risks, or those who were behind him did’; luck came his way, and he is now probably one of the richest men in Australia. If statements that have been published from time to time are true, he has more extensive interests iri Australia than any other man. He is considered to be the “ cattle king “ of the world.

Senator Guthrie:

– That at the present time is his misfortune.

Senator FINDLEY:

– There are “ups and downs “ in every walk of life. If the seasons are good the men in that line of business make huge fortunes. If luck is not in their favour, some of them lose fortunes. The most successful men in Australia have been of the Sidney Kidman type:

Senator Sir Thomas Glasgow:

– It would be fair for the honorable senator to put the losses against the gains.

Senator FINDLEY:

– I am not going to’ enter into that question here and now. That is a matter for the Government of the day to consider; but I say it is manifestly wrong of the Government to allow these taxes to remain uncollected foi: such a long time. When we talk of leasehold land we ought to remember that nearly all the land of Australia has appreciated in value during the last few years.

Senator Sir Thomas Glasgow:

– Cattle stations have not appreciated during the last four years. I do not think that a cattle station of any value exists in Queensland to-day.

Senator FINDLEY:

– What increases the value of land?

Senator Sir Thomas Glasgow:

– The value of the products obtained from it.

Senator FINDLEY:

– It is population that increases the value of land. Take the population away from a country and the land has no value. The community creates land values. Where there is little or no population in the Northern Terri tory, land can be obtained at a peppercorn rental. That is due to the absence of population and want of means of communication.

Senator Guthrie:

– Yet the Department has assessed an unimproved leasehold in the Northern Territory at £88,640. That is the kind of taxation that the honorable senator is defending.

Senator FINDLEY:

– I am defending the principle. I did not say I believed that the assessments, whether made by leaseholders or Government assessors, were right; I could not, because I do not know. But I say that the principle of taxing leasehold lands is sound, and can be justified in the same way as the taxation of freehold lands. I am. astonished that the Ministry, which calls itself a business Government, is not doing what any . business firm would do, by collecting the moneys owing to it. What excuse can it offer ? . Why should this section of the community be specially favoured? Any one would be in favour of granting breathing space to any section of the community which had a good case and was poorly circumstanced. I have had no evidence that the leaseholders have made out a good case. The Crown is the best of all landlords. In times of hardship the small man who is a tenant of the Crown is given more than breathing time. He is helped in numerous ways to tide over his difficulties. He is not pushed for debts owing to the Crown, as he would be if they were owing to private individuals.

Senator Reid:

– Most of the leaseholds in Queensland went down in value at one time until they could not be sold.

Senator FINDLEY:

– That is no argument against the collection of this tax. People have failed in various lines of business, but they have had to pay their taxes up to the last. I knew one man who years ago won a small prize in a Tattersalls sweep. He had been in different parts of the State, and had been out of the State. I am not sure that he had not been out of Australia. Years afterwards, when he was not in a position to pay the income tax, the Department discovered his whereabouts and made him pay up. It should collect the tax in the same way from the big leaseholders. If the list that has been published is correct, the leaseholders are not poor men, and there are not many of them. As it has not been challenged, it is probably correct, or nearly so. The information which Senator Pearce said could not be obtained without considerable trouble is, apparently, available from some source. The Government would have no difficulty, with the assistance of experts in the Taxation Department, in ascertaining exactly the amount of the arrears. It would be interesting to know the names of. the persons associated with the companies which hold extensive areas of land under lease. If we- had such information I believe it would show that those associated with these institutions are among the richest men in Australia, and that some of them, having amassed fortunes in this country, do not think Australia good enough to live in, and have moved to Grosvenor-square or somewhere else. No argument has been advanced against the principle of taxing land values. The Government proposes to throw the reports of the Royal Commissions into the waste-paper basket, although the money that could have been collected might have been used for increasing the invalid and old-age pensions. It is evident that Ministers have little, if any, consideration for the aged and the invalid, although they are very much concerned about the wealthy section of the community and are prepared to make them a present of about £1,300,000.

Senator GRANT:
NEW SOUTH WALES · ALP

– After some trouble, and with the assistance of the officers of Parliament, I have been able to ascertain exactly what honorable senators are asked to do. It appears that it is proposed to amend section 29 Of the principal Act to make it read as follows : -

Notwithstanding anything in the last two preceding sections, the owner of a leasehold estate under the laws of a State relating to the alienation or occupation of Crown lands or relating to mining (not being a perpetual lease without revaluation, or a lease with a right of purchase) shall not be liable to assessment or taxation in respect of tobe estate.

Personally^ I am not in favour of the proposal. It is a departure from the principle underlying land value taxation, and a departure which should not be countenanced by any one who is in favour of the taxation of the Common wealth being spread over those who are best able to bear it. When the Fisher Government considered the subject of imposing direct taxation, it decided that, for the time being, it would exclude from the operation of the Federal ‘ land value tax all leasehold property. . Probably that Government realized that if it attempted too much at ohe time, it would suffer defeat. It must be remembered that land monopoly is the wealthiest, oldest, and most securely established of all monopolies. It is not surprising that the Fisher Government postponed, for the time being, the question of asking the leaseholders of the Commonwealth to contribute something towards the national taxation. At a later date, however, some of those who were members of that Administration brought forward this proposal and had it incorporated in the Land Tax Assessment Act. It was not embodied in the law without opposition. In all countries there has been an attempt to defeat direct taxation, because the wealthy classes know that indirect taxation is much less objectionable to the people. In the New South Wales Parliament there has been the strongest possible opposition to any system of direct taxation, and especially land taxation. Some time ago I asked for a return showing the value of the land held in the Commonwealth.

The PRESIDENT (Senator the Hon T Givens:

– Order!’ I ask Senator Barnes not to smoke in the Chamber.

Senator Barnes:

– Under what standing order is smoking prohibited?

The PRESIDENT:

– I am entirely responsible for the conduct of the business of the Senate, and I ask the honorable senator to cease smoking.

Senator GRANT:
NEW SOUTH WALES · ALP

– I think it is very offensive, and I am surprised at the honorable senator.

Senator Guthrie:

– It is the first time such a thing has been done in the Chamber, and one of the honorable senator’s own party is responsible for it. Senator GRANT. - It is most objectionable to me.

The PRESIDENT:

– Order! I remind the honorable senator that he is not responsible for the conduct of the proceedings.

Senator GRANT:
NEW SOUTH WALES · ALP

– I was surprised to learn that the total value of the lands of the* Commonwealth was only £455,000,000. I do not wish to split hairs as to what constitutes wealth, but I regard anything that is convertible into cash as wealth. The value of the land as returned by the owners was £455,000,000.

The PRESIDENT (Senator the Hon T Givens:

– The Bill is to amend section 29 of the Land Tax Assessment Act 1910-16, and the honorable senator must confine his remarks to that section’ and the amendment of it, for which this Bill provides. I .have allowed him considerable latitude, but he will not be in order in referring to freehold land.

Senator GRANT:
NEW SOUTH WALES · ALP

– I am not sure whether the return to which I have referred was in connexion with leasehold or freehold land.

The PRESIDENT:

– The honorable senator quoted the value of the land as returned by the owners.

Senator GRANT:
NEW SOUTH WALES · ALP

– In our efforts to impose taxation on Crown leaseholds and privately-owned land, we were confronted in the early stages with numerous difficulties; but I cannot see any difference between the imposition of a tax on privatelyowned land and a tax on land held under a lease. I know of numerous cases in New South Wales where there are within areas of privately-owned land, large tracts of leasehold land, and under the Local Government Act no difficulty is experienced in imposing and collecting the tax. As far as the leasehold lands of the Commonwealth are concerned, it does not appear that there is any difference between leasehold and freehold, for taxation purposes. If a person pays £5,000 for a freehold estate, he is taxed upon that value, and surely if a person is paying the full rental value of a lease it is equally fair that he should also pay taxation in proportion to the value of the lease. There is, however, a strong objection on the part of these people to pay anything at all, although we hear wonderful stories from various parts of the country as to the actual position in which they are placed. The whole of the western division of New South Wales is held under lease. A Board has been created to periodically adjust the rentals, but whether the full annual rental is collected or not, the holders of leaseholds have just as much right to pay the Commonwealth land tax as have owners of freehold estates. I have not great faith in valuations made by the owners themselves, because when an owner makes a valuation of his own property, he knows that the .valuation may be used by the taxation authorities for the imposition and collection of taxation on that basis. Lessees as well as owners should be compelled to pay land taxation, but it should be on a fair valuation basis. Land owners who fix their own valuations for taxation purposes do not fix the same rate as they would for selling purposes. This system was tried in New Zealand, and as it was a complete failure it was abandoned years ago. The best method of taxation is for the Government to appoint valuators against the owners’ valuation, and allow the taxpayer the right to appeal to a Board, before which he can submit his case. Even the most efficient Government valuators may err whether valuing freehold or leasehold properties. I favour the idea of valuations by Government officials subject to appeal.

Senator Reid:

– That is what we do in Queensland.

Senator GRANT:
NEW SOUTH WALES · ALP

– And it is a fair method. If Government valuators value the land, and the taxpayer has the right of appeal, no exception should be taken to the procedure. It will be admitted that any .one undertaking the work of land valuing must have had considerable experience, and that even in such circumstances striking anomalies occur. Some time ago a Royal Commission waa appointed to investigate this question, and it considered every phase very extensively. The Commission came to the conclusion that there was nothing operating in favour of leasehold land which did not operate in favour of freehold land.

Senator Reid:

– A lessee pays rent.

Senator GRANT:
NEW SOUTH WALES · ALP

– Tes, but the honorable senator might complete his argument by saying that the man who invests the whole of his capital in freehold loses the interest on the purchase money, and if it is fair to tax him it is equally fair to tax the. man who has used his capital in other directions. If the land is valued by Government valuators and the tax- payer has the right to appeal to a Board, there can be no cause for complaint.

The PRESIDENT (Senator the Hon T Givens:

– The honorable senator has repeated many of his arguments two or three times, and I ask him to continue his speech without repetition.

Senator GRANT:
NEW SOUTH WALES · ALP

– As a matter of fact, I believe you are correct, Mr. President, and I was going to do it again.

The PRESIDENT:

– The honorable senator will not be in order in doing so.

Senator GRANT:
NEW SOUTH WALES · ALP

– The Government is making a mistake in the attitude it is adopting towards this question. It is not fair that a large and wealthy section of the community should be permitted to escape taxation in this way, because if it is right to tax freehold land, it is equally right to tax leasehold land.

The PRESIDENT:

– I ask the honorable senator to resume his seat. The statement, he has just made has been repeated several times, and if he cannot submit fresh arguments I ask him to discontinue his speech.

Question - That the Bill be now read a second time - put. The Senate divided.

AYES: 17

NOES: 7

Majority . . . . 10

AYES

NOES

Question so resolved in the affirmative.

Bill read a second time.

In Committee:

Clause 1 agreed to.

Clause 2 (Crown leases).

Senator McDOUGALL:
New South Wales

.- The Commonwealth ought to ascertain whether these companies are financially in a position to pay this taxation. Unless they are unable to pay it they should be liable to taxation, as is the case with any other taxpayer. The Government inquires into the earnings of old-age pensioners, and if they earn more than the amount provided by the Act they are denied the pension. The Taxation Commissioner ought to be given power to make inquiry, and to let the Government know if these people are able to pay the tax.

Clause agreed to.

Clause 3 agreed to.

Title.

Senator GARDINER:
New South Wales

.- This Bill sets out to present to certain leaseholders money that should rightfully be paid by them. It would, therefore, be well for the title to properly describe the contents of the measure, and state that it is a Bill providing for the making of a present, by the Government, to its wealthy friends. Possibly this concession is being granted for services rendered. These persons may have a “ pull “ on the Government because of certain services, for which the Government is asking the taxpayers to find the money. Would I be in order in moving an amendment to give the Bill its correct title?

The CHAIRMAN (Senator Newland:

– The honorable senator would not be in order in moving such an amendment as he suggests.

Senator GARDINER:

– Is the title of a Bill such that it cannot be altered ? Are the rights of honorable members such that they cannot move an amendment; or are the risks to be apprehended too great? I regret that the Government has not truthfully stated in the title the contents of the Bill, and that at the end of the session it is helping its friends at the expense of the public funds.

Title agreed to.

Bill reported without amendment; report adopted.

Bill read a third time.

page 3495

INVALID AND OLD-AGE PENSIONS BILL

Bill received from House of Representatives.

Standing and Sessional Orders suspended, and Bill (on motion by Senator Pearce) read a first time.

page 3496

SPECIAL ANNUITY BILL

Secondreading.

Senator PEARCE:
Minister for Home and Territories · Western Australia · NAT

– I move -

That the Bill be now read a second time.

This Bill is a recognition by the Government of a duty that it owes to the widow of a man who served his country honorably and well. The late Honorable F. G. Tudor was one of the foundation members of the Federal Parliament. For many years he was a Minister of the Crown, having occupied the position of Minister for Trade and Customs. Subsequently he was for some years the Leader of His Majesty’s Opposition in the House of Representatives. On his death his widow and family were left with a bare living; but, owing to an unfortunate circumstance over which the widow had no control, the living was lost, and the widow is now, and has been for some time, in circumstances the very reverse of comfortable. It is considered that the least the country can do is to grant her this small annuity in order that she may be saved from want.

Senator GARDINER:
New South Wales

.- This Bill will meet with neither opposition nor delay from either side of the Senate. It will be recognised by all those who were associated in this Parliament with the late Honorable Frank Gwynne Tudor that he gave his life to the service of his country as truly as ever a man did. If service counts for anything, this action on the part of the Government is timely, for more useful service has never been rendered than that which was rendered to his country by the late Mr. Tudor. He was honorable, conscientious, and thorough-going. I thank the Government for this recognition ofthe splendid services of such an excellent man.

Question resolved in the affirmative.

Bill read a second time, and passed through its remaining stages without amendment or debate.

page 3496

INCOME TAX ASSESSMENT BILL

Second Reading

Senator PEARCE:
Minister for Home and Territories · Western Australia · NAT

– I move -

That the Billbe now read a second time.

I ask the forbearance of honorable senators in my attempt to explain some of the technical details of the Bill, because they are involved and hard to follow. They contain features which are new to Commonwealth legislation. The most noticeable of these are -

  1. Provisions for the taxation of companies’ profits in the hands of the company at a flat rate on the total profits, and the inclusion of dividends, &c, in the assessments of shareholders for the purposes of -

    1. determining the rate of tax payable on income from other sources by taxpayers whose rate of tax on the dividends does not exceed the company rate of1s. in the£1. In this case the dividends will not be taxed in the hands of the shareholders, and the shareholder’s tax will be calculated at the rate applicable to his other income; and
    2. collecting additional tax from shareholders whose rate of tax on their total income exceeds the company rate of1s. In this case the dividends will be included in the assessable income, not only as stated above in paragraph (a) for purposes of determining the rate of tax only, but the dividends will themselves, as part of the total income, be taxed in the hands of the shareholder at the rate appropriate to his total income. The shareholder will, however, be entitled to a rebate of the company rate on the dividend included in the shareholder’s taxable income.

These provisions, with consequential amendments of the principal Act, are expressed in clauses 3 and 5 as to consequential provisions, and clause 4 as to the main provision.

  1. The exclusion of companies from the operation of the averaging system, because companies are, and will continue to be, taxed at a flat rate on profits when earned. This is provided for in clause 2. Where there is a progressive scale of tax, as in the individual scales of the Commonwealth Act, the averaging system operates to provide a remedy for hardships which may arise. It cannot be said that similar hardships arise in the case of companies taxed at the flat rate, though, as against this, it may he urged that while a company whose income fluctuates largely escapes the pressure at high rates in the year of high profits, it obtains no allowance in respect of losses. At present it is possible for a company to escape tax at the flat rate in any year if its average taxable income is zero or a minus quantity. The following example will demonstrate how the provision will work : -

would not be assessable in any year. In the first two years there was no taxable income, and in the third year the rate of tax applicable to its average income was nil, because its average was a minusquantity, viz., minus £100/3 =minus £33J. If the averaging system were not applied to companies, then, in the case shown by this illustration, the company would, in the third year, be taxed at the flat rate upon its actual profits of £2,900. The company is taxed at a fixed rate which cannot vary in any way, whatever the variation in the annual profits may be.

In the case of other taxpayers, the rate to be paid varies with every variation of £1 in the average income. The effect is that, while in the case of an individual the averaging system may sometimes operate in favour of the taxpayer and sometimes in favour of the revenue, in the case of a company that system, while it may often operate in favour of the taxpayingcompany, can never operate in favour of the revenue.

  1. A provision under which live stockowners may, at their option, return their income on a cash basis, under which they will omit the natural increase of each year until it is disposed of, or on the basis of a trading account in which they will bring to account all their live stock on hand at the beginning and end of each trading period, at cost price or market value, whichever is the less. Cost price, in relation to purchased live stock, will be the purchase price, and, in relation to natural increase, it will be a cost price fixed by the owner of the stock between minimum and maximum limits, which will be prescribed by regulation. The proposed limits will be -

Two methods for the cash basis have been considered, viz. - (a) in which natural increase only are to be excluded until sold; and (6) in which all live stock are excluded until sold, except that purchases made during a year will be set against the sales made during the same period. It has been decided that the cash basis shall be applied only to the natural increase of live stock born during the year. It will be excluded until disposed of. Any extension of this basis is regarded as unnecessary and undesirable, as the experience of State Commissioners shows that a cash basis, which represents receipts and expenditure only, invariably proves disadvantageous to the taxpayer. Disadvantage may arise to the taxpayer in this respect from various causes, among which may be mentioned - (a) forced sales of live stock on account of drought conditions; (b) extensive sales in one year of accumulations of surplus stock during preceding years; (c) losses of live stock through death, which cannot be claimed as a deduction from revenue.

  1. The reduction of the taxable income of overseas shipping interests from 10 per cent, to 7£ per cent, of the total freights and passage money. The present provision requiring the payment by the owners or charterers of oversea ships of tax on 10 per cent, of the freight earned in Australia has been found to be somewhat oppressive and out of relation to the existing conditions. It has been demonstrated, to the” satisfaction of the Commissioner of Taxation, that, at the present time and for the past two years, all shipping companies trading regularly to Australia have been carrying on at greatly reduced revenue. Notwithstanding this loss, the companies have been taxed by the Commonwealth at 2s. 5d. in the £1 on an assumed profit of 10 per cent, of freight and passage money, &c, received in respect of goods and passengers shipped in Australia for carriage beyond Australia. The companies protested strongly against the tax in the circumstances, but no relief was. afforded to them at the time. Subsequently, when the Government agreed to a subsidy being granted to the meat export business upon condition that sea freights were reduced, the overseas shipping companies pointed out their position, and compared their treatment by New Zealand with that experienced in Australia. The companies suggested that the taxable income of the company should be deemed to be an amount not exceeding 5 per cent, of the freights and passage money, &c. for goods and passengers shipped in Australia, and that the rate of tax should be reduced from 2s. 5d. in the £1 to ls. 6d. in the £1. The Government considered that some reduction of taxable income was justifiable at the present time, and fixed the amount of the taxable income at 7i per cent, of the freights and passage moneys mentioned, because it had decided to charge tax on the income of companies at ls. in the £1. A 5 per cent, income tax at ls. 6d. in the £1 would yield the same amount of tax as a 1 per cent, income tax at ls. in the £1. When the overseas shipping business improves, it may be necessary to revise this basis of assessment.
  2. Section 30 of the principal Act, which provides for certain rebates in respect of business income where the rate of tax on that income exceeds the present company rate of 2s. 5d., needs alteration in view of the intention to reduce the company rate to ls. With a view of making the section permanently applicable, although the rates may be subsequently changed, the proposed wording is general in character. This is provided for in clause 9 of the Bill.
  3. Amendment of the existing penalty of 10 per cent, of the tax for failure to lodge returns, or to include income in returns, or to pay tax by the due date, is proposed to be made by substituting a new penalty for such breaches of the law, of 10 per cent, per annum on the amount of the tax involved. The present provision in section 56 of the principal Act for a penal tax of 10 per cent, on the tax unpaid in cases of belated payments of tax has been found to be harsh in operation, and has been the subject of much complaint. The proposal now embodied for the substitution of additional tax at the rate of 10 per cent, per annum on the amount of tax unpaid will remove any reasonable ground for complaint. This is dealt with in clause 10 of the Bill. It is proposed to alter the penal provisions of section 67 of the principal Act on similar lines to the alteration of section 56, so far as the 10 per cent, penalty is concerned; and remarks in regard to that section are applicable also to section 67. This matter is covered by clause 11.
  4. There are a few additional amendments of a minor character, viz., an amendment of section 23 (1) (i) of the Income Tax Assessment Act 1922, to permit deduction of calls paid on snares in mining companies mining for oil, which has been inserted at the Treasurer’s direction, and consequential amendments of the principal Act following upon the main amendments already referred to.

The Government consider it desirable to make a statement to Parliament of the intention of section 21 of the Income Tax Assessment Act 1922, together with the manner in which the Commissioner of Taxation administers the Act. The section is a necessary and essential feature in the general scheme of the Commonwealth income tax, because of the imposition of the tax by means of a graduated rate on an aggregate income, and the taxation of companies’ profits at a flat rate, which is low compared with the rates payable by individuals with large incomes. If the section were not in the law, the relatively low rate payable by companies would be a very strong inducement, more particularly in the case of private companies, to the companies to, refrain from distributing the annual profits. The shareholders’ interests in the company would thus become more valuable each year, without any liability of the individual shareholders to pay tax on profits thus capitalized. In the original Income Tax Assessment .Act 1915, the corresponding section provided that if a company had not distributed a reasonable proportion of its profits, the whole of the profits could be deemed to have been distributed, and the share- holders were individually made liable to pay tax on the additional sums deemed to have been distributed to them. The shareholders’ additional tax was payable in addition to the tax already paid on the profits by the company. On account of the very harsh and inequitable operation of that section, the Government subsequently amended it, so that the tax to be collected would be the amount paid by the company or the amount payable by. the shareholders on the additional distribution deemed to be made to them, whichever was the greater. In 1922, when the Income Tax Assessment Act was reconsidered by the Parliament, the section was altered so that the company would be liable for any additional tax that would have been payable by the shareholders on any additional amount of the profits deemed to be distributable, and, further, the maximum amount which could be deemed to be distributable was fixed at two- thirds of the taxable income. The section provided for certain things which, inter alia, the Commissioner of Taxation should have regard to in determining whether an additional amount could reasonably have been distributed by the company. Amongst these was the relation of the distributable income to the taxable income. The Commissioner of Taxation looks for, and makes full provision for, the following items, which he treats as not being distributable profit: -

  1. All items of actual expenditure debited to profit-and-loss account or appropriation account, such as Federal income tax, war-time profits tax, donations, subscriptions, law costs. These items (and other similar ones) are not deductible in arriving at the taxable income, but as they have been expended, cannot be termed available for distribution.
  2. Amounts necessary to restore unrecouped losses of paid-up capital or of accumulated trading profits invested in the business. These amounts are allowed in full from the profits under consideration.
  3. Reserves to meet losses which the directors considered at the date the dividend was decided upon were certain to arise in subsequent trading periods. Reasonable proof of the directors’ knowledge of losses is required to be produced.

Losses may be from fall in value of trading stock or any other cause.

  1. Reserves for income taxes. - Many companies raise reserves to enable each year to bear its own tax. If reasonable, the reserves are treated as undistributable.
  2. Reservations of profits to meet unusual commitments, e.g., high-priced goods from overseas were rushed on importers and delivered en masse instead of over an extended period. All available funds required to meet the unexpected liability are treated as not being distributable.
  3. Sinking fund, calculated at 5 per cent, per annum compound interest, to repay debentures used by the company for the purposes of its business.
  4. Sinking fund, based on the period of the lease, necessary to amortize cost of lease and/or of improvements thereon in which the lessee has no tenant rights.
  5. Provision for bad debts where the practice is to make reserves for the writing off of debts proved bad.
  6. Depreciation in excess of departmental rates. This is to provide for depreciation of buildings and for depreciation of plant, &c, on account of obsolescence for which the Income Tax Assessment Act does not provide.
  7. Money retained to meet bad debts on time-payment purchases and reserves to carry forward profits on time-payment purchases not yet received.
  8. Investments in war loans.
  9. Money expended in alterations and additions, not increasing capital value of the asset and not possible to capitalize.
  10. Special reserves by pastoral companies to provide against droughts.
  11. Increase in taxable income owing to application of departmental values to live stock. An endeavour is made to ascertain the true value of the stock.
  12. The book value of plant which for various reasons is scrapped.
  13. Any special features indicated by the circumstances of each case.

The intention of the Government in framing section 21 of the 1922 Act in its present form was to protect the revenue against evasion which would have been possible if the maximum distribution had been expressly stated as being two-thirds of the distributable income, but, at the same time, it was intended that when the Commissioner had ascertained the bona fide distributable income, any further distribution which he considered possible should not cause the total of the actual and the assumed distribution to exceed two-thirds of the bona fide distributable income. Although this fact is not stated in the law, and could not be stated without exposing the revenue to loss, the Commissioner of Taxation will interpret the law in the manner indicated. I am sorry to have bored the Senate with this long technical explanation. It is desirable, however, to have it on record as it is an indication of the interpretation placed upon the provisions of the Bill, and of the way in which it will be administered.

Debate (on motion by Senator Gardiner) adjourned.

page 3500

TARIFF BOARD BILL

Second Reading

Senator PEARCE (Western Australia -

Minister for Home and Territories) [4.50 a.m.]. - I move -

That the Bill be read a second time.

Honorable senators are aware that the Tariff Board Act 1921 will expire on 15th March next. This Bill extends the Act to the 15th March, 1925. In order to make the Board more widely representative, and able to cope with the vast amount of work with which it has to deal, it is proposed to increase the number of members from three to four. The importance of its work since its inception warrants that extension. A continuance of the Act is also necessary, because the exercise of powers in other Acts, such as the imposition of dumping duties under the Industries Preservation Act, and the taking of action in regard to deferred duties under the Tariff Act, is dependent upon inquiry and report by the Board.

Senator FINDLEY:
Victoria

– The Bill for the creation of the Tariff Board was introduced in the Senate in July, 1921. It had a poor reception. Those who supported it were only lukewarm, and its opponents were strong in their criticism and vigorous in their opposition. The Minister who submitted the Bill said that the Minister for Trade and Customs was so hard worked that it was almost impossible for him to perform his duties satisfactorily to the Department and the community unless he had additional assistance. It was said that the expenses of the Board would be about £1,000 per annum. Those who opposed it had their doubts about the accuracy of that statement, and they have since had every justification for their view. In the last financial year the expenses incurred by the Board were £4,396, and on this year’s Estimates a total of no less than £7,000 is provided. The Board has not given the measure of satisfaction that some of its supporters anticipated. There have been complaints by importers, manufacturers, and the general public. It has disappointed every section of the community. The duties it has arrogated to itself ought to cause this Chamber to hesitate, not merely about appointing an additional member, but about allowing the Board to continue any longer in existence. It recently submitted a report which shows that -

Upon representation from the Primary Producers’ Association, the chairman, on behalf of the Board, wired to the Prime Minister a full statement of the request made by the wheatgrowers, and urged the withdrawal of some of the conditions imposed by the Commonwealth Bank in connexion with the advance to be made on the wheat to be harvested during the then approaching season.

The supporters of the Bill never thought that the Board would take on that kind of work. I should imagine that those who voted for it did so in the belief that it would devote its time entirely to matters related to the Tariff and to industries that were affected by the Tariff. I fail to see where the Board gets power to make representations regarding the Commonwealth Bank. I could understand the Board making representations to the Government, and the Government pleasing itself whether it acted on those recommendations, but I cannot understand why the Board, on its own initiative, moved in such a matter. Later, the report says -

At the request of the Government of Western Australia the Board visited some of the settlements being prepared in the south-west of the State some distance from local markets.

Was that one of its duties?

Senator Pearce:

– Certainly it was. Members of the Board were there to inquire into the effect of the Tariff on those settlements.

Senator FINDLEY:

– The report does not show that. It goes on to say -

The formation of these groups necessitated the immediate provision of a railway line to enable the products of the settlers to be transported to the seaboard, and to enable the settlers to obtain their supplies. After inspecting the country, the Board recommended that free entry should be given for all the railway rails and track materials.

Senator Pearce:

– Is not that a Tariff matter affecting that settlement?

Senator FINDLEY:

– The Board went to the settlement, saw that the settlers were inconvenienced by the want , of railway communication, and then made its recommendation. That ought not to be the duty of the Tariff Board. Surely the State Government in Western Australia could make representations to the Federal authorities?

Senator Pearce:

– It is an Australian Tariff Board, and it has just as much right to visit Western Australia as it has to visit Bourke-street.

Senator FINDLEY:

– The report states -

The Board has given considerable attention to the representations made in regard to the duty on agricultural implements, but in view of the fact that inquiries are now being made with a view to the preparation of a report on the subject, it is not desired to make further reference to agricultural implements in this report.

The probability is that the reason why we have not had some definite statement by the Board in respect to that matter is that representations have been made to the Board that it should placate certain sections of the community by allowing their agricultural machinery to be admitted free into Australia. We are also told that -

On several occasions, at the request of local manufacturers, the Board has deputed the chairman to go to different States to assist in obtaining orders for Australian engineering shops.

Did anybody know, when the original Bill was before Parliament, that the chairman of the Board would become a commercial agent, travelling from State to State in order to secure orders for engineering and other firms? Where is this going to end? The report goes on to say -

The Board has no hesitation in reporting that the present Navigation Act is working very detrimentally against the best interests ofthe primary and secondary producers.

I maintain that it was no part of the duty of the Board to put such a paragraph into its report. Did any Government give the Tariff Board power to inquire into the operations of the Navigation Act? The Board is evidently exceeding its duty. The Board further reports -

While in England Mr. Brookes will deal with many matters of material interest to the Commonwealth, especially in connexion with securing support for Australia’s claim for greater Tariff preference.

Has the Government commissioned Mr. Brookes to go to London to see if the Board can secure trade reciprocity between the Commonwealth and the Homeland ? I thought that was a matter for the Prime Minister (Mr. Bruce). The last paragraph in the report states -

The work tends to increase, and cannot be coped with in the usual official hours. The Board urges that, should Parliament decide to extend the period of the Board’s operation, the method of the payment of the business representatives by fees should be dispensed with, and remuneration by salary adopted.

In all seriousness I say that there is no justification for the continuance of this Board . It is true that it cannot increase or reduce duties, but it has made certain recommendations which have been acted upon, with the result that certain duties have been suspended for a given period. Fbr a long time one of the members has been absent from Australia, and shortly the chairman, who is the ComptrollerGeneral of Customs, will accompany the Prime Minister to London. The Government now proposes to appoint a fourth member of the Board. If the members are to be allowed to roam all over Australia, and at the same time to act as commercial travellers for various industries, they will have a never-ending job. When the principal Act was under consideration Senator Guthrie said. -

I frankly confess that I dread any further public expenditure. I am strongly in favour of economy, and, therefore, very diffident about the creation of any further Boards.

The honorable senator went on to say that the creation of the Board would be a protection to the manufacturers and the consumers of Australia. He had a mistaken idea that the Board would have the power to stop profiteering-. Certainly the Board would have an indirect power to do so, because, if it found that any manufacturer was charging excessive prices, it could make certain recommendations to the Government. Senator Drake-Brockman, in the course of a few remarks on the Bill, said -

I shall be surprised if the Bill survives its second-reading stage. It certainly will not survive if my vote can assist to reject it. I hope that the honorable senator’s vote this morning will be consistent with that expression of opinion. He went on to say that the establishment of the Board would simply mean the re-creation of the old and expensive Inter-State Commission. Senator Wilson remarked -

Most of us are pledged to the principle of political economy, and in this connexion we have the opportunity of preventing the creation of another large department. Already the people are unnecessarily burdened in connexion with the number of Boards which are in operation. Once a department is started it is almost impossible to say where it will end.

A division on the second reading of the Bill resulted in the measure being carried by 19 votes to 11. Amongst those who voted against it were Senators Benny, John D. Millen, Drake-Brockman,. Elliott, Givens, and Wilson.- Senator john D. Millen said that he was opposed to the Bill lock, stock and barrel. I hope that he is of the same opinion to-day.

Senator Payne:

– The two measures are dissimilar.

Senator FINDLEY:

– The only difference is that under this Bill the life of the Board is to be extended for another two years, and the personnel increased from three to four members. If the Bill is passed, I trust the four members of the Board will be representative of all sections of the community. The present members are mainly interested in giving as much protection as possible to manufacturers. We believe in giving just consideration to manufacturers, but there are other interests which also deserve attention. The consumers, primary producers, and, workers should also have representation. The Board would then be truly representative of all sections of the people affected by the Tariff. As a Protectionist, I am anxious to see industries established under the declared policy of Australia. Ministers of Customs have not complained that they have been unable to cope with the work with which they are intrusted until within the last year or two, when the Government of the day decided that the only way in which the work could be done was by the creation of a Board. Other Boards and Commissions have been appointed, on all of which are friends and supporters of the Government. The probabilities are that they have one of their own friends in view for the new position to be created. I should not be surprised if an additional member is to be appointed because of the Country party’s representation in the Cabinet. There are rings, trusts, and combines amongst the manufacturers enjoying protection under the Customs Tariff Act. It is the duty of the Government to see that people other than manufacturers are also protected. I have not seen a statement by the Board that it has made investigations concerning the exploitation of the people by commercial combines. I am not disposed to vote for a continuance of the Board, because it has not given the satisfaction which some of its supporters anticipated, and also because it has caused much inconvenience to some people. Although the Board is not empowered to increase or reduce Customs duties, complaint has been made by people affected that they do not know what is going to happen, because it has the power to make recommendations to the Minister, and in this way duties have been suspended. The Board involves a waste of money, and an additional member will mean further expenditure.

Senator NEEDHAM:
Western Australia

– The only reason given by the Minister (Senator Pearce) for the introduction, of the Bill was that the principal Act will expire on the 15th of March next. I do not think the Commonwealth would suffer if the Board were allowed to die a natural death, because I cannot see that any benefit has accrued to any section of. the community as a result of its operations. I would have supported a Bill to repeal the Act, but I am not likely to assist in perpetuating the existing deplorable atrocity. I am beginning to wonder whether Parliament or the Government is governing, or whether we are handing over all the responsibilities of government to Boards. It is not only the intention of the Government to continue the Board and increase its personnel, but also to add to the cost by granting fixed remunerations instead of fees per sitting. I presume honorable senators opposite will support the BiU.

Senator Findley:

– I have given the names of some supporters of the Government who strongly opposed the original measure.

Senator NEEDHAM:

– Yes; it will be interesting to see how they vote. A little while ago, when we were considering the appointment of a Board to control the Commonwealth Government Shipping Line, strong representations were made to the Government from this side to appoint a representative of the workers. We were out-voted. If this measure is passed, I presume a representative of the Country party will be appointed to the Tariff Board. Why should there be a representative of that party and not of the Labour party on the Board? As a matter of fact, the Board should be above and beyond all party politics. Do not let me bo misunderstood. I am not suggesting, or inferring, that the composition of the Board at the present time is a reflex of party politics; but I do say that if we pass this measure there will creep into the composition of the Board a political complexion that should be kept out of it. I venture to think that this Bill has been brought in because of the powerful influence of a section of the Composite Ministry which is allegedly governing Australia. I know of no other reason. I believe that Major Oakley, for whom I have every respect as a very capable man and an able administrator, is chairman of the Board, at the present time. I understand that he contemplates going to London at, I believe, about the same time as the Prime Minister. Why should an extra man be put on to do this work? Major Oakley could very well sever his connexion with the Board. I am destitute of language with which to adequately express my dislike of this measure.

Senator GRANT:
NEW SOUTH WALES · ALP

– I call attention to the state of the Senate. [Quorum formed.]

Senator NEEDHAM:

– When I allow my mind to travel back through the halls of memory, I have tried to find out what work this Board has had to do, and I have not been able to assure myself that it has been very busily engaged. Had I been in the Senate when the original Bill was introduced, I should have opposed the appointment of the Board.

Senator GRANT:
NEW SOUTH WALES · ALP

– I call attention to the state of the Senate,[ Quorum formed.]

Senator NEEDHAM:

– I was about to suggest that this work could be done better by departmental officers than by a TariffBoard. It has been stated that the Board can only make recommendations. I am under the impression that it can go further, and that it sometimes does things which only Parliament should do. Australia has committed itself to a fiscal policy which, to my mind, is a sane one. I refer to the Protective policy. Again and again Parliament, acting under a mandate from the people, has determined that everything possible shall be done to foster, to protect, and to nourish Australian industries. I very much fear that there may come a time when the Tariff Board will act contrary to the will of Parliament. I know that there are many anomalies in the Tariff Act to-day. I should like to see them removed, but I do not think that the Tariff Board should determine what those anomalies are. That matter should be determined by the Parliament of Australia. That is one of my main reasons for opposing the measure. In the first place I object to the Tariff Board. It is an atrocity which we should not perpetuate. I object to the number of. members being increased by one. I object, also, to the chairman leaving the Board and going to London. I do not say that we could send to London a better man than Major Oakley, but I do say that he cannot do the two jobs. There are many otherreasons why the Bill should not be agreed to, but I think that I have stated a sufficient number to warrant its rejection.

Question - That the Bill be now read a second time - put. The Senate divided.

AYES: 15

NOES: 6

Majority … … 9

AYES

NOES

Question so resolved in the affirmative.

Bill read a second time.

In Committee:

Clause 1 (Short title and citation).

Senator GRANT:
NEW SOUTH WALES · ALP

.- The title of this Bill is a misnomer. It is a measure to provide a position for some one who is temporarily out of employment, and I think the title should be amended to read -

A Bill for an Act to provide additional employment.

Clause agreed to.

Clause 2 agreed to.

Clause 3 -

Section 5 of the principal Act is amended by omitting therefrom the word “ three “ and inserting in its stead the word “ four.”

Section proposed to be amended -

For the purposes of this Act there shall be a Tariff Board consisting of three members.

Senator FINDLEY:
Victoria

. - I want to understand the position. There are three members of the Tariff Board, but one is now away in London.

Senator Pearce:

Mr. Brookes is absent on leave.

Senator Sir Thomas Glasgow:

– But does not draw his pay.

Senator FINDLEY:

– I understand that the members of the Tariff Board draw pay for each sitting they attend, and that Mr. Brookes is doing work in London by trying to arrange for reciprocal trade.

Senator Pearce:

– Section 6 provides that, in the absence of a member of the Tariff Board the Governor-General may appoint some one to act for him.

Senator FINDLEY:

– Is some other person acting in the place of Mr. Brookes ?

Senator Pearce:

– There are only three members of the Board. Mr. Brookes cannot perform the functions of a member of the Board while he is absent.

Senator FINDLEY:

– Surely he is a member of the Board until he sends in his resignation or is suspended. He is a member of the Board who is doing work, on behalf of the Commonwealth, in London, and, apparently, another gentleman has been appointed to act in his stead.

Senator Sir Thomas Glasgow:

– A deputy has been appointed in his stead.

Senator FINDLEY:

– If I am assured that the Bill means that the gentleman appointed in the place of Mr. Brookes is to act temporarily, I shall know where I stand. As it is, it would appear that the Government may, if it thinks fit, have five members on the Board.

Senator Pearce:

– There are now to be four permanent members of the Board, and we can appoint a deputy to act while a member of the Board is absent.

Senator FINDLEY:

– Do I understand that the gentleman who has been appointed to act for another is not permanently appointed ?

Senator Pearce:

– He cannot be, seeing that he has merely been appointed as deputy.

Senator FINDLEY:

– I do not think it was ever contemplated that a deputy should be appointed in the place of a member of the Tariff Board who might go overseas. Such action could have been contemplated only in the case of illness or unavoidable absence from duty.

Senator McDOUGALL:
New South Wales

– I move -

That the word “ three “ proposed to be left out stand part of the section.

I shall oppose every proposal to appoint a Board. We have heard a great deal about this Board doing a lot of useful work, but such talk is ridiculous to those who know anything about this business. I was appointed to the Board of Trade, but that Board, which had been meeting previously, did not hold another meeting after my appointment. The other members of the Board were men interested in trade and commerce. They had the supervision of big business concerns, and they used to hold regular meetings until I was appointed to represent the workers. When I was elected to the Senate, and could no longer hold a position on the Board, they resumed their meetings. I shall always object to the creation or extension of Boards of any description to carry on work that should be conducted by the Government or Parliament. For what do we get our pay, but to do this work? Before Federation, when I was travelling through the country with some prominent men in opposition to the Constitution Bill, I hearda great deal about the increased cost of government which Federation would involve. I heard one man say, “ Why, it will cost you an extra 3s. 9d. a year, the charge of registering your dog.” It is now as high as the price of an elephant. The cost of government in Australia is going up by leaps and bounds. Very few people have any idea of what they are paying every week to be governed. Every time the Government have an opportunity to appoint a Board they do so, and whenever a Board is appointed, it proceeds to select officers, and build offices in the various capitals” to accommodate itself and its satellites. Of course, I know that the present Government are not anxious to have any interference with the Boards they are creating, but their object in creating them is fairly obvious. There must be some reward for services rendered, not to the nation, but to the Government. They never appoint to these Boards any one who has been trained in the hard school of practical experience. They appoint some curled darling, who has not had sufficient experience to enable him to carry on the work he has been appointed to do. It is time some one stood up on behalf of the working classes and objected to these rewards being given by the Government for services rendered in political battles. Every section of the community should be represented on whatever Boards are appointed. Is it fair that a senator representing half of the electors of New South Wales should not be going to London with the Prime Minister in order to speak on behalf of. the people ? Apparently, in= the opinion of the Government, there is no one clever enough outside the ranks of its followers to fulfil such a mission, but I could set up from the Labour movement man for man against any one in the party opposite and score every time, although, perhaps, not from an oratorical point of view.

The CHAIRMAN (Senator Newland:

– The honorable senator is getting away from the clause.

Senator McDOUGALL:

– I am afraid I am. I have no desire to do so, and I am satisfied to move my amendment. But, at every opportunity, I shall oppose the creation of Boards to take over the control of business that should be conducted by the Parliament and the Government.

The CHAIRMAN (Senator Newland:

– The honorable senator’s amendment is not practicable without .a very drastic alteration of the verbiage of the clause. By negativing the clause he will accomplish his object as effectively as by carrying the amendment.

Senator McDOUGALL:

– I accept your advice, Mr. Chairman, and ask leave to withdraw my amendment.

Amendment, by leave, withdrawn.

Senator FINDLEY:
Victoria

– The Minister referred me to subsection 4 of section 6 of the principal Act in reply to my contention that the clause would give the Government power to increase the personnel of the Board to five. The sub-section to which I have been referred says -

In case of the illness, suspension, or absence of any member of the Board, the GovernorGeneral may appoint a person to act as a deputy of the member during the illness, suspension, or absence, and the deputy shall, while so acting, have all the powers and perform all the duties of a member.

That is quite clear, but it pre-suppose that a man is ill, has been suspended, or is absent in such a way that he is unable to perform his duties as a member of the Board. It is true, at the present time, that a member of the Board is absent, but he is performing his duties in London as a member of the Board. I do not think the wildest supporter of the Bill ever expected that any member of the Board would be commissioned by the Government of the day to negotiate with the Imperial Government on the question of reciprocal trade with the Commonwealth. That, however, is what one member of the Tariff Board is doing in London. It has been said that he is drawing no salary for that work. If that is so, I can understand the reason for it. The Tariff Board is not sitting in London. In the absence of that gentleman, an additional member is to be appointed. I am not a lawyer, but I say that if the Bill goes through, the Government will be able to appoint four members in Australia, while having a fifth in London. I see no necessity for the Board. I had hoped that it might be possible to get a Board truly representative of all sections of the people. The majority of the Senate, however, is opposed to any alteration. Even Senator Drake-Brockman, who showed such strong opposition to the Bill when it was first introduced, was found voting this morning with his party. He voted for the very principle which he opposed a year or two ago. It is the same with Senator John D. Millen, Senator Benny, and Senator Wilson. If I were opposed to the principle of a thing, and gave reasons for my belief, it would take some strong arguments to cause me to change my views and reverse my vote. What ought to trouble Government supporters is the cost of the Board. It cost a lot last year, and it will cost more next year, because a fourth member will be appointed. The amount provided on the Estimates is £7,000. I feel especially keen on this subject when I realize that the Board is essentially a class board. It is not a board of representative people. It does not protect the people’s interests. Its members are more or less commercial agents, who are looking after the interests of manufacturers. There was a general belief that it would look after the importer, the manufacturer, the primary producer, and the consumer.

Senator DRAKE-BROCKMAN:

– The Board is part of the iniquitous system of high protection.

Senator FINDLEY:

– Protection being the settled policy of Australia, it should be the duty of the Board to see that all sections of the people, as far as possible, are fairly treated. It has not done that. The public has not had a fair deal from the Board. Wholesale ‘exploitation has been taking place, and the people are being fleeced by huge combines of protectionist manufacturers.

Senator Drake-Brockman:

– That is a natural corollary of high protection.

Senator FINDLEY:

– It is done also in Free Trade countries. The duty of the Board should be to inquire into the charges made in the columns of the daily press about the way in which trusts and combines are working. Would I be in order in pointing out that the Board, although it has the power, has not done anything to prevent the people being charged exorbitant prices for the commodities they consume?

The CHAIRMAN:

– The honorable senator would not be in order.

Senator GARDINER:
New South Wales

.- I should like the Minister to tell the Senate who will be appointed to the Board.

Senator Pearce:

– I cannot say) because I do not know.

Senator GARDINER:

– From certain figures which were moving round the Senate a few weeks ago, I assumed that at that time the matter had been decided. It looked as if an additional member was to be appointed, and that some one had been selected. I believe that the carrying of Senator McDougall’s suggested amendment would be better than negativing the clause. Senator Findley says that protection is the settled policy of the Commonwealth. I agree with him, and admit that I am out of touch with public opinion on that matter. In any case, it is not right that the Board should consist entirely of members of one particular fiscal view. They are all protectionists. A member who would be able to look at the facts from another point of view would be an advantage to the Board. What is more natural than for protectionists to say, when complaints are made by business firms regarding the importation of certain goods, that “ dumping “ is taking place. When a report to that effect came from the Board to the Minister he would need to be a very strong man to ignore it. The present Minister for Trade and Customs (Mr. Austin Chapman) is a thorough believer in the principles of protection, which he has advocated all his- life. Only one small section of the community is represented on the Board. A little opposition on the Board might make it much more effective’ than it has been. I am opposed to the Board, because I regard it as an interference with the rights of Parliament. It does work that Parliament should do, and shoulders responsibilities that Ministers should carry. In addition, the cost pf it is disproportionate to the services rendered. We already pay Ministers to do those services, and they have at their disposal a trained staff of highly skilled officials. The Board comes frequently into collision with people who do business with the Department of Trade and Customs. I believe it to be composed of conscientious men. When disputes occur they meet representatives of trading institutions and hear their side of the story. They listen to proposals, and make a recommendation to the Minister. Judging by the reports in the newspapers, those recommendations are so numerous that the Minister is powerless to deal with them in opposition to the Board. As he has a highly expensive Board to do this work, the Minister naturally allows it to do it. A weak Minister will accept all the recommendations of the Board, because it means following the line of least resistance. Why does the Minister not tell us who is to be the fourth member? I can only imagine that it is intended to appoint some political friend who is “ down and out.” I protest against the increasing extravagance of this most wasteful Government. There is no justification for increasing the personnel of a useless and burdensome body, yet it is proposed to add 25 per cent, to the cost of maintaining it. If some of the members are already connected with the Public Service, they could be employed on better work than that of improving the position of manufacturers. As far as I can see, four members will more effectively assist In closing up avenues for trade than three have done. I am in favour of Senator McDougall’s proposal.

Senator FINDLEY:
Victoria

– I do not desire to delay the passage of the Bill, but I am not satisfied with the information that the Minister (Senator Pearce) has given to the Committee. The report of the Board shows that almost every recommendation it has made has been carried out. I want to know whether the suggestion for remuneration of the Board by salary has been adopted. If the Government has decided to agree to that suggestion, I can well understand the statement of Senator Gardiner that a position is to be found for a friend of the Government.

Question - That the clause stand as printed - put. The Committee divided.

AYES: 17

NOES: 7

Majority . . 10

AYES

NOES

Question so resolved in the affirmative.

Clause agreed to.

Clause 4 agreed to.

Clause 5 (Quorum of Board).

Senator GARDINER:
New South Wales

– When speaking on the second reading of the Bill Senator Findley showed, by quoting the report of the Tariff Board, that the relation of its members with the Minister has given them a rather exalted opinion of themselves. When a Board whose quorum is two tells this Parliament what its opinion is of an Act passed by the Legislature it is displaying arrogance that should not be tolerated.

Senator Elliott:

– It was appointed by Parliament to inquire into and report on the operation of the Tariff.

Senator GARDINER:

– It was not appointed to report on some of the matters on which rather striking comments have been made by it. One need have no hesitation in saying that it has obtained the upper hand over Ministers when it reports to Parliament that legislation is working unsatisfactorily. Parliament is the best judge of such matters. If the Board had been appointed to report to Parliament on all Acts of Parliament passed it would be well within its rights; but this Board was appointed for a specific purpose.

Senator Elliott:

– What has it reported on?

Senator GARDINER:

– The operation of the Navigation Act. I understand the Government is to appoint a Commission to inquire into the Navigation Act. The Tariff Board has stated “ the Board has no hesitation in reporting that the present Navigation Act is working very detrimentally against the primary and secondary producers.” That is an assumption of power which is totally unjustifiable. It is an arrogant act, and one which Parliament should not tolerate.

Senator KINGSMILL:
WESTERN AUSTRALIA · NAT

– It is an unpleasant truth.

Senator GARDINER:

Senator Kingsmill will agree with me that it is a matter of opinion.

Senator Kingsmill:

– And locality.

Senator GARDINER:

– Quite so. I can understand such States as Tasmania and Western Australia having occasion to complain. A Board appointed to deal with Tariff matters should not report to this Parliament that one of its Acts - an Act relating to navigation - is working most detrimentally against the interests of the producers. This Parliament, if it will accept that, will accept anything. There is nob an UnderSecretary in the Commonwealth Service who would dare to submit such a report on another Department, and if he did he would be suspended. Does the Minister approve of the action taken ?

Senator Drake-Brockman:

– It shows that the Board acts fearlessly.

The CHAIRMAN (Senator Newland:

– The clause relates to the formation of a quorum, and I am afraid the honorable senator is wandering from the subject.

Senator GARDINER:

– I should like you to put it in a nicer way, Mr. Chairman. I am not wandering yet. I should like the Minister (Senator Pearce) to express his opinion instead of Senator Drake -Brockman, in his usual authoritative manner, answering on his behalf. Will the Minister say whether the Board is not exceeding its powers in commenting upon another Department and upon other than Tariff legislation passed by this Parliament?

Senator Pearce:

– It is justified if the Acts of Parliament referred to affect our industries.

Senator GARDINER:

– I shall endeavour to have the title of the Bill altered. The Board should function under the Minister for Trade and Customs in the manner intended. If the Minister thinks it is right, I have misapprehended the purpose for which the Board was appointed, and I do not care whether the quorum is to consist of two or ten. Perhaps it should be informed that the Senate is not functioning as it ought to do.

Clause agreed to.

Clause 6 agreed to.

Title.

Senator GARDINER:
New South Wales

– I intend to move that the title be amended so that it will read “ A Bill for an Act to appoint a Board to control the destinies of Australia.”

The CHAIRMAN (Senator Newland:

– I cannot accept such an amendment.

Senator Needham:

– I should like to amend the title to read “ The abolition, of the Tariff Act,” as the intention of the Board is to undermine the Tariff.

The CHAIRMAN:

– I cannot accept such an amendment. I ask honorable senators to treat the matter seriously, as we are legislating for the Commonwealth.

Senator Gardiner:

– I thought the Tariff Board was doing that.

Question - That the title be the title of the Bill- put.

The Committee divided.

AYES: 15

NOES: 7

Majority … … 8

AYES

NOES

Question so resolved in the affirmative.

Title agreed to.

Bill reported without amendment; report adopted.

Bill read a third time.

page 3508

INCOME TAX BILL

Bill (on motion by Senator Pearce) read a first time.

Second Reading

Senator PEARCE:
Minister for Home and Territories · Western Australia · NAT

– I move -

That the Bill be now read a second time.

This is purely a formal Bill providing for the imposition of income tax at the same rates as those of last year, with the following exceptions : -(a) tax on companies. Last year the tax was 2s. 5d. in the £1 on undistributed profits. This year it is to be1s. in the £1 on the total profits. It is, however, subject to the provision I referred to previously - that the company pays the1s. and the individual shareholder pays the difference. (b) Taxation of interest received by absentees from debentures of companies. Last year the tax was 7d. in the £1. This year it is to be at the flat rate of 1s. in the £1. It has been decided that the Commonwealth shall retire from a certain field of taxation. To enable that to be done a flat rate is to be imposed. The States will tax above that, (c) Taxation of dividends received by absentees. Last year the companies paid on behalf of absentees a tax of 7d. in the £1 on dividends paid to’ absentees. The other Bill, of which I moved the second reading, provides the machinery for collecting taxation at these rates.

Debate (on motion by Senator Gardiner) adjourned.

page 3509

TAXATION OF LOANS BILL

Second Pleading.

Senator PEARCE:
Minister for Home and Territories · “Western Australia · NAT

– I move -

That the Bill be now read a second time.

I have a long explanation of this Bill, but it can be condensed into a very few words. It provides for the abolition of the principle of tax-free loans. It is the result of an agreement entered into at the Conference of Commonwealth and State Ministers. It was there agreed that from the end of this year no further tax-free loans shall be issued. This matter was assuming serious proportions. The total amount of tax-exempt State loans outstanding in Australia is now about £230,000,000. There were six tax-free war loans, aggregating £138,000,000, which bore interest at the rate of 4J per cent. Allowing for redemptions and conversions, the amount of Commonwealth tax-free loans is now £122,000,000. The last Federal taxfree loan’ was issued in April, 1918. All Commonwealth loans issued after that date in Australia are subject to Federal income tax, but are free from State income taxes. Altogether, the tax-free debts of the Commonwealth and the States amount to about £350,000,000, and the annual interest on these debts is about £16,000,000. The income tax which would be paid on that interest if it were not exempt, is estimated at about £2,000,000 per annum. There is a set-off to this loss of revenue in that the Commonwealth and the States are paying less in interest. It is calculated that the saving thus effected amounts to about £700,000 per annum; therefore, about £1,300,000 by way of income taxation is lost. Loans issued by the Commonwealth and the States in the past, and those is sued up to 31st December next, will not be effected by this Bill. Each state has undertaken to pass the necessary legislation. This legislation will not come into force except by proclamation; and, of course, the Commonwealth will not bring it into force unless the States carry but their part of the bargain.

Senator GRANT:
NEW SOUTH WALES · ALP

– Is it proposed that the Federal loans shall be liable to State taxation ?

Senator PEARCE:

– They are at present; but State loans are not liable to F’ederal taxation.

Senator GARDINER:
New South Wales

– The income which is derived by holders of Commonwealth and State stock which is free from taxation is, according to Senator Pearce, about £16,000,000 a year. I do not think that the tax-free loan is doing much injury to any one. The outcry against such loans is widespread. The idea is held that extraordinary benefits are gained by some persons from tax-free loans. I have never been able to appreciate the force of that argument. I can remember when Senators Maughan and Ferricks, ably supported by Senator Stewart, argued strenuously about the gilt-edge investments which were being created for wealthy persons by the issuing of tax-free loans. On making comparisons I find that a £20 share in the Colonial Sugar Refining Company during last year was quoted as high as £53. Every investment of £100 was, therefore, worth more than £200. These Commonwealth gilt-edge securities, however, are generally quoted at about £2 10s. below par, except for a few days before the halfyearly interest is due, and even then they do not rise to the full extent of the interest payable. I have often wondered why these so-called gilt-edged securities do not reach their face value on the market.

Senator Payne:

– Because when the loans were floated the rate of interest was less than the current rate.

Senator GARDINER:

– After all, it is a pretty fair test of the value of these so-called gilt-edged securities, and show3 that they are not a remarkably attractive investment for capital at the present time.

Senator Payne:

– At one time these taxfree 4£ per cent, bonds fell as low as £89. ‘ ,

Senator GARDINER:

– While the £20 shares of the Colonial Sugar Refining Company were selling at £46, one of our stocks issued at £95 was selling at £92 12s. 6d. If there is anything giltedged about that sort of investment, the people who have money are not nearly as astute and shrewd as we who are without money imagine they are. It is quite possible that the Government have been induced to bring in this legislation to meet the wishes of the States. I was a member of the Government which was responsible for the issue of the first Commonwealth tax-free loan. After consulting financial advisers, Mr. Andrew Fisher realized that any failure to raise a loan in Australia would deal a serious blow to the credit of the Commonwealth, and he decided to make the loan as attractive as possible by exempting the interest earned from taxation. Consequently, although the rate of interest, 4£ per cent., was considered remarkably high at the time, the additional inducement was offered that the income derived would not be taxed. I remember hearing one gentleman arguing that the interest on the tax-free loans worked out at 14 per cent. He was estimating the tax exemption not on the interest earned, but on the full amount of the loan, that is to say, not on £4 10s., but on £100. Of course, he was able to make out a splendid argument to show what a fine security this stock was to the people who held it, but he was the first to laugh at his error when it was pointed out to him. Some mutual arrangement will have to be made between the States and the Commonwealth in regard to borrowing, otherwise the public may consider it necessary for’ the Commonwealth to take steps not only to limit the borrowing powers of the States, but also to take away from them their sovereign rights. With municipal, shire, State, and Federal borrowing, the burden of the interest bill is becoming too heavy for the people to bear. I have been wondering whether it would not be advisable for the Government to compel certain people to invest in Commonwealth interest-free loans. Instead of calling upon them to pay a heavy income tax, would it not be better to compel them to loan to the Commonwealth for five years a certain percentage of all incomes over £500 a year? I am not putting forward this suggestion as a carefully thought-out scheme, but it might be adopted as an experiment in regard to raising loans for the Commonwealth. With the burden of the interest bill so heavy, relief must be secured, and it can best be obtained not by calling upon wealthy people to pay an increased tax on their profits, but by requiring them to loan, for a period of five years, 10 per cent, of their incomes over £500 a year. Thus, a man with an income of £1,000 a year would lend the Commonwealth 10 per cent, on £500 - that is to say, £50 - for five years. He would certainly lose interest at the rate of £2 10s. a year, calculating it on a basis of 5 per cent, on the £50. That would not be much of a loss to the individual, but spread over the whole of the taxpayers it would bring into the Treasury a great deal more than would a higher rate of income tax. It would have this advantage to the individual, that, whereas income tax once paid does not come back to the taxpayer, at the end of five years he would be repaid his £50, and in the meantime would be in a position to use his advance as good security on which to raise money. The position of the national debt is so serious that it will not be adequately met by the slow accumulations of the sinking fund. A scheme which would bring into the Treasury as an interest-free loan 10 per cent, of each person’s income in excess of £500, every year would, if the money so raised were utilized for the redemption of the ordinary war debts, rapidly put the country in a proper financial position. Each year the interest bill payable by the community at large would dwindle, and the saving to the country would be equal to more than the increase in the cost of living in the case of the majority of the pepole.

Senator Elliott:

– If the honorable senator’s scheme were once adopted, his party would never allow it to be dropped.

Senator GARDINER:

– I am speaking for myself in submitting the scheme, and I approach it with a great deal of timidity. There is such a real danger in the ever-increasing load of taxation that the people have to bear in order to meet the ever-increasing annual interest bill on municipal, shire, State; and Federal borrowings, that I think a com- pulsory loan free of interest should he raised in order to enable the country as speedily as possible to reduce its heavy indebtedness. The experiment would be well worth trying. A man would not lose his money, although he would lose a- certain amount of interest. His investment would be perfectly safe. His money would be handed back to him at the end of five years, instead of being taken permanently from him by an increased income tax, such as may be found necessary to meet the growing cost of government.

Senator GRANT:
NEW SOUTH WALES · ALP

– I call attention to the want of a quorum. [Quorum formed.]

Senator GARDINER:

– This Bill will stop tax-free loans. We have to realize that Governments do strange things when raising loans. The extraordinary methods adopted to induce people to subscribe to the present loan are quite wrong. They are something like those of a showman inducing a crowd to go into a circus There is band-playing and drum-beating, with flags flying, posters glaring, and oratory in g. public street. The Government appeals to every one, but does not make a direct and distinct appeal to the people who have the money.

Senator Elliott:

– It is the big holders who have converted. The small ones have not.

Senator GARDINER:

– My honorable friend must know the reason for that. People who, during the war, were willing to offer their lives for their country, also put something from their scanty living allowances into war loans. They had then had four years of Labour rule. They have since had seven years of Nationalist rule. Their earnings have not been maintained, and they have been reduced to spending their principal. Also, during the war they were more excited and keener than they are now. The present method of advertising a loan costs an enormous sum of money, and, to my mind, is foolish. I do not know whether it is profitable. It is certainly infra dig. for the Commonwealth Government to have speakers on platforms in Collins-street, Melbourne, and Martin-place, Sydney. haranguing the multitude to induce them to participate in this splendid investment. One of the inducements offered to intending investors in previous loans was that they could pay a deposit, and then monthly or quarterly instalments to complete the total amount. If that privilege were given in connexion with the present loan much more money would be obtained. Many persons have been looking forward for years to the time when they would get their £10 back, and they now wantto finger the notes. The small man cannot be expected to invest to the extent that he did during the exciting days of the war. Many people are not satisfied with the aftermath of the war. They were told that, “ This is a war to end war. This is a war to make the world safe for Democracy.” Many Democrats are beginning to doubt whether the world is as safe for Democracy as it should be, and some are beginning to think that, disastrous and costly as it was, the war has not ended war. They are beginning to wonder whether they were not deceived by what was said ten years “ago, not by deceitful people, but by people whose mental machine was working in such a way that their minds created pictures which could never be realized. The overzeal of the people induced men and women with a few pounds to invest in the war loans. They invested their little bit to help to bring about the results which were promised. They are now dissatisfied because their expectations have not been realized. It would surprise honorable senators to know the opinions of Australia’s great financiers when the first taxation free loan was floated. Most of the expert financiers of the country were called together by Mr. Andrew Fisher to discuss the subject, and when I think about it now I have to laugh at their views of the maximum amount of money that could be raised by loans in Australia. They did not think it would be possible to raise more than a £5,000,000 loan. It required the firmness and judgment of men who were not financiers to show that it could be done. When the Labour party said, “ The risks must be taken, and we shall try to get this money,” the financiers got a big shock, but they got a bigger one when double the money asked for was subscribed. I realize that in many money matters we must be guided by financial experts, but when it comes actually to doing things, they are not the best guides. They are experts j /a handling money, in turning it over, but they are novices in estimating anything outside their particular sphere. The loans are falling due, and they must be renewed. I suppose that when the present loan is fully subscribed we shall have reached the end of tax-free loans. If I had a lot of money to invest I could find hundreds of safe companies which would return 2 per cent, or 3 per cent, more than I could obtain by putting money into war loans. The Government, under this Bill, are entering upon a new phase of legislation. The State Treasurers have consented to the proposals, but there is no unity of action .on the part of the Federal and State Parliaments. I, as a representative of one of the most powerful States., can see in this measure an inroad upon the sovereign rights of the States. Although the Constitution lays it down that where State and Federal laws conflict the Commonwealth law shall prevail, this Bill involves an interference by. the Commonwealth Parliament with the sovereign rights of the States. If only five out of the six States agreed to the Bill, would a proclamation be issued announcing that the Commonwealth could not interfere with the States in their legislation? We should provide in this measure that the proclamation shall not issue until all the States have passed this law. That would be a recognition of the constitutional fact that the States have certain powers which cannot be taken from them without their consent. I wish to know whether the Government will issue the proclamation only when all the States have agreed to the proposal.

Senator Pearce:

– Why should we assume that the States will break an agreement?

Senator GARDINER:

– Those who entered into that agreement were representatives of the States, but there is a great difference between the rights of the Commonwealth and what the Commonwealth ought really to do. When loans are renewed, will they be tax free?

Senator Pearce:

– They will cease to be tax free when they have to be renewed.

Senator GARDINER:

– Then, I do not know that I shall be justified in supporting that proposition. Having uttered my warning, I shall let the matter rest where it is.

Senator GRANT:
NEW SOUTH WALES · ALP

– I take it that it is intended to secure money from investors by taxation of the interest that they will receive on their loans; and I remind the Government that it will be necessary to secure the consent of those investors before it will be possible to tax them. Under such conditions the investors will cease to support our loan. A very large section was hostile to the issuing of these loans, because it objected to any being issued locally. I do not see that it will make the slightest difference to the Commonwealth whether the loans are issued tax free or not. When previous loans were tax free, the Commonwealth was paying only 4£ per cent. Commonwealth stocks that can be purchased on the market to-day are not the profitable investments that some people would have us believe. According to a recent announcement in the press, a Commonwealth taxfree stock, maturing between now and 1925, was purchased at 97f. Those who invested in that loan cannot secure the price paid; the amount would be below 97§, less commission paid on the sale, which is not a very attractive proposition. A stock maturing in 1927, although tax free, is quoted at 97^. As a fact, the whole of the tax-free loans are, in the opinion of investors, the least desirable. Another loan, maturing in September of this year, issued at 5 per cent, or 6 per cent, is available today at 102£, plus the commission, which cannot be regarded as a gilt-edged investment. One maturing in 1927, issued at 5 per cent., is bringing in, the open market 98f . Tax free and taxable loans are not eagerly sought, and it will be most difficult for ‘ the Commonwealth to secure the reconversion of any of these loans, particularly when they are subject to the Federal and State income tax. In the future there may possibly be only one tax, and tax-free loans will then be a somewhat better investment. When these loans are converted higher interest and conversion expenses will be incurred, and I do not think the Government will gain much from the proposal now before the Senate. Those who have so much to say in favour of “gilt-edged” securities have ‘ample opportunities every day to participate in this type of investment. They have not been eagerly sought, and it will be increasingly difficult to convert loans if higher taxation is imposed both by the Commonwealth and States.

Bill read a second time, and passed through its remaining stages without amendment or debate.

page 3513

INCOME TAX COLLECTION BILL

Bill received from the House of Representatives.

Standing and Sessional Orders suspended, and Bill (on motion by Senator Pearce) read a first time.

page 3513

AGREEMENTS VALIDATION BILL

Second Reading

Senator PEARCE:
Minister for Home and Territories · Western Australia · NAT

– I move -

That the Bill be now read a second time.

The Bill has been brought down to place beyond doubt any defect in the making of the wool tops contracts. A recent decision of the High Court is to the effect that the Commonwealth, in the absence of special legislative enactment, was not qualified to enter into binding contracts of the nature purported to be entered into. This legal defect raises a doubt as to what would be the result of an action claiming a refund of the profits paid to the Commonwealth. An application has been made in one case for a refund. If this Validating Bill is passed the Commonwealth will stand as a fully authorized party to the contract, and its profits made secure from attack against any of the contracting parties who might lay an action under the belief that they have a legal claim to a refund of the Commonwealth share of the profits. The Commonwealth Government, in conjunction with the Imperial Government, acquired the wool clips of Australia during the period of the war, and for one year after its termination. To give effect to the acquisition and control of wool, war precautions regulations were passed. The Bill arises out of certain agreements, made in circumstances due to the war, for the manufacture and sale of wool tops. Five agreements are concerned, viz. : -

  1. The Commonwealth and Whiddon Bros. Ltd., made 1st March, 1917.
  2. The Commonwealth and Whiddon Bros. Ltd., mode 7th December, 1918. ,
  3. The Commonwealth and Yarra Falls Spinning Co. Pty. Ltd., made 24th December, 1918.
  4. The Commonwealth and Lincoln Knitting and Spinning Mills, made 2nd October, 1919; and
  5. The Commonwealth and The Colonial Combing, Spinning, and Weaving Co. Ltd., made 12th March, 1920.

The Bill is to validate the abovementioned contracts, as doubts have arisen as to their validity. In the first contract, made with Whiddon Brothers in 1917, the wool taken for the manufacture of wool tops was at appraised prices, with subsequent adjustment to flat rate. The terms of remuneration to the company were on the basis of fifty-fifty if a war-time profits tax was not introduced ; if it were, the basis was one-third to the company and two-thirds to the Commonwealth Government. Under the second contract the company paid appraised price for the wool taken, with subsequent adjustment to flat rate, and, in addition, there was a clause in the agreement which provided that the company was to pay such additional sum for the wool purchased during any wool season as should be decided by the Central Wool Committee, to be equal to the percentage amount of the dividend payable by the Committee to the growers of wool in respect of profits derived from the wool clip from which the wool purchased by the wool tops manufacturers was derived. This amounted to an increase of, approximately, 20 per cent, above appraised prices, the proceeds being credited to the Wool Pool. The company acted as agents for the Government in the manufacture and sale of wool tops, and its remuneration was fixed as follows: - 4½d. per pound for the first million pounds weight of wool tops manufactured and sold under the agreement’. 4d. per pound for the second million pounds weight of wool tops manufactured and sold under the agreement. 3½d. per pound for the third, fourth, and fifth million pounds weight of wool tops manufactured and sold under the agreement. 3d. per pound for the sixth and seventh million pounds weight of wool tops manufactured and sold under the agreement.

The profits after deduction of commission and working expenses were to be paid to the Government. The Central Wool Committee also agreed that should any other wool tops company receive higher remuneration Whiddon Brothers would be placed on a similar footing in order to observe equality of treatment. The contracts with the Yarra Falls Company and the Lincoln Spinning Mills were cm similar terms to the 1918 agreement with Whiddon Brothers. The contract with the Colonial Combing, Spinning, and Weaving Company was based on a different principle, tie company paying the Government 80 per cent, of the profits and retaining 20 per cent, for itself. All the above contracts were made voluntarily and; in good faith by all parties concerned, and the various companies worked under them up to 1920. Whiddon Brothers, the Yarra Falls Company, and the Lincoln Spinning Mills received the remuneration agreed upon, and made good profits out of their contracts. They paid to the Commonwealth Government approximately £600,000. No question of duress or hardship was raised ‘by the companies mentioned, and the question of equity therefore does not arise. Recently Whiddon Brothers forwarded to the Commonwealth Government a letter reading as follows: -

I am instructed by my board of directors to address you with reference to certain payments made by this company under what purported to be agreements dated 3rd April, 1917, and 7th December, 1918, respectively, between the Commonwealth of Australia and Whiddon Bros. Limited.

We have been advised that we are entitled to recover the whole of the moneys so paid, and/or retained, and now enclose statement showing how the sum of £324,331 9s. 5d., which we claim, is arrived at.

In the light of recent decisions of the High Court of Australia, we assume that the Government of the Commonwealth will admit the company’s claim (subject to the accuracy of the figure supplied).

We shall be glad to have your assent to this, and to know as early as convenient when the amount is likely to be available.

Whiddon Brothers is the only company that has made a claim; but if similar claims are made by the other companies referred to, and on the same basis, the total amount claimed would be about £600,000. They cannot, and do not, set up any claim in equity that they have any right to participate in that amount by virtue of any contract or because of any disadvantage they suffered. The contracts they entered into provided for certain remuneration, which remuneration has been, and will be, paid. The object of the proposed legislation is to validate the agreements referred to, and which the companies say, because df a recent decision of the High Court, are invalid. The High Court did hold that certain agreements were invalid. The Government is accepting that judgment on the relative contracts to those before the Court, and have exempted them from the operations of this Bill. The ground of the decision was practically that the Executive of the day had no authority either under the Constitution or then existing legislation to enter into the contracts. ‘ Whiddon Brothers are claiming on the technicality that legislative sanction was not obtained for the Contracts, and they are, therefore, entitled to make the claim on the Commonwealth, although there is no moral justification for it. The Government propose to prevent the companies from being able to say that they are not bound by their contracts, and that they are entiltd to more than they contracted for. Regarding the Colonial Combing, Spinning, and Weaving Company Limited, a claim has been made by the Commonwealth. The company says it has made no profits and that they are governed by the High Court decision (Commonwealth and Central Wool Committee v. The Colonial Combing, Spinning, and Weaving Company Limited). The question of profits is an accountancy matter. If there are any profits the Commonwealth ought to get its share. Counsel have advised that the Commonwealth should validate its position by passing legislation. The Central WOOl Committee strongly recommend the Government to resist in every way possible the payment of the money claimed, which would mean in practice that these companies were able to secure raw wool in Australia at appraised prices - the lowest in the world - and sell wool tops in the open markets at the world’s quotations during war time. All other woollen manufacturers were subject to the control of the Central Wool Committee during the war period, and were restrained from selling woollen goods overseas, except on the basis of the world’s prices for raw wool. If Whiddon Brothers Limited or other wool top companies selling tops for export overseas were allowed such profits as they are now claiming they would secure terms far more advantageous than were permitted to any other wool organization in the British Empire. Although this has been a rather long explanation, there is a perfectly simple question at issue. That’ is to say, after the agreements we’re entered into a technical point arose in connexion with a law case, which raised a doubt as to whether those contracts which were entered into without specific Parliamentary sanction were legal. We are, therefore, perfectly entitled to seek that Parliamentary sanction which, at the time the contracts were entered into, was not known to be necessary, because the High Court decision had not then been given. In these circumstances, I ask the Senate to quickly pass this measure so as to give the necessary legal sanction and thus protect the taxpayers of the Commonwealth against the loss of this money as the result of claims being made against the Government.

Senator Gardiner:

– What would happen if this Bill were left over until next session?

Senator PEARCE:

– A case may come before the Court. It would be inadvisable to pass legislation while a claim was sub judice. At present there are no claims in respect of this matter before the Court.

Senator FINDLEY:
Victoria

– I have no desire to prevent the passage of a Bill that will protect the Commonwealth. It seems an extraordinary thing that the Government of the day, although it had at its disposal legal officers of very high standing, and could have secured the services of the best legal luminaries in Australia, could not protect the interests of the people in a businesslike way.

Senator Pearce:

– The contracts were made in accordance with what was believed to be the law at that time. The law has since been differently interpreted.

Senator FINDLEY:

– The law was the same then as it is to-day.

Senator Pearce:

– The interpretation of the law was not the same.

Senator FINDLEY:

– The gentlemen who were acting on behalf of these companies, or members of companies, that entered into an agreement with the Commonwealth apparently were able to get legal advisers, whose opinion was that if the case were carried to the High Court a verdict would be given against the Government. It seems extraordinary to me that the Government did not take every possible precaution to see that the business was conducted satisfactorily to the Commonwealth .

Senator Pearce:

– That judgment was given only in October, 1922.

Senator FINDLEY:

– I do not think it ought to have been possible for a judgment to be given against the Commonwealth. Why have we legal advisers? It ought to be their business to prevent the possibility of an action at law being successful in regard to any business arrangement. If our legal advisers are being overworked it is time additions were made to the staff of the AttorneyGeneral’s Department. A big sum of money is involved. This matter demonstrates the ethical standards of some business institutions. Apparently there is no business morality in some spheres of activity. If they see a chance of getting something that they are legally, though not morally, entitled to get, they do not hesitate to make claims. Some of the Justices of the High Court have been members of the Commonwealth Parliament at some time or other. In interpreting the law, they have given a verdict against the Government. I regret that very much. I thought it would have been possible, even during war time, for the Government to protect the interests of the citizens of Australia. If this Bill does not go through one firm alone will press a claim on the Government for £300,000. I do not want that firm to get the people’s money, and I therefore support the Bill.

Senator McDOUGALL:
New South Wales

– If an agreement has been made, and it has not been carried out by those who contracted with the Commonwealth to do certain things then some measure of this nature is absolutely necessary. There are other agreements which the wool kings have not carried out. I want legislation passed to compel these persons to restore to their natural condition the playgrounds which they stole from the people. As I shall not have another opportunity during this session, I now protest against the action of some of these wool firms. I have not had much time to gothrough this Bill and to study the effect of the agreements involved, but, in my opinion, the Commonwealth is giving way to a few big firms in order to save trouble. The Commonwealth is a good old mother to these firms, and they are all making demands upon it. The only persons who are holding off are the workers who pay the taxes. In the limited time at our disposal I have not been able to devote to the Bill the attention which it requires, but I do not offer any objection to it.

Senator GARDINER:
New South Wales

– I am certain that I have misapprehended the purpose of this Bill. I thought, at first, it was merely a Bill to stop a big “ hand out “ of money, because of some decision in a case in which certain companies had fought against the Commonwealth and won on a technical point, although they had no moral claim to win their fight. I thought also that it was a Bill to validate certain agreements which the Court had said were invalid. That is to say the Court had not actually declared these particular agreements invalid, but had held that an agreement exactly similar to these was invalid. I believe that this case was fought out for many days by a certain company whose interpretation of their agreement with the Commonwealth was different from that which had been placed upon it by the Commonwealth, and that the decision of the Court was in favour of the company. Am I right in assuming now that that decision would give other companies who have entered into similar agreements with the Commonwealth a claim on the Commonwealth and that this Bill will prevent them from making that claim?

Senator Pearce:

– They could, and probably would, have the same right to upset these agreements as the Colonial Combing, Spinning, and Weaving Company had.

Senator GARDINER:

– I am now beginning to see the purpose of the measure. In considering a Bill, I have to ask myself, first of all, if it is right, and if I think it is right it takes a lot of persuasion to make me vote against it. Then, I often ask myself whether it is expedient, no matter whether the question of right or wrong may stand in the way. And sometimes I ask myself if it is necessary. Often the further question crops up as to whether the passage of the Bill would bc of advantage to the people of the Commonwealth. I understand that this Bill is to validate certain agreements, similar in character to one declared invalid by a Court, after a most costly hearing, the expense of which unfortunately has fallen upon the Common wealth. But because a decision has been given at the instance of a greedy or hungry company, are we now legislating so that certain companies, which did not press their claim or join in with the other company in fighting the matter through the Court, may be ruled out of court if subsequently they ask for a decision similar to that given upon the claim of the other company? Are we to put it beyond their power to press a legal claim against the Commonwealth? Are we morally right in taking from one set of men a legal claim which a Court has already allowed to other people upon an agreement similar to those upon which they would have the right to make their claim? If we are doing this, then, I say we are laying down a most pernicious principle, namely, that when we feel that the public purse may be endangered we can set matters right by afterthought legislation.

Senator Pearce:

– None of these companies tried to find any fault with the one agreement per se. What one company said was that we had not the power to enter into an agreement, and on that ground they sought to obtain the whole of the profits derived from the making and sale of wool tops.

Senator GARDINER:

– I am gradually discovering the true purport of the Bill, and when I do, I do not know that I shall not support the Minister. Although these companies were satisfied with the terms of their agreement with the Commonwealth, a Court has decided that the Government had no legal power to enter into it. Are our Crown law officers responsible ? I understand that we have some very distinguished gentlemen in the Department of the Attorney-General, men with very distinguished titles and letters attached to their names. But it is only those distinguished titles and letters that make me regard them as. lawyers.. Under an Act passed in 1917, certain honorable senators were elected. The provisions of that Act were included in a Bill passed in 1920, yet the very same legal authorities which drafted the measure of 1920 declared, in 1923, that the Statute under which money had been paid for years prevented it from being paid any longer. The reason they advanced was that there had been an alteration in the Act. Yet the sections which they said had been amended had not been varied even to the crossing of a “t” or the dotting of an “ i.” That is one sample of the ability of our Crown law officers. Who is to blame for this agreement which has cost the Commonwealth Government such a large sum of money? Has any punishment been meted out to the responsible individuals? So far as I can see, there has been none; and now Parliament is asked, at a late hour of the session, to take away the legal rights of certain people. Half-a-dozen different views are chasing each other through my mind. I am wondering whether we can do this without injuring our integrity. Can we, by way of an afterthought, prevent any. one else who has a similar document from getting a similar decision to that given in the case of the agreement between the Commonwealth Government and the Colonial Combing, Spinning, and Weaving Company? I do not wish to vote for something I do not understand, and I ask the Minister (Senator Pearce) to make his reply as clear as possible. Are we to be asked to prevent people who have not yet pressed their claim from securing a decision in. accordance with a judgment already given by a Court ? And are we to do this merely to save money to the Commonwealth? It seems to me that, while we may be saving money, we may at the same time be losing our honour.

Senator PEARCE:
Western AustraliaMinister for Home and Territories · NAT

– None of the companies will be deprived of any rights they may have in regard to the terms and text of their agreements with the Commonwealth; but the Bill will deprive them of the possibility of evading those agreements on a purely technical point which does not affect the terms of the agreements, but has arisen since they were made in good faith by both parties and since they have been in operation without in any way being challenged by either party. A technicality has arisen under a decision given by the High Court in another case in 1922. The Executive Council thought, when it made these agreements, that it had the power to make them. Its power had not been challenged previously. The High Court, however, said something new and novel. It said that the Executive Council had not the power, and that in order to give it the power there should have been a Statute under which the contract was directly executed. It was a mere technicality.

Question resolved in the affirmative.

Bill read a second time.

In Committee:

Clauses 1 and 2 agreed to.

Sitting suspended from 8.34 to 10 a.m. (Saturday).

Clause 3 (Exemption from Act of certain agreements).

Senator McDOUGALL:
New South Wales

.- I should like to know whether the High Court could upset this Bill if it became law. The agreement, in connexion with which a claim has been made, is said to consist of two telegrams. There appears to have been no proper agreement drawn up. Can the Government assure me that the Parliament has sovereign rights to deal with this matter, and that its decision cannot be upset by the High Court ?

Senator PEARCE:
Minister for Home and Territories · Western Australia · NAT

– I cannot say what the High Court may or may not do. All I can tell honorable senators is that the Crown law officers advise us that this Bill is necessary, and that they believe it to be complete and sufficient.

Senator McDougall:

– After reading the clause carefully I am satisfied that it meets the case.

Clause agreed to.

Preamble and title agreed to.

Bill reported without amendment; report adopted.

Bill read a third time.

page 3517

AIRFORCE BILL

Bill received from House of Representatives.

Motion (by Senator Pearce) proposed -

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

Senator GARDINER:
New South Wales

– I understand that the Bill incorporates the provisions of the British Army Act.

Senator Pearce:

– It specifically excludes them.

Senator GARDINER:

– I have information to the effect that, although the measure apparently containswhat a majority of honorable members in another place evidently desired, it is still so worded as to give effect indirectly to the proposal that raised a storm of protest there.

Senator Pearce:

– I can make a definite statement on that matter in my second-reading speech.

Senator NEEDHAM:
Western Australia

– Honorable senators might very well be supplied with copies of the Bill, and be allowed a few moments to read it before this motion is carried. A few days ago, there was a stubborn debate in another place, and there was an attempt made to embody in the Bill the provisions of the British Army Act. Certain action was taken, and that proposal was withdrawn. Like Senator Gardiner, I have received information of a reliable nature that an attempt has been made to put into the Bill something that the other Chamber has already determined should not be included.

Senator Graham:

– That is correct.

Senator NEEDHAM:

– I think other honorable senators will take that view also, if they study the Bill. The question at issue is whether or not the people of Australia shall have command of their own defence forces. When honorable senators peruse the Bill they will be able to decide whether or not there is a subtle move to evade or defy the wish of the Legislature on this matter.

Senator PEARCE:
Minister for Home and Territories · Western Australia · NAT

– I fail to understand why this attempt is being made to throw suspicion on the action of the Government. I have a copy of the Bill, and arrangements are being made for its immediate circulation among honorable senators, although it is not usual to follow that practice until a Bill has been read a first time. So far from anything in the measure embodying the provisions of the British Army Act the exact reverse is the case. A clause has been introduced which specifically prevents that Act from being incorporated in the Bill. The Government has promised that, in reference to the Defence Act, the Naval Defence Act, and the Air Force Act before Parliament is asked to make any change, a Commission shall be asked to examine the Australian Acts and the British Army Act. It will be invited to report on the best way to improve our own Army Act, if it is thought desirable to do that, or to incorporate the British Army Act if that course is deemed to be preferable. But no action will be taken until that Committee has presented its report to Parliament.

Senator Needham:

– What will be the nature of that Committee?

Senator PEARCE:

– I cannot say. The Government has had no opportunity of dealing with the matter up to the present. After the Bill has been read a first time, I shall immediately go on with my second-reading speech. My explanation will be very concise and clear, and if honorable senators then feel that they require further time to consider the Bill I shall have no objection to postponing the debate until some of the other Bills have been considered.

Question resolved in the affirmative. ,

Bill (on motion by Senator Pearce) read a first time.

page 3518

WHEAT POOL ADVANCES BILL

Bill received from House of Representatives.

Motion (by Senator Pearce) proposed -

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

Senator GARDINER:
New South Wales

– I am just wondering whether the Minister (Senator Pearce) is in order in moving the suspension of the Standing and Sessional Orders to deal with a Bill which has not yet been circulated. It is asking a lot of the Senate to expect us to support such a motion without knowing for what purpose. I have now been supplied with a copy of the measure.

Question resolved in the affirmative.

Bill (on motion by Senator Pearce) read a first time.

Second Reading

Senator PEARCE (Western Australia -

Minister for Home and Territories) [10.18 a.m.]. - I move -

That the Bill be now read a second time.

The Bill provides for a guarantee by the Treasurer of the Commonwealth, if he thinks fit, te a banking corporation for the repayment of advances or the settlement of an overdraft advanced to an association of persons for the purpose of controlling a scheme to secure the marketing of wheat during the financial year ending 30th June, 1924. It also gives the Treasurer the power to lay down the conditions of that guarantee, and if he thinks fit to revoke the guarantee if the conditions are not complied with. This is in pursuance of a policy adopted, with variations, since 1915, and the only change in form! iia that instead of a guarantee to a State Wheat Pool, it is to’ a co-operative Wheat Pools Association, consisting of persons formed for that purpose. The guarantee is at the rate of 3s. 8d. per bushel of wheat marketed under the scheme. That is practically all that the Bill contains, and as honorable senators are familiar with the system of marketing wheat through Pools, I do not think the measure needs any further explanation.

Senator PEARCE:
NAT

– No. It is for only one year. It was done previously under the Commercial Activities Act, but now there is a special Statute dealing with the marketing of wheat. The Treasurer is empowered to make advances only up to the 30th, June, 1924.

Senator GARDINER:
New South Wales

– Perhaps no exception can be taken to the suspension of the Standing and Sessional Orders in this instance, as the purport of the Bill can be seen at a glance. It is not like an Income Tax Bill, which the more one studies it the less he understands it. This merely provides that the Commonwealth is again to finance the Wheat Pool. In 1915 I was associated with the Government which initiated the Wheat Pool system, which was such a huge benefit to the wheat-growers of Australia. I do not think that full justice has ever been done to what is one of the biggest undertakings the Commonwealth has ever handled. It has been marred, unfortunately, by a few unscrupulous private people who, by cheating, thieving, and stealing wheat, seriously interfered with what was a successful undertaking of great magnitude, in which, both the Commonwealth and the States were part ners. The Commonwealth was not responsible for the deficiencies. I am wondering now that we have a business Government, whether the financing will be handled through the Commonwealth Bank. This i3 a purely business undertaking, under which ari advance of 3s. 8d. per bushel will be guaranteed on all wheat placed itf the Pool. Would it not be well for the Commonwealth Bank, with all its machinery for preparing mortgages, advancing money, and making agreements, tu take control of this branch of the work ? This Government has the reputation of being a big business Administration - it gave itself that name1 - and is supposed to show the way in which the business of the country should be conducted. .

Senator Duncan:

– It has put through a lot of business.

Senator Kingsmill:

– There has been a big turnover.

Senator GARDINER:

– Possibly so. That may be highly satisfactory, but it would be more acceptable if the amount had been fixed at 4s. instead of 3s. 8d. per bushel, as, with the probability of lower prices on the other side of the world, such a rate would be very acceptable to the farmers. We are paying bounties- or making gifts - to the producers of shale oil, to the breeders of cattle, and to the producers of sulphur, and it seems strange that that section of the community which is most deserving of our consideration is always being overlooked when gifts are being distributed. Why is not a bounty paid to the farmer, on the quantity of wheat he produces? I am in favour of sound logical methods when dealing with the various industries, and I wonder why we do not deal with them all in the same way. We were informed last night through the medium of a ruling that in legislation there cannot be any differentiation as between States, and if such is the case, why should there be any differentiation in our dealing with the primary and any other industries. The graziers, who in many instances do not need any assistance at all, have been very generously helped, and the Government, in effect, has said, “ You require much capital to carry on your business, and we shall help you.”

Senator Elliott:

– A bounty is not being paid in this instance.

Senator GARDINER:

– No, but the Commonwealth and the States will make up the .deficiency, if any. In the past those who have been associated with Wheat Pools have been making inroads into the profits on wheat by many unscrupulous methods. A little while ago, when speaking about the losses in the Wheat Pools, a distinguished statesman from New South Wales, and possibly one of the greatest men who have ever been in public life in that State, said that the real reason for the deficiency was that farmers’ teams came into the yard and the drivers having obtained receipts for a certain quantity drove out of the yard and returned a little later and received another receipt for the same load. That is how the deficiency occurred.

Senator Kingsmill:

– It had a good circulation.

Senator GARDINER:

– It did. Instead of the circulating sovereign it was the circulating wheat. The Australian production of wheat in that year, if measured by the returns from the Pool, would have shown an exceptional yield. I suppose those in control of Pools are becoming wise, but I am not surprised at such methods being adopted, because private enterprise trains men to do such unscrupulous things. The distinguished statesman in New South Wales to whom I referred .a few moments ago is Mr. Gregor McGirr. The fact that Wheat Pools have been looted by private enterprise, which did its looting not within the law, but without liability, should make us very careful in our future transactions. In dealing with a certain measure which we passed during the night or in the early morning - it seems years since the sitting opened - we were taking considerable risks, but in this instance there is no danger. The Government has laid itself out, in quite a dozen measures, to “ loot “ the public Treasury in order to assist its friends. The farmer has not sufficient influence to obtain gifts from, the Government. Were he a beef -grower he could obtain assistance. Were he interested in many other matters the “loot” would be handed out. The “ watch-dogs “ of the farmer only a short ‘twelve months ago were likened by their Leader to a policeman ready to turn on the electric light to cause the “burglars” to drop the “loot.”

I suppose that that honorable gentleman has found that his position has been much improved since he has taken a position in the Cabinet, and instead of having to watch other people handling the public funds he is now able to pass the “loot” to his own friends. It does not look as though the farmers are going to get much out of it. They are being guaranteed 3s. 8d. per bushel. I think the guarantee went as high as 5s. a little while ago. Has there been any reduction in the cost of producing wheat? If not, what is the reason, for cutting the farmer down to 3s. Sd. ? Surely if it costs as much to-day to produce a bushel of wheat as it did three or four years ago, the guarantee should not be any less.

Senator Guthrie:

– Unfortunately, it costs more to produce; but the world’s market has fallen a lot.

Senator GARDINER:

– I suppose there is a desire to fix the price at world’s parity. I have not heard Dr. Earle Page and his friends talking so much about world’s parity lately. I do not think they would get a profitable price if they demanded world’s parity. That was a beautifully sweet-sounding phrase which men used when wheat was high, but it is not to be publicly whispered when there has been a fall in the price of wheat. I do not entertain the idea that any one can be assisted by artificial means. The methods of production must be sound, practical, common-sense business methods. Wheat Pools are a cooperative system of handling the produce. If they were properly managed in the interests of the farmers they would be immensely superior to the bad old system of leaving the farmer at the mercy of the exploiter. Although the amount guaranteed is not large, I suppose we must be thankful for small mercies. The Government - these champions of private enterprise, these opponents of Socialism - are still prepared to have a little mixture of Socialism in their private enterprise programme. They have no desire to make a profit out of the wheat-growers, but they still say that the funds of the people who do .not grow wheat are to be drawn upon.

Senator Hays:

– Everybody must have bread.

Senator GARDINER:

– We have Biblical warrant for the statement that “ Man shall not live by bread alone.” Where are the friends of the farmers today? They are not insisting upon .a guarantee commensurate with that which the beef-grower secures for his beef. It is more costly to produce wheat to-day than it was some years ago, and it must ever become more costly. The cost of production can be. reduced by the use of the very best farming machinery that has been invented. Various agricultural implements are dearer to-day than they were twenty years ago. In order to shut out the competitor in the manufacture of farming machinery, and so to assist our secondary industries, a high protective duty has been imposed. The farmer has been left to struggle with his land, and produce his wheat under almost primitive conditions. If he could only have it put upon his farm, there is at hand machinery which would make the farm produce double what it now produces. It is apparently no concern of Parliament to move in that direction ; everything, according to the Government, must be left to , private enterprise. I realize what a tremendous asset to any country are the men who produce from the soil; but they are no more essential to the development of this country than is any other class which is doing useful work. I admit that the more farmers we have the better it is for the country. Their prosperity also makes the country prosperous. This Bill is not going to add to their pros- perity. If. Senator Guthrie were not prevented from speaking he could show from his own knowledge that it is not possible to produce wheat profitably at 3s. 8d. per bushel. Parliament to-day is not a place in which men meet to discuss measures. It is a place in which some members meet to sleep while measures are being passed. I can remember the time when a party would be looked down upon if one of its members did not reply to a damaging statement immediately it had been made.

Senator Kingsmill:

– The honorable senator is like Macbeth ; he has murdered sleep.

Senator GARDINER:

– I shall not quote from Macbeth in the present temper of the House; since if I did I might find myself suspended. If I felt so inclined, however, I should say, “ Out ! “ I am pointing out the great loss that will be suffered by the wheat-growing States of Western Australia, South Australia, New South Wales, and Queensland because “the men who know most about this subject are not permitted to speak When we get into Committee I shall move an amendment to make the guarantee 4s. a bushel - not in the spirit of granting a bonus, but as a recognition of the fact that the primary producer makes very little profit when the price does not exceed the guarantee proposed by the Government. The guarantee must be based on the cost of production.

Senator PEARCE:

– The honorable senator wants us to do as New South Wales did. A Labour Government in that State bid 2s. 6d. per bushel above the guarantee offered by the Commonwealth in order to make themselves appear- to be good fellows. They came to the Commonwealth afterwards begging it to find the extra 2s. 6d.

Senator GARDINER:

– During the war it was essential to have a Wheat Pool. Wheat was selling at less than 3s. per bushel in many places when it was really worth about 5s. The Commonwealth Government gave a guarantee to the Pool that it would find the money for the overdraft, and have the wheat transported to the markets of the world, where it was continually rising in value. While State Parliaments exist I suppose that legislation of this character is best left to them. I think that honorable senators ought to take a division on the point as to whether a guarantee of 3s. 8d. or 4s. shall be paid. If it is decided that the lower amount is sufficient, I shall at least have the satisfaction of knowing that I have “ done my bit” to secure the adoption of a rate which I think would insure to the farmer a reasonable profit.

Question resolved in the affirmative.

Bill read a second time.

In Committee:

Clause 1 agreed to.

Clause 2 -

Where an association of persons . . . has arranged to receive an advance from . . . a ‘banking corporation . . . the Treasurer of the Commonwealth may . . . guarantee to the banking corporation the repayment of the advance. . . . Provided that the amount so guaranteed shall not exceed the sum of Three shillings and eightpence per bushel of wheat marketed under the scheme.

Amendment (by Senator Gardiner) proposed -

That the words “ three shillings and eight pence “ be left out with a view to insert in lieu thereof the words “ four shillings.”

Senator PEARCE:
Minister for Home and Territories · “Western Australia · NAT

– I ask the honorable senator not’ to press his amendment. The guarantee of 3s. 8d. has not been arrived at in a haphazard fashion, but only after taking the best expert advice in the Common-‘ wealth as to what is a fairly safe figure at which a guarantee could be fixed.

Senator Guthrie:

– The Government have gone as far as they can safely, go.

Senator PEARCE:

– The present outlook of the wheat market would indicate that the Government are taking a considerable risk.

Senator Guthrie:

– They are.

Senator PEARCE:

– I ask Senator Gardiner whether it is wise in a matter like this to institute a new practice by which one party may outbid another; because ms amendment really amounts to that. The honorable senator has disclosed no grounds for leading us to believe that he has any advice that 4s. would be a more reasonable guarantee than 3s. Sd.

Senator Guthrie:

– I could get votes among the wheat-growers in the Mallee if I sought to have the guarantee fixed at 5s., but I do not wish to buy votes.

Senator PEARCE:

– I suggest that Senator Gardiner should withdraw his amendment.

Senator GARDINER:
New South Wales

– I have no intention of withdrawing the amendment. In a normal state of mind no party would try the system of outbidding another party, but as I am not normal, owing to the way in which business has been conducted during the last seventy-two hours, I have to resort to means which may possibly be regarded as infra dig.

Question - That the words proposed to bo left out be left out - put. The Committee divided.

AYES: 8

NOES: 17

Majority . . . . 9

In division:

AYES

NOES

The CHAIRMAN (Senator Newland:

Senator Guthrie is not in order in attempting to cross the chamber once tellers have been appointed.

Question so resolved in the negative.

Amendment negatived.

Clause agreed to.

Title agreed to.

Bill reported without amendment; report adopted.

Bill read a third time.

page 3522

AIR FORCE BILL

Second Reading

Senator PEARCE:
Minister for Home and Territories. · Western Australia · NAT

– I move -

That the Bill be now read a second time.

This Bill is intended to. be only a temporary measure. It is f or the establishment of the Air Force as a distinct part of the Defence Force and for its organization and government until a more comprehensive measure can be passed. Such a measure will be introduced at the latter part of the present session of Parliament. The Air Force is now- part of the Military Forces; and, as many difficulties are experienced in its administration, it is essential that it should be administered as a separate branch of the Service. Until distinct substantive provision; is made for the government of the Air Force, the Force and the members thereof will be subject to the Defence Act as at present; Power is given, however, to modify or adapt the Defence Act and regulations to give them full effect as regards the Air Force, but, as will be seen in the last clause of the Bill, the Defence Act cannot be modified or adapted in order to make the Army Act of the United Kingdom applicable under any circumstances. I have already intimated that it is the intention of the Government to have the whole question of the Defence Act and the Naval Defence Act, which incorporate the Army Act in time of war, and also this Air Force legislation, examined by a Committee with a view of deciding what should be the future policy in regard to these various Defence branches and their relation to the Forces of the Empire. The result of the deliberations of that Committee will come before Parliament at a later stage, but in the meantime it is 1 desirable that this Bill should be passed. Owing to the fact that the Air Force has not been constituted under its. own Statute, no guarantee of permanency of employment can be given to the men of the Air Force, and ‘there is danger of the magnificent trained personnel that we have, as the result of war experience, at the present time, being lost to us, because some of our men are being offered tempting positions in1 other parts of the world. Unless we give these men some guarantee of permanency we cannot expect them to turn down those offers and remain here. Being Australians they would prefer to remain here. It is imperative that we should pass this Bill at once so as to place the force on a statutory basis. No questions of a debatable character are raised in it. The one matter which might, have been debatable has been expressly excluded.

Senator GARDINER:
New ‘South Wales

– I thank the Leader of the Government (Senator Pearce) for his explanation of sub-clause 5 of clause 3. I think I am correct in stating that that provision was not in the Bill as originally brought under my notice, but has since been inserted by the Government. I am now in a different position from that which I occupied when I spoke on the motion for the suspension of the Standing Orders. I’ wanted to see the Bill and to examine its contents quite apart from the Minister’s assurances. Now that the provision making the British Army Act inapplicable to the Air Force of the Commonwealth has been placed in the Bill, thanks to the determination of the Labour party, I am willing to accept the measure without- further debate.

Senator NEEDHAM:
Western Australia

– I also was under the impression that when the Air Force Bill was introduced it contained a provision that would have allowed the British Army Act to apply to the Australian Air Force. ( Had the Minister (Senator Pearce) then assured us that- ‘as a result of the efforts, vigilance, and indeed, draftsmanship of the Labour party in another place, the sub-clause referred to by Senator Gardiner had been inserted, 1 should not have been so anxious. I was credibly informed only a few moments ago that, as a result of the vigilance of our party, the Bill as originally introduced in another place had been amended. Sub-clause 5 of clause 3 reads -

Notwithstanding anything contained in this Act, the Imperial Act called the Army Act and any Acts amending or in substitution for it and for the time being in force, shall not apply to the Air Force. That language is as plain as English can be made. As the Bill is necessary for the protection of Australia, and as it is now admitted that we can manage our own Air Force without incorporating in the Bill any provisions of the British Army Act, I am prepared to support this Bill.

Senator GRAHAM:
Western Australia

– While I am satisfied that aeroplanes and submarines are a necessary part of the defence of Australia, I should like to ask the Minister whether the Air Force will be used to quell industrial disturbances, as was done recently in South Africa?

Senator PEARCE:
Minister for Home and Territories · Western Australia · NAT

– I thank the Leader of the Opposition (Senator Gardiner) and Senator Needham for accepting the Bill. In reply to Senator Graham, I hope that no portion of our Permanent or Citizen Forces will ever be used to quell industrial or civil disturbances. There is a prohibition against the Citizen Forces being used to quell industrial disturbances, and I have every confidence that the Australian people, being in possession of full political power, will never have to resort to force to obtain their rights. Every nation, however,. must reserve to itself a force so that if, at any time, any misguided section tried to overthrow the government of the country by force, the Government could defend itself. If anything of that kind - which is unthinkable in Australia - should ever occur, is it believable that we would leave to rebels the right to use their - Air Force, if they had one, while denying to ourselves the right to defend our liberties and lives by using our Air Force? If any honorable senator can conceive of an attempt being made within the country to overthrow the government of this country by force, then I can conceive of the Government of the day! acting in defence of itself and of the liberties of the people, having the right to use every force at its ‘disposal to uphold its authority.

Question resolved in the affirmative.

Bill read a second time and passed through its remaining stages without amendment or debate.

page 3524

INCOME TAX ASSESSMENT BILL

Second Beading.

Debate resumed (vide page 3500), on motion by Senator Pearce -

That the Bill be now read a second time.

Senator GRANT:
NEW SOUTH WALES · ALP

– I do not wish it to be inferred that because I do not refer in detail to certain clauses in this Bill, I therefore approve of them. As a matter of fact, the whole of our income tax legislation, and particularly the amending Bill before us, is injurious to the best interests of the people of the Commonwealth. I hope that at a no very distant date we shall have a party in power in r ,his Chamber which will repeal the whole of that legislation. In the meantime that is not possible. I propose to address myself, not to the whole of the Bill, but to two exceptionally objectionable clauses which it is sought again to incorporate in- it. It is doubtful which of the two is the more offensive. There is one part of the Bill which proposes to deal in a very drastic way with the man on the land, and another which proposes to deal in an equally objectionable and offensive manner with the skilled artisan. It is intended to compel the man on the land to pay taxation every year in proportion to the intelligence, energy, and determination he shows in improving his farm and in increasing the number and value of his stock. People in the cities wonder why the cost of beef and mutton is so high. They would wonder still more if they read the newspaper reports of the price cattle raisers secure for their animals. Why is there such a difference between the price paid by the town dwellers for beef and mutton and that received by the producers? Apart from that, I wish in particular to confine my remarks to the clause in the Bill which compels the farmer or the cattle, sheep, or horse raiser, to pay taxation in proportion to the value of the work he does for the community. ‘ I would remind honorable senators - some of whom have never been on a farm - that life on a farm is a continual round of toil from one end of the year to the tother. It does not matter whether the weather is hot, cold, wet, or dry, the work of the farmer never ceases. We never hear, and never- will hear, of a farmer being unemployed. He always has more work to do than he can possibly perform. Without him this country would not be in its present prosperous condition. After a farmer has overcome the countless difficulties experienced in securing land, years elapse before he can bring it into profitable use. His work is never done, and that is why so many people have an aversion to ‘ life on the land. He is always confronted with the danger of m the devastation of his holding by drought, flood, or fire. In a few hours he may lose the fruits of the efforts of a lifetime. He is always bothered with high railway fares and freights, and the cost of machinery and everything he uses is constantly mounting Up. Far removed from the advantages and attractions of city life, when he finally .succeeds in surmounting his difficulties, he is penalized for his industry in proportion to the value of the stock he raises. Surely that is not the way to deal with the men engaged in the primary industries of this country. If a measure of this nature were put before the farmers in a clear manner, I do not think that 1 per cent, of them would agree to it. When the Bill reaches the Committee stage I shall ask honorable senators to reject it. A person with a taxable income must, under the Act, add the value of his home to the value of the land whereon it stands, and on 5 per cent, of the total sum he must pay income tax. In paragraph e of section 16 of the Act, it is proposed to strike out the word “ five” and substitute the word “ four.”

I take that to mean that it, was the intention of the Government at one stage to reduce the percentage upon which the owner is obliged to pay income tax in respect of his home. I do not know exactly whether the Minister (Senator Pearce) intends to proceed with the amendment that appears in print to eliminate the whole clause. I intend to move an amendment that will have the effect of preventing the income tax gatherer from insisting upon all taxpayers adding the value of the home to the value of the land in order to arrive at the taxable income. So far the Government has receded from its position only to the extent of 1 per cent., but that is not sufficient. The people have been suffering for a long time from a very acute and ever increasing shortage of housing accommodation, and it is ridiculous and mischievous to tax a man because he builds a home. It is a distinctly backward step, worthy of the dark ages. I have a recollection of Parliament, in its wisdom, agreeing to expend very large sums in order to assist in housing the men who recently fought for Australia, and in every case where they have a taxable income it is proposed to fine these men, not once, but every year. I ask the Senate to refuse to fine the farmers, because they produce beef, mutton, and grain for the people, and to decline to impose an unjust penalty on the taxpayer with a home of his own. Successful efforts have been made to grant a bonus to the cattle raisers, who are by no means the poorest section of the community, and bonuses have been granted in other directions. Why should we not make a similar concession to the builders of houses who never come to Parliament and ask for anything except to be left alone? In view of the restrictive legislation by which they are surrounded, the time has arrived when those who build homes should receive something in the nature of a substantial bonus. I do not care for the idea of a direct bonus for house building; I should prefer to see penalizing sections of the Income Tax Act struck out.

Senator GARDINER:
New South Wales

– This is a measure the debate on the second reading of which the Minister for Home and Territories (Senator Pearce) was good enough to adjourn until a later hour, and in the interval I have had an opportunity to collect the notes which, from time to time, I have prepared. I have been a long time in public life, and I believe that up to the present I have not been able to impress any one with my methods of dealing with financial questions. Now that an opportunity occurs to again deal! with this subject, I find, to my horror, that, after months of careful preparation, I have to address myself to the question after sitting continuously for over twenty-four hours. Income taxation is, perhaps, one of the most objectionable forms of taxation with which we have to deal, because it is a tax on industry and merit. A man who burns the midnight oil and eventually reaches that stage where he can earn an income in proportion to the success he has achieved is taxed. That is contrary to all sound principles. Of course, it is an easy way of obtaining revenue, as the method of assessment and collection is comparatively simple. When we consider this measure, we are startled to find the distance Governments will travel in endeavouring to get a few shillings from the pockets of those who toil. Senator Grant dealt with the most objectionable clause in what is a most objectionable Bill when he referred to the tax on the stock of the grazier, which is regarded as income. My idea is that stock becomes income only when it is sold. If agrazier or a farmer has to abstain from turning his stock into money for an indefinite period, owing to the market being over supplied or for other reasons, he should not be taxed in respect of it. Clause 4 is one of the most objectionable provisions in the Bill. It reads -

Section 16 of the principal Act is amended -

by inserting in the proviso to paragraph (a) thereof, after the word “ account,” the words “ except where the taxpayer otherwise elects, as provided in paragraph (aa) of this section”;

by omitting from paragraph (a) the definition of “ Value “ and inserting in its stead the following definition: - “ For the purposes of this paragraph ‘Value’ means -

in the case of trading stock (not being live stock) - the actual cost price or market selling value of each article of trading stock or the price at which each article of trading stock can he replaced, at the option of the taxpayer in respect of each article; and

in the case of live stock (not being live stock used as beasts of burden or as working beasts) - the cost price or market selling price at the option of the taxpayer. The cost price in relation to natural increase of live stock shall be the via lue per head of the live stock selected by the taxpayer within the limits prescribed and the value so selected shall be used for the purposes of the assessment of the financial year beginning- on thu 1st day of July, 1923, and of all subsequent years; “;

If I do not misunderstand the provision, it means, working it out roughly, that the taxable income of the farmer or the grazier is higher when his flocks and herds are increased, as their value is added to his income. Legislation should be of such a nature that it does not injure the community; but, under our present methods of government, taxation, which must be endured will always be objectionable. Taxation in any form which brings about conditions that create economic waste, or bring about destruction, must be deplored. I have had some experience in connexion with this matter, and have been able to gauge the actual results of this legislation. I have been informed that, in consequence of the value of stock being regarded as income, calves when dropped have been knocked on the head, because, ‘ if retained, they would have been a dead loss to the owner. On one property, on a small area, I counted, during a very brief observation, twenty head of calves which had been destroyed.

Senator Guthrie:

– Did they belong to the so-called “beef barons”?

Senator GARDINER:

– No, they were owned by .a man in a comparatively small way. .. >

Senator Guthrie:

– Others have had to do the same.

Senator GARDINER:

– I admit that. The economic loss to the Commonwealth, even in that little place I visited, must have been very great; but when I was shown how the income tax was increased if these animals were permitted to live, I could realize the necessity for the action taken. By the time the calves had reached a marketable age the cost of keeping them would have amounted to a good deal, although no return whatever had been received. When I saw the number destroyed on a comparatively small area, I endeavour.ed to imagine the number which must be annually lost throughout the Commonwealth. In a little while the calves which had been destroyed would have been worth 20s. each, and, under favorable conditions, in two years’ time would have been valued at £3, £4, or even £5 per head. a

Senator Ogden:

– Is taxation the only cause?

Senator GARDINER:

– No. In a country of such vast areas we should have laws to promote, instead of to retard production, and it is time we introduced intelligent legislation to prevent this ruth-‘ less slaughter. I remember a story told to me when a boy by my school teacher, to the effect that when the window tax was imposed- in Great Britain it was not long before the people did without windows, with a disastrous effect upon architectural beauty as well as upon the light and comfort of a home. I thought what stupid people they were in those days. When I entered the Federal Parliament and found that there was legislation in existence which led to the destruction of one of our most valuable products, I thought that after all we had not advanced very much during all the centuries that had intervened. Is it not a stupid thing to have legislation which leads to the destruction of such valuable, property as the young stock of this country, which for practically five years continues to increase in value? If my estimate and judgment are correct, hundreds of thousands of pounds are lost annually as the result of stupid legislation of this kind. I do not expect that the Government or its supporters will alter the practice, or care anything about the matter. I am of opinion that there is no desire at this stage to discuss this Bill or reason the” matter out. I give honorable senators opposite credit for endeavouring to improve the lot of the primary producer as far as their ability will allow them. Legislation of this nature, however, does very little for the primary producer. I do not mind the application of the averaging system - that is a departure in the right direction - but I do claim that we have yet to. go a very long way in computing the in- come of a farmer before we shall do him justice. Take the case of a man in the Northern Territory, who sets out to have his stock disposed of in the southern markets. The cost of grazing, raising, and droving probably is greater than the price which he receives in an overstocked market. Then he is taxed on the stock he produces. I have a few amendments which I intend to move in Committee. Having moved them I shall feel satisfied that I have endeavoured to bring this legislation into line with the opinions of the people whom I represent.

Question resolved in the affirmative.

Bill read a second time.

In Committee :

Clause 1 agreed to.

Senator DUNCAN:
New South Wales

– I move -

That after clause 1 the following new clause be inserted: - “ 1a. After section 5 of the principal Act the following section is inserted in PartI 5a. (1) This Act shall not apply to any income derived from primary production in the Northern Territory by a resident of that Territory prior to the 1st day of July, 1927.

In this section -

“Primary production” means the production resulting directly from -

cultivation of land;

maintenance of animals or poultry;

mining; or

iv ) fisheries ; and includes dairy produce manufactured by the person who produced the raw material used in the manufacture of that produce ; and

“income derived from primary production “ means income which is derived directly and in the first place from primary production.’ “

This amendment was suggested in another place by the honorable member for the Northern Territory (Mr. Nelson). It was accepted by the Government, but, unfortunately, the “ guillotine “ fell and the opportunity to have it included in the Bill lapsed. I consider it to be eminently desirable, and believe that it should be included in the measure.

Senator PEARCE:
Western AustraliaMinister for Home and Territories · NAT

– The Government have decided to accept this amendment, and have notified Mr. Nelson to that effect. The Commissioner of Taxation and I had ar ranged to have a conference to endeavour to bring in something of this kind, but we were not able to meet. There is no doubt that this will be an encouragement to people who are going in for this class of production in the Territory. It is limited to five years, in the first place.. I think the Committee should accept it.

Amendment agreed to.

Clause 2 (Income tax).

Senator PEARCE:
(Minister for Home and Territories · Western Australia · NAT

– Paragraphb of this clause takes companies out of the provision relating to the averaging of income, so that the rate fixed may be applied to the actual taxable income for the year preceding the year of assessment. Paragraph a is consequential upon paragraph b.

Senator GARDINER:
New South Wales

.- I think the Government is merely laying itself out to reduce the income tax of that section of the people.

Senator Pearce:

– It only says that one part shall be paid by the company. The person who receives the dividend will not escape; he will pay the extra tax on his income.

Senator GARDINER:

– This Bill does not fix the rates. Another Bill states that the rate at which the tax is to be paid by the companies shall be1s. in the £1 on the whole of the profits. Under the principal Act the company tax has been imposed on the undistributed profits at the rate of 2s. 5d. in the £1.

Senator Pearce:

– The averaging system is the only thing with which this clause deals. It removes companies from the operation of the averaging system.

Clause agreed to.

Clause 3 -

Section 14 of the principal Act is amended -

  1. by adding at the end of sub-section

    1. thereof the following paragraph: - “; and (m) dividends, bonuses, or profits, or the face value of bonus shares distributed by a company among its members or shareholders, except asprovided under section 16 of this Act.”.

Section 14 of the principal Act proposed to be amended: -

  1. The following incomes, revenues and funds shall be exempt from income tax:

    1. .
Senator PEARCE:
Minister for Home and Territories · Western Australia · NAT

– Paragraphb of this clause is necessary, because of the intention to exclude dividends, &c, from a shareholder’s assessment when the shareholder’s rate on property income does not exceed1s. in the £1. This proposal is consequential upon the decision of the Government to tax the whole of the profits of the company in the hands of the company at1s. in the £1, and to tax dividends, &c, only in the hands of those shareholders whose individual rate of tax on property income exceeds1s. in the £1.

Clause agreed to.

Clause 4 -

Section 16 of the principal Act is amended -

  1. by inserting in the proviso to para graph (a) thereof, after the word “ account,” the words “ except where the taxpayer otherwise elects, as provided in paragraph (aa) of this section “;
  2. by omitting from paragraph (e) the word “ five “ and inserting in its stead the word “ four “.

Section proposed to be amended -

  1. The assessable income of any person shall include -

    1. profits derived from any trade or business and converted into stockintrade or added to the capital of or in any way invested in the trade or business:

Provided that for the purpose of computing such profits the value of all Hoc stock [not being live stock used as beasts of burden or as working beasts), and trading stock (not being live stock), not disposed of at the beginning and end of the period in which the income was derived shall be taken into account.

  1. five per centum of the capital value of land and improvements thereon owned and used or used rent free by the taxpayer for the purpose Of residence or enjoyment and not for the purpose of profit or gain:
Senator GRANT:
NEW SOUTH WALES · ALP

.- I move-

That paragraph (a) be left out.

If this amendment is agreed to I shall regard it as a test vote on the question of whether all live stock should be excluded from a primary producer’s taxation return. It is an outrageous idea to tax a man in proportion to the live stock he produces. The removal from farmers, stock-raisers, and stock-owners of the necessity of including live stock in their income tax returns would be one of the most valuable forms of assistance we could render to them. It would mean the removal of an annual fine imposed on all producers of beef and mutton. Repeatedly I have seen statements in the press that owners of young calves have destroyed them in order to avoid the operation of this provision of the Income Tax Assessment Act. No one in his ordinary senses would countenance the continuance of legislation of this kind. I know that income taxation is built up on lines to which I am hostile, but there are degrees of mischievousness in the Assessment Act, and the inclusion of live stock in taxation returns is one of the worst features of the measure. Without labouring the matter, I submit my amendment, trusting that the Committee will discuss it, and have no hesitation whatever in supporting the very moderate but very necessary basic alteration I suggest.

Senator PEARCE:
Western AustraliaMinister for Home and Territories · NAT

– There is no reason why the man who makes an income in the business of rearing and selling stock should be exempt from taxation any more than should a man who grows and sells wheat, or grows wool.

Senator REID:
QUEENSLAND · NAT

– But a man who grows wheat is not taxed until he sells his wheat, whereas the man who breeds cattle is taxed on his calves before he sells them.

Senator PEARCE:

– I take it that honorable senators are agreed that income should be taxed whether it is earned, by raising stock, wheat, or wool, or by the manufacture of boots. This Bill remedies a defect in the Act. It gives to the raiser of stock an option. This clause provides for the omission of the definition of “ value “ in paragraph a of section 16 of the principal Act, and the insertion in its stead of the following definition : -

For the purposes of this paragraph “ Value “ means -

  1. in the case of live stock (not being live stock used as beasts of burden or as working beasts) . . .

This is the option to which I direct the attention of honorable senators, the cost price or market selling price at the option of the taxpayer. The cost price in relation to natural increase of live stock shall be the value per head of the live stock selected by the taxpayer within the limits prescribed, and the valueso selected shall be used for the purposes of the assessment of the financial year beginning on the 1st day of July, 1922, and of all subsequent years.

The limits prescribed are as follows: -

Section 16 is also to be amended by inserting after paragraph a a new paragraph as follows: - (aa) Notwithstanding anything contained in paragraph (a) of this section, an owner of live stock may elect to omit from the account required by that paragraph the value of all natural increase of any live stock owned by him and born during the year in which the income is derived. . . .

He can be assessed in respect of them only when he sells them. Surely nothing can be fairer than to give him these options.

Senator Hays:

– Once he has exercised his option the choice made will be his standard of taxation from year to year?

Senator PEARCE:

– Yes. I understand that this method has met with the approval of stock-raisers, and therefore I ask the Committee to reject the amendment.

Senator Reid:

– If he is not charged for his calves and stores until they are sold, is not a pastoralist giving away his capital all the time?

Senator PEARCE:

– He is making a profit on the sale of his stock.

Senator Reid:

– But the Minister says that no stock is to be added to the original number until they are sold.

Senator PEARCE:

– That is only if he so chooses; he has that option. Of course, if they are sold in the year of assessment they must be included.

Senator Lynch:

– If an owner selects his own standard as between the minimum and the maximum, will he be allowed to change it in the event of a reduction in values owing to a fluctuation of the market?

Senator PEARCE:

– He will bring in the stock at the market value if it is lower than the standard he has selected.

Question - That paragraph a proposed to be left out (Senator Grant’s amendment) be left out - put. The Committee divided.

AYES: 6

NOES: 18

Majority . . 12

AYES

NOES

Question so resolved in the negative.

Amendment negatived.

Senator PEARCE:
Minister for Home and Territories · Western Australia · NAT

.- I move-

That paragraph (e) be omitted.

This amendment is consequential upon the decision of the House of Representatives to eliminate from the Bill a provision which would have prevented the deduction of expenditure on repairs to the taxpayer’s own residence. The paragraph which it is now desired to omit from the Bill was inserted by the Government upon the recommendation of a Conference of Commonwealth and State Commissioners of Taxation, and a representative of the Royal Commission on Taxation, held recently for the purpose of ascertaining to what extent modifications of the Commonwealth Income Tax Assessment Act could be made to secure a greater measure of similarity between Commonwealth and State taxation laws. The Conference recommended that 4 per cent, of the capital value of the taxpayer’s own residence should be included as income instead of 5 per cent, as hitherto, and that it should be regarded as the net income, but subject to deduction of rates paid in respect of it, and of interest paid on money borrowed on the security of the residence. The Conference pointed out that a considerable amount of administrative difficulty was experienced by Taxation Departments in distinguishing between iona fide repairs and expenditure on alterations and improvements. As the House of Representatives refused to deprive the taxpayer of a deduction in respect of repairs, it is necessary to revert to the former basis of income which required 5 per cent, of the capital value of the residence to be included in the taxpayer’s return. The elimination of paragraph e of the clause will effect this result. The inclusion in a taxpayer’s return of 5 per cent, of the capital value of his residence, if the residence is owned by him, has’ always formed part of an income tax assessment. It is also included in the Income Tax Assessment Acts of Queensland and South Australia. In Victoria the basis is 4 per cent. One of the principal reasons for including this percentage as -income is that the taxpayer enjoys the annual value of his investment. If he did not own a home he would have to rent one, and taxation would be paid by the landlord. The’ rent would be part of the landlord’s income. In those circumstances there would be no equality. The man who lives in his own home is more fortunate than he who does not, and it is not desirable to allow the one to escape taxation while we tax the other, for we may be sure that the landlord who pays the tax recovers it from the tenant.

Senator Elliott:

– Would it not be better to encourage people to own their own homes ?

Senator PEARCE:

– Every one wants to own, not only the house in which he lives, but also one to let. .

Senator GRANT:
NEW SOUTH WALES · ALP

– I intend to exhaust all the forms of the Senate in order to fight this issue to a conclusion. I am not very much surprised’ at Senator Pearce’ s speech, because he is following the attitude of the Government to which he belongs. The clause in the original Income Tax Assessment Bill .passed by the Federal Parliament was introduced, I believe, at the instigation of the ex-Prime Minister (Mr. W. M. Hughes), and it was forced through the Labour caucus by the narrow majority of two votes. Having got through there, its passage through the Federal Parliament was easy. I did everything I could to prevent it getting through caucus, and I did not give it very enthusiastic support, if I gave it any at all, on the floor of the House.

The paragraph under discussion is part of the principal Act, and the effect of it is that every one in this country, who dares to build a house for himself, is penalized. I consider that the man who builds himself a home is doing a good, straightforward, upright, honest thing, which is of immense value to the country.

Senator Thompson:

– The honorable senator’s proposal would benefit the man who lives in a home worth £10,000.

Senator GRANT:
NEW SOUTH WALES · ALP

– There are ‘ numerous other ways in which a person who happens to own a home of that value can be taxed. I am not so much concerned about him as about the working man who owns his own home. Even if a man does live in a palatial home, he has probably invested his own money in it, or has borrowed other people’s money for the same purpose. By so doing he has greatly improved the locality in which he lives, and has done something to. build up the wealth of the community.

Senator Thompson:

– Hear, hear! The honorable senator does not always adopt that line of argument.

Senator GRANT:
NEW SOUTH WALES · ALP

– I do. I invite the honorable senator to recall any instance in which I have done otherwise. Some honorable senators seem to come here with preconceived opinions. They do not care to listen to anything that is said, and they go away still holding the same opinions. Ever since I can remember I have been strongly opposed to any proposal to tax industry. An incident came under my notice in early life, and made a lasting impression upon my plastic mind. It was the case of a farmer whose lease had only a few years to run. He provided himself with some uptodate and extra-heavy machinery, and probably, for the first time in the history of that country, used it in cultivating additional new land. What happened? Because he did that, because he obtained the up-to-date machinery, because he employed more labour, and increased the production of that part of the country) when his lease expired his landlord substantially increased his rent. That is typical of what is happening throughout the country. Any one who pays the slightest attention to the subject knows that, in very many instances, houses in the suburbs of our cities arn extremely objectionable. In many of them Senator Thompson would scorn to be found, dead or alive. I am concerned with the thousand and one advantages that would flow from a plentiful supply of up-to-date housing accommodation. If we penalize the man who builds his own home we shall tend to prevent the erection of homes. When we increase his income tax every year we do to that man, his wife, and his family, a very grave injustice. We not only do that, but we also prevent the investment of capital, and drive it out of the country into more profitable avenues of investment elsewhere. The removal of this provision would not destroy the Bill. It would merely remove from the sphere of taxation the homes of the people. Having spoken at least twice on this subject this session there is no need for me to say more. I ask honorable senators to disregard the hurried decision arrived at by another place, to ignore the remarks of Senator Pearce, and to support my proposal, for in doing so they will very greatly and permanently minimize the housing shortage, improve the homes of the people, and remove taxation from a source where it should never have been imposed. I give notice that I shall move an amendment to provide for the elimination from taxation of the assumed income from a house in which the taxpayer himself resides.

Senator ELLIOTT:
Victoria

– I am strongly in favour of the amendment of which Senator Grant has given notice. Every one who builds a house at present is faced with the prospect of a heavy loss as soon as conditions revert to normal. The cost of materials is greatly inflated, labour is at the peak of the market, and every onewho ventures to build a home for himself will be faced, on a small scale, with the difficulties that have beset the War Service Homes.

Amendment agreed to.

Amendment (by Senator Grant) put -

That the following new paragraph be inserted: - “ (e) by omitting from paragraph (e) all the words after the word ‘five’.”

The Committee divided.

AYES: 13

NOES: 12

Majority … … 1

AYES

NOES

Question so resolved in the affirmative.

Amendment agreed to.

Clause, as amended, agreed to.

Sitting suspended from 12.45 to2.15 p.m. (Saturday).

Clause 5 (Taxation of companies).

Senator LYNCH:
Western Australia

– This clause gives me an opportunity to once more bring under the notice of the Government the necessity for doing something quickly and on a substantial basis to assist the gold-mining industry. During a discussion in the Senate a few days ago attention was directed by other honorable senators and myself to the fact that the Government should at once come to the rescue of that industry. The figures I quoted were to the effect that other industries in the big cities on the coast-line have doubled in importance during the last nine years as regards wages paid, plant and machinery employed, and value of manufactured products, whereas the mining industry has declined. The gold-mining industry is still far behind. The number of men employed in it is one-third less than it was nine years ago. The output is on the same declining ratio, and nothing has been done to relieve the industry of taxation such as has recently been done, with my approval and support, in connexion with pastoral leases. The time has arrived when immediate attention should be given to the mining industry. I recognise that the occasion is perhaps somewhat inopportune to enable us to do ample justice to such an important industry, but unless action is immediately taken failure will loom ahead. Senator Grant, who advocates certain remission in taxation, should remember that unless we keep the people in the interior employed the industries along the coast-line will have little hope of success. The gold-mining industry has been one of the most profitable, and has given considerable impetus to manufacture. In Western Australia - and I am not speaking directly on behalf of that State - 30,000 men were employed on the Golden Mile some years ago; today there are only 15,000 to 18,000. Central Queensland presents the same sorry spectacle, and similar conditions exist in other localities where gold mining is undertaken. There are two ways in which relief can be afforded. One is by the remission of taxation for a fixed period in order- to encourage, the men to invest money in the industry, and the other is by a system of modified duties on mining machinery and other necessities of metalliferous mining. This industry induces men to leave the city for the interior, and it is usually those virile and venturesome members of the population who make their way to the goldfield when conditions are prosperous. When the gold mines opened up at Coolgardie and the Murchison it was thought that agriculture there would be confined within very narrow limits ; but experience has taught us that the agricultural area can be extended. The Southern Cross district, which was regarded as a hopeless proposition, from the point of view of agricultural development, a few years ago, has now amply demonstrated that men there can be happy and prosperous and accommodated in comfortable homes in a prosperous agricultural locality. The mining industry brings population from the coast to the country, and when mining diminishes those who are for the time- perhaps unable to obtain employment on the field find other means of obtaining a livelihood and eventually become permanent residents. In the North-West and in Queensland, the hardy prospector explores the untrodden wastes, but if he is not helped by men who have money to put into the industry he has little hope of success. People do not invest their capital in undertakings unless there is a prospect of profit. If assistance is not speedily rendered a deadly blow will be aimed at the mining industry. The Government must realize the urgent necessity for giving immediate attention to the requests brought under the notice of the Prime Minister (Mr. Bruce) a few days ago by a deputation consisting of honorable senators, honorable members of another place, and representatives of the mining industry. Unless they do so, the! industry will perish.

Senator PEARCE:
Western AustraliaMinister for Home and Territories · NAT

– I promise Senator Lynch that I shall bring his remarks under the notice of the Treasurer (Dr. Earle Page) and recommend that sympathetic consideration be given to his request. As the honorable senator mentioned, representations were recently made to the Prime Minister “ (Mr. Bruce), and the facts then brought forward will receive the careful consideration of the Cabinet.

Senator GRAHAM:
Western Australia

– I am very pleased to have the assurance of the Minister (Senator Pearce) that it is his intention to bring this matter under the notice of the Government at an early date. I was a member of the deputation which waited upon the Prime Minister (Mr. Bruce) in connexion with the gold-mining industry. During the war the industry experienced a very severe setback whilst other industries were making huge profits. I understand that during that period the gold produced from our mines was commandeered by the Imperial authorities at less than its market value, which resulted in the industry losing several millions of pounds. Western Australian senators are receiving communications from Western Australia and other parts of the Commonwealth asking what is to be done. I am prepared to leave the matter in the hands of the Minister, and trust that the earliest opportunity will be taken to give effect to some of the recommendations submitted by the deputation to the Prime Minister.

Senator THOMPSON:
Queensland

– I, too, was a member of the deputation to which reference has been made. Central Queensland is particularly interested in this matter, because the Mount Morgan mine, in spite of every effort to make ends meet, lost £70,000 last year. We are not likely, of course, to get much relief under this Bill, because many of the mining concerns that are working will not have any income, and, consequently, will be exempt from taxation. If the Government will consider a remission of land tax it will be a means of giving substantial relief to mining companies, and I trust this aspect of the question will be considered when the matter is engaging the attention of the Cabinet.

Senator NEEDHAM:
Western Australia

– We are now dealing with an industrywhich is truly Australian, as its operations are not confined to any particular State. As a member of the deputation which waited upon the Prime Minister (Mr. Bruce), and which was representative of every State, all parties, and the mining industry throughout Australia, I am glad to have the assurance of the right honorable gentleman that the promises then made by the Prime Minister (Mr. Bruce) will not be overlooked. I hope the assistance sought will be readily given. The gold-mining industry is not seeking any special treatment, but I trust that the Government will bend its energies during the recess towards affording that relief which is so much needed.

Clause agreed to.

Clause 6 agreed to.

Clause 7 -

Section 23 of the principal Act is amended -

by omitting from paragraph (i) of sub-section ( 1 ) thereof the words. “ base metals or rare minerals “ and inserting in their stead the words, “base metals, rare minerals, or oil, or in any company carrying on afforestation “.

Notwithstanding anything contained in the principal Act or this Act. there shall be deducted from the assessable income of a taxpayer for the financial year commencing on the 1st day of July, 1923, all sums paid by the taxpayer during the financial year commencing on the 1st day of July, 1921, in calls on shares in any company or syndicate prospecting for oil. in the Commonwealth; and

by omitting from paragraph (k) of sub-section (1) thereof the word “ Forty “ and inserting in its stead the word “Fifty”.

Section proposed to be amended: - 23. (1) In calculating the taxable income of a taxpayer the total assessable income derived by the taxpayer from all sources in A ustralia shall be taken as a basis, and from it there shall be deducted -

so much of the assessable income as is paid in calls on shares in a mining company or syndicate carrying on mining operations in Australia for gold, silver, base metals or rare minerals;

the sum of Forty poundsin respect of each child who is under the age of sixteen years at the beginning of the financial year in which the income was received”, wholly maintained by any taxpayer who is not an absentee.

Senator PEARCE:
Western AustraliaMinister for Home and Territories · NAT

– I move -

That after the word “ afforestation “, line 7, the words “ as its principal business “ be inserted.

The object of the amendment is to confine the exemption to a company carrying on afforestation as its principal business, otherwise a companycarrying on afforestation as a side line might derive advantage from the exemption.

Amendment agreed to.

Senator PEARCE:
Western AustraliaMinister for Home and Territories · NAT

– I move-

That paragraph (b) be left out.

This is a drafting amendment. Paragraph 6 is included in the clause, which provides that section 23 of the principal Act is amended in the direction indicated in that clause, but paragraph b in its present form cannot amend section 23. It is an overriding provision for one yearonly, and being of a temporary nature cannot amend the principal Act and should be placed at the end of the clause. The paragraph to be deleted will be reinserted later.

Amendment agreed to.

Clause, as amended, agreed to.

Clauses 8 to 12 agreed to.

Motion (by Senator Pearce) proposed-

That the following new clause be inserted : -

Notwithstanding anything contained in the Principal Act or this Act, there shall be deducted from the assessable income of a taxpayer for the financial year commencing on the 1st day of July, 1923, all sums paid by the taxpayer during the financial year commencing on the 1st day of July, 1921, in calls on shares in any company or syndicate prospecting for oil in the Commonwealth.

Senator Lynch:

– Will this clause be taken to apply to the calls paid by a taxpayer who is a member of a company engaged in refining oil, as well as of a company engaged in prospecting for oil?

Senator Pearce:

– No; it will apply only to a mining company that is prospecting.

Proposed new clause agreed to.

Title agreed to.

Bill reported with amendments; report adopted.

Bill read a third time.

page 3534

NAVIGATION ACT AND NATIONAL INSURANCE ROYAL COMMISSIONS

Senator PEARCE:
Minister for Home and Territories · Western Australia · NAT

. - (By leave) - In appointing members to the Royal Commissions dealing with Navigation and National ‘Insurance, the Government experienced considerable trouble in its endeavours to give representation to the different parties, and, as far as possible, to the States. The members have now been appointed. On the Royal Commission dealing with Navigation, they willbe - Mr. J. H. Prowse, M.P. (Western Australia), Chairman: Senator W. L. Duncan (New South Wales) ; Senator H. E. Elliott (Victoria) ; Senator C. S. McHugh (South Australia); Mr. F. Anstey, M.P. (Victoria); Mr. A. C. Seabrook, M.P. (Tasmania); and Mr. G. E. Yates, M.P. (South Australia). The members of the Royal Commission on National Insurance will be - Senator John D. Millen (Tasmania), Chairman; Senator J. F. Guthrie (Victoria) ; Senator A. McDougall (New South Wales); Mr. W. G. Mahony, M.P. (New South Wales); Mr. A. E. Green, M.P. (Western Australia); Mr. J. A.J. Hunter, M.P. (Queensland) ; and Mr. J. Francis, M.P. (Queensland).

page 3534

LOAN BILL

Message received from the House of Representatives intimating that it had disagreed to the amendments made in the Bill by the Senate, for the following reasons : -

Because the amount is provided in the Bill in order that effect may be given toa resolution of the House which was passed without division in favour of the erection of a provisional Parliament House at Canberra.

Because, in the interests of the Commonwealth, it is essential to make provision for the meeting of the Parliament at Canberra at the earliest practicable date.

Ordered :

That the message be considered in Committee of the Whole forthwith.

In Committee (Consideration of House of Representatives Message) :

Senator PEARCE:
Western AustraliaMinister for Home and Territories · NAT

– I move -

That the Committee does not insist on the amendments of the Senate disagreed to by the House of Representatives.

It will be remembered that the Committee reduced by £1 the amount of the proposed vote for “. Works Services and acquisition of land in Federal Capital Territory “ as an instruction to the Government to proceed with the erection of the nucleus of the permanent building instead of a provisional building. Clause 4 of the Bill as well as the Schedule was amended accordingly. I think that, with very few exceptions, the members of all parties are desirous that an early commencement shall be made with the erection of a Parliament House at Canberra. There is a difference between the two Houses as to the type of Parliament House that should be built. In the Committee the voting was 19 to 13 in favour of proceeding with the erection of the nucleus of the permanent building. In the other House, apparently, there is a unanimous feeling in favour of a provisional building. That is shown by. the fact that no division was called for on the motion. I ask those honorable senators . who voted with the majority in Committee to bend to the will of the House of Representatives on this occasion. It is a matter upon which we want to get a decision. The vote of the Committee placed the Government in a quandary. Seeing that there is such a preponderating majority in the House of Representatives in favour of the erection of a provisional building, and that there was a difference of only six in the voting in this Committee, it will be apparent that the great majority of the members of the two Houses are in favour of proceeding with the provisional building.

Senator GARDINER:
New South Wales

– I am not in agreement with the Leader of the Senate (Senator Pearce) on this occasion. Although I did not prominently associate myself with the objection to the construction of a provisional Parliament House at Canberra, I certainly think that the weight of evidence is with the Committee on this occasion. The Public Works Committee made an inquiry and sent two alternative proposals to the Government. The first proposal had the support of all except one member of the Public Works Committee. That was that the nucleus of the permanent building should be commenced forthwith. The second proposal submitted to the Government was contained in the minority report of one of the New South Wales representatives. What is the position of the Senate? There was a time when the Senate had sufficient firmness and intelligence, and realization of the position which it occupies under the Constitution, to stand up for its rights. If the Committee intends to accept Senator Pearce’s proposal, it ought to do so in a whole-hearted way; there ought’ not to be any half measures. Honorable senators ought to realize, as I have during the last week, that, apparently, the Senate has no rights, and very little influence as far as legislation is concerned ! It has passed Bill after Bill, without even consideration or comment, and has not dared to offer an amendment. If honorable senators who yesterday so valiantly gave expression to their opinions, and dared for once to carry an amendment against the House of Representatives, are going to give way now, I propose to move that the following message be tendered to the House of Representatives : - “ The Senate regrets that its action has caused the House of Representatives any trouble or concern, and in view of the fact that it has passed many Bills without amendment or even consideration, tenders its most humble apology to your most honorable House for having dared to amend a Loan Bill.” If we have dared, once in a session, to carry an adverse amendment and a wrong has been done, we ought to say that we are sorry, and shall not offend again. If, when we proceed to a division, I find that the Government supporters who voted for the amendment have been struck with terror and intend to stampede to the other side, I shall move that motion. If, on the other hand, they are still able to stand up and hold the bridge with me, I shall be most happy in the knowledge that Australia’s money is not to be wasted on a provisional building, but will be spent on the commencement of the building that is to be the final home of the Parliament of Australia. Mr Walter Burley Griffin’s magnificent design should not be impaired by amateur draughtsmen in Government Departments. I hope that Australia’s Capital will have the most magnificent lay-out of any capital the world has ever seen. Therefore,. I stand for no make-shift provisional Parliament House. I want the real permanent home of the Australian Parliament commenced forthwith under conditions which will enable designs to be submitted for the most beautiful permanent structure we can possibly get from the architects of the world - preferably Australian architects. I do not wish to delay the Government. Senator Pearce has had a great deal to do, but this proposal of mine will enable us to finally test whether certain honorable senators opposite have swallowed the pluck they had yesterday and are prepared to go back on their opinions, or conveniently absent themselves so that there may be no interference with the will of another place.

Senator OGDEN:
Tasmania

.- I still believe that we should commence the erection of’ a good permanent building in which to house this Parliament at Canberra. But, if I find that I am leading my forces into a cul desac - if I find that there is no hope of victory - I always regard discretion as the better part of valour, since thereby, not only the forces themselves, but also their leader, are saved. With great regret, therefore, I intend to reverse the vote I gave yesterday. I voted to send this amendment to another place, in the hope that it wouldaccept it. They have not done so ; and if we insist on them making it, the result will be that no work will go on at Canberra. I have had, as I shall still have, occasion to urge the claims of Tasmania, but I do not want it to be thought that, as a representative of a small State, I am approaching this question in any parochial spirit. I want the Federal Parliament to meet at Canberra. We have to keep the compact, and I want to see the nucleus of a permanent structure built; but by maintaining the attitude that I took up yesterday, I should not now secure any success in the direction I desire. That is my difficulty. If I thought that I should meet with success by voting against the Minister’s motion I would do so ; but I see no hope of getting what I desire, and I do not think that any honorable senator who voted as I did yesterday can show me a way out of my difficulty, or what we could gain by pressing the amendment. I must adopt either of two courses - leave the chamber and not take part in the division, or reverse the vote I gave yesterday. As I do not believe in adopting the former, I must adopt the latter course.

Senator THOMPSON:
Queensland

– As one of those who supported the Government’s proposal, I urge those honorable senators who voted for the request moved by Senator Guthrie to fall into line with the attitude taken up by another place. The argument used by Senator Gardiner about Mr, Griffin’s lay-out still holds good. It is merely a lay-out, and the building now proposed will not be a permanent one. Faith can be kept with architects for designs for the permanent- House, which can be arranged for at any time ‘ within the next fifty years. In regard to Senator Gardiner’s suggestion that by not insisting on our amendment we shall belittle the Senate, I do not think that any one could lower the dignity of the Senate more than Senator Gardiner has done during the last day or two. I urge those honorable senators who are wavering not to listen to the advice of Senator Elliott and other Victorians, but to agree to the attitude taken up by another place.

Senator PAYNE:
Tasmania

.- I refrained from speaking yesterday on Senator Guthrie’s amendment, because I was anxious to see the Government’s proposal put into operation. I was the only Tasmanian senator who supported the Government, and I supported them because, after a personal visit to Canberra, I felt that the Government were on right lines when they proposed to build a provisional Parliament House. The impression has been spread, abroad in Tasmania that this provisional Parliament House will be a building with only a few years’ life, and must very soon be scrapped ; but it was clearly explained yesterday that although it would not be a permanent structure for a Parliament House, it would be a building of a permanent character, which could be utilized to advantage and profit in many directions when no longer required for a Parliament House. I want to make my position clear. I hope that I shall be able to influence my Tasmanian colleagues, who did not. support the Government yesterday, to reverse their votes as Senator Ogden proposes to do. I am quite confident that any man who had visited Canberra, and had taken an interest in the work of development there, could not have adopted the attitude that many honorable senators adopted here yesterday in their opposition to the Government’s proposal. As I think that proposal is in the best interests of the whole community, I urge honorable senators to agree to the motion.

Senator GRAHAM:
“Western Australia

– I shall vote on this motion as I did yesterday. I am of the same opinion as Senator Gardiner - that we should have the permanent structure at Canberra, and, notwithstanding all the absurd rumours as to the possibility of 200 or 300 men being thrown out of work if the amendment be carried - rumours intended only to influence our decision on this question - I shall vote as I did yesterday.

Senator FINDLEY:
Victoria

.- Yesterday afternoon, during the consideration of the schedule to the Loan Bill, a long debate took place on an amendment submitted by Senator Guthrie, which the Leader of the Government in the Senate (Senator Pearce) assured us would, if made, mean a stoppage of all works at Canberra. Senator Guthrie, in the belief that his request would bring about that result, later on submitted it in an altered form, and sought to have the item reduced by £1. When I asked the Leader of the Government what would be the effect of that alteration, Senator Pearce plainly told the Committee that it would not have the effect which the original amendment would have had, and he inferentially said that if honorable senators agreed to it, it would not be taken as a vote of want of confidence in the Government. Apparently the honorable senator has changed his attitude since yesterday.

Senator Pearce:

– What I said was that it would be taken by the Government as an indication that the Senate, was against the erection of a provisional Parliament House, and preferred to have the permanent structure.

Senator FINDLEY:

– Inferentially the Leader of the Government said that the carrying of Senator Guthrie’s amendment would be an intimation to the Government not to proceed with the temporary building, but to proceed with the permanent structure forthwith. We realize that every honorable senator who supported Senator Guthrie’s amendment was under the impression that the Government would agree. to it, so that there would be no stoppage of work at Canberra, and no one would be thrown out of employment. But, apparently for party political motives, since that amendment was forwarded by this Chamber to the House of Representatives, all sorts of rumours have been set afloat to the effect that if we insisted upon it the Government would stop all works at Canberra. That is the game the Government _ proposes to play.

Senator Pearce:

– I did not say that.

Senator FINDLEY:

– Other people have said it.

Senator Reid:

– Another place has rejected our amendment.

Senator FINDLEY:

– For what reason?

Senator Reid:

– Because honorable members there disagreed with it.

Senator FINDLEY:

– Exactly ; but before the message came back to this Chamber intimating that the House of Representatives had not agreed to the amendment, negotiations were afoot, and the acid test was applied to a number of senators who had been strong in their support of the amendment. The acid sank well into them.

Senator Reid:

– We have not voted yet.

Senator FINDLEY:

– I ‘ quite realize which way the vote will go. There was a majority of nineteen to. thirteen yesterday. What explanation will be offered by those who supported Senator Guthrie’s proposal yesterday and are not prepared to insist upon it to-day? What has changed their opinion since yesterday? Senator Pearce has expressed the opinion that in the aggregate there is in the two Houses, a majority in favour of the erection of a provisional Parliament House. But is that the reason why we are. to do. certain things? I thought that the Senate was a distinct branch of the Legislature. I thought that senators had certain rights, and that we could divide on all questions submitted to us for decision. Apparently, we are not to be permitted to do so. According to the Leader of. the Government, all that should influence the minds of certain honorable senators is the fast that out of 111 members in both Houses a majority are not in favour of a certain proposal, and that no matter what we may do in this Chamber, if the majority in the aggregate in the two Houses are against what we do here, the will of that majority must be observed. We might as well dispense with the Senate. I am a member of a party pledged to abolish the Senate, and if this is to be the practice the sooner it -is abolished the better. Senator Thompson urged those honorable senators who voted yesterday against the Government’s proposal” to reconsider their attitude. He tried to persuade them to do so, as if he could persuade any one to change his views or alter his vote ! This eloquent statesman from the tropical

State of Queensland-

Senator Thompson:

– I do not claim to be eloquent.

Senator FINDLEY:

– I am merely saying that the honorable senator, who is an eloquent statesman from the tropical State of Queensland, has pleaded with myself and others ! It is like pouring water on a duck’s back to try that sort of persuasion with me. The honorable senator hurled an insult at my respected Leader (Senator Gardiner), a man for whom we have the highest respect and the greatest admiration. He is a man amongst men, and the party he leads in this Senate will not tolerate any insult being cast upon him by Senator Thompson, or any one else.

Senator Thompson:

– There was no insult.

Senator FINDLEY:

– There was a deliberate insult in the statement that he had lowered the dignity of this Chamber. He has raised the dignity of this Chamber.

The TEMPORARY CHAIRMAN (Senator McDougall:
NEW SOUTH WALES

– I would point out to Senator Findley that no exception was taken to the statement at the time it was made, and Senator Gardiner has not taken exception to it.

Senator FINDLEY:

– I take exception to it, and I want to warn Senator Thompson, and every one else, that when they insult Senator Gardiner they insult every member of the Labour party.

Senator Duncan:

Senator Gardiner is well able to look after himself.

Senator FINDLEY:

– He is. He can defend himself at any time, in any circumstances, in this Chamber or out of it, better than any other man I know. But I am his humble follower, and I cannot, as such, tolerate any insult being hurled at him. He can take his own part better than any man can take it for him. I recorded my vote against the Government’s proposal yesterday in the conscientious belief that the permanent, and not the temporary building should be proceeded with. I am in favour of the work being undertaken as soon as possible. I have ‘always been in favour of a Federal city. I voted for the present site, and am as keenly anxious as is any honorable senator on the -other side to go to Canberra, although, if I were to study my personal convenience I should say, “ Stay here.” I am not a Statesrighter, or a parochialist, but a Federalist. It will be a good thing for Australia when the Federal Parliament assembles at Canberra. Well-informed men tell us that the delay involved in meeting at Canberra in a permanent instead of a temporary building will be the’ difference between three years and six years. Would it not be better for us to wait for six years and have a building that would be a lasting monument to Australia ? I feel very keenly about this, because

Senator Cox:

– New South Wales members feel keenly also on this question. Why not have a division ? The honorable senator will not be able to change any one’s vote.

Senator FINDLEY:

– I am well aware of that, so I shall sit down. I do not wish to be the cause of any members from New South Wales missing their trains.

Senator NEEDHAM:
Western Australia

– I am sorry to see that *the Government is getting panicky on this matter. It is quite evident that it has “ the wind up,” for the attitude of the right honorable the Leader of the Government (Senator Pearce) to-day was in marked contrast with his attitude yesterday. My attitude is the same as it was yesterday, and I shall vote as I voted yesterday. I made my position quite clear when speaking on the amendment moved by Senator Guthrie. I said that if I thought it was a trap to prevent the early removal of this Parliament to Canberra I would not vote for it, and that I would vote, not for a temporary,, tin-pot, or provisional structure-, but for a permanent one. If the Government is sincere in its desire to move the seat of Government to Canberra, it can easily do so. Senator Findley has said that the difference in the time involved in building a permanent instead of a temporary structure will be a matter of three years. If the Government was anxious to get to Canberra there would be no need to dismiss a single workman. It could, in fact, engage more workmen and proceed with the work expeditiously. By no stretch of the imagination can I be regarded as ari “ anti-Canberra-ite.” I was one, about fourteen years ago, when I helped to “ stone-wall “ a motion that Canberra should be the Seat of Government, but as this Parliament decided that it should be there, I have ever since done all I could, by my vote and my voice, to get there as soon as possible. 1

Senator BARNES:
Victoria

.- It is about time the people who are governing this country woke up to the fact that, after all, Australia is a nation. We have a highly-developed civilization here, and we have a people game enough to do the job required of them if their legislators will take the necessary responsibility. The Senate declared, by its vote yesterday, that it wanted the permanent National Parliament House to be built at Canberra, and to be started at once. There is no other responsibility in the matter. The Government proposes to construct a ramshackle, temporary building, because it has not the courage to inform the people of this country that it intends to do the job in a way that will be a credit to the nation. It has been said that a lot of people will be thrown out of work if the Senate does not reverse its decision. I do not believe it. I hope the gentleman in charge of the Department “which carries out the work will be big-minded enough to say, knowing that the people of the country, and the members of both- Houses of Parliament, will be behind him, “We are going to do this job properly, and we are not going to have any makeshifts.” The people of my electorate are very’ interested in this matter, and so am I. I hope the Senate will re-amrm its decision.

Senator ELLIOTT:
Victoria

.- Why is this matter sprung upon us after the supporters of the amendment moved yesterday have gone home? The genesis of this precious scheme seems to be something like this: A proposal was brought forward for a temporary structure to accommodate Parliament for the time being. That, for various reasons, was rejected by those in charge of the works, who then brought forward the original scheme for a permanent building, and evolved a cross which was a sort of temporary-permanent affair. That did not suit, and they have now made another cross, which is a sort of “ comeback “ building, and is supposed to last for fifty years. It is to be situated just under the brow of the hill, upon which the permanent structure will rest, and it will be an eyesore for the next two generations. The Senate considered these things, and had the advantage of the assistance of one of the members of the Public Works Committee. We are now asked to reconsider our decision and reverse it. No additional reasons have been advanced why we should do so. We are simply asked to bow to the decision of the other House. Every one knows how the present position was brought about. It is neither more nor less than an attempt to “ dish “ the Labour party. I shall not alter my vote, and I consider that if we in the Senate back down from our position of yesterday, as if we had no right to be consulted regarding this work, this Chamber might as well be abolished at once. Our only effective influence can be exerted by insisting upon some measure of control over the money votes for works passed by the other House. What is the use of talking about the rights of the Senate if we surrender them?

Senator Cox:

– Let us get home.

Senator ELLIOTT:

– I am not going to be brow-beaten by Senator Cox, or any one else. I consider it an outrage on this Chamber that this matter should be brought forward when some honorable senators have already left to catch their trains.

Question - That the Committee does not insist on the amendments of the Senate disagreed to by the House of Representatives - put. The Committee divided.

AYES: 13

NOES: 6

Majority … … 7

AYES

NOES

Question so resolved in the affirmative.

Resolution reported.

Motion (by Senator Pearce) proposed -

That the report be now adopted.

Amendment (by Senator Gardiner) proposed -

That the following message be transmitted to the House of Representatives : - “ We regret that our action has caused the House of Representatives any trouble or concern, and in view of the fact that we have passed many Bills from that Chamber without amendment or even consideration, the Senate tenders its most humble apology to your most honorable House for having daredto amend the Loan Bill.”

The PRESIDENT (Senator the Hon T Givens:

– I cannot accept the amendment. It would be a highly improper message to transmit to another place, and the honorable senator is not in order in submitting it.

Question resolved in the affirmative.

Report adopted.

page 3540

INCOME TAX BILL

Debate resumed (vide page 3509), on motion by Senator Pearce -

That the Bill be now read a second time.

Senator GARDINER:
New South Wales

.- This Bill should be considered in conjunction with the Income Tax Assessment Bill. One of the clauses deals with the collection of revenue from Tattersall’s sweeps, lotteries, and similar sources. It is beneath the dignity of the Senate to consider such a proposal. If I addressed a letter to Tattersall’s, Hobart, the Postal Department would not deliver it, but as soon as an investor in a Tattersall’s sweep is lucky enough to secure a “ draw,” the Commonwealth Government, under this Bill, will immediately step in and claim 12½ per cent, of the prize money. If the taxation of money won in a sweep or consultation is not wrong in principle, then the Postal Department should deliver letters addressed to Tattersall’s. If the Commonwealth insists on collecting for revenue purposes a percentage of the winnings in connexion with these sweeps, it is highly inconsistent to condemn the investment of money in Tattersall’s as an immoral practice.

Senator Ogden:

– Does the honorable senator suggest that the Commonwealth becomes a partner in the business?

Senator GARDINER:

– Yes ; if it is an iniquitous practice the Government is a party to it. In any case this Parliament should set an example to the rest of the community, and it should not go to such sources as Tattersall’s for its revenue. I do not think the people approve of the Government doing so.

Question resolved in the affirmative.

Bill read a second time.

In Committee:

Clauses 1 to 5 agreed to.

Clause 6 (Tax on Prizes in Lotteries).

Amendment (by Senator Gardiner) . proposed -

That the House of Representatives be requested to leave out the clause.

Senator OGDEN:
Tasmania

– I have asked a question regarding the policy of the Government towards Tattersall’s, and should like to know if I am entitled to have an answer to my question after the termination of the session? My attitude on the clause before the

Committee depends on the answer received.

Senator PEARCE:
(Minister for Home and Territories · Western Australia · NAT

– The honorable senator, as an old Parliamentarian, will realize that since his question was submitted to me Ministers have had very little time to meet for the consideration of matters of policy. As theLeader of the Government in the Senate, I shall take care that the honorable senator’s question, and any others that have not been answered, receive consideration during the recess.

Question put: The Committee divided.

AYES: 7

NOES: 16

Majority . . 9

AYES

NOES

Question so resolved in the negative.

Request negatived.

Clause agreed to.

Clause 7 agreed to.

Schedules agreed to.

Title agreed to.

Bill reported without request; report adopted.

Bill read a third time.

page 3540

INCOME TAX COLLECTION BILL

Second Reading

Senator PEARCE:
Minister for Home and Territories · Western Australia · NAT

.- I move-

That the Bill be now read a second time.

The two main principles in this Bill are the authority to make an agreement for one collecting authority on a uniform schedule, and the provision for compensation to officers in the Commonwealth Public Service who may be retired in consequence of the decreased activities of the Taxation Branch. The commencing day is the 30th June, 1923, and the Bill consists very largely o,f machinery to give effect to these proposals. An agreement with New South Wales has been signed subject to parliamentary authority. An agreement has also been arrived at with Victoria, and it is expected that it will be signed next week. Negotiations are in progress with South Australia, Tasmania, and Queensland, while Western Australia will continue during this financial year under the existing amalgamated system. Commonwealth and State officers are to be retired proportionately to the relative strength of the staffs before amalgamation. The rights of the Commonwealth officers transferred to the States will be preserved, and the status of officers protected. Provision is made for the retirement of officers somewhat on the basis of the Defence retirement compensation, which was one month’s pay for each year of service with a minimum of six months’ pay.

Senator Lynch:

– Does it apply to temporary as well as to permanent officers? .

Senator PEARCE:

– Temporary employees who have passed the prescribed examination are to be treated as permanent officers, and those who have not will / not be entitled to compensation. Returned soldiers who are temporary employees will, as far as possible, be placed in other Departments, and limbless men will be provided for. Where returned soldier employees cannot be given employment they will be given a sustenance allowance for a definite period of eight weeks.

Senator Guthrie:

– Will the limblessmen be given employment?

Senator PEARCE:

– Yes. With the temporary employees we are following the same practice that was adopted under the Defence Retirement Act. Temporary employees, who have not passed the prescribed examination, are continually being retired all over the Commonwealth, so that they will not be placed in a worse position in consequence of the Bill.

Senator FINDLEY:
Victoria

. -I very much regret that this important measure is being introduced in the final hours of the session, in circumstances, perhaps, unparalleled in the history of the Commonwealth. Notwithstanding everything that may be said to the contrary, from 50,000 to 60,000 men are unemployed, and if this Bill is carried it will mean a further addition of probably 2,000 men to that number. There are, approximately, 2,000 employees in the different Commonwealth Taxation offices throughout the Commonwealth, - the majority of whom are men with families, and if they are not married they have dependants, or are seriously considering additional responsibilities, so that probably 6,000 or 7,000 people will be affected. I understand that there are in the Department 1,600 permanent -and 400 temporary employees, probably 70 per cent, of whom are returned soldiers. I should have thought that, before taking extreme steps, the Government would have done, everything possible to arrange for the transfer to other Departments of the men who are to be compulsorily retired. The majority of these men passed the prescribed examination to qualify for, their positions, and have given complete satisfaction to the officers in charge of the Departments in which they are engaged. This Bill is dissimilar to the Defence Retirement Bill, as in that case the retirements were voluntary.

Senator PEARCE:

– Not all of them.

Senator FINDLEY:

– A majority were. In most cases the officers of the Defence Department were in a higher grade than the employees in the Taxation Department. Some Defence officials were nearing the retiring age, and nearly all of them had been in the Service for some years. Compensation equal to one month’s pay for each year of service does not compare at all favorably with the compensation paid to the officers in the Defence Department. Those retired from the Defence Department had been practically twice as long in the Service, and were receiving nearly double the salary of the taxation officers. The average of six months’ compensation in the case of the Defence officers amounted to a considerable sum, but as the majority of those” who are to be compulsorily retired from the Taxation Department average only about £250 a year, six months’ salary will amount to only £125. 1 If the Government wished to do the fairthing they should make the compensation somewhat equivalent to the compensation paid to the Defence officers. The majority of the men who are to be retired belong to the lowest paid divisions. The maximum salary of their class does not exceed £250 per annum. On their retirement the average’ payment to them will be £125. A few have been longer in the Service, and, being in a higher grade, are in receipt of a .slightly higher salary. I do not know of anybody who will receive more than about £166. What are these men’s prospects ? There are no other avenues in this Department for them, and no provision has been made to transfer them to other Departments. Some officers who anticipated the introduction of a measure such as this secured employment outside the Service. I should like to know if those men who voluntarily retired from the Department, anticipating that they would later be compulsorily retired, will be eligible for compensation ?

Senator Pearce:

– In such cases the provisions of this Bill will not apply.

Senator FINDLEY:

– Supposing some of the men who are to be retired subsequently accept other employment in the Service, if it is offered to them, will they .be called upon to pay back in a lump sum the retiring allowance which they have received, or will they be allowed to pay back the amount in small instalments ?

Senator Pearce:

– I think the honorable senator can take it that they will be allowed to refund the amount in instalments.

Senator FINDLEY:

– I again express my regret that the Government has not done’ for these men what it did for the military men. If the compensation in their case were on the same basis as that of officers who retired from the Defence Department under the Defence Retirement Bill, they would probably get £200 or more. The prospects of these men are not very good, and £125 will not carry them far. Apparently, the Government is pledged to the Bill in its present form. It might, however, be possible to amend it in Committee in the direction I have indicated.

Senator GARDINER:
New South Wales

– I join with Senator Findley in his opposition to this measure. This is the high-water mark’ of Government retrenchment. The Ministry has given money with a lavish hand to all its friends. Shipping companies, absentee land-owners, and other big interests, have had their taxes reduced, but

Government employees ‘ are to be ruthlessly turned adrift, ‘ after years of faithful service, with compensation that will be altogether, inadequate. ‘ In view of the growth of the various Departments, these men could be quickly absorbed if a little foresight and care were exercised. No greater hardship can be imposed* upon any one than to be told suddenly to seek employment elsewhere. It may be said that the Commonwealth will save £2,000 in one year. That is problematical. If the Government had any consideration for its employees it could, by regulation and careful selection, gradually dispense with the services of these men in their present positions, and have them transferred to other positions in the Service. I realize how hopeless is any attempt to obtain from the Government even the slightest sympathy- for other than the big interests, upon which the eyes of this” Administration are fixed. Those are the men who put them in power, and they reward them with a lavish hand. At the same time they deal ruthlessly with men who have rendered faithful service to the Commonwealth for a number of years. At this, the eleventh hour, I ask the Government to refrain for a time from retiring these men, and to endeavour to find positions for them in other branches of the State and Commonwealth Public Services. They gained their present positions as the result of a competitive examination, and have held them by useful and excellent service to the Commonwealth. Surely, instead of turning them adrift with paltry compensation, the Government can stay its hand until they are placed in other positions. The Government will boast of this as one of its acts of retrenchment. It gives hundreds of thousands of pounds to its wealthy friends, and in order to save a mere £2,000 it intends to turn these men adrift. They are highly qualified, and are trained to the business. When they have been retired fresh men will have to be trained. If they had wealth, if they had influence, if they had friends in high positions, this would not happen. I realize, however, that my protest will fall upon deaf ears. Honorable senators opposite have no sympathy with these men, nor have they the inclination to stay this ruthless act of retrenchment.

Question - That the Bill be now read a second time - put. The Senate divided.

AYES: 12

NOES: 6

Majority … … 6

AYES

NOES

Question so resolved in the affirmative.

Bill read a second time.

In Committee :

Clause 1 agreed to.

Clause 2 (Commencement).

Senator GRANT:
NEW SOUTH WALES · ALP

– Will the existing exemptions in the Income Tax Assessment Act be continued ?

Senator Pearce:

– That matter is not dealt with in this Bill. However, they will be continued.

Clause agreed to.

Clauses 3 to 13 agreed to.

Clause 14 (Compensation not payable as a right) .

Senator GARDINER:
New South Wales

– This clause provides that compensation payable under this Act shall not be claimable or recoverable by any person as a matter of right, but shall be deemed to be a free gift by the Commonwealth. I would like to know why compensation should not be claimable as a right.

Senator PEARCE:
Minister for Home and Territories · Western Australia · NAT

– The same provision is contained in the Defence Retirement Act, and the object, of course, is to prevent litigation. It certainly makes the Minister the sole judge, but still it is desirable to avoid litigation in this regard. Persons who are dissatisfied always have the right to make representations to members of Parliament. I think that Senator Gardiner can rest satisfied that justice will be done in this matter.

Senator GARDINER:
New South Wales

– I am not satisfied that justice will always be done. I remember a measure under which the Government decided to give a gratuity to certain people, and in it they inserted the provision to which I have just drawn attention in this Bill. An officer who had rendered , most distinguished service to the Commonwealth, was prevented, by purely departmental envy or enmity, from getting the gratuity. So bad was his case that, although I was alone in the Senate in opposition to the Government, the majority of honorable senators agreed to the appointment of a Select Committee to inquire into it. All the members of that Select Committee agreed that this officer had a moral right, while all but one on the Committee agreed that he had a legal right to the gratuity.

Senator Pearce:

– That is not a bad record, when we know that there were hundreds of thousands of applicants for gratuities.

Senator GARDINER:

– Yes ; but perhaps others did not get the ear of some one who could fight for justice for them. It took me two years to get this man’s case heard. I congratulate honorable senators on the fact that they did not let party spirit enter into that investigation. I mention these facts to show how unfairly this particular provision may work. I happened to know this old gentleman, and I took up his case, fighting it here session after session, until finally, thanks to the Government, I was permitted to move for the appointment of a Select Committee to deal with it. The Committee did its work, and the Government of the day, acting on its finding, voted this old gentleman a sum of money equal to what he would have drawn as a gratuity.

Senator Pearce:

– Is the honorable senator alluding to the case of Captain Strasburg ?

Senator GARDINER:

– Yes. He was a poor man, and was obliged to take the money on that account, but he would rather have had the honour of drawing the gratuity.Having had that case in hand, I raise my protest against a proposal that people whose services are no longer required, and to whom compensation is to be paid, shall have no legal right in the matter, and may not show that they are not getting a fair deal. If a man were given the right to this compensation, the Courts would be open to him to enable him if aggrieved to show that justice had not been done. This is but another example of the way in which the powers of the Government are encroaching on the will of Parliament. Legislation is so framed as to make it easier for the Departments to do their work, whereas our chief consideration should be in the direction of endeavouring to give a fair deal all round.

Senator FINDLEY:
Victoria

– I do not like this clause because of its uncertainty, and because it would make it appear that the Government are making the recipients of this compensation a gift of six months’ pay, or more. Why do we not say straight out that it is the right of these people to receive this money ? Is the provision in the Defence Retirement Act similar to this?

Senator Pearce:

– Yes.

Senator FINDLEY:

– I do not approve of it, more particularly now that I have heard Senator Gardiner’s statement of the case of a man who was entitled to a war gratuity, but could not make a legal claim for it. Some of the officers provided for in this Bill may be denied the amount to which they are justly entitled.

Senator Lynch:

– Is it contemplated that State officers shall be compensated under this Bill, or will it apply exclusively for Commonwealth officers ?

Senator Pearce:

– It is for the States to compensate their own officers. This Bill is confined to Commonwealth officers.

Clause agreed to.

Clauses 15 to 17 agreed to.

Title agreed to.

Bill reported without amendment; report adopted.

Bill read a third time.

page 3544

WAR PRECAUTIONS ACT REPEAL BILL

Bill received from the House of Representatives.

Standing and Sessional Orders suspended, and Bill (on motion by Senator Pearce) read a first time.

Senator PEARCE:
Western AustraliaMinister for Home and Territories · NAT

– I move -

That the Billbe now read a second time.

The purpose of this Bill is to extend the operation of section 7 of the War Precautions Act Repeal Act 1920-22. The Act gave power to register foreign companies operating in Australia. The Bill will extend the operation of the present law until 31st December, 1924. It continues the present control over companies in which the predominating interests are ex-enemy, and over companies which desire to register for the purpose of carrying on manufacturing, mining, and other operations outside the Commonwealth. It also continues control over foreign companies generally, including fire and marine insurance companies. Before permitting any non-British fire and marine insurance companies to register, it has been the practice, for some years past, to require the company to lodge a deposit with the Treasury in order to afford protection to local policy-holders and creditors. This requirement is on the lines of legislation in the United States and New Zealand, which obliges foreign-owned insurance companies to make deposits varying from £50,000 to £150,000.

Question resolved in the affirmative.

Bill read a second time, and passed through its remaining stages without amendment or debate.

page 3544

REMOVAL OF PRISONERS (TERRITORIES) BILL

Bill returned from the House of Representatives without amendment.

page 3544

INCOME TAX ASSESSMENT BILL

Bill returned from the House of Representatives with a message that it had agreed to Nos. 1, 3, 4, and 5 of the amendments made by the Senate, and had agreed to amendment No. 2 with an amendment.

In Committee (Consideration of House of Representatives’ message) :

Clause 4 -

Section 16 of the principal Act is amended -

by omitting from paragraph (e) the word “five” and inserting in its stead the word “ four “.

Senate’s Amendment, No. 2. - Leave out paragraph (e), insert the following new paragraph - “(e)by omitting from paragraph (e) all the words after the word ‘ five ‘.”

House of Representatives’ Message. - Agreed to by the House of Representatives with the following amendment : -

Omit the words “from paragraph (e) all the words after the word ‘ five ‘ “, and insert “ paragraph (e) thereof”.

Motion (by Senator Pearce) proposed -

That the Committee agree to the amendment of the House of Representatives upon the Senate’s amendment No. 2.

Senator Pearce. - Yes.

Motion agreed to.

Resolution reported and adopted.

page 3545

POST AND TELEGRAPH BILL

Bill received from the House of Representatives.

Standing and Sessional Orders suspended, and Bill read a first time.

Senator CRAWFORD:
QueenslandHonorary Minister · NAT

– I move -

That the Bill be now read a second time.

The Bill is designed to amend the Post and Telegraph Act in certain respects. Clause 2 amends section 46, under which all postal articles which remain undelivered at any post-office have to be transmitted to the General Post Office before being returned to the sender. This not only causes tremendous congestion at the General Post Office, but seriously delays the return of undelivered postal, articles to the senders. The intention of the amendment is that undeliverable postal articles shall be dealt with at the General Post Office or such other post-office as the Postmaster-General directs. This will considerably expedite the return of such articles to the sender, and will permit of more economical handling of this class of mail matter. ‘ Another amendment is made to section 48. This deals with, the disposal of dead letters. The section prescribes that undelivered correspondence can be opened only at the General Post Office. The amendment is to permit of the opening of such correspondence at the General Post Office or at a post-office as prescribed by the PostmasterGeneral. Clause 4 amends section 50, which prescribes that the Deputy Postmaster-General shall return undelivered postal articles- which have been opened in pursuance of section 46. The amendment is to permit of the postmaster at offices directed by the PostmasterGeneral (as’ well as the Deputy Postmaster-General) being empowered to return such postal articles to the senders. Further, the section, as it now stands, only provides that the sender of an undelivered postal article shall, on return of such article to him, pay the original postage payable thereon, if such was not prepaid, but it does not stipulate any penalty if the sender refuses to pay. Therefore, there is now no power to compel the sender to pay. The amendment provides that undelivered postal articles on which ‘the original postage has not been prepaid shall pay double the original postage, and if the sender refuses to pay he shall be liable to a penalty of not less than two pounds, and not exceeding five pounds. This provision is very necessary, inasmuch as the Department is put to great expense in the double handling of these articles, and as the Act at present stands it is possible for a person to post an article without prepayment of postage and, on its return to him, to refuse to pay the postage. Clause 5 amends section 51, which does not make any provision for the registration of an undelivered postal article which contains a valuable enclosure. Section 38.(3) of the Act prescribes that all articles containing valuable enclosures must be registered. The amendment is to provide for the registration of articles containing valuable enclosures which are returned to the sender, and for the registration fee to be paid by the sender. The amendment is to empower the Postmaster-General to dispose as he may direct of packets addressed to places abroad, and returned to the Commonwealth as undeliverable. if the contents are not money, or a security, or order for money payable to bearer, instead of such packets being destroyed, sold, or converted into money as now provided by section 51 (2). Clause 6 makes a necessary amendment of section 85. The amendment is necessary to enable the Department to erect lines on short poles along country roads. This will reduce the cost of construction, and thus enable the Department to extend telephone facilities in many cases where the cost would otherwise be prohibitive. The addition to the Act of a new section is necessary to impose upon persons opening new roads the liability for the cost of the removal of telegraph poles rendered necessary thereby, just as liability is thrown upon’ municipal councils for the cost of removals rendered necessary by their action.

Question resolved in the affirmative.

Bill read a second time, and passed through its remaining stages without amendment or debate.

page 3546

INVALID AND OLD-AGE PENSIONS BILL

Second’ Beading.

Senator PEARCE:
Minister for Home and Territories · Western Australia · NAT

– I move -

That the Bill foe now read a second time.

In the measure I am now submitting, it is proposed to increase the maximum rate of pension from 15s. to 17s. 6d. per week. In addition, the amount which a pensioner may earn without affecting the rate of his pension will be increased from 10s. to 12s. 6d. per week. The rate of pension has .already been increased on two occasions.

This Bill provides that the pensioner may earn a little more money without affecting the rate of his pension. A single person will thus_ be able to have pension and earnings “up to 30s. per week, whilst the total income of a married couple, including pension, may be as high as £3 per week. In addition, the measure provides for an increase in the rate of pensions payable to inmates of benevolent asylums from 2s. to 3s. per week. In view of the stage we have now reached with the business of the Senate, I shall not further discuss the Bill. I trust that it will be speedily passed.

Senator GARDINER:
New South Wales

– The Government has gone one step towards improving the position of the old-age pensioners. During the Address-in-Reply debate I suggested that the parties should confer with a view to fixing an adequate payment to pensioners, instead of trying to out-bid one another. I suggested that a maxi mum pension of 30s. a week be paid, and in view of the high cost of living, I think that amount would-be justified. Throughout Australia the desire is increasing to allow the pensioners, not a bare subsistence, but a sum that would enable them to spend their old age in comfort. The Bill is long overdue, but I nevertheless welcome it as a tardy measure of scant justice. I wish the Government had made the payment at least £1 per week, or had permitted its supporters in another place to exercise their opinion free from party influence. The Government, however, ‘made’ it quite clear in the other branch of the Legislature that it would regard any attempt to increase the amount as a vote of censure. No session will be allowed to pass without this matter being raised by the Labour party until full justice is done to these aged people.

Senator Pearce:

– The . matter will come before the Insurance Commission.

Senator GARDINER:

– I understand that the Government intends appointing such a Commission, and of course the personnel of that body will be determined by the party in power. Until I saw this Bill I thought that the Government did not intend to bring it forward this session. Such benefit as it does confer will certainly be appreciated by the pensioners.

Senator NEEDHAM:
Western Australia

– I welcome this Bill in the dying moments of a very short session. It has been a hard struggle to obtain this scant recognition of the claims of the invalid and the aged.

Senator Guthrie:

– That is hardly fair, seeing that all honorable senators are in favour of it.

Senator NEEDHAM:

– If the Government had not cracked the whip, the oldage pensioners would have received at least £1 pei- week. The Prime Minister (Mr. Bruce) told his followers in the other House that if they voted for more than 17s. 6d., he would resign. We accept the Bill, such as it is, because it gives a small measure of justice, but the fact remains that this Government will ‘continue to reign at the expense of the aged and the infirm of Australia!

Senator Guthrie:

– - When the Labour party was in power, the pension was only 10s. .a week.

Senator NEEDHAM:

– The party with which Senator Guthrie is associated opposed the granting of even 10s. a week at that time. When the Labour party fixed the pension at 10s. a week, the cost of living was much lower than it is today. Had time permitted, I should have submitted an amendment with a view to increasing the pension to the blind, but I realize that it would be a hopeless task to induce the Government to accept such a proposal.

Senator GRAHAM:
Western Australia

– I, too, am pleased that at’ least a small increase of 2s. 6d. per week is to be granted to the invalid and old-age pen- sioners. I had expected the amount to . be increased to at least £1 per week.When the Labour party fixed the payment at 10s., the purchasing power of half a sovereign was almost equal to that of £1 to-day. According to the Treasurer (Dr. Earle Page) the pensioners in 1910 could obtain housing, clothing, and food for 20s. a fortnight, whereas to-day, owing to the increased cost of living, they have to pay 34s. 3d. I hope that when the next Budget is presented provision will be made for a pension of at least £1 per week

Senator FINDLEY:
Victoria

– No doubt every honorable senator is glad that this is the last Bill. to be introduced this session, and I regret that it does not make better provision than 17s. 6d. per week for the invalid and aged. When Senator Guthrie interjected that the Labour party was responsible for fixing the pension at 10s. a week, he did not explain that 10s. per week would purchase more in 1910 than 17s. 6d. will to-day, but that statement is borne out by the statistics published in the Commonwealth Y ear-Book. Ten shillings, at that time, had the same purchasing power as 17s. lOd. now has. This Government, therefore, has not actually improved the position of the pensioners, compared with what it was in 1910. As a matter of fact, the old people are rather worse off than they were at that time. I believe the people of Australia are prepared to do justice to our worthy pioneers in their hour of need. I regret also that the increase is to be made by proclamation, because a month or two may elapse before the increased rate is available. ‘ Is the Minister prepared to give the approximate date ? It would have been preferable to date the increase from the beginning of the financial year. If that had been done it would’ have meant something more for those poor old people who have been anticipating this increase since the Government’ announcement of some weeks ago. I again express my sincere regret that the Government has not seen fit to increase’ the invalid and oldage pension to 20s. per week.

Senator LYNCH:
Western Australia

– I welcome this as an instalment of that justice which we hope to see meted out to those old people who are entitled to all the help we can give them. I do not want to introduce the party spirit, because both parties are entitled to their share of credit for the sympathy extended to our invalid and aged people. I trust that the finances and general prosperity of the Commonwealth will be such as to warrant further sympathetic attention to these old people before very long., I want the blind, too, to be specially considered, and also those who made provision for old age by means of the surrender value of their life insurance policies. This measure has been submitted to us after we have been sitting continuously for thirty hours, and following very shortly after a thirty -six hours sitting. It is beyond our powers therefore to give it the adequate attention it deserves.

Senator GUTHRIE:
Victoria

– I indorse the sentiments, expressed by Senator Lynch, as I sincerely trust that at nc distant date additional consideration will be given to invalid and old-age pensioners, and particularly to the blind. In reply to the point raised by Senator Findley, I wish to state that I find that according to the Official Y ear-Book the increase in the cost of living since the date on which pensions at the rate of 10s. per week were granted has been 59 per cent.

Question’ resolved in the affirmative.

Bill read a second time, and passed through its remaining stages without amendment or debate.

page 3547

LEAVE OF ABSENCE TO HONORABLE SENATORS

Motion (by Senator Pearce) (by leave) agreed to -

That leave of absence be granted to every member of the Senate from the determination of the sitting this day to the day on which the Senate next meets.

page 3547

SPECIAL ADJOURNMENT

Motion (by . Senator Pearce) proposed -

That the Senate, at its rising, adjourn until 3 p.m. on a date to be fixed by Mr. President, which day of meeting shall be notified by Mr. President to each senator by .telegram or letter.

Senator GARDINER:
New South Wales

– In ending- the session in this way I do not think the Government is conducting its business in a proper manner. I do not know what its intentions may be, but I think we are entitled to know. Apart from the war period, when there was always the possibility of Parliament being hurriedly summoned, Parliament prorogued instead of adjourned. Unless there is a good reason for the Government adopting what I consider an unwise course, I shall oppose this motion. The Minister (Senator Pearce) has not acquainted us with the reasons for this motion, but my suspicions were aroused when he moved the motion granting leave of absence to honorable senators. I can only voice my protest against the session ending in this unorthodox manner.

Question resolved in the affirmative.

page 3548

ADJOURNMENT

Defence Department:Wages of Em ployees at Swan Bay - Singing in Parliamentary Refreshment Rooms - Locomotives Stored at Port Augusta - War Service Homes Contract : Royal Commission - Valedictory.

Senator PEARCE:
Western AustraliaMinister for Home and Territories · NAT

.- I move-

That the Senate do now adjourn.

On the 24th August last Senator Guthrie asked the following question: -

Is there any truth in the statement that, at Swan Bay, near Queenscliff, the Defence Department is paying certain employees less than the basic wage.

I am now able to furnish the honorable senator with the following information : -

I am informed that certain employees at Swan Island are paid at the rate of 12s. per day, which is above the rate fixed by the Federal Arbitration Court for labourers in these districts. The decision on the matter was based on the fact that the men concerned were not engaged as storemen, or to work in a naval store, but as casual labourers on unskilled labourers’ work similar to that of municipal employees, whose award rate is 11s. 6d. per day. The matter was dealt with by the previous Minister for Defence, who did not consider that the men concerned couldbe regarded as coming within the designation of “ storemen and packers “ or “ store labourers.” The Minister for Defence will, however, go into the whole question afresh vat the first opportunity.

I should like -to thank honorable senators for the very great consideration they have shown to me and my colleagues during this session, and especially during the very strenuous times through which we have passed in the last few weeks. I assure them that I value very highly their close co-operation in passing the various measures we have submitted to them. It has been a very severe strain upon them. They have been asked to sacrifice their convenience, and possibly their health, in the rush of business that has taken place. I also express my appreciation of your work,. Mr. President, and that of the Chairman of Committees, and I thank the officers of the House, for the valuable assistance rendered to us. May I say also that my colleague (Senator Wilson), the Assistant Minister, who is shortly leaving for England, asked me to convey to you, to the members of the Senate, and to the officials, his thanks for their kindness to him, and his good wishes and kind regards to all.

Senator GARDINER:
New South Wales

– I am sorry that, at the close of the session, when harmony should exist, I cannot join with the Minister in thanking everybody. I thank most heartily the officers of the House and those who have given me and the party which I have the honour to lead, a fair deal. I conclude this session with feelings of intense disgust at the way in which we have been treated. I am exceedingly sorry to have to say that. We have been subjected to a strain to which no party has previously been subjected, and without reason. Had the Government in the short period at its disposal brought down measures which it considered important, and put them before the Senate in such a way as to enable proper consideration to be given to them, I should not have been found acting as I now am. This week has been unbearable. The inconvenience to which we have been subjected could easily have been avoided by the exercise of a little commonsense and foresight. The only satisfaction I have is that, heavy though the strain has been upon us, the Leader of the Government in the Senate has had a still heavier load to bear.

I wish to make an explanation in regard to the singing of songs in the dining-room, and to place the facts briefly before the Senate. Mr. Charlton and I interviewed Mr. President to obtain the use of one-half of the dining-room in order that my honorable colleague might give to his supporters an entertainment before the breaking up of Parliament Mr. Charlton selected Wednesday night, in order that the function might not clash withthe official dinner which the remainder of Parliament was tendering to Mr. Bruce on Thursday. At jovial gatherings of the kind it is natural that songs should besung. That is nothing unusual. During this session I accepted an invitation from honorable senatorsopposite to attend in the diningroom a send-off to honorable senators who were defeated at the last general election. The toasts at that gathering were accorded musical honors. Any one who heard the songs that were sung onWednesday evening must admit that in our party are men who possess magnificent voices, and who make a splendid chorus. Some unmusical people may have been disturbed. I am sorry that an attempt was made to put Mr. Charlton andhis party in a wrong position. I felt hurt that a wrong impression should have been created by the reference which was made to the matter in the Senate.

SenatorGR AH AM (Western Aus- tralia) [5.4]. - I wish to ask the Minister representing the Minister for Works and Railways what has become of the ten locomotives that were stored at Port Augusta? Have they been sold? If so, at what price? If they have not been sold, where are they ?

Senator Crawford:

– I am not in a position to give the information, butI shall have inquiries made and ascertain what has been done.

Senator FINDLEY:
Victoria

.- On more than one occasion I have asked the Leader of the Government for information regarding the appointment of a Royal Commission to inquire into a certain War Service Homes contract. Is he yet able to furnish that information?

Senator Pearce:

– I am sorry thatI am not yet able to give the honorable senatorthe information he seeks.

The PRESIDENT (Senator the Hon T Givens:

– I desire to thank Senator Pearce and the members of the Senate generally for their expressions of appreciation of the services of the staff during thesession. The work has been extraordinarily heavy.I think it willbe admitted that it has been a greater strain onmembersof theHansard staff than on any other branch of the Service.The parliamentary refreshment room staff has also been extremely hard worked,and I think they deserve our thanks for the way in which they have catered forus under very difficult and trying circumstances. It has been a strenuous time also for the Clerk, the Assistant Clerk, and the other officers of the Senate.I tender to each of them our thanksand our appreciation of the good service rendered. The session has, perhaps, been asstrenuous for me as for any other member of the Senate. I havealways recognised - and I hope that I always shall - that I am in the hands of the Senate, and that it is my duty to carry out the work as honorable senators desire it to be done. I . hope that every member of the Senate during the recess, he it long or short, will have a pleasurable relaxation from the arduous duties they have recently had to perform. I extend the same wish to the members of the various staffs of the Senate and of the Parliament generally.

Question resolved in the affirmative.

The PRESIDENT (Senator the Hon T Givens:

– The Senate stands adjourned to a date to be fixed by me, which day of meeting will be notified by me to each honorable senator by telegram or letter.

Senate adjourned at5.7 p.m. (Saturday).

Cite as: Australia, Senate, Debates, 24 August 1923, viewed 22 October 2017, <http://historichansard.net/senate/1923/19230824_senate_9_105/>.