Senate
27 June 1924

9th Parliament · 2nd Session

  1. Senate
  2. 9th Parliament
  3. 1924

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

page 1669

PAPERS

The following papers were presented : -

Public Service Act - Appointment of G. S. Peddie, Department of Works andRailways.

Territory for the Seat of Government - City Leases Ordinance - Regulations amended.

page 1669

QUESTION

CANBERRA CITY LEASES

Senator GRANT:
NEW SOUTH WALES · ALP

asked the Minister for Home and Territories, upon notice -

  1. Why has he not laid on the table of the Senate regulations amending the City Leases Regulations 1921?
  2. When will these proposed regulations be tabled ?
Senator PEARCE:
Minister of Home and Territories · WESTERN AUSTRALIA · NAT

– Printed copies of the regulations did not become available until yesterday. A copy of the regulations will be laid on the table of the Senate to-day.

page 1669

SUPPLY BILL (No. 1) 1924-25

Third Reading

Motion (by Senator Pearce) pro posed -

That the bill be now read a third time.

Senator NEEDHAM:
Western Australia

– During the debate on the first reading of this bill, I drew attention to the injustice suffered by Mr. Thomas Houghton, searcher and watchman of the Customs Department, Fremantle. I pointed out that for the heinous offence of taking a cup of tea at half-past 2 o’clock in the morning of the 12th June, 1923, whilst on duty - a water police constable having temporarily relieved him - he had been suspended, and tried by a board, which had returned the finding “ Charge not proven.” This man, who had been under suspension for five weeks, was thereupon reinstated. He incurred an expenditure of £37 for counsel’s fees . and witnesses’ expenses, and understood that, as in a court of law, the costs would be paid by the losing side. I read the correspondence which had passed between myself and the exMinister for Customs, Sir. Austin Chapman, and pointed out that the ex-Minister had reprimanded the Collector of Customs, Fremantle, for having used language in the nature of a threat towards Houghton.

Yesterday, the Minister (Senator Pearce), in closing the debate, said that Parliament had appointed a Public Service Board to deal with all such matters, and that, in the circumstances, Parliament should not be called upon to deal with the case. Surely the Minister does not mean that the Public Service Board: is to be regarded as. above Parliament, or that any member of the Public Service is to be denied the right of redress through Parliament, which is the highest tribunal to which any man can appeal. If that is the Minister’s idea of how the Public Service is to be conducted, then I suggest that he is wrong. The other point which the Minister tried to make was that the Public Service Board had decided the matter. As a matter of fact, Mr. Houghton’s case was dealt with by an appeal board, established prior to the creation of the present Public Service Board, and prior even to the passage of the bill authorizing the establishment of the Public Service Board. What is more, the regulations governing the positions of searchers and watchmen were framed after Mr. Houghton’s case had been dealt with by the appeal board, and as a result of the evidence adduced at that inquiry the regulations were made more stringent. Mr. Houghton, as I pointed out yesterday, has been in the service of the Customs Department for a greatmany years, and he has been commended by the Comptroller-General of Customs for his vigilance. In the circumstances, I submit that his case deserves more serious consideration at the hands of the Minister than it received yesterday. Again I ask the Minister representing the Minister for Trade and Customs in this chamber to look into the matter, and see whether, in view of the fact that the charge against Mr. Houghton was not proved, something can be done to relieve him of the expense which he had to incur during the inquiry by the appeal board.

Question resolved in the affirmative.

Bill read a third time.

page 1669

NATIONAL DEBT SINKING FUND BILL

Bill received from the House of Representatives.

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

.- I move-

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

This is one of those measures which I indicated to the Senate yesterday it was necessary to pass before the end of the financial year. I regret again having to ask the Senate to adopt this course, but I remind honorable senators that the bill is not a contentious measure. It passed through another place in one day. Its purpose is really to extend the principle already approved by both Houses for the payment of the necessary money into the trust fund. This must be done before the end of the financial year.

Senator GARDINER:
New South Wales

– Again I enter my protest against the motion for the suspension of the Standing and Sessional Orders to enable the bill now before the Senate to be passed forthwith. I have not the least objection to an increase in the number of sittings of the Senate. Personally, I care not how long we sit. It would be more in keeping with common sense and business methods, and more in keeping with the dignity of the Senate if wo were not obliged to suspend Standing and Sessional Orders to deal with emergency legislation.

Senator Pearce:

– This motion for the suspension of the Standing and Sessional Orders is in accordance with our Standing Orders.

Senator GARDINER:

– Our Standing Orders should be so framed as to enable the Senate to conduct its business without having to adopt this unusual course. It appears to me that since this Government has been in office the Standing Orders have been in the way, and that wo have been obliged to use these emergency powers, which the Senate retained when agreeing to the existing Standing Orders, to suspend them whenever the need arises. This course is objectionable. On the present occasion I am afraid to call for a division, because I am aware that, in order to suspend the Standing Orders, there must be an absolute majority of the Senate voting in the affirmative. I doubt if the Government can command an absolute majority. Yesterday the Government won by only one vote. Possibly certain honorable senators supporting the Government, after sleeping upon yesterday’s work, may have come to the conclusion that this business of suspending the Standing Orders is not wise. Therefore, I do not feel disposed to call for a division lest the Government be without the necessary majority to give effect to its desires.

Question put.

Senator McDougall:

– No.

The PRESIDENT:

– There being one call in the negative, there must be a division so that I may ascertain if there is an absolute majority of the Senate in favour of the motion.

The Senate divided.

AYES: 19

NOES: 8

Majority … … 11

AYES

NOES

The PRESIDENT (Senator the Hon T Givens:
QUEENSLAND

– There being an absolute majority of the whole Senate voting with the “ Ayes,” I declare the question resolved in the affirmative.

Senator Kingsmill:

– I rise to a. point of order. At the present time the Senate has only 35 members, seeing that the seat of one honorable senator, who, unfortunately, died recently, has not been filled. What then now constitutes an absolute majority?

The PRESIDENT:

– The Standing Orders provide that a motion such as this shall be carried by an absolute majority of the whole Senate as constituted, irrespective of the number of senators present. An absolute majority consists of over one-half the Senate, that is nineteen members.

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

page 1671

MAIN ROADS DEVELOPMENT BILL

Second Reading

Standing and Sessional Orders suspended.

Senator CRAWFORD:
Honorary Minister · Queensland · NAT

– I move -

That the bill be now read a second time.

The object of the measure is to provide a sum for the continuation of the policy that the Government ‘ initiated over twelve months ago, when an appropriation of £500,000 was passed by Parliament for the financial year 1923-24. for national main roads development within the Commonwealth. The amounts allocated to the various states, on the basis of population and area, and on the understanding that the states should also contribute towards the work on a £i for .1 basis, were as follow: -

It was provided that the work was to be carried out under certain regulations, and the money was to be expended on certain roads, as set out in the act and regulations. In only three of the states, viz., Victoria, South Australia, and Queensland, were there bodies, such as country roads boards, possessing the information enabling the work to be put in hand at an early date after the money was made available. In the other states, cither no organisation existed or the assistance of the local bodies had to be enlisted. Moreover, the work being generally in remote parts of the Commonwealth, considerable survey and location were necessary to ensure proper expenditure. The result has been that up to date the combined expenditure of the Commonwealth and the states will not exceed £250,000, but work in all the states is now proceeding rapidly,, and the remainder of the vote should be expended before the end of 1924.

Senator Guthrie:

– Then only one-half the amount voted by Parliament last year has been expended ?

Senator CRAWFORD:

– I have already pointed out that the sum of £250.000 represents the combined expenditure . to date of the Commonwealth and states.

Senator Guthrie:

– Then it is the fault of the states, and not of the Commonwealth Government, that the work has not been proceeded with at a rapid rate.

Senator CRAWFORD:

– There was no delay on the part of the Commonwealth Government, which has done everything possible to expedite the expenditure of the money and the construction of the developmental works for which the money was voted.

Senator Guthrie:

– Then the states have been too slow ?

Senator CRAWFORD:

– In some of the states the necessary organization did not exist. In those states that had main roads boards the work proceeded more rapidly than where similar organizations did not exist.

Senator Duncan:

– Were there not disputes as; to what constituted main roads?

Senator CRAWFORD:

– There was some difference of opinion on that point, and the Commonwealth adhered to its, decision that the money was to be expended only in the construction of developmental roads.

Senator GREENE:
NEW SOUTH WALES · NAT

– It was stated yesterday by the Minister in another place that the total Commonwealth expenditure to date had been £120,000.

Senator CRAWFORD:

– Quite so. The states have contributed on a £1 for £1 basis. Whilst the expenditure of the money in accordance with the requirements of the act is being carefully supervised, so as to obtain the best effect for the expenditure, it must be pointed out that only a portion of the work on the various roads could be done with the relatively small amounts available: for instance; there are roads which will ultimately cost £50,000 or £100,000. The forming and clearing to the extent of some thousands of pounds could only be done this year, the ground requiring to be consolidated for preferably a year before the more important metalling could be undertaken. Thus, the expenditure in many cases will be either totally lost, or to a great extent lost, unless the work, which will extend over some years, is carried to completion. It is therefore submitted for favorable consideration, that there should be a further grant similar at least to the amount provided in 1923-24, which, if available, could with advantage, it is thought, be doubled by the states increasing the amount to £1,000,000. The act, with its regulations prescribing the character of roads and the method of construction, may be said to have been put into successful operation with but some few exceptions, in which, however, the difficulties have been overcome. In one state in particular, in which no .country roads board exists, and where the assistance of the shires had to be sought, some difficulty has occurred, as each of some hundred odd shires submitted its definition of the roads that would come under the definition of the act. This has necessarily meant some delay in dealing with the applications, and disappointment when the applications have had to be refused, but it is understood that this state will, like the ‘ other states, shortly have a central body, such as a country roads board, to deal with construction of roads, and thus the trouble experienced will be overcome. Again, in three other states where country roads boards did not exist, the Government placed the construction work under the respective Public Works Departments. It has taken some time to organise the scheme, but it is now in good working order, and giving effective service. This organization will be available in .connexion with future expenditure. I submit the bill for the consideration of the Senate. Now that a start has been made there should be no delay in spending .the money, and there is .very little doubt that the balance remaining from the last vote and the money now being provided will be spent during the coming financial year.

Senator GARDINER:

– Why is there any urgency for the bill?

Senator CRAWFORD:

– Because the Government we anxious to. get the work going as quickly as possible, and to have this money paid into a trust fund at once. The states are not likely to commit themselves to the initiation of a programme of work until the money has actually been set aside. It is therefore a matter of urgency to pass the bill before the Senate rises to-day.

Senator GARDINER:
New South Wales

.- Last year when a similar bill was before the Senate I protested against what I regarded as an encroachment on state rights. The State Governments and municipal coun cils are the best authorities to undertake the work of constructing and maintaining roads, and if the Commonwealth Government are anxious to devote money to the care of roads, the amount should be made available to each state in a lump sum as decided upon. Thus we should avoid coming into contact with the State Governments in a way that necessitates continual negotiations between the federal and state authorities as to whether the money provided is being spent satisfactorily and with the full approval of the Commonwealth. Otherwise the Commonwealth will be losing sight of its proper functions, and this Parliament will be dragged into a position it was never intended to occupy. Of course, if that comes about it will prove very useful to those who claim, as I do, that Australia should have one parliament only, but a large section of the community still objects to that idea, and adheres to the belief that .certain spheres of .activity should be marked out for both Federal and State Parliaments. It is certainly trespassing tn a state sphere for the Commonwealth to mix itself up in the business of finding money to build and repair roads.

Senator Payne:

– This money is not intended for repairing roads.

Senator GARDINER:

– I understood the Minister to say that some of it was intended for that purpose.

Senator CRAWFORD:

– The money is to be provided for the construction of new roads.

Senator GARDINER:

– If that is so, the position is absolutely worse. It would be a huge blunder to spend £1,000,000 to build new roads while there are old roads which are almost impassable. Before we commence to make new roads, which also will have to be kept in repair, we should keep in decent repair those now in existence.

Senator CRAWFORD:

– How much would the honorable senator like to spend on the roads in Cumberland County ?

Senator GARDINER:

– I suppose the roads in Cumberland County are the worst in the world. It is possibly the most densely populated part of Australia outside metropolitan areas, but as the people who live there know the value of good roads, and as there is a more intelligent atmosphere than was formerly the case, they have recently elected good “roads and bridges “ labour members .of Parliament. Under the old system of electing members of Parliament it was quite natural for .their roads to fall into a .state .of disrepair, but A Labour Government set to work and proceeded to put them in order. .The Commonwealth ‘Government is now making it .possible for members of the [Federal Parliament to go to a public department and urge the building of roads in ±heir .constituencies. An honorable member will thus be in a position to go -to his electors armed with a Government communication -that a proposal to ‘build a certain road has been brought .under attention and agreed to, and it will be a great .recommendation for him to use when Tie is seeking re-election. This bill is. but another illustration of the incapacity of the Commonwealth Government to handle the finances. I have known plenty of people in private life to .be in an excellent .position financially when they had only .a .small amount of money to handle., and yet become quite reckless .and extravagant when they had large sums of money to handle. Despite the fact that for the last ten years Ministers have teen faced with most serious financial problems., they are always seeking for means to squander money. The fact that a measure lias been introduced to spend money on building new roads, at a time when the financial position of the Commonwealth is so grave, is a complete outrage. I am not opposed to the building of good .roads. If we had the money to spare, which we have not, and if we had so much cash in hand .that we were anxious to give gifts to State Governments, I would spend some of it in putting up plants for £he manufacture of cement .for the building of concrete roads throughout the Common wealth, so that ‘State Governments and municipal councils could secure cheap material to enable them to have, not only roads, but good roads. The greatest evil in Australia is the fact that we have roads that are not properly constructed, or not constructed in a manner that will make them last. With the rapid development of motor traffic, good roads are essential ‘but that i3 no reason why the Government should .seek -to extend the powers of the Commonwealth by dabbling in the construction of .such roads. I feel sure that if the work were entrusted to the properly constituted road authorities, it would be done better than by having too many people dabbling in it. I can understand a Commonwealth Minister bringing- to bear his great experience and declaring how good roads can be made, and -no doubt he will hold up the expenditure off .this money in order that he may be in a position to give his .advice to the constructing authorities. The money already voted has not been fully spent, and the blame for this sort of thing is always put on some one else. The Federal -Government blame the states, the states lay the blame ion the Federal Government, but -no one will accept the responsibility for the delay. If the matter is made -the responsibility of one authority only, we shall always be in a position to £x the .blame for an illconstructed work. I -cannot understand where the urgency exists for the suspension of the Standing Orders of the Senate in order to rush through at one sitting a measure for the making of new roads. This sudden desire to tenter upon the task of building new roads is extraordinary -on the part of ;a Federal Parliament. 1 .could .quite understand the members of a shire council realizing the prompt need for having a road built. I could quite understand -representations being made to a State Government that a hew road should he built in a hurry. A State Government has its departments in order, and officers available -,to make an immediate report .upon the .necessity for such a new road. I -cannot understand, however, a Federal Government with an ‘overwhelming financial burden undertaking this sort of work at the expense of the workers of Australia, taxed so heavily as they are to-day, and as they have never been before. I think the Minister should give us some idea where these new roads will be built and some reason for suspending the Standing Orders of the Senate to pass the “bill. I could understand the urgency f or passing a bill i;o provide money to repair existing roads, and making them passable to the great ‘benefit of the community, but when the Government look about for places -where they can build new roads, -which -will get into the same state of disrepair as existing roads, I cannot understand the need for urgency, and I shall certainly call for a division on the second reading of the bill.

Senator GREENE:
NEW SOUTH WALES · NAT

– As a member of the first National Government that provided money .for the purpose of building main roads,

I can hardly take exception to the purpose of the bill, but I join with Senator Gardiner in his expression of opinion as io the unwisdom of finding this money /entirely for the construction of new roads. I do not think that that has been done. I know roads in New South Wales on which some of the money was supposed to be expended, and they are not new roads.

Senator H Hays:

– They need not necessarily be newly proclaimed roads, but they may be unconstructed roads.

Senator GREENE:
NEW SOUTH WALES · NAT

– The roads of . which I am speaking are partly constructed and partly unconstructed Vehicles pass over them to the peril of the lives of their occupants. A great amount of the money provided has been used in making these roads passable. That is quite right. If the money is to be used it should be used to the benefit of those who are already on the laud. As a practical man accustomed to country conditions, I ask the Minister (Senator Crawford) who says that this money is entirely for new roads, what sense there is in building new roads into the back of beyond when we already have 20 or 50 miles of impassable roads in between ?

Senator H Hays:

– That is not the idea.

Senator GREENE:
NEW SOUTH WALES · NAT

– I know it is not, and I want to put the Leader of the Opposition right as to what I believe is the intention of the Government and as to what is actually being done with this money.

Senator H Hays:

– The money is for new construction.

Senator CRAWFORD:

– It is perhaps largely a question of what is a road. The money cannot be used for repairing a properly constructed road.

Senator GREENE:
NEW SOUTH WALES · NAT

– That is quite another matter. I agree with Senator Gardiner that it is not the work of the Federal Parliament to interfere with the state and municipal authorities and to say what is to be done with the money expended within their borders. So long as it is expended in placing roads in the best possible condition and ‘ constructing a. road which is a mere track, no objection can be taken. It is not, howover, the responsibility of this Parliament to definitely state what particular road work shall be undertaken. That is not our job. In a case of which I know something we did not do that. The money was advanced to the states on £1 for £1 basis on the understanding that it was to be spent on main roads and on the construction of new roads. That is, I think, as far as this Parliament can go. I admit quite freely as an old politician that one may not obtain the same political advantages as if it were spent solely on new roads.

Senator Crawford:

– I have heard that some- of the money has been absolutely wasted.

Senator GREENE:
NEW SOUTH WALES · NAT

– Not in all the states. The state and municipal authorities should be able to say “where the money can best be expended. We receive a very large revenue in the form of a petrol tax, and also derive a large revenue from the duty on imported chassis. These are purely revenue duties. Parliament has deliberately imposed taxation in that form to raise revenue, and in view of the fact that the Government derives considerable revenue from these two sources, which are directly associated with the transport of goods and people within Australia, we have a right to find some of the money required for the construction and maintenance of roads. I am entirely in sympathy with the Government in granting money to the states on condition that they contribute on a £l for £1 basis in order to assist the local authorities in the construction of new roads, with the definition of new road’s as I understand it. But I take the most serious exception indeed ‘to the manner in which this is being done, and I think’ that it is time Parliament deliberately refused, in future, to permit this system of finance to continue. What is the real object? Why is the Senate considering this bill at this juncture? Why have the Standing Orders been suspended ? The real reason is not that which the Assistant Minister (Senator Crawford) gave to the Senate. He knows that perfectly well.

Senator CRAWFORD:

– Thank you.

Senator GREENE:
NEW SOUTH WALES · NAT

– I say deliberately that the real reason is that the Treasurer (Dr. Earle Page) does not wish to add this £500,000 to next year’s aggregate budget figures. We are also being asked to deal with another measure, to which 1 cannot now refer, for precisely the same purpose. In last year’s budget we had one of the most extraordinary examples I have ever seen of this sort of finance.

Really the expenditure budgeted for was £1,250,000 more than the- aggregate budget figures disclosed, and we are having a repetition of exactly the same thing this year. The present practice must cease. I say that deliberately, because I feel that the country is not being given a fair deal. What is actually happening is this : We are asked to appropriate to-day £500,000 which is to be placed in a trust fund, and having been so appropriated, although the money is to be expended in the next financial year, it will not appear in next year’s budget figures except «s expenditure placed to a trust fund. It will not appear in the aggregate figures for next year. We cannot continue financing in that way. We should frame our budget so that the country may know exactly to what extent it is committed each financial year. This measure has been introduced in this way and in this form to prevent the disclosure of what the aggregate figures are likely to be for the next financial year. Another bill which is now before the Senate has been submitted for precisely the same purpose. If its consideration were held over until next week, which would be in the coming financial year, instead of being passed this week, which is at the close of the present financial year, the amount involved would be included in the budget figures; but if it is passed this week instead of in next financial year the amount will not appear in the budget figures. That is not a fair way to treat Parliament and the country. I think the practice should cease. It may be said that the urgency is such that the money could not be found in time to permit this expenditure to proceed in the ordinary way. What has the Minister told us this morning? He eventually agreed with a statement made by his colleague in another place that the actual expenditure of the £500,000 voted last year was included in the expenditure of the year before, so that it did not appear in last year’s budget figures. This was done by post-dating the actual trust account bill, as can very easily be shown by reference to the bill itself. He has also told us that only £120,000 of money has been spent by the Commonwealth, and that the Government hope that the remainder will be spent by the end of the present calendar year. It is perfectly clear, therefore, that it is not urgently necessary to appropriate an additional £500,000 to-day. The Senate should have the budget before it before being asked to agree to the expenditure of £500,000 in relation to next year’s expenditure.

Senator Foll:

– Would it make any difference in the matter of actual road construction if the amount were included in next year’s figures?

Senator GREENE:
NEW SOUTH WALES · NAT

– None Whatever. But it would make a difference to the balancesheet because the Treasurer would be able to show an amount of £500,000, which ought to be £1,000,000.

Senator Crawford:

– The amount can easily be increased.

Senator GREENE:
NEW SOUTH WALES · NAT

– Of course. If the figures justify it the Government can say that they will vote another £500,000, but I repeat that we should still have the budget figures before us, as we would then be in a position to determine whether £500,000 as is proposed is sufficient in the circumstances, or whether the amount should be, say, £1,000,000 or £1,500,000. This method of finance is fundamentally unsound. We should not be asked to vote these large sums in advance of the Treasurer’s ‘annual financial statement. We ought to have that document before us before we are asked to vote this money. Later on, perhaps, when it comes to another stage, it will be open to the Senate to take such action, as will present the views of the Senate to another place. I have said all 1 desire to say on this subject, and have endeavoured to put the case as clearly as I could before honorable senators. I agree with some of the statements by Senator Gardiner, particularly in relation to taxation, which is to-day very heavy. I am hoping that when the budget is presented a number of the purely revenue duties which are collected to-day will be reduced so that the people may find some relief. I do riot wish to see relief given entirely to the rich man. Not in the least. During the period of the war and since, the taxpayers have been carrying an immense burden, which has been borne by the rich as well as the poor, and I am hoping that when, the budget figures are introduced, and we know the whole story, it will be possible to relieve the taxation burden of the rich as well as that of the poor. a

Senator GRANT (New South Wales) pi.57]. - In the Estimates of Revenue and Expenditure for the year ending 30th June. 1924, we are informed that the total revenue of the Commonwealth is estimated at £60,749,000, but in addition- to that, vie are- told, more or less accurately, by the various financial experts,” that the revenue is likely to exceed that amount by approximately £11,000, 00&. .

Senator CraWFORD:

– Not £11,000,000 for the present financial year.

Senator GRANT:
NEW SOUTH WALES · ALP

– The Government are taxing the people of the Commonwealth, at a very much heavier rate, and in more directions than is necessary, in order to meet the abnormal and, to some extent, unforeseen expenditure. They are now at their wits’ end as to how to dispose of the surplus. With an excess revenue amounting, to £11,000,000, the Government should realize that it is their duty to reduce the .taxation in a number of directions. What objection can there be to substantially reducing the income tax and raising the exemption to £400 or £500 ? That would afford relief to a large number of citizens, and to that extent would remove taxation from industry. The Government now insists, upon taxing people in proportion to the services that they render to the community.

The PRESIDENT (Senator the Hon T Givens:

– The honorable senator is entitled to make a reference to the matter of taxation, but he may not devote himself wholly to that matter.

Senator GRANT:
NEW SOUTH WALES · ALP

– I do not intend’, sir, to run counter to your idea of what is the right and the wrong procedure, because I recognize that your view is generally the correct one. I thought that I would be in order in casually mentioning that a remission of taxation is long overdue, and should immediately engage the attention of the Government. It is contrary to the wish of the taxpayers that they be called upon to pay annually £11,000,000 more than is necessary to- carry on the government of the country..

Senator CRAWFORD. That £11,000,000 includes the accumulated surplus and is not the result of only one year’s Operations.

Senator GRANT:
NEW SOUTH WALES · ALP

– T understand that; but it- seems to me that £11,000,000 more has been - raised than has been required.

Reference lias been made to the petrol tax. The user.s- of motor’ cars are taxed in various directions by both the states and. the Commonwealth.’ WOUld: it not be an immense advantage to those persons if they were- relieved from- that taxation f One would think that they were’ actinginjuriously towards other citizens when one sees the manner in which they are. perpetually harassed. The cost of motor cars to-day is beyond the reach of manypeople, and it. ought to be the aim of the Government to decrease rather than to- increase, that cost.’

Senator CRAWFORD:

– The construction of good roads, which this expenditure will make possible, will benefit motorists.

Senator GRANT:
NEW SOUTH WALES · ALP

– The money will also be expended for other purposes that have not been mentioned by the Government. It is intended to amend the Main. Roads Development Act. That act provides that £500^.000 annually shall be- made available out of the accumulated surplus. The money that has already been voted! has not been expended, and we- are informed by the Minister (Senator Crawford) that he does not anticipate that it will be expended before the end of December, 1924;. yet he desires to have placed at the- disposal of the various State Governments a further sum of £500,000. I do not think that the construction of roads is the work of the Commonwealth Government. The local authorities, or the State Governments, should have charge of the construction and upkeep of lanes, streets, and roadways.

Senator CRAWFORD:

– None of this money will, be spent on lanes or streets.

Senator GRANT:
NEW SOUTH WALES · ALP

– The Government does not know in what . direction the money will be spent after it leaves them. This proposal will have the complete approval of motor car and bicycle owners, as well as the owners of other means of transport. 11. is an excellent votecatching measure; but I’ do not suggest for a moment that it has been brought forward with that object in view. It is altogether wrong- for the Commonwealth Government to make of itself a taxing machine-; and to hand to. the State Governments the revenue so raised. As those authorities in turn will band the money over’ to municipalities, shires, and roads board’s, a good deal of leakage will occur before it finally reaches the man who wields the pick and shovel. Those persons who, notwithstanding the vast resources of this continent, find it impossible to secure any employment, will, no doubt, be relieved to a certain extent by the expenditure of this money; but, if the go-slow policy of expending, only a fraction of the amount that is voted is persisted in, it ‘is problematical when the total sum made available will be exhausted. It is, doubtless, true that if it is properly expended the primary producers will be enabled to market their produce more readily and cheaply. The raising of revenue by means of income taxation, land taxes, and Customs duties, and its distribution in dribs and drabs, is to me entirely distasteful. Those who expend the money are the people who should raise it. It is not a function of the Commonwealth Government to tax goods that are imported from low-wage countries, and to ladle out the resultant revenue to the states in this manner. The functions of the Federal . Government have been accurately defined in the Constitution. I defy any Minister to point to any provision in the Constitution which indicates an intention .to apply to road-making any of the funds of the Commonwealth. I realize the importance of placing a wide interpretation upon the class of road on which this money shall be expended. If the municipalities are to have control of the expenditure, roads that are in a bad state of repair may conveniently be characterized as roads that require to he newly constructed. ‘The taxpayers’ associations in the various states are clamouring very loudly for a remission of taxation, and they do not hesitate to specify the direction in which they would like to see the taxation reduced. One of - the immediate e’ffects of even a decision to construct a new road will be to immensely increase the value of land not only alongside the railways, but between the proposed new road and the main centres of population. The Government should repeal this act,’ .and, by reducing taxation, absorb the surplus, which it is incapable of judiciously expending. It could then throw upon the local bodies the necessity of taxing land values. While ostensibly this expenditure is to be made ‘for the purpose of giving employment to returned soldiers and others who are unable to secure ‘Work, a permanent effect will be the making of a substantial donation to those who -own. land- adjacent to the roads that it is proposed to construct. Those persons should be -called upon to defray 9.9 per cent, of the cost of making those roads. It appears -.to me that the Government is -asking us to indorse a vicious system of taxation. I shall, therefore, vote against the- second reading sf the bill.

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

– I desire to reply briefly to the criticism, by Senator Greene. There may be a good deal to be said for the point of view that he advanced, that this is not , the best way in which to present the accounts of the nation. I, however, direct attention to the fact that that criticism is somewhat belated; because, if it applies to-day, it applied equally .as well when the first bill was introduced to give effect to the desire to assist in the carrying out of a roads policy .for the Commonwealth. I take it for .grafted that Senator Greene and others who adopt his view of the financial aspect do not dissent from the advisability or the desirability of doing all that we can to provide a better class of roads throughout Australia.

Senator GREENE:
NEW SOUTH WALES · NAT

– Hear, hear !

Senator PEARCE:

– I take it, also, that those honorable senators realize the value of such roads to development. la reply to the contention that the states only should bear the responsibility of carrying on this work, I draw attention to the fact that in the United States of America, which works under a constitution similar to ours, the federal authority very -largely subsidizes the states to provide -national highways.

Senator FINDLEY:
VICTORIA

– We do not want to follow their lead.

Senator PEARCE:

– In this matter I think we can follow them with great advantage to ourselves. I have been in the United States of America, and have seen the admirable roads that have been ‘constructed there. Those roads are a splendid national asset. Because I believe -that the Senate is overwhelmingly in favour of the principle of the bill, I shall not refer further to it. I remind the Senate -of the difficulty that would be ‘created if the criticism which Senator ^Greene directed to the measure’ were acted upon. Last year exactly: .the same procedure was adopted.;

Senator GREENE:
NEW SOUTH WALES · NAT

– Not exact*] v the same procedure. - - ‘

Senator PEARCE:

– Last year we passed a bill authorizing the payment out of the revenue for 1922-23 of the sum. of £500,000 for .main roads development.

Senator GREENE:
NEW SOUTH WALES · NAT

– That bill was passed in the present financial year, 1923-24.

Senator PEARCE:

– It may have been passed in the succeeding year, but its provisions were made retrospective.

Senator GREENE:
NEW SOUTH WALES · NAT

– Exactly; that could be done in this case.

Senator PEARCE:

– But that is not what the honorable senator suggested should be done. He suggested that we should include- this vote in the ordinary budget expenditure and have it debited to the financial year to which the budget applied. That was not done in the financial year 1922-23. The bill to which I refer was assented to on the 2nd July, 1923, but it was passed before the end of the previous financial year, and its provisions were made retrospective, so the amount was not debited to the year 1923- 24, but to the preceding financial year.

Senator GREENE:
NEW SOUTH WALES · NAT

– And it was done for exactly the same reason that I am urging in respect of this measure.

Senator PEARCE:

– If, as the honorable senator suggested, wo did not pass this bill in this financial year, the expenditure would have to be met out of the Treasurer’s Advance Account. And assuming that the Government policy with respect to expenditure for main roads development was continued, the accounts would show no payment at all for the vear 1923-24. The year would be a financial blank so far as assistance to the states for main roads was concerned, whilst in the financial year 1924-25 provision would have to be made for two financial years.

Senator GREENE:
NEW SOUTH WALES · NAT

– No.

Senator PEARCE:

– It is an absolute fact, unless, of course, we pass this bill in the next financial vear, and make its provisions retrospective. But wherein lies the virtue of doing that? That course will not ensure the inclusion of the expenditure in the budget, and therefore does not quite meet Senator Greene’s criticism. It would be merely doing the same thine; in another way.

Senator GREENE:
NEW SOUTH WALES · NAT

– Under my proposal the Government could get exactly the same amount of money spent in exactly the same time.

Senator PEARCE:

– But it could not be debited to this financial year.

Senator GREENE:
NEW SOUTH WALES · NAT

– It would be debited to the proper financial year.

Senator PEARCE:

– I ask all honorable senators who are acquainted with the Treasury methods if it is not a fact that there is no provision for this vote in the budget for the financial year now closing ?

Senator GREENE:
NEW SOUTH WALES · NAT

– No, because the expenditure was authorized for the previous financial year.

Senator PEARCE:

– Therefore if we do not make this special provision there will be no debit against the revenue for 1923- 24, of this amount unless - and even- Senator Greene does not advocate this - we allow the bill to stand over until next week, and make its provisions retrospective.

Senator FOLL:
QUEENSLAND · NAT; UAP from 1931

– “What would be the effect of including this item in the next, financial year’s expenditure?

Senator PEARCE:

– The effect would be to show an additional £500,000 surplus for this financial year, when really that amount was ear-marked for a definite purpose. Although the appropriation under last year’s vote was made available early in the present financial year, owing to the delay in getting the local governing bodies in the various states into line, only £125,000 was expended in the financial year. But those local governing bodies in the various states have entered into certain liabilities. The probability is that contracts have been entered into for the expenditure of a great portion of the amount of appropriation unexpended. The reason why the Government in .1922-23 adopted the procedure which we have followed to-day, was that it wished to be able to give an absolute guarantee, through the various State Governments, to local governing bodies throughout the Commonwealth, that the money would be available. We could not have given that undertaking had we included the. amount in the ordinary budget expenditure, be cause usually the budget is not passed until later in the financial year, and the Government had to take action, in respect of expenditure for main roads .development, early in the financial year.

Senator GREENE:
NEW SOUTH WALES · NAT

– The object could have been achieved, by passing a single bill, and making it applicable to the financial year.

Senator KINGSMILL:
WESTERN AUSTRALIA · NAT

– Expenditure in the budget is never anticipated?

Senator PEARCE:

– Yes. Does Senator Greene suggest that we should provide for the expenditure out of the Treasurer’s advance? There are really three alternatives. We may, if we choose, meet this contemplated expenditure out of the Treasurer’s advance account : we may include it in the budget; or meet it, as now proposed, by passing this bill. The advantage of the present course is that we shall be able to give a guarantee to local governing bodies throughout the Commonwealth that the money will be available. The State Governments are entitled to know, because they have to prepare their own budgets.

Senator Duncan:

– What would be the effect if we did not pass this bill until next week?

Senator PEARCE:

– We could make its provisions retrospective. We should have to apply it to the previous financial year - that is, this year - otherwise the Treasury accounts would show no payments for this financial year into the fund. I submit, therefore, that the difference between the course suggested by Senator Greene and the method adopted by the Government is the difference between tweedledum and tweedledee.

Senator GREENE:
NEW SOUTH WALES · NAT

– The course I suggest would show the true financial position. The method followed by the Government would not do that.

Senator PEARCE:

– I have explained the difference between doing as the honorable senator suggests and passing this bill before the end of the financial year to which the expenditure must be debited. We merely propose to do to-day what Senator Greene suggests we should do to-morrow. If we follow the course outlined by him there will be no provision for the expenditure of this money in the financial year now closing. If there was anything in the honorable senator’s contention that this vote should be included in the budget, we could not make the expenditure retrospective. It would have to be included in the expenditure for the next financial vear.

Senator Foll:

– Would it matter if we made provision for two years’ expenditure in the budget for the next financial year ?

Senator PEARCE:

– It would not be a fair presentation of the expenditure. This, properly speaking, is a liability of this financial year, and before we enter into- it we should know that we have the authority of Parliament for the expenditure.

Senator GREENE:
NEW SOUTH WALES · NAT

– It will be a- statutory obligation if we follow the course I suggest.

Senator Kingsmill:

– If it is included in the “budget it will be necessary to alter the act.

Senator PEARCE:

– We should not have to do that. Parliament would authorize the expenditure up to £500,000. Senator Greene’s criticism of the bill may be sound, but it is belated. It should have been directed against the proposal last year.

Senator GREENE:
NEW SOUTH WALES · NAT

– “Unfortunately, I was not here then.

Senator PEARCE:

– Perhaps that was why Parliament blundered. The Government having decided to provide for the money in this bill, and in this way, it would be exceedingly awkward now if Parliament adopted a different principle. The accounts for this financial year would show a blank, although, as a matter of fact, we had actually expended the money.

Senator J B HAYES:
Tasmania

– I have much pleasure in supporting the bill. I have had a. great deal of experience with main roads, particularly in my own state, and I know their value. My only regret is that the Government has not seen its way clear to make the amount available much large*.

Senator GRANT:
NEW SOUTH WALES · ALP

– Do not forget that this appropriation is for new roads.

Senator J B HAYES:

– I have no doubt that the Government had good reason for the course adopted last year of voting the money and making the bill retrospective. What the Minister (Senator Pearce) has said is perfectly correct. If the amount is included in the budget expenditure, the accounts for the present financial year will contain no reference to the expenditure. It is simply a ques.tion whether we shall put the matter right from a strictly treasury point of view, or allow it to stand.

Senator GREENE:
NEW SOUTH WALES · NAT

– If we pass this bill, the expenditure will never appear in the budget at all.

Senator Pearce:

– Yes, it will.

Senator J B HAYES:

– The item must be shown in the national balance-sheet. Personally I think, with the Minister, that the difference between Senator Greene’s suggestion and the Government proposal is the difference between tweedledum, and tweedledee. It really does not matter very much, because the expenditure will be shown in the accounts. A more important question is the condition under which the vote is granted to the states. The- treasury drew up certain conditions under which the money was to be expended, and, owing to- difficulty in getting one set of conditions for the whole of the Commonwealth,, there has been delay in expending the amount available-. Let me. take the case of my own. state. The conditions there differ very largely from, those in the other states. Tasmania has a great deal of hilly country and a heavy fainfall. Every contract for the sale of 100 acres of land contains the implied’ condition that a metal road’ shall be- constructed to the land As a result, we have m Tasmania Between 5,00,0 and1 6,000 miles of metal roads. About 25 per cent, of the public- debt of. Tasmania is due to expenditure1 on* roadsand bridges, and1 the effect” las’ been topractically cripple the state* financially. The work has all been1 done8 out of loan money, and the municipalities have been unable; tew keep the roads in proper order. Australian engineers: can construct road’s aa well ass engineers in any cither- park of the- world ;. it is- simply ai matter of hawing; sufficient money to carry out the work. The- light roads built years ago were sufficiently heavy for the> class- of traffic then, in existence;, but.- with the. advent, of motor transport it is a, common) sight nowadays to see a. motor lorry with, a load of from 12 to 14 tons of produce or timber, bumping, along, our light, roads at a considerable speed’. Ordinary country roads were never intended’ to carry such, heavy traffic, and consequently more costly highways have, become necessary. . Senator GARDINER - The Commonwealth Government will not allow the states to use any of the road vote to repair such roads.

Senator J B HAYES:

– It is for exactly this class of road that the money should’ be used. The states have done the best they could with the money aft their disposal, and since there is- now a new- class of traffic to be coped with, there is no good reason to prevent the expenditure of the Commonwealth money on th!e re-construction of existing highways.

Senator Thompson:

– Does not Tas- mania tax the motorists?

Senator J B HAYES:

– Yes, but the revenue derived from that source is a mere drop in the bucket.. It is not too much to ask the Commonwealth to spend the whole of the revenue derived from motor traffic, directly or indirectly, on. main roads. A motor tax for the repair of those roads would be an unfair proposition, seeing that business motor cars are. often driven. 13,000 or. 14,000 milesa year., whereas many private owners keep their cars garaged for the. greater part of the time. We have a., petrol tax, and it would not be too much to ask the Com.monwealth Government to allow the money raised in that way to be used for road construction.

Senator GRANT:
NEW SOUTH WALES · ALP

– Should not the people who own the land pay something: towards the- upkeep of thee roads ?

Senator J B HAYES:

– They do. The honorable senator lives in Sydney, and perhaps is not fully conversant with the conditions’ in the other states. In Tasmania* there* are- large areas of very rich land, but there are also very mud larger areas of poor- land1 oy which that land is- divided. As in- Gippsland’, the land in Tasmania- is’ very patchy. We- have hundreds of miles of metalled road’s running through country- that is producingnothing and1 is- incapable- of being used’ to- good advantage-. The land’ is notworth more- than 10a1. an acre. and ir* merely suitable for wintering’ a few cattle .or sheep. The- residents of the towns that ane- connected- by these roads have to pay for their upkeep’, and5 the best method to adopt is indirect taxation:. - Everybody in the Commonwealth, whether’ a shopkeeper in Sydney or a potato grower in. Tasmania, benefits, by good roads, .and a larger amount of general revenue could, equitably be spent for the purpose of obtaining the increased production that results from good high-ways. If a State Government came forward with a proposition to- build a new road in a- new district the Minister for Works and- Railways would, say, “Very well; that is just, the place where you can, spend, this money.” If some of the roads, now in at worn-out condition, had not been built by the T.asmanian authorities, the Government would readily allow Commonwealth funds to be used for their construction.. But seeing that Tasmania has already built those roads, and now finds itself, unable to reconstruct them, it is unfair for the Federal Government to declare that Commonwealth money cannot now be spent on them. At least a reasonable proportion should be available for reconstruction purposes. I believe it has been decided to keep down the grades of the new roads to 1 in 20. I should like to see roads of no steeper grade than 1 in 30 if they could be obtained, but that is impossible in a great many parts of Tasmania. In consequence of the regulations framed by the Commonwealth authorities, the engineers have had to look about them to find places where roads to* fit the conditions laid down could be built, instead of being permitted to spend the money in places where it could1 be- used with the greatest benefit to the largest number of people. I have had a good deal of experience of the principle of making grants on the £1 for £1 basis, and I believe that if a municipality’ or a State Government is prepared: to advance half the money for a necessary work, it is an earnest of their bona fides, and one need have no compunction in giving favorable consideration to their request to be allowed1 to spend the money. Where_ money is allocated on this principle, it is in the interests of the states to see that it is spent in the most economical manner, and in places where it will do most good. I am, therefore, convinced that the allocation of the expenditure could with safety be left very largely to the states themselves. If the Commonwealth Government allowed the State Governments and the municipal authorities to decide in the main where the money should be spent, it would result in roads being constructed to the best advantage.

Senator GRANT:
NEW SOUTH WALES · ALP

– Would the honorable senator insist on the payment of pound for pound by the states?

Senator J B HAYES:

– Yes, because it means cheap money for them-.. Their engineers must have better knowledge of local conditions than Federal engineers of equal standing, could possibly be expected to have: I have much pleasure in supporting the bill. I should have been better pleased if it had provided for £1.000:000 “instead of £500,000- My object is to help the Government to improve the measure.

Senator KINGSMILL:
Western Australia

– One of the main points to consider how this,, proposal affects the relations between the- Commonwealth and th0 states, and it is refreshing, and none the less gratifying,, to find the leader of the party supposed to be in favour of unification showing that he :s in favour of state rights. From my point of view I think that the bill is thoroughly satisfactory in -that respect; and any honorable senator who reads the parent act must come to the same conclusion., My remarks in this- connection, have a. bearing on what Senator J. B.’ Hayes has said in regard to the control of the works under consideration. The principal act shows that the control of the expenditure is only what might be regarded as sufficient to satisfy the Federal Government that its money will be expended in the right direction. Section 8 provides -

No payment shall be made under this act unless - :

there is submitted to the Minister a proposal in writing, specifying the main roads upon which the money paid is- to be- expended, and containing, full details of the proposed roads, including plans, method of construction and such other particulars’ as the Minister requires; and

the proposal, is approved by the Min ister.

There is- nothing in that section that takes the control of the expenditure out of the hands of the states. Section 9 reads -

The Governor-General may make regulations, not’ inconsistent with this act, prescribing all’ things which are required or permitted to be prescribed’, or which are necessary or ‘ convenient to be prescribed, for giving effect to this act, and in particular -

for prescribing the classes of roads which are to be deemed to be main roads for the purposes of this act; and . - . . (.b) for empowering the Minister to impose conditions in relation to’ the expenditure’ of any moneys “paid, or ‘ payable in pursuance of this act.

Those two sections, by giving wide discretionary powers to the Federal Government, get over, to a very great extent, the. objection that has been raised, in the first place,’ in regard to the definition of main roads, and, secondly, as to whether the money should be used for reconstruction work, or simply for the making of new roads. Any reasonable person, on reading those sections., would’ say that even repairs to existing main roads could be undertaken.

Senator Gardiner:

– The -Minister,, then, is not’ a reasonable man.. .

Senator KINGSMILL:

– Some Ministers, in the opinion of some people, are never reasonable. It all depends on the point of view. It will be quite possible, if a good case is made out, for the responsible Minister of any party to give consent to the expenditure of money even for much needed repairs. It is obvious, indeed, when we consider how few really new main roads have to be constructed, that much good cannot be done unless the money is partly used for reconstruction work. The main arteries of traffic are already laid down, and whatever new roads are now built will be merely veins or feeders. I think, therefore, that it is reasonable to say that the money should be spent for reconstruction work as well as for the making of main roads. The only other point on which I desire to speak is that raised by Senator Greene. It is a point that escaped the notice of the Senate when the original bill was passed. The Leader of the Senate has said that there is not very much difference in the mode of procedure, but from my point of view there is this difference - one is right and the other is wrong. Senator Greene has undoubtedly taken up the right attitude. Expenditure which has to be made in any year should be, as far as possible, debited to that year. There is a very easy way of providing for it. A trivial amendment in the body of the bill will do so, and if it is moved I shall certainly support it. That we have done wrong in the past is no reason why we should continue to go wrong ; rather is it a reason why we should set matters right as speedily as possible. It is unthinkable that any honorable senator would oppose the second reading of a bill that is undoubtedly for the benefit of the states, and means giving back to the states some of the money which, rightly or wrongly - in some cases wrongly - the Federal Government has taken from them. Every honorable senator must support it, more especially when for some time the tendency of federal revenue has been upwards, while that of state revenue has been downwards. It is right that the Federal Government, out of the fulness of their purse, should relieve the stringent necessities of the states which have suffered a great deal and have been hampered by losing their main sources of revenue to the Commonwealth. I have much pleasure, with the reservations to which I have alluded, in supporting the .second reading of the bill.

Senator PAYNE:
Tasmania

.- - I appreciate the remarks made by the two honorable senators who have preceded me with regard to the need for recognizing that main road development should not be confined to the construction of main roads, but should also apply to the further development of existing main arteries. The title of the bill would lead one to imagine that under certain conditions the improvement of existing main roads is permissible. A main road may have served a district for a number of years, and yet be totally inadequate to meet the requirements of further development until it is put in such a condition that proper use may be made of it. Many seem to imagine that the people of Tasmania expect roads to be made without calling upon the land-owners to make some contribution towards their cost, but, for the information of Senator Grant, who has interjected that land-owners should be compelled to pay for the roads of the state, I may say that there is no part of Australia to-day where the land-owners and the land occupiers are paying as heavily for tie maintenance and construction of roads as they are in Tasmania.

Senator GRANT:
NEW SOUTH WALES · ALP

– How much in the £1 do they pay ?

Senator PAYNE:

– The rate levied by the municipal authorities for the upkeep of roads is Is. 3d. in the £1, based on the annual value.

Senator GRANT:
NEW SOUTH WALES · ALP

– That is a tax on industry.

Senator PAYNE:

– It is a tax on the land. No one can own a piece of land in Tasmania unless he pays his contribution towards the cost of the maintenance and construction of roads. Senator J. B. Hayes has asked, the Government to provide regulations under the act to meet the special case of. Tasmania. I have a letter from the Municipal Association of Tasmania asking me to assist them in directing the attention of the Government to the necessities of Tasmania. The grounds for their request are as follow : -

That, owing to the conditions in Tasmania being different from any other state, the Minister be urged to approach the Federal Government to allow 50 per cent, of the road grant to be spent in the reconstruction of the main roads for the following reason : - “ That, owing to the nature of the country, long lengths of metalled roads were essential to provide outlets for settlers; upwards of 6,000 miles have been so constructed. These, while suitable for the purpose when built, were, on account of the cost, necessarily light, and will not stand the present-day traffic.”

I endorse the comments of the association. The roads now need widening and strengthening to carry modern traffic.

Senator O’Loghlin:

– Why is Tasmania different from any other state?

Senator PAYNE:

– The honorable senator can speak of his own state. The conditions in the hills of South Australia may be similar to those in Tasmania. I am putting the case for Tasmania. Another Victorian senator may argue from the point of view of Gippsland. The case I am putting up may be supported by representatives of other states This question of widening and strengthening main roads is very urgent, and I ask the Minister to bring under the notice of Cabinet the necessity for amending statutory rule No. 104 of 1923, which lays down the conditions under which the money made available can be expended. I suggest that it should be recognized that money spent on improving existing main roads by widening and strengthening thorn is equivalent to putting down another length of road to be termed a main road for the future development of the state. The Huon-road carries an enormous traffic, and its maintenance in anything like decent order has involved a heavy expenditure on the part of the ratepayers and taxpayers of Tasmania. Its disrepair has been brought about by the heavy traffic caused by the additional production of the district, and the same remark applies to the north-west and north-east roads. If we strengthen main roads, and at the same time give due attention to the building of additional main roads which are necessary to develop the country, we shall be materially assisting in the development of the states. I trust that the suggestions made to-day will be considered by the Government, and that provision will be made in the direction requested.

Senator McDOUGALL:
New South Wales

.- The root of the evil in connexion with the disbursement of the Commonwealth’s millions is the fact that we have a federated instead of a unified Australia. The only cure is the adoption in the very near future of the proposals of the Labour party for unification’. Wise men in the early days of federation predicted what would take place within twenty years under the present form of government, which has proved such a huge failure and blunder. The States have refused to provide £1 for £1 so far as expenditure on main roads development is concerned, because they have very little control over the way in which the money is spent. Conditions are laid down by the Federal Government to which they cannot conform. One condition is that a road must develop some new area. If a state finds that the money is to be spent on a road in a portion of the state in need of development it may agree to the conditions imposed, and provide £1 for £1 with the Commonwealth Government for that work. But if it’ realizes that a road proposed to be developed may be’ of little value to the state, and that as a matter of fact no money need be spent upon it for many years to come, it will not put up its £1 for £1, because the money spent in building that particular road would be practically money thrown away. The states are perfectly willing to avail themselves of the opportunity to spend the Commonwealth’s money, but the conditions imposed by the Commonwealth Government are such that they cannot conform to them. They do not feel justified in spending their own money ‘in developing roads that may not be required for years to come. . Sitting suspended from 1 to 2.30 p.m.

Senator McDOUGALL:

– The extension of main roads does not mean the development of private property or the making of roads through privately owned lands, but the construction of: roads which will be of advantage to the whole of the Commonwealth. Main roads are necessary in the Northern Territory and in the north of South Australia, and Western Australia, where portions of the country are at present quite inaccessible except by means of an aeroplane. The principle involved in this instance is a very good one. The general body of taxpayers in the Commonwealth will have to find the money, because we cannot: expect the states to incur heavy expenditure in the construction of roads which for some time will be of comparatively little value. It has been contended by some people that the money is being advanced to the states in order to provide employment for a certain section of the unemployed, and whilst that is a most laudable object, we know that the bill has been introduced at this stage and its passage is being expedited merely to enable the Government to adjust the* financial position in the way they desire.

Senator FOLL:
QUEENSLAND · NAT; UAP from 1931

.- It is not my intention to oppose the second reading ‘ of the bill, but I think it is the duty of honorable senators to carefully note the remarks made by Senator Greene as to the reason why this measure is being treated as urgent. The honorable senator stated that the amount involved is to be charged to the expenditure of the present financial year which will end within two or three days, whereas it should really be a charge upon the funds of the next financial year, because during that period most of the money will be spent. I’ gathered from the Minister (Senator Pearce), that a precedent was created twelve months ago by pawing a similar bill before the close of the financial year, but that is no justification for adopting a similar practice on this occasion. The Minister pointed out that we should be in an unsatisfactory position if two appropriations of a similar amount for the same purpose were made in one year, but I cannot see why there should be any objection to that.

Senator H Hays:

– There would not be two appropriations in one year, but in one year -there would, not .be any appropriation at all. “

Senator FOLL:
QUEENSLAND · NAT; UAP from 1931

– If there were no appropriation in one year, later there would probably be two appropriations in the same year. The Minister did not deny: that ; this is an undesirable way in which to conduct the public finances, but merely suggested that we should be guided by precedent. I respect the opinions expressed by Senator Greene, who has not only had extensive ministerial experience, but has also a wide knowledge of public finance. His views are, I am sure, of benefit and of interest to honorable senators. The Government should take cognizance of the fact that it is apparently the wish of a large number of their supporters that this method of conducting public finance should be discontinued. I do not feel justified in opposing the bill, because such action would create the impression that I am opposed to the Federal Government assisting the states in the matter of road construction. I am not opposed to the principle of advancing money to the states to assist shire councils in this very necessary work.

Senator Gardiner:

– Is the honorable senator opposed to the principle of charg ing next year’s expenditure to this year’s accounts ?

Senator FOLL:

– Yes.

Senator Sir Thomas Glasgow:

– Why did not the honorable senator oppose a similar bill last year?

Senator Duncan:

– We were informed last year that the circumstances were exceptional, and I believe we were assured that the action would not be repeated.

Senator Crawford:

– On a previous occasion when a similar bill was submitted, Senator Greene was a member of the Government.

Senator FOLL:

– Even if this practice has been followed since the inception of Federation, it is wrong, and we should take this opportunity to discontinue it, particularly as the position has been so forcibly brought under our notice.

Senator Crawford:

– Is it the desire of the honorable senator to “ talk out “ the bill ?

Senator FOLL:

– I object to the interjection of the Minister. I am not endeavouring to do what he suggests. I shall claim my right to express my views on any matters which come before the Senate for consideration. It would be reasonable on the . part of the Government, seeing that so many of their followers object to the method adopted, to delay the passing of the bill for a few days, because if it is passed next week the appropriation will automatically come out of next year’s revenue. In common with other honorable senators, I regret that the amount is only £500,000, particularly when one considers the large amount of revenue extracted by way of Customs duties and other taxes from the people who use the roads. It is only fair in the circumstances that a substantial portion of the revenue so derived should be devoted to road construction. If a person purchases a motor car, even an ordinary low priced American machine, he has to pay £60 or £70 in Customs duties, and from the moment he commences to run it he is further taxed on the petrol he uses. He is also taxed on the tires, although he is assisting one of the largest industries in this country. Generally speaking, it can not be said that the average motor car owner runs his car for pleasure, especially in country > districts, where motor vehicles” are as an important factor in developmental work as was the bullock wagon or the sulky in early days. I am not in favour of the imposition of a tax on motor chassis. I think they should be admitted free. Until oil is discovered in Australia in payable quantities the users of petrol are likely to be taxed somewhat heavily. There is a larger number of cars per 100 of the population in Australia than in many other countries, . and the Government should recognize that the users of motor vehicles are entitled to more consideration than they are at present receiving. In addition to the charges which have to be met in the form of Customs duties, a motor car owner also has to pay £5 or £6 a year for using roads which, in some instances, are practically impassable. He has also to pay a driver’s license fee, and generally has to contribute a much larger sum to the revenue of the country than should be necessary. 1 have no hesitation in saying it would be impossible in any other part of the world to find roads worse than some of those in Australia. I am not blaming the local authorities, because the task which they have to undertake, with the limited funds at their disposal, is in most instances formidable. Senator J. B. Hayes mentioned that in Tasmania there are large areas where the nature of the country is poor, and where the shire councils are unable to raise sufficient revenue with which to -construct roads. During a motor tour which I made a little time ago, I discovered that where good country had been subdivided into small holdings which were occupied by prosperous people there were good roads, but in the poor country where the revenue was inadequate they were in a most unsatisfactory state. A scheme should be agreed to between the federal, state,’ and shire authorities for building roads in the manner provided in the bill. There is a strong feeling in the country against the continued imposition of heavy Customs -duties, particularly on motor chassis, accessories, tires, petrol, &c, and it is thought that the time has arrived when the duties should either be reduced or a considerable portion of the. money so collected spent on the construction of better roads. If a request is submitted in committee to increase the amount from £500,000 to £1,000,000 I shall support it, as I think it only reasonable, in view of the state of the Customs’ revenue at present, that a larger grant should be made. Consumers and users of dutiable commodities do not like to see’ a-11 accumulated surplus of £11,000,000, while at the same time they are ‘being heavily taxed. It is necessary; of course,, to make some provision for lean years, but I ‘ do not see why the Government should raise by direct or indirect taxation millions more than is ‘. necessary to carry on the work of the country. That is an aspect which should be seriously considered. The Government should not seek to increase the amount received in indirect taxation through the Customs Department or gloat over the accumulated surplus. On the contrary, the finances should -be readjusted in such a manner that only, sufficient revenue will be collected to carry on the government of the country and make the necessary payments into the sinking fund. Senator Greene forcibly voiced the opinion of the majority of honorable senators on this side when he expressed dissatisfaction with the manner, in which this bill has been introduced. The question of roadmaking in Australia is one of considerable magnitude, and honorable senators should have been afforded the opportunity to prepare to discuss the matter and advance constructive criticism. However, the Standing Orders have been suspended, and, in the terms of the motion that was carried by the Senate this morning, the bill must go through all its stages without delay. In submitting that motion the Minister (Senator Crawford) pointed out how essential it was that the bill should go through.; but on analyzing the matter we find that there is no necessity to pass the bill to-day, -because roadmaking is not being held up pending its passage. This is an attempt by the Treasurer (Dr. Earle Page) to balance the ledger. The accounts will not truly reflect the position of the finances, as this advance of £500,000 will be made next year, and should properly be debited tonext year’s accounts. A point that I want to make in conclusion was referred to by Senator Kingsmill. If this money is to be spent only in making new roads, the whole scheme is farcical. We havenot the right to limit the activities of the municipalities or of the states by insisting that they shall not repair an existingroad or build other than main roads.

Senator Crawford:

– They can construct those roads .out of their own funds.

Senator FOLL:

– Wei are laying, down, the principle that the Federal Govern- . ment is to participate in the work of” road-making. The scheme was originally evolved to afford relief to unemployed returned soldiers. It was then recognized that the Commonwealth Government was to some extent responsible for roadmaking. Our duty is not merely to vote the money, but to advance constructive ideas for future guidance. We have not today been given the opportunity to do that. None of us knew that the bill was to be introduced at this stage, and we have been compelled to make a few impromptu remarks. I hope that the Ministry will repent in view of the fact that honorable senators, who are loyal supporters, are not satisfied with this .method of dealing with the finances. Let the bill stand over until next week, and so enable honorable senators to endeavour . to improve it. The money that is advanced can then be included, as it should be, in next year’s expenditure.

Senator NEEDHAM:
Western Australia

– It appears to me that there is trouble amongst some honorable senators sitting on the government benches, and there are signs of decay in the ministerial ranks. This afternoon I witnessed an attempt by. the Minister to persuade an honorable senator to desist from making further remarks, and later the Government Whip was told, sotto voce, by the same honorable senator to mind his own business. It is interesting to note that honorable senators opposite, by their conduct to-day, admit that an attempt is being made to bind them and compel them to swallow holus bolus whatever measures are brought down. The principle of the bill has my entire and hearty support, but I have one or two objections to it. My first objection - which I think is a very sound one - was voiced very ably this morning by Senator Greene. It is that money which should be expended from next year’s accounts should not be debited to this year’s accounts. Another objection I have is that the amount proposed to be advanced is not sufficiently large. Senator Foil has very well said that the Commonwealth Government for the second time is taking a very active part in road-making. There is something more in this matter than the construction and maintenance of good roads for the use of motor cars and other vehicles. In determining our course of action we should be guided by the question of defence. Senator DrakeBrockman must realize that good roads are essential if we are to defend Australia against an invader.

Senator Cox:

– The honorable senator does not believe in defence. I have heard him Bay that he would have peace at any price.

Senator NEEDHAM:

– Senator Cox is having his usual joke. He has never heard me state that I am opposed to the defence of Australia. I would cheerfully vote for the allocation of £2,000,000 for road-making, and I would provide that sum out of the surplus in which the Government is at present wallowing. That money would be well spent in constructing good roads in the different states. Whilst I agree with the principle of the bill, if honorable senators opposite have the courage of their convictions, and will call for a division in order to have the further consideration of the measure deferred until next week, I shall support them.

Senator Foll:

– The honorable senator says he i3 in favour of the bill. How, then, could he vote against the motion for its second reading?

Senator NEEDHAM:

-I am in favour of it, with certain reservations. I affirm the principle of the bill, but I believe that the present is not an opportune time to pass it. If it were introduced next Wednesday I would cheerfully vote for the second reading without question. The Government would do well to take the advice of its supporters and defer further consideration for the present.

Senator Foll:

– If the motion for the second reading is defeated, the Government may not reintroduce the measure.

Senator NEEDHAM:

– I suspected thai Senator Foil was not as courageous as his remarks would lead one to believe.

Senator Foll:

– I said I would not vote against the second reading.

Senator NEEDHAM:

– I was hoping that the honorable senator would. He would then have followed to its logical conclusion the speech that he has jus made.

Senator Foll:

– I want, this money ti be advanced. I should like to see a greater sum provided.

Senator NEEDHAM:

– I am sure that if Senator Foil, Senator Greene, and one. or two other honorable senators opposite were to demand the postponement of the bill until next Wednesday, their wishes would be met, and they would possibly be able to persuade the Government to make the amount £1,000,000 instead of £500,000. I thought that Senator Foil had a little more courage than, evidently, he possesses. He condemned the action of the Government lock, stock, and barrel, yet he is prepared to vote for the second reading of the bill. I trust that the Government will not insist upon proceeding with the measure.

Senator GUTHRIE:
Victoria

.- Briefly I want to endorse the remarks of honorable senators regarding the manner in which this Bill has been rushed forward. Road-making in Australia is a very important matter. Good roads are a national asset, and there is no work on which money could be better spent. It is a disappointment to- me that, although last year the Commonwealth Government made available £500,000 with the stipulation that the states were to .advance £1 for £1, for road construction, for some reason or other only 25 per cent, of the money voted has been expended, notwithstanding the fact that the people are complaining about the bad state of tho existing roads, and urging the necessity for the construction of new roads. The Minister (Senator Crawford) has told us that the fault does not lie at the door of the Commonwealth Government, but that the reason is a lack of organization in the states. That does not apply to Victoria, which, fortunately, possesses an excellent organization in the country roads board, that is doing splendid work in the construction and upkeep of roads. The sole reason that a greater number of roads is not constructed, and that those at present constructed are not kept in better repair, is a lack of funds.

Senator GRANT:
NEW SOUTH WALES · ALP

– Has Victoria exhausted its quota of last year’s vote? ‘

Senator GUTHRIE:

– I think it has. The other states have not done so. In view of the state of the Commonwealth finances - there is a surplus of about £11,000,000, largely owing to the collection of high Customs duties - it is reasonable to expect the Government to make provision for more and better roads, particularly in view of the fact that some millions of pounds of the revenue comes from duties on motor cars and petrol. The Government should grant a larger amount to the states for the construction and maintenance of roads. A great many of the roads which have been constructed, even in this state, where the Country Roads Board is doing a splendid work, are rapidly deteriorating. Big motor lorries, fitted with solid tires and carrying up to 10 tons, are tearing our roads to pieces. The condition of some of the roads, even in Victoria, is deplorable. On Wednesday afternoon I tried to get a man to motor me from Terang to Melbourne, but he refused because of the ruts in the road between Camperdown and Colac. Some of the nits are said to be 2 feet deep. It is no use shutting our eyes to the fact that roads in Australia are deteriorating, and that there is urgent need for the maintenance and consolidation of our arterial roads. I should like to see a trial made somewhere with concrete roads, as has been done in the United States of America. If I had the power I would put a heavy wheel tax on those heavy motor vehicles which are doing so much damage to roads throughout the Commonwealth.

Senator GRANT:
NEW SOUTH WALES · ALP

– The honorable senater 14 quite out of date. He ought to advocate the taxation of the people who own the land.

Senator GUTHRIE:

– I know very well that the honorable senator has a bee in his bonnet on this question of land values taxation.

Senator NEWLANDS:
SOUTH AUSTRALIA · ALP; NAT from 1917

– He has a whole hive of bees.

The PRESIDENT (Senator the Hon T Givens:

– Order! There are altogether too many interjections. I remind Senator Grant and also Senator Guthrie that this bill contains no reference whatever to land values taxation.

Senator GUTHRIE:

– I regret verymuch that the bill is being rushed through the Senate. The amount proposed to be allocated is totally inadequate. The bill should make provision not only for road construction, but also for the maintenance of existing roads. When the measure is in committee, I should like to see a clause inserted to enable the money to be spent on the maintenance of existing roads, as well as on road construction.

Question resolved in the affirmative.

Bill read a second time.

Int. committee:

Clause 1 -

  1. This Act may be cited as the Main Roads Development Act 1924.
  2. The Main .Roads Development Act 1923 is, in this Act, referred to as the Principal Act.
  3. The Principal. Act, as amended by this Act, may be cited as the Main Roads Development Act 1923-1924.
Senator GREENE:
NEW SOUTH WALES · NAT

– I move -

That the figures “1924”, sub-clause (3), be left out with a view to insert in lieu thereof the figures “ 1925.”

My object, of course, is quite clear. I want to indicate definitely to the Government, if the committee agrees to my amendment, that this bill and its expenditure belong to the financial year in which the money may be expended; and not to the financial year now closing. A little while ago, when I was dealing with this question at another stage of the bill1, I expressed as forcibly as circumstances permitted my opinion of the method of finance for which the bill provides. The short title suggests that the expenditure belongs to the financial year 1923-24, when properly it belongs to the year 192.4-25. I have moved my amendment so that honorable senators may have an opportunity to indicate by their votes whether this method of financing meets with their approval. There are quite a number of. trust accounts in the general finances of. the Commonwealth. Large sums, as. a matter of fact,, are paid from trust accounts for old-age pensions and for repatriation benefits, and every year Parliament votes in the Estimates for the* year the- amounts which ar& to be placed’ to. the credit of those trust accounts. My fundamental objection to the Government proposal is that if this method’ of procedure is followed year after year, these sums will never appear in the- annual Estimates. This bill expressly designs to shut the amount out from the Estimates for the year. The procedure is wrong. It is fundamentally unsound finance, and the committee should not agree- to it. I ask honorable senators to- register their disapproval’ of this method of finance. , Senator CRAWFORD (QueenslandHonorary, Minister) [3110]. - I understand that Senator Greene’s contention is that if . the bill is passed in its present form the amount which ‘ it is> proposed to vote for the purpose of main roads development will not appear- in the Estimates for the- year. That is not so. We voted amounts for other purposes in a similar way last year, and those amounts appear in the Estimates.

Senator GREENE:
NEW SOUTH WALES · NAT

– They do not. Senator CRAWFORD-.- I refer the honorable senator to the item “‘£200,000, compensation to officers of the Taxation Department,” appearing on page 6 of Receipts and Expenditure from the Consolidated Revenue. .

Senator GREENE:
NEW SOUTH WALES · NAT

– Will the Minister read the heading at the top of the column t

Senator CRAWFORD:
NAT

– I intend to. Then there is the item, “ wire netting, £250,000,” in. the column headed 1922-23..

Senator GREENE:
NEW SOUTH WALES · NAT

– Exactly ;. not 1 923-2.4 .

Senator CRAWFORD:

– We do not always expend money in the year in which it is voted. I also’ remind the honorable senator that in the previous year a sum, I believe totalling £200,000, was set aside as compensation for officers, who were retired from the- Defence Department.

Senator GREENE:
NEW SOUTH WALES · NAT

– Does the Minister suggest that is a precedent for the present method,?

Senator CRAWFORD:

– It was money voted in exactly the same way as now proposed..

Senator Pearce:

– - And it was voted before Parliament passed the Defence Retirement Bill,

Senator GREENE:
NEW SOUTH WALES · NAT

– I shall dea,l with that.

Senator CRAWFORD:

– That proposal was- brought forward by a Government of which, the- honorable? senator was. at member, so we are not now establishing a precedent. It was’ established, when, the honorable senator was in> the Ministry;’ thus: he assisted to create the precedent. In the circumstances th& Government cannot accept the amendment.

Senator GREENE:
NEW SOUTH WALES · NAT

– The Honorary Minister (Senator Crawford) has set up two> suggestions which, he says, are answers– to my argument. I shall deal with the latter first. He says that the Government of which I’ was a member, in 1921-22 established the- precedent for the present bill. It was the last budget prepared by the National Government. In: that year we set aside £300,000, treating it as a trust account, and carried, it forward to be dealt with- in the, following year.

Senator Pearce:

– And then’ passed, the necessary legislation.

Senator GREENE:
NEW SOUTH WALES · NAT

– The Minister for Home and Territories knows the history of. that, financial- transaction just as well as I da. He* knows that I was responsible for what was done, and he knows the reason why it was done. Parliament in the previous year had voted a considerable sum of money towards, defence expenditure, but in 1921-22 I was sent to the Defence Department with definite instructions to curtail the expenditure for the following year by a very large amount. I knew as well as the Minister knew that that instruction meant the dismissal of a very large number of men from the department. It also meant that if, during that financial’ year, we expended all the money that Parliament had put into our hand’s for the Defence Department, a great deal’ of it would be thrown away. Accordingly, from the moment I became Minister for- Defence I set out to save every penny that I could of the amount which- Parliament had voted for the department, placing- it on one side to be used as compensation for the officers who had to go. The differencebetween what the Government is doing now and what we did then, is that Parliament had* voted £300,000 for defence expenditure-.

Senator Pearce:

– But it was not in a trust account until’ Parliament put it there.

Senator GREENE:
NEW SOUTH WALES · NAT

– Nevertheless,, Parliament had voted every penny of the money.

Senator PEARCE:
NAT

– But it had to be voted again as compensation.

Senator GREENE:
NEW SOUTH WALES · NAT

– It is- true that w« had to get the sanction of Parliament to expend that money again as compensation. But Parliament had! given us that money, and Ave put it aside in that way.

Senator Pearce:

– - Is it not. a fact that we passed a bill ta put that £&00,000into a trust fund ire the year before we passed the bill for the retirement of those officers, and for providing the necessary money to compensate them,?!

Senator GREENE:
NEW SOUTH WALES · NAT

-No. we- did! not;

Senator Pearce:

– It is a- fact; the records show it.

Senator GREENE:
NEW SOUTH WALES · NAT

– -Wo paid it iff the same year.

Senator PEARCE:

– Not in- the same financial1 year. .

Senator GREENE:
NEW SOUTH WALES · NAT

– The Defence Retirement Bill and the Trust Account. Bill were put through in the same financial year.

Senator Pearce:

– No; the bill providing for the trust account was passed in the previous year.

Senator GREENE:
NEW SOUTH WALES · NAT

– But. the Estimates show that that money,, instead of. being expended in the direction set out in the items,, was put aside as- a trust fund.. Then we got the sanction o£ Parliament to< establish a. trust fund,, and spend the money in. the way we suggested. The other statement made by the Minister was;, as- nearly as I can recollect it, that the money does appear in the Estimates because it is- shown iia. the column, giving the previous! year’s expenditure. I think that is the- way in which the- Minister pu>t the matter.

Senator CRAWFORD:

– That is the ease.

Senator GREENE:
NEW SOUTH WALES · NAT

– And that is the fundamental ground of my objection, for, if we go- on in this- way,, when the accounts for the year’s expenditure are set out, the. £500,000 to- be spent this- year will appear in. the expenditure of the year before. This practice will go on year after year, and this- sum* will never be brought to- account in the Estimates of Expenditure for the current year.

Senator PEARCE:

– -Parliament will never be asked to vote it twice, of course..

Senator- GREENE - I arm not suggesting that. What I do suggest is ta<a4 this; method of expenditure is wrong. If it.be right, will the Minister ten me why the Government does not treat other trust funds in. the same way?: Take old-age pensions. Every vote for the old-age pensions account goes: into a. trust fund.

Senator Pearce:

– There have been payments’ into* the old.-age pensions account that did not appear in the ordinary budget.

Senator GREENE That may be; but every year- the money ordinarily voted by Parliament to this fund: goes into a trust account. A. similar practice is followed with regard to- the repatriation! vote. It is voted every year, and it goes into a trust account. I maintain that the mam roads development vote should be treated in the same way. I am- perfectly satisfied’ that” the only reason for this action iff that the- Treasurer (Dr.. Earle Page)does” mot wish to- show the true- expenditure for the year. He knows’ very well what - the’ effect would be if this expenditure were included in the year’s figures. He knows that it would show that some of his promises given to the country in the flamboyant speeches he made when he was opposed to the Ministers with whom he is now associated in the Cabinet had not been redeemed. The Senate should insist upon the Treasurer putting into each year’s accounts the expenditure for that year. That is what I want to see done, and in urging it to-day I consider that I am doing a public service. The method of finance now adopted simply means hiding from the country the true expenditure year by year. The Treasurer owes a duty to the people to be frank with them. The practice of which I complain is not a frank one; it is a deliberate attempt to hide the true position, and it should cease forthwith.

Senator GRANT:
NEW SOUTH WALES · ALP

– The Minister (Senator Crawford) has completely failed to show any good reason why the practice complained of should be followed. He’ has informed us that not more than one-fourth of the amount voted by Parliament last year for main roads development has been taken by the states in accordance with the conditions laid down. Up to date, only about ?120,000 has been expended out of the available sum of ?500,000. Although it is expected that the ?500,000 available last year will be exhausted before the end of December, we are within a few days of the close of the current financial year, and we are asked to make available a further sum of ?500,000. The object of Senator Greene, I think, is a very laudable one. He desires that the money to be expended during the currency of the next financial year shall be voted in that year and brought into account in the figures for that year. In the circumstances, I fail to see how any honorable senator can so far neglect his duty as to assist the- Government to do something which is shown to be quite unnecessary. Why .not wait until the end of the financial year ? It will close next week. We are assured by tha daily press, and from the floor of the Senate, that the accumulated surplus is in the vicinity of ?11,000,000, and at the close of the year we shall see exactly how the finances of the Commonwealth stand. It will then be time enough to consider the voting of any money for the ostensible purpose of making new roads. The real effect of the vote is to place handsome donations in the hands of the land-holders whose properties adjoin the roads to be constructed. I, therefore, support the amendment.

The CHAIRMAN:

-(Senator Newland). - I have to rule the amendment out of order for the reason that it conflicts with sub-clause 1, which reads : - “ This act may be cited as the Main Roads Development Act 1924.”

Senator Duncan:

– Would it be competent for the Senate to recommit the bill for the purpose . of altering the figures “ 1924 “ in sub-clause 1 ?

The CHAIRMAN:

– It will be quite within the province of an honorable senator to move for the recommital of the clause at the proper time.

Senator Kingsmill:

– If it will be competent for us to recommit the bill later on, surely a necessary amendment in a previous part of the clause can then be made?

The CHAIRMAN:

– We cannot go back.

Senator KINGSMILL:

– We do not propose to go back. If the amendment is carried, as I hope it will be, we can subsequently recommit the bill for the purpose of making an amendment in subclause 1, which you, Mr. Chairman, suggest should have been made in the first place. If that is so, how can the present amendment be out of order?

The CHAIRMAN:

– We cannot recommit the bill in committee.

Senator Kingsmill:

– I am aware of that fact; but we can recommit it on reaching the report stage. If this amendment is not carried, there will be no necessity to recommit the bill, and a recommittal will not be. proposed. I point out the possibility of avoiding delay.

The CHAIRMAN:

– We are helpless in the matter.

Senator KINGSMILL:

– If the honorable senator withdrew ‘his amendment temporarily, could not an amendment be proposed to sub-clause 11

The CHAIRMAN:

– Yes.

Senator GREENE:
NEW SOUTH WALES · NAT

– I am quite prepared to do that.

Amendment, by leave, withdrawn.

Senator GREENE:
NEW SOUTH WALES · NAT

– I propose to submit my amendment in sub-clause 1.

The CHAIRMAN:

– It is not part of my duty to tell honorable senators what they ought to do ; but, if I may be allowed to indicate my view to the honorable gentleman, I think his best plan would be to move for the insertion of a new clause to provide for what he wants to do.

Senator GREENE:
NEW SOUTH WALES · NAT

– If the objection- to the amendis that, since the citation of the act is 1.924, 1 cannot now move to make it 1925, I am quite prepared to alter the terms of the amendment, so that subclause 3 will read : - “ The principal act. as amended by this act, may be cited as the Main Roads Development Act 1924-25.”

Senator PEARCE:

– That would not make any difference. This is simply the descriptive clause of the bill.

Senator GREENE:
NEW SOUTH WALES · NAT

-I am aware that the amendment could only give an indication to the Government of what, I. trust, is the Senate’s opinion on the principle involved.

Senator PEARCE:

– The honorable senator has made his protest, and since the amendment will effect nothing, why does he not let it go at that?

Senator GREENE:
NEW SOUTH WALES · NAT

– The trouble is that one must do something to give effect to a protest, otherwise nothing is accomplished.

Senator Pearce:

– The amendment will simply have the effect of misdescribing the title of the bill.

Senator GREENE:
NEW SOUTH WALES · NAT

– An old parliamentarian, such as the Minister is, will appreciate quite well the fact that if this alteration is made, the Government will be obliged to make another alteration, and as that is what I am seeking to have done, I move -

That after the figures “ 1024,” sub-clause (1), the figures “ 1925 “ be inserted.

Senator GARDINER:
New South Wales

– My purpose in rising is to pour oil on the fire by suggesting a simple way out of the difficulty. Senator Greene will soon learn that if an improvement to a bill is suggested in the Senate the Government will not agree to it, but if he moves to strike out the clause, and has sufficient support ‘from honorable senators to have it struck out, such an unheard of act on the part of this chamber will cause the Government to bring down another bill in the form desired by him.

Senator PEARCE (Western Australia - ‘Minister for Home and Territories) [3.32]. - Nothing will be accomplished by the amendment except to misdescribe the title of the bill, and if it were agreed to, the Government could only send the measure back from another place with its title properly described. Senator Greene and others have stated their views as to whether the Government are right or wrong in regard to their method of dealing with expenditure from trust funds. 1 have already shown that this is not an isolated ease, that it is a practice that has grown up, rightly or wrongly, and that it was even observed by a Government of which Senator Greene was a member. . I have looked up the case of the compensation payable under the Defence Retirement Act. On page 84 of the 1923-24 budget an item of £300,000 was shown as having been paid into a trust fund, out of which compensation was to be paid to retiring defence officers, and that payment was made before the 30th June, 1922, whereas all payments out of the fund were made in the following year.

Senator GREENE:
NEW SOUTH WALES · NAT

– Of course, they were. Senator PEARCE. - Therefore Senator Greene was a member of a Government that was doing exactly what Ministers arc now proposing to do. I appeal to him as a supporter of the Government. He and others have made a very vigorous protest, and all that will be effected if this amendment is carried is that the bill will go back to another place with a misdescription of its title.

Senator GREENE:
NEW SOUTH WALES · NAT

, - In view of the very emphatic way in which I have endeavoured to show the great difference between what was clone” in 1922-23 and what is being done now, I am astonished that the Minister (Senator Pearce) should insist that the one step was a precedent for the other. It was not a precedent to be followed in this Case. I admit quite frankly that not very much will be gained directly by agreeing to the amendment, but the indirect gain will be that we shall accomplish, what we desire - the Government will be obliged to bring down the bill in the next financial year.

Senator Pearce:

– They will place the responsibility for the loss of the bill on those honorable senators who are taking this action.

Senator GREENE:
NEW SOUTH WALES · NAT

– I am not worrying about that, because I have made my position -abundantly clear.

Senator Pearce:

– If honorable senators like to reject the bill in a roundabout way, well and good.

Senator GREENE:
NEW SOUTH WALES · NAT

– I do not propose to reject the bill. All I want’ is to have the finances of the country conducted -on right lines.

Senator Gardiner:

– The honorable senator must understand that he is expected to say “Yes, Senator Pearce” to everything introduced by him.

Senator GREENE:
NEW SOUTH WALES · NAT

– I do not think that Senator Gardiner’s -estimate of the intelligence of honorable senators is correct. He must have been misinformed, or his observations of events have led him to form wrong conclusions. When I was an honorable member of another place my recollection was that fairly frequently the Senate was in the habit of sendingback amendments to which the Government did not agree.

SenatorNeedham. - They were intelligent amendments.

Senator GREENE:
NEW SOUTH WALES · NAT

– Very intelligent amendments, which gave me a high appreciation of the intelligence of the Senate. Therefore I must ask honorable senators to agree to my amendment with as little delay as possible.

Senator KINGSMILL:
Western Australia

– I do not think the Leader of the Senate(Senator Pearce) is quite fair in his interjections regarding the possibility of the bill being rejected because the Senate wishes to express a definite opinion about tine method in which the finances areadministered. I am pleased that Senator Greene does not propose to withdraw his amendment, andI venture to pay that its acceptance will not lead to the rejection of the bill. If another place will not agree to make the alteration it will only have to say so, and the amendment will have to take its chance of toeing insisted on or not pressed, as the case may be, if it comes back to this chamber. No one objects to the principle of the bill. Our only objection is that it does not observe the principle that estimates of expenditure shall show the expenditure for the current year to which itbelongs. That is the stand I take up.

Senator Pearce:

– It means that no Federal Parliament can dispose of a surplus, because when a budget is prepared no one knows what the year’s surplus is likely to be.

Senator KINGSMILL:

– I understand that there is a fairly accurate forecast of what this year’s -surplus will be, although, the budget is not yet prepared.

Senator Pearce:

– If, according to the honorable senator’s arguments, the expenditure is shown in the budget of theyear in which the money is provided, it will be necessary to put what is to be spent in any one year in the following year’s budget.

Senator KINGSMILL:

– I am led towonder whether one object of this bill is to decrease the apparent surplus.

Senator Pearce:

– It will certainly decrease it.

Senator KINGSMILL:

– We should certainly not seek to increase the Commonwealth surplus, which is becoming a. byword and a scandal in the states. If the original intention of the Commonwealth Parliament had been carried out, these huge surpluses weare enjoying: would have been distributed amongst thestates. However, as I am unbiased by any previous ministerial errors or faults in this direction, such as those Senator Greene has apparently committed, my way is clearly open, and I esteem it my duty to convey to the Government the idea of at least some honorable senators that the system which has been followed, in the past, andfrom which Senator Greene has now broken away, is wrong. The amendment mayeffect no good, but, at any rate, it will be an expression of the opinion which I hold very strongly and very firmly.

Question - That the amendment beagreed to -put. The committeedivided.

Ayes … … …17

Noes … … … 12

Majority … … 6

Question so resolved in the affirmative. Amendment agreed to.

Amendment (by Senator Greene) agreed to -

That the figures “ 1924,” sub-clause (3), be left out with a view to insert in lieu thereof the figures “ 1925 “.

Clause, as amended, agreed to.

Clause2 -

Section 3 of the principal act is amended by omitting therefrom the words “ Five hundred thousand pounds “ and inserting in their stead the words “ One million pounds “.

Section proposed to be amended : -

There shall be payable out of the Consolidated Revenue Fund, which is hereby appropriated accordingly, an amount not exceeding Five hundred thousand pounds for the purposes of this act.

Senator GUTHRIE:
Victoria

. I move -

That the House of Representatives be requested to insert after the word “ million,” line 4, the words “ five hundred thousand.”

I have moved this request because I think it necessary that more money should be spent on road construction throughout Australia.

Senator CRAWFORD:
Honorary Minister · Queensland · NAT

– The Government cannot accept the request because if it were adopted the states would have to find a similar amount, and.it is very improbable that in the present circumstances, owing to the financial stringency in some of the states, they would be able, if willing, to raise the necessary money.

Senator GREENE:
NEW SOUTH WALES · NAT

– That could be very easily overcome by making the states contribution towards the additional sum 10s. for each £1 contributed by the Commonwealth.

Senator CRAWFORD:

– The Government are not prepared to alter the basis set down in the bill, which provide far equal contributions by the Commonwealth and the states. In addition, to the objection mentioned, only £250,000 of the £1,000,000 available has been expended in the present financial year. If the measure is passed ins its present form £1,750,000 will be available during the coming financial year, which should surely be sufficient.

SenatorDUNCAN (New South Wales) [3.50]. - The position is not quite as stated by the Minister (Senator Crawford), as; the bill does not contemplate that any sum mentioned in it will have to be met at once by an equal amount by any one of the six states desiring to take advantage of the offer.

Senator Crawford:

– The bill has to be read in conjunction with the principal act.

Senator DUNCAN:

-It simply means that Parliament is setting aside a certain amount, and if the states so desire they can utilize it on a £1 for. £1 basis according to their financial position.

Senator Pearce:

– Section 6 of the principal act reads -

The amount payable under the last preceding section shall not in the case of any state exceed Onepound sterling for every One pound sterling expended by that state upon the development of main roads.

Senator DUNCAN:

– That is the point I am making. The Government are proposing to place at the disposal of the states a certain sum which they can use if they so desire. Senator Guthrie suggests that it should be increased. If the states wish to use the money it will be necessary for them to provide an equal sum on a £1 for £1 basis from their own funds, but they may not desire to do so. On the other hand it may be their desire to expend a larger sum, and I do not think the operations of the states should be limited in this necessary work to the extent of £1,000,000 as proposedby the Government when we can, by adopting: the suggestion of Senator Guthrie, make an additional £500,000 available which, of course, may not be used. We know that certain states which are not experiencing financial stringency are interested in extending and developing main roads; and it is imperative that we should place as large a sum. as possible at their disposal. The request submitted by Senator Guthrie seems to be a fair one to the states.

Senator Drake-Brockman:

– It will not help their finances.

Senator DUNCAN:

– It will not be a disadvantage. If the- request is agreed to, and the amount allotted to each state - from which it can draw if it so desires on a £1 for £1basis - is largely increased, some- of the states,I am sure, will take advantage of the opportunity.

Senator GRANT:
NEW SOUTH WALES · ALP

– The request submitted by Senator Guthrie, if adopted, would mean a substantial increase in. taxation. In the bill, as now amended, it appears thatthe whole of the sum mentioned is to be made a charge on the revenue for the next financial year, and not against the accumulated surplus of £11,000,000.

Tho proposal to increase the amount by £500,000 seems to suggest that further consideration of the bill should be delayed’ until we have the Estimates for the next financial year before us. There is no immediate hurry or necessity to vote this money at present. As the committee has decided that the amount involved is to be made a charge against the revenue of tho next financial year it would, I think, be better to adhere to the smaller amount. If at a later date we found it necessary we could increase the amount in an amending bill. To make a larger amount available at present is simply juggling with the national balance-sheet. We should make a fresh start on the 1st July, as soon after that dato we will know what our commitments are likely to be, and can then give some indication to the electors as to where we are to obtain the money.If we intend to continue collecting revenue through the Customs and using it in the construction of roads throughout tho Commonwealth, we shall be perpetuating a most unfair system. Would it not be better to adopt the policy in force in Queensland and New South Wales, and to a lesser extent in other parts of the Commonwealth, and to clearly indicate to the electors that we propose to raise £1,000,000 by imposing a land tax of ¼d. in the £1 which would produce that amount each year. If we made it Id, in the £1 we would raise about £4,000,000 per annum. A policy of that nature should be embodied in a bill, “as it is unfair to collect money from Customs and excise duties and other sources which the Government have tapped. It must be remembered that the expenditure of this money will place land-owners whose property adjoins new roads or roads which are thu3 improved in a much better position, and the policy of improving people’s property at the expense of the whole of the taxpayers should not be supported. I oppose the request submitted by Senator Guthrie.

Senator H HAYS:
Tasmania

– I shall oppose the request submitted by Senator Guthrie, not because there is no necessity for the expenditure of tho larger amount, but because I believe the amount provided in the bill is sufficient to meet the requirements for this specific purpose during any one year. It must be borne in mind that each state, however much we increase the amount, will have to raise a similar amount by way of taxation if it wishes to take advantage of the larger sum. In Tasmania a much larger amount could be spent on the maintenance and construction of new roads, and I would prefer to 6ee this grant made available for a longer period rather than to increase it for any one year. In Tasmania a comparatively large sum could be profitably expended each year.

Senator Foll:

– If certain states do not require the money they need not utilize it.

Senator H HAYS:

– A state might not wish to use tho additional money, but it would have to find its proportion in common with the other’ states which were, perhaps, in a better financial position. It would have to find its quota in order that other states could take advantage of the legislation.

Senator Foll:

– Such states need not contribute on the same basis.

Senator H HAYS:

– The basis proposed is a reasonable one, and seeing that each state has to consider its own financial position it should be allowed to decide what sum it requires, if not for new roads, at least for the maintenance of existing roads.

Senator Foll:

– It is not the feeling that Customs revenue which is raised from vehicles that use the roads should be handed back to the states ?

Senator H HAYS:

– I think so; and it is right and proper that it should be handed back. But there must be a limit to the amount that can be economically and profitably spent by the State Governments each year. At present there is a substantial balance unexpended, apart from the £500,000 for which provision is now being made. I intend to oppose the request, because many of the states will not be able to take full advantage of the added benefit, although they will be called upon to provide their quota

Senator J B HAYES:
Tasmania

– Speaking on the second reading, I said that owing to the large amount oi revenue that is derived by the Government from motor cars and other vehicles it could well afford to increase this grant. I still believe that that is so, and I do not retract one word of what I said. The Government, however, is responsible for the finances and must say where the money is to come from. We have approached it with the request that this grant be increased, and it has advanced reasons why, for the present year, that should not be done. It has been pointed out that more than £800,000 was available for the current financial year. I should like to see the amount increased, but I do not think we would be acting fairly if we endeavoured to take out of the hands of the Government the conduct of its finances. When I am not satisfied with its actions I shall not hesitate to say so. Because I have not succeeded in inducing them to make a greater advance, I do not on that account intend to vote against the Government. I believe that if, at the end of the year, the sum provided is found to be insufficient, the Government will deal fairly by us.

Senator REID:
Queensland

– I do not object to the allotments to the states being increased, but I should like the Minister to inform me whether any state h’as exhausted its quota.

Senator Crawford:

– The whole of the money has been allocated to the different states, but it has not been spent.

Senator REID:

– Have the states advanced pound for pound, and expended the whole of the vote?

Senator Pearce:

– No, only a quarter of the amount made available has been expended.

Senator REID:

– Therefore, all the states at present have a credit balance?

Senator Pearce:

– Yes.

Senator REID:

– This proposal, then, merely means an additional amount which the states do not really require.

Senator FOLL:
Queensland

.- I was surprised to hear the Minister say that only one quarter of the amount previously voted had been expended.

Senator Crawford:

– I explained why a greater amount had not been spent.

Senator FOLL:

– If the states still have three-quarters of the amount previously voted, I fail to understand why this bill was brought down. “We are forcing a further sum upon the states when they have not lifted the amount previously provided.

Senator Crawford:

– It is not a matter of “ forcing “ this grant upon them; they are all willing to take it.

Senator FOLL:

– At the same time they are responsible for the provision of a similar amount. I know the Queensland Government would be quite willing to make a much larger subsidy than it is called upon to make. It was only after speaking to the original bill that I had the opportunity of discussing the matter fully with the Queensland UnderSecretary for Public Lands. Queensland, which is a state of vast areas, will leap great advantages from this scheme, even though Tasmania’s finances are such that it is not able to fully avail itself of the generosity of the Commonwealth. I intend to vote for the request.

Senator DUNCAN:
New South Wales

– On the point of whether the states require this money, I remind the Minister (Senator Crawford) that to-day a deputation from the municipal associations of Victoria, New South Wales, Tasmania, and South Australia waited upon the Treasurer and asked him to increase the grant to £1,000,000. They further requested that it be made notonly during this year, but for a number of years.

Senator Pearce:

– The municipalities . will not! have to find the additional sum required if the grant is made.

Senator DUNCAN:

– The Minister infers that the representatives of those municipalities had not the backing of the State Governments concerned. I point out that Mr. Gordon, the Victorian Minister .for Agriculture, was the principal speaker. It will thus be seen that there is a real desire in a number of the states that this grant should be increased, and that the request of these associations is to a certain extent supported by the State Governments which are particularly concerned.

Senator GRANT:
NEW SOUTH WALES · ALP

– The mere fact that a deputation representing certain municipal associa’tions to-day waited upon the Treasurer should not for a moment be taken by honorable senators as an indication that they have any authority to represent the ratepayers in their municipalities. 1 know from a long experience that deputations from municipal councils have, time and again, without any authority from the ratepayers, waited upon the Government and asked it to come to their assistance. Municipalities in New South Wales in which the unimproved . value of the land is as great as £2,000,000 have had the impertinence to approach the State Treasurer praying for assistance to enable them to construct their roads. In the same way some Tasmanian senators are always seeking assistance. Those supplicants should be told pointedly and clearly that the propercourse for them to adopt is to tax local land values -and .find .their own revenue. There can be -nothing more ridiculous or -a’bsurd than t© tax the poor people through the Customs House and ladle out the revenue so derived to the wealthy ‘land-owners -to “increase, the value of their lands. Those who vote for a measure of this sort ought to be impeached before the electors. It ra the most outrageous proposal that I have .ever had placed before me. ‘I am surprised and .disgusted to find that men who occupy ‘a good, strong, financial .position ‘can urge that the money which is extracted from the public through the Customs House, the income tax, and by other means, should be handed to people who .are well able to pay their .own way. Some time ago I had a .return prepared from data that was furnished .on the wealth census cards. The estimates of the very people who ar.e behind this agitation to subvent the Customs duties showed that the value of the lands .of Australia at .that time was £455,000,000. I -venture to say that today those lands are worth at least £1,’000,000,GOO. The imposition of Id. in the £1 : upon their land values would provide them with, not a paltry million, hut £4,000,00.0. The poor land in Tasmania, which is said to he worth only ‘ about 103. an acre., would only be called upon to pay about Ji. per .acre. That is the source from which this revenue .should come. I protest against such a rotten proposal .as the subvention of the national funds for these purposes.

Question - That the request he agreed to - “put. The ‘Committee divided..

Ayes … … 12

Noes .. .. -.12

The TEMPORARY CHAIRMAN (Senator Payne:
TASMANIA

– The Ayes and Noes feeing equal, the question ‘therefore passes in .the negative.

Request negatived.

Clause agreed to. -Clause 3 agreed to.

Preamble.

Senator GRANT:
NEW SOUTH WALES · ALP

.- - Are we .to understand now that this Bill will become ‘.operative -on and after 1st July -next? ‘Senator Crawford. - The bill will have to be considered in another place before it is finally passed. 1 shall then he in a position to answer ,the honorable senator’s question.

Preamble and title agreed to.

Bill reported with amendments; reportadopted. “Bill read a .third time.

page 1696

NATIONAL DEBT .SINKING FUN© BILL

Second Reading

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

– I move-

That the bill tie now read a second time.

The hill brought down in August last, ,and passed into law, provided for the establishment of a sinking fund of 10s. per cent, per annum, as well .as certain other payments, including one-half the profits of the Commonwealth Bank, to a fund for the extinction of the national debt. That measure vested the sinking fund in a .commission consisting of the Treasurer, the Chief Justice of the High Court, the Governor a£ the Commonwealth Bank, the Secretary to the Treasury, and the Solicitor-General. The act placed the commission beyond ‘the ‘Control of the Treasurer. It is anticipated that the sinking fund will earn 5 per cent. on. the amount paid into it, and that it will liquidate the irrecoverable debt of the Commonwealth within 50 years. On the 30th June last, the war -debt was £219,450,000, and other debts totalled £31,550,000, or a total of £251,000,000. This bill provides for a variation of the principle in respect of post office loans. It is recognized that those loans may ‘be expended on works having a shorter life than 50 years, and therefore it is considered desirable that the sinking fund shouldbe so controlled as to extinguish the debt so incurred in a shorter period. As regards payments, the first paragraph of the amending clause of the bill requires acontribution of £91,000 per annum to be made for a period of 30 years, beginning with thecurrent financial year. In the principal act, the contribution is fixed at the rate of 10s. per cent. per annum on the public debt, other than the war debt, existing at 30th June 1923, and it totals £158,000. Of this amount, £45,500 is applicable to the debt represented by expenditure out of the loan fund on post office works, and by the value of post office properties transferred from the states. The amount of £91,000 represents twice the amount of the original contribution, which is at the rate of 10s. per cent. per annum. The bill is on the same lines as the measure passed last year, except that there is an alterationof the amount ofcontribution in respect of loans for postoffice works. It is necessary to pass the measure without delay so that payments may be made into the sinking fundduring the present financial year.

SenatorGRANT (New South Wales) [4.23].. - During the passage of the principal act, it was decided to annex onehalf the profits -of the Commonwealth Bank to the sinking fund. Ioffered all the objection I could to that proposal, but it was agreed to. Ihad some hope that, in this amending bill, the Government would have reviewed the decision thenarrived at, and have given the Commonwealth Bankauthorities an opportunity to extend their operations to all the principal towns and cities in the Commonwealth. I find the Government has not done so. It is now proposed to take from the present surplus the sum of £91,000, and place it to the credit of the national debt sinking fund, and to do so for a further period of 30 years. When the principal act was being dealt with, a number of questions were asked as to the probable date of the extinction of the national debt. We were assured then that it would be wiped out inside of 50 years, butapparently the predictions then made were not well founded, for it is now proposed to make further substantial additionsannually from the Consolidated Revenue to the sinking fund. To that, I do not offer very much objection, but I find that, in the second sub-clause of clause 2, it is proposed, in connexion with the Postmaster-General’s Department, to contribute to the sinking fund a sum equal to £1 per cent. of the expenditure of that department out of the loan fund from the 1st July, 1923, to the end of the financial year in which the payment is made. In the third sub-clause, there is a provision to continue this payment till 1954. The Government might just as well borrow more money for the purpose of liquidating the national debt as to borrow money, andplace it in the sinking fund to the credit of the PostmasterGeneral’s Department. This provision is quite unnecessary, and will lead to an unjustifiable amount of bookkeeping and circumlocution. It would be much better to strike out the second and third subclauses. I cannot understandwhy the Minister in charge of the bill has given us no explanation ofthe reason for the inclusion of these provisions. If he desires to place more money to the creditof the National Debt Sinking Fund I have no objection to assisting him in that direction, for I think that the proper way to deal with the national debt is to gradually liquidate it. I am prepared to request the other House to assist in liquidating it to the extent of thesum the Minister expects to receive under paragraphscb and cc of sub-clause2. Federal income tax officials enter into calculations involving microscopical fractionsof a penny, and surely there should be no difficulty in wiping out the second and third paragraphs, and mentioning a round sum in the first paragraph. If we agreed to the last two paragraphs, nobody would have the slightest idea as to how much either or both of them would produce, and I shall movein committee for their deletion.

Question resolved in the affirmative.

Bill read a second time.

In committee:

Clause 1agreed to.

Clause 2 -

Section9 ofthe principal tact is amended by inserting in sub-section(1) thereof,after paragraph (c) the following paragraphs.: - “(ca) in each financial year for a period of 30years,commencing with the financial year. 1923-1924, a sum of

£91,000;

“(cb) in each financial year for a period of thirty years commencing with the financial year 1923-1924, a sum equal to One pound per centum of the expenditure of the PostmasterGeneral’s Department out of the loan fund from the 1st day of July, 1923, to the end of the financial year in which the payment is made; “ (cc) in each financial year for the period of twenty years commencing with the financial year ending on the thirtieth day of June, 1954, a sum equal to One pound per centum of the expenditure of the PostmasterGeneral’s Department out of the Loan fund during the financial year in which the payment is made and during the 29 financial years immediately prior to that year;”.

Amendment (by Senator Grant) negatived -

That paragraphs (cb) and (cc) be left out.

Clause agreed to.

Title agreed to.

Bill reported without amendment; report adopted.

Bill read a third time.

page 1698

OIL AGREEMENT BILL

Second Heading.

Senator CRAWFORD:
QueenslandHonorary Minister · NAT

– I move -

That the bill be now read a second time.

The purpose of this measure is to ratify an agreement which has been provisionally made with the AngloPersian Oil Company Limited to increase the capital of the Commonwealth Oil Refineries Limited by the sum of £250,000, of which one-half has to bo provided by the Commonwealth and one-half by the Anglo-Persian Oil Company. The bill also provides for the appropriation of the necessary loan moneys. I need scarcely point out that mineral oil is of great and growing importance both for industrial and defence purposes. The internal combustion engine has revolutionized motive power, and the number of petrol-driven engines is increasing with great rapidity. Again, the substitution of oil for coal in firing the boilers of ships is also increasing rapidly. Many merchant ships and most modern warships burn oil. There are at present more than 3,000 vessels, many of them of very large size, fitted for using liquid fuel, and a number of them are trading to Australia. Hitherto, owing to the high price, there has been little market for fuel oil, except for a limited number of special purposes. The Commonwealth Oil Refineries Limited will be able to supply large quantities, and to sell, ex tank, at a price not exceeding 70s. a ton.For large orders even less will be charged. The company has evidence that it has created a market for this article which has never previously existed. Before the war, the control of oil production and distribution was almost entirely in the hands of foreign countries, chiefly the Standard Oil group and the Royal Dutch-Shell group. In 1909, the Anglo-Persian Oil Company was formed to develop certain oil interests in Persia originally obtained by an Australian - Mr. W. K. D’Arcy, of Mount Morgan. During the war, the British Government acquired a controlling interest in this company. The British Government is not prone to purchase interests in commercial ventures. But twice in its history has it done so - in the case of the Suez Canal and in the case of the Anglo-Persian Oil Company. In each instance the object was national security.

Oil is of vast importance to the British Navy, and it would also be required for many military purposes in time of war, such as for motor cars, aeroplanes, tanks, &c. The British Government’s investment is said to have cost £5,000,000, and to bo now worth many times that sum. The company has been developed entirely by British capital and enterprise, and is controlled in the last resort by the British Government with its majority of shares. The British Government has also two representatives on the board of directors.

In 1920, an agreement was entered into between the Anglo-Persian Oil Company and the Commonwealth Oil Refineries Limited to refine oil in Australia. The capital of this company is £500,000, divided into 500,000 shares of £1 each. Of these, the Commonwealth Government owns 250,001, and the Anglo-Persian Oil Company and its nominees 249,999. The board of directors, numbering seven members, includes three representatives of the Commonwealth. The objects of the refinery company, shortly stated, are the development in Australia of the oil refin- ing industry, the erection and operation in Australia of modern oil refineries, the sale and disposal of the refined products, and other incidental objects.

The terms of the 1920 agreement are well known to honorable senators. They bind the Anglo-Persian Oil Company to supply crude oil in sufficient quantities until indigenous oil is available in Australia; they provide that the company shall sell its oil products at prices which are fair and reasonable; and they give the Commonwealth the option -of purchasing tho Anglo-Persian Oil Company’s interest in the company at the expiration of fifteen years. The first fruits of the Anglo-Persian Oil Company’s interest in Australia was the erection by it of large fuel oil bunkering tanks at Sydney Melbourne, and Fremantle, which greatly increased the oil bunkering facilities in Australia, and made it possible for large oil-driven liners to trade here. The Commonwealth Oil Refineries Limited has now completed the erection of its first refinery, which is operating at Kororoit creek, near “Williamstown. It lias also built a bunkering tank on the Yarra, at Spotswood, and has established pipe-line connexion between that and the AngloPersian Oil Company’s tank at Port Melbourne, so that fuel oil can now be delivered on board in bulk at either place. It has also established distribution depots in the various capitals to market its oil.

One thing was not decided or definitely provided for in the original agreement, namely, the marketing of- the oil. It was left open whether the company should market its own products, or whether that should be done through some other agency. The capital of the company has enabled it to establish ‘ the refinery, wharf, the depots and pipe-lines mentioned, but it is not sufficient to enable it to carry trading stocks. -The Government is in agreement with the refinery- company that it is necessary for the company to market its own goods, which involves its having a trading capital. The holding of the necessary stocks for, say, three or four months, before realization, involves a trading capital of at least £250,000, and the Commonwealth has, subject to ratification by Parliament, agreed with the AngloPersian Oil Company to supply this capital, each partner to contribute one-half.

The Commonwealth Oil Refineries Limited does not enjoy u monopoly. It shares the Australian business with other large and well-established- concerns. It is bound to sell at fair and reasonable prices. Subject to this condition, its policy is in the hands of the directors. It can be reasonably expected that its effect will be to exercise a stabilising effect on the price of oil. As regards fuel oil, of which the available quantities aBd the facilities for bulk purchase were formerly very scant, there will be an immediate advantage to the public, both as regards price and quantity available. As regards motor spirit and kerosene, in which the supplies of the refinery are only a fraction of the whole trade, the Commonwealth Oil Refineries cannot control the price, but can undoubtedly help to stabilize it. At the present moment, and probably for the first time, the price of motor spirit in Australia is down substantially to the level of London prices. This has certainly not been the case during the last few years. . Whether the fact that the Commonwealth Oil Refineries Limited has been in the field has had anything to do with this result maybe a matter of opinion, but so it is. It is anticipated that the company can make a reasonable profit by selling its products at reasonable prices, and that its existence will be a useful check on any tendency to maintain prices above what theworld’s market justifies. The Commonwealth has, on the unanimous advice of tho- directors, confirmed a favorable price for crude oil for a period of two years, and freight for the same period is being negotiated: I may add that the vicechairman of the Anglo-Persian Oil Company (Admiral Sir Edmond Slade) and Mr. Watt’s, another director, -have recently been here, and expressed high satisfaction with the refinery itself, and with the quality of the products.

Debate (on motion by Senator GRAHAM) adjourned.

Sitting suspended from 4.^7 to 6 p.m.

page 1699

MAIN ROADS DEVELOPMENT BILL

Message reported from the House of Representatives intimating that it had agreed to the amendments made by tho Senate

Senate adjourned at 6.4 p.m.

Cite as: Australia, Senate, Debates, 27 June 1924, viewed 22 October 2017, <http://historichansard.net/senate/1924/19240627_senate_9_107/>.

View PDF View XML View in Voyant