10th Parliament · 1st Session
The President (Senator the Hon. Sir John Newlands) took the chair at 11 a.m., and read prayers.
page 4433
asked the Minister for Defence, upon notice -
– The information will be obtained and areply will be furnished to the honorable senator as soon as possible.
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Leave given to Senator McLachlan to introduce the following bills: -
Service and Execution of Process Bill.
State and Territorial Laws andRecords Recognition Bill.
Post and Telegraph Bill.
Post and Telegraph Rates Bill.
Bills read a first time.
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– I move -
That the bill be now read a second time.
Immediately after the Commonwealth Housing Act was passed by Parliament in December last, the Commonwealth Bank officials entered into discussions with the Savings Bank officials of the several States. Although the principles embodied in the act were accepted by the State Savings Banks, the discussions disclosed that, in certain matters of detail, the provisions of the Commonwealth act conflicted with the practice of the State authorities. It therefore becomes necessary to make some slight amendments of the original law. The act provides that, except for the purpose of discharging a mortgage, no loan shall be made to a person who already owns a house. But a person who owns a dwelling-house may desire to enlarge it. As financial assistance for that purpose is consistent with the policy embodied in the Commonwealth’s housing scheme, it is proposed that the act be amended to enable that to be done. The amending bill also provides that a person who has already received a loan to enable him to acquire a dwelling-house may receive an additional loan to enable him to enlarge it. Under the act a loan can not be made to any person who has already received a loan. A person who has acquired a home under the Commonwealth housing scheme may be compelled to change his place of residence owing to his transfer from one place to another in the course of his employment, or for some other cause; but, having already received one loan, he would not be eligible to receive assistance in acquiring another home in his new place of residence. It is proposed, therefore, to amend the law by providing that a loan shall not be made to any person who has already received a loan’ unless that loan has been repaid in full. Should a person sell the home that he is leaving, and repay the loan to the house-building authority, he will thus become eligible to receive further assistance to enable him to acquire another dwelling. Some house-building authorities provide homes under a rent purchase agreement. Under that system the house-building authority retains the title to the land, and sells the property to the purchaser on payment of weekly amounts, including interest and principal. When the principal moneys repaid amount to 60 per cent, or 66 per cent, of the cost of the property, the title is transferred to the purchaser, and the outstanding balance of the principal money is secured by a mortgage on the property. In order to allow the housebuilding authorities to continue that method of selling houses under the Commonwealth housing scheme, the act is being amended to provide that any reference to an amount lent, or to a loan, shall be read as including a reference to an amount used by an authority for the purpose of a rent purchase agreement. For the purposes of clarity, it is also proposed to amend the act to make it clear that, where an authority administers more than one housing scheme, it shall be sufficient to enable it to share in the Commonwealth housing scheme if one of its schemes is in accordance with the provisions of the act. The original act provided that the Commonwealth Savings Bank should repay to the Treasurer, by means of a sinking fund contribution of 10s. per cent, per annum, any moneys lent to the bank under the authority of the Commonwealth Housing Act. It was intended that the Commonwealth Savings Bank should, in turn, make arrangements with the authorities that moneys lent to those authorities out of loans received from the Treasurer should be repaid to the Savings Bank by a sinking fund contribution of 10s. per cent, per annum. It is now found that this method of repayment is not acceptable to the authorities consulted. They point out that they receive repayments from borrowers at varying and frequent intervals, and they desire to be in a position to repay loans to the Commonwealth Savings Bank as and when they receive repayment of loans made to the persons acquiring the homes. To meet the State Savings Banks in this matter, it is proposed to amend the act to provide that loans made to the Savings Bank shall bear such rate of interest, and be subject to such terms and conditions of repayment, .as are agreed upon between the Treasurer and the bank. This is an elastic provision which will enable the Treasurer and the Savings Bank to come to an arrangement for the repayment of loans which will obviate the necessity of moneys lying idle because there may be no immediate avenue for investment. For the purposes of the national debt sinking fund, the loans will be recoverable loans, and as such the repayments will be paid over to the National Debt Commissioners, and will be applied to the extinction of the debt. If loans are raised in lump sums from time to time for the purpose of making advances to the Savings Bank, considerable sums of money, on which interest is payable, will lie idle in its hands until it is able to lend them to the house-building authorities. To obviate the loss to the Savings Bank, it is provided in the bill that, pending the borrow-* ing of moneys, the Treasurer may advance to the Savings Bank out of any moneys in the Commonwealth public account, sums not exceeding the amount which the Treasurer is authorized to borrow under the act. By this means the day-to-day requirements of the Savings Bank will be met without any loss of interest to the Treasury or the bank, and at a later date the public account will be recouped the amount advanced by means of a funding loan. The amendments now submitted are designed to facilitate the working of the scheme. They in no way interfere with the fundamental principles underlying the Commonwealth’s housing scheme, and I therefore confidently commend the bill to the House.
Debate (on’ motion by Senator Needham) adjourned.
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Debate resumed from 26th April, (vide page 4373), on motion by Senator. Sir George Pearce -
That the paper be printed.
– Among the many political sins which this Government has committed, the selling of the Commonwealth ships stands out in bold relief as the greatest sin of all. This sale is an act of injustice against the people of Australia. My honorable friends opposite appear to take it as a matter of course. But the day has not long gone by when some of the same honorable senators were very loud in their praises of the Commonwealth Government Line of Steamers, and used to point out in glowing language the splendid services the Line was rendering to the country. Foremost among those who praised the Line was the Prime Minister himself, who, in no unmistakable terms, pronounced his belief in the need for such a line, and stated that, to his knowledge, its existence was responsible for keeping Australia free from the tentacles of the Shipping Combine. To-day the same Prime Minister, as the result, I venture to say, of outside pressure from the financial interests which dictate the policy of my honorable friends opposite, and which supply the necessary funds to pay their election expenses, has been compelled to change his mind, and to change the policy of the Government. This Government appears to be obsessed with the idea of handing over all national utilities and services to its friends.When it came into power a few years ago, we had in existence the Commonwealth Woollen Mills. Every one admits that they rendered good service to the people of this country ;. but, just when they were making a satisfactory profit, they were sold. The mills had been valued at £267,000, yet they were given away for a sum of £155,000 - a little more than half the amount for which they were valued.
– Judging by the verdict of the people at the last election, they approved of the sale.
– The sale of the woollen mills was not before the people at the last election. The only questions which they were asked to consider were red revolution, the alleged impending red menace, and the deportation of two men. The people were doped, and led into a condition of hysteria. No mention was made of the sale of the woollen mills. The Government got back to power on a wave of hysteria.
We come now to the sale of the ships. This sale is bad enough in itself, but it is worse still to see the ships thrown away like remnants at the bargain sale of some emporium. These vessels are splendidly built; some of them are admitted by expert shipping authorities to be the finest vessels of; their class afloat. Yet, they are to be sold for a song. To whom? To a branch of the Shipping Combine. Lord Kylsant and Lord Inchcape practically control the shipping services of the world. When the Combine takes over these vessels, it will not have any concern for the Australian people, the Australian shippers, or the Australian primary producers. The ships will be run for the Combine’s shareholders. I say advisedly that we need not expect any quarter fromthe Shipping Combine.
– The ships have not been of much use to the present shareholders.
– It is impossible to estimate the financial benefits which those ships have conferred on Australia. Now, we are faced with the actual sale. Lord Inchcape in 1926 made a statement that unless prices came down, passenger fares would go up. Just as soon as passenger fares went up, freights would follow. We have been told by the Right Honorable the Leader of the Senate (Senator Sir George Pearce) not only yesterday but on another occasion when these ships were being discussed, that we were losing a certain amount of money a year, as a result of their operations. It is quite true that we were losing money, but, on . the other hand, the people of Australia were gaining by the fact that freights and fares were kept down. And if we were losing money by the operations of the Commonwealth Government Shipping Line, other countries have been, and still are, losing money by the operation of their national shipping services, but they still retain their fleets. Take, for example, America and Canada. America to-day is losing at the rate of 20,000,000 dollars a year on its national fleet. Canada is losing 7,000,000 dollars a year, and still they retain their vessels because they are a national utility.
– Because they cannot sell them.
– Anybody could sell ships at the price this Government is selling them. But the fact is that neither Canada nor America want to sell their vessels. They know that even though they may be losing from a commercial point of view, from the point of view of the nation as a whole, the retention of the ships is justified.’
We have been told by this Government that we should have cruisers to protect our trade routes and, as a matter of fact, we have recently undertaken to build two cruisers at considerable expense. One of them has already been launched. We should not forget that some of these vessels that we have sold were capable of being equipped with heavy calibre guns. The cruiser Sydney carries eight 6-inch guns and four 3-pounders. Each “Dale” steamer is capable of carrying eight 6-inch guns and one 4-inch gun, and each “Bay” liner can carry seven 6-inch guns. Therefore, in comparison with our cruisers, they can be better equipped, as far as guns are concerned, and in time of trouble, if it ever occurred, they could be of very great assistance to us. Yet, we have sold these seven comparatively new vessels, most of them being not more than six or seven years old, for the sum of £1,850,000, or, if you add to it the £50,000 that has been thrown in for the repatriation of the crews, they have been sold for - £1,900,000.
– The crews do not need repatriation, most of them being domiciled outside Australia.
– It is difficult to determine what the economic, value of these vessels has been to Australia, or the benefits they have conferred upon the people.
– It is easy enoughto determine the loss.
– The loss was patent each year, but the fact that the ships have been the means of keeping down fares and freights has more than compensated for the yearly loss in trading. I shall quote from some cablegrams to prove beyond the shadow of a doubt that the Commonwealth Government Line of Steamers was actually instrumental in keeping down freights. Here is a cablegram dated London, 7th December, 1925 - lt is proposed to increase outward freight rates, that is, from the United Kingdom to Australia, subject to merchants consenting as per agreement on the following basis: - £5 measurement to £5 10s.; £3 las. to £4; lower measurement rates by 2s. 6d. ; objectionable cargo £1, leaving iron and steel rates, paper and most weight rates unchanged.
To that cablegram the Commonwealth Shipping Board replied on the 7th December as follows -
Outward freight rates, Board of Directors has decided at meeting to-day cannot agree to any increased rates, considering such course fatal to interests of Line as being opposed to purpose for which it exists.
I wish to draw particular attention to the tenor of the Board’s reply to the request from London that it should agree to an increase in freights. The Board realized that its duty was at all reasonable costs to prevent an increase in freights and fares.
Later, on the 23rd December, 1926, the following cablegram was received from London : -
In view of coal position, Conference propose immediately advance outward freights by approximately 15 per cent. Foreigners agree. It is proposed to exclude items such as rough weights. British owners ask your earnest consideration and agreement. Atlantic lines increase from 15 per cent, to 25 per cent. Understand other trades also considering. Reply.
To this the Commonwealth Shipping Board replied -
Referring your telegram 23rd inst., regret ive cannot agree. Consider it would be equally impolitic from both British owners and our point of view. To refrain from advancing rates may encourage reduction berth tonnage, which is desirable. In any case oil-burning tonnage could not justify. Coal trouble is only temporary, and in our opinion increase likely to reduce volume of traffic.
There we have a further proof of what the Commonwealth Shipping Board considered to be its duty. Speaking on the subject on 9th November, 1927, I quoted item after item of freights that had been reduced through the instrumentality of the Commonwealth Shipping Board. My facts are incontestible, and their accuracy has been admitted by honorable senators opposite. In addition to those reductions, the operations of the Commonwealth Shipping Line prevented increases in freights. Cablegram after cablegram passed between the Commonwealth Shipping Board and Mr. Larkin, the latter being anxious, according to many of his cablegrams, to bring about increased freight rates, but at all times he encountered the resistance of the Shipping Board to any increase.
– How does the honorable senator account for the fact that New Zealand experienced even greater reductions, despite the fact that the Commonwealth Line never ran to that country.
– I am not concerned with New Zealand at the moment, I am confining my remarks to the operations of the Australian Commonwealth Line of Steamers. I contend that that line rendered splendid service to the general public of Australia, and it is deplorable that it should now be sacrificed and sold for a comparatively negligible amount. It has been claimed th’at because the vessels of the Line did not carry large cargoes of certain commodities, the reductions that took place from time to time wre not due to the existence of the Line. That contention is unsound. The Commonwealth Line may have carried only a small quantity of wheat, for instance, but the fact that it reduced freights again and again forced its competitors to do the same.
– What influence could the operations of the line have had when it carried less than 1 per cent, of the Australian exported freight?
– The Line certainly influenced all rates of freights, irrespective of the quantity handled, because opposition lines knew that they would lose business if they increased freight rates.
The conditions of the sale of the Line differ entirely from those which were suggested in 1925 by the Prime Minister. In that year the right honorable gentleman definitely said that his Government was not prepared to recommend to Parliament the transfer of the line to the British register and its manning under British conditions. Now the Government states that the line is to be placed on the British register. The Prime Minister also stated in 1925 that his Government was not prepared to sell the vessels unconditionally. The Melbourne Age of 24th February, 1925, stated-
– The honorable senator will admit that the Melbourne Age is a very unreliable authority.
– I am not quoting the opinion of the Age, but its report of what was said by the Prime Minister. The right honorable gentleman said that the Government proposed, to . invite tenders from prospective purchasers for the line as a going concern, subject to the condition that the purchaser would maintain a regular and efficient service between Australia, Great Britain and the continent. It was also provided that the purchasers should not increase freight or passenger rates, and the sale was also to be subject to the condition that the purchasers would not enter into any shipping ring or combine. The Prime Minister said that if such arrangements could be made, the primary function for, which the
Commonwealth Line wa3 created, that of protecting the Australian shipper, would be effected.
– And everybody refused to buy the Line under those conditions.
– To-day tho same vessels are to be thrown away for a few pounds to one of the biggest shipping combines in the world.
– It would cost the Commonwealth Government more if the ship3 were retained, as continual losses have been sustained through the operations of the Line.
– That is not so. The general public of Australia would have benefited had the Line been maintained, even though there was a monetary loss, as our producers would then have been assured that freights would be reasonable.
The Prime Minister, in a speech in another place a day or two ago, said that the purchasers had promised, as far as possible, to continue the policy of the Commonwealth Line regarding rates of freights, and that there would be no exploitation of Australian importers or exporters. I fear that my interpretation of that promise will be entirely different from that of Lord Kylsant and his friends. I believe that it will not be very long before there will be an increase of 10 per cent, in freights and fares. Lord Kylsant and his friends would not term that exploitation, but merely a reasonable profit. Later, the rates will probably be increased by 15 per cent, to 20 per cent., and those gentlemen will still consider that they are honoring their promise, and not exploiting the people of Australia. The only stipulation in the sale agreement is that the vessels shall be maintained on a British or Dominion register for ten years, and that for ten years a service shall be maintained equivalent to that ^ which previously existed. The remarks of the Prime Minister imply that we shall not enjoy an equivalent service. Previously, these vessels plied between the ports of Australia, carrying passengers and cargo, and they were very well patronized. We discover now they are not to trade on the Australian coast, so that the Prime Minister’s promise is to go by tho board.
– What does the honorable senator call an “ equivalent “ service?
– A continuation of the service which was previously in operation on the Australian coast.
– Mr. Kneen stated that it was not the proper function of the Commonwealth steamers to compete for Australian trade.
– In any case that was done, and we are not to receive an equivalent service in the future. I now come to the price of the Line, which is, perhaps, the most important feature of the transaction. The people of Australia were astonished when they read details of the price that is to be paid for these seven vessels, and I have no doubt that honorable senators opposite were also astonished.
– The State Governments made worse bargains when relinquishing their shipping enterprises.
– Two wrongs do not make a right. The following details as to the cost and date of the several vessels sold will be of interest: -
Those seven vessels were sold for £1,850,000.
– Little more than the cost of one of the “ Bay “ steamers.
– That is so. The extra £50,000 was added to the price to cover the cost of repatriating the crews from the Mother Country to Australia.
Let us analyse the transaction in another way. I have already shown that the vessels cost approximately £7,500,000 to build. Their age ranges from three years to seven years, and yet the Government has disposed of the entire fleet for practically the cost of one. Actually they are modern ships. It is extraordinary that in about six years after their construction the Government should sell the whole of the ships for the sum mentioned. Can Ministers and their friends point to this transaction as an example of sound business methods? Will Senator Thompson, who is acclaimed as a good business, man, subscribe to a transaction of this sort?
– It is good business to scrap anything that is not paying.
– When the Leader of the Senate was announcing the sale of these ships, Senator Kingsmill, by way of interjection, said something about obsolescence. Since none of the vessels are more than six years old, it cannot be said that they are even approaching obsolescence. As a matter of fact, shipping experts have declared that the two “ Dale “ ships are the finest vessels of their size afloat. Barely four years have elapsed since they were launched, so it is ridiculous even to hint that they are not new ships. I admit, of course, that a vessel launched to-day may not embody improvements in certain details to be found in a ship launched a few months hence. When shipbuilders have a contract for the construction of three or four vessels, they do not build all the vessels simultaneously. They lay the keel of one and carry out the work up to the stage of launching before they commence on the second. During construction certain improvements in detail are noted, and the later vessels may be in certain minor ‘details slightly better; but for all practical purposes they may be regarded as sister ships. Senator Sir George Pearce also quoted the price received by the Orient Company for the Ormuz which was sold recently. That vessel was purchased for £257,000. But the Ormuz was built in 1914, whereas the “ Bay “ liners ‘were constructed eight years later, and the “ Dales “ ten years later. There is nothing like “the same amount of depreciation to be provided for in the case of the Commonwealth ships, and yet the average price of the “Bay” steamers is only a little more than £257,000. Notwithstanding the disparity between the age of the Ormuz and the age of the Commonwealth vessels the Prime Minister in another place and the Leader of the Government in this chamber, quoted the sale price of the
Ormuz, as a basis of comparison for the sale of the “Bay” steamers. It is generally conceded that vessels of this type have an average life of 20 years, and as the Ormuz was built in 1914 its period of usefulness as a passenger-carrying vessel is now limited to six years. As its purchase price was £257,000, the buyer gave approximately £43,000 per annum for the balance of its period of usefulness. The average price paid for the “ Bay “ steamers is £300,000 each, and as we may presume that they have fourteen years of service ahead of them, the cost works out at about £21,000 a year.
SenatorFoll. - Does the honorable senator believe that they will have fourteen years of life if run on the present time-table ?
– Yes.
SenatorFoll. - That was not the opinion of representatives of the Line when they gave evidence before the Public Accounts Committee.
– I admit that there was a difference of opinion among witnesses as regards the probable life of the ships if run on the present time-table, but I believe that their period of usefulness will be at least fourteen years. Senator Sir George Pearcereferred also to the sale recently of two Italian steamers of 9,700 tons for £.190,000 each. I cannot say what is the anticipated life of those vessels, but I submit that compared with the sale price of the Ormuz, which is eight years older than the “Bay” steamers, the purchasers of the Commonwealth Line have made a much better bargain. The “Dale” steamers, I remind the Senate, are practically new vessels. They are scarcely four years old, whereas the Ormuz is fourteen years old. Of course, the vessels mentioned by the Leader of the Senate may have greater passenger accommodation than the “ Bay “ steamers, but from what I have heard of Italian ships, their owners are not very particular as regards the space allotted to passengers. They are inclined to cram two in a space which, according to our ideas of comfort and hygiene, should be set apart for one passenger. The Minister did not say anything about the cargo-carrying capacity of tiiose vessels. Perhaps he will supply this omission when he is replying to the debate. The Fordsdale and Ferndale, I repeat, are two of the finest vessels in their class afloat. They have more refrigerating space than any other vessel in the Australian trade and they are also very speedy. To my mind, it is absurd to compare vessels constructed in 1914 with others built in 1922 and 1924. A vessel built next year would probably be an improvement on one built this year, but steamers built four, or even seven, years ago cannot be regarded as having become useless. As a matter of fact, they are really in their prime.
Last year, when we were discussing the projected sale of the Australian Commonwealth Line of Steamers, I mentioned that the present Government was accustomed to subsidizing private enterprise. There is no hesitation on the part of private concerns to come to this Parliament for assistance when they are in a bad way, and the statute-book gives ample proof of the fact that by means of bounties and bonuses and in many other ways the Commonwealth Government has subsidized private enterprise. Yet, because the Australian Commonwealth Line of Steamers has been making a loss of a few thousand pounds, the Government has sold it.
SenatorFoll. - The enterprises subsidized by the Government were of benefit to the country, whereas the Commonwealth steamers were not.
– Does the honorable senator contend that the Australian Commonwealth Line of Steamers is not of benefit to the country?
SenatorFoll. - It is not now.
– I think that the honorable senator was among those who, at one time, thought that the Line should be retained.
– No, I was not a member of the Public Accounts Committee when that recommendation was tabled.
– When I asked Senator Thompson if he would take part in a business transaction similar to that which the Government has taken in the sale of these steamers, he said that he would scrap anything that would not pay. I wonder if he would scrap some of the industries, some of them in his own State, that are being spoon-fed. To me it is apparent that the Government revels in trying to do away with public utilities supplying essential services to the community. “When Senator Pearce was dealing with this question yesterday he spoke as if the extra £50,000 which the White Star Line is paying was an extra payment by which the Commonwealth would benefit. That is not so. The original tender stipulated that the vessels were to be taken over at the terminal ports. The Prime Minister has informed us that half the vessels have their terminal ports in Australia and the other half in Great Britain. It is obvious that on the steamers being handed over by the Commonwealth, the personnel will have to be repatriated. The White Star Company has asked that all the vessels be delivered in London. On the 26th March last a cablegram was despatched by Mr. Larkin stating that it would involve at least £85,000 for the repatriation of the crews if all the vessels of the Line were delivered in London; and, therefore, seeing that only half the steamers have their terminal ports in Great Britain, if the old conditions of the contract for the handing over of the vessels at their different terminal ports had been retained, it would have involved an expenditure of approximately £42,500 to repatriate the Australian personnel on those vessels whose terminal ports were in London. That expenditure would have fallen on the Commonwealth Government in any case, and it is clear that the delivery of the whole of the . vessels in London will involve the Commonwealth in a further expenditure of a like amount. Thus the greater part of, if not more than, the £50,000 which has been added to the offer by the White Star Line will be spent in repatriating personnel. It will certainly be more than the estimate of £35,000 given by Senator Pearce.
– As a matter of fact our calculations were based on returning the whole of the crews to Australia, but the evidence taken before the Public Accounts Committee shows that nearly half of the personnel are domiciled in Great Britain and will probably remain there after the vessels are handed over to their new owners.
– A good deal has been said, in discussing the projected sale of these vessels, about the Line having been run at a loss because of industrial trouble. That assertion is sufficiently answered by the following, which appeared in the report of the Joint Committee on Public Accounts, dated the 11th August, 1926-
For some time, both before and after the inception of the Board, the operations of the Line ‘were, it was stated, in evidence, considerably hampered by industrial troubles, but in June, 1925, an arrangement was made by the Board with certain unions in the transport group, other than the Seamen’s Union, and since that date it was claimed the Commonwealth Line had had no serious trouble.
It is quite evident that during the lastfew years the Line has suffered very little because of industrial trouble. Having reviewed the terms of the sale, I contend that the price paid for the vessels is outrageous. Any shipping man in Australia would agree that the steamers are worth more than the Commonwealth is getting for them. It is bad enough for Parliament in its wisdom to determine that the Line should be sold, but it was imperative that the Government should look after the interests of the people by seeing that a better price was obtained.
– Has the honorable senator ever tried to sell a second-hand motor car?
– I have not sufficiently advanced to own a car of any sort. Does the honorable senator suggest that the vessels should be classed as second-hand ! If a man buys an overcoat and wears it once, it immediately becomes a second-hand coat, but I cannot be led to believe that seven vessels, the oldest of which is only seven years old, which cost £7,500,000 to build, should be sold for £1,850,000. The Government has done wrong in committing this outrage on the people of the country, but the time is drawing nigh when it will be called upon to give an account of its stewardship to the people of Australia.
– I should like to hear the honorable senator’s opinion on the threat to make the vessels “black.”
– I have never been afraid to give my opinion publicly on any public question, and my opinion on the matter to which the . honorable senator has drawn attention, will be given at the proper time and in the proper place. I am dealing now with the sale of the vessels, and for* the reasons I have mentioned, and for others which I could adduce if I had more time to do so, I am opposed to the action the Government has taken. In order to test the feeling of the Senate, I move -
That all the words in the motion after the word “ That “ be left out, with a view to insert in lieu thereof the words “ in the opinion of the Senate the Government by the sale of the Commonwealth Line of Steamers has sacrificed valuable public assets and has placed Australian producers, shippers, and our people generally at the mercy of the shipping combine.”
– I know that Senator Needham would be the last to endeavour to misrepresent another honorable senator, but in the course of his remarks he made a reference to myself which I must clear up. I had actually resigned from the Joint Committee on Public Accounts before the presentation of the first interim report, which was signed by Sir Granville Eyrie who succeeded me as chairman of the committee. It was probably an oversight on Senator Needham’s part to associate me with the presentation of that particular report.
– I do not mean to do so.
– When I resigned from the committee I think it had just about reached the stage of giving consideration to what its recommendation should be.
In my opinion, the Government has made an extraordinarily good deal in disposing of the Australian Commonwealth Line of Steamers to the White Star Line. I make no apology for supporting the Government’s action. The figures presented to us yesterday by the Leader of the Senate were sufficient to justify the sale of the ships. In my opinion, the Government was fortunate in securing such a satisfactory price for them. It is ridiculous to compare the present value of the ships with their cost when constructed. Prices were probably at their peak when the “Bay” steamers were built. When the Shipping Board was formed to take over the vessels an independent valuation was made by an expert, and it was found to be £100,000 less per steamer than the value placed upon them by. the Government. Considering the amount of new tonnage which has been built since that time, and the prices realized for other vessels, the price obtained must be regarded as satisfactory.
Senator Needham said that, under existing working conditions, and with the present time-table in operation, the vessels belonging to the Line should have a further life of fourteen years. It is true that the honorable senator has had practical experience in the -construction of ships; but he knows that every competent witness who appeared before the Public Accounts Committee while he was a member of it stated definitely that the five “Bay” steamers could not be expected to continue to run to the present time-table. In order .to maintain a monthly service each way between. Australia and Great Britain they had been kept in commission without sufficient attention being given to them. That state of affairs could not continue indefinitely. The general manager of the Line said that to maintain a monthly service two additional vessels would have to be added to the fleet. To obtain those vessels another £1,500,000 would have been necessary. But that expenditure, instead of reducing the losses incurred by the Line, would have increased them. Had the Government purchased two new vessels, and thereby increased the losses it would have deserved the censure of the people of Australia. Senator Needham compared the selling of these ships with the disposal of the Commonwealth woollen mills at Geelong. That action on the part of the Government was given prominence by the Opposition at the election before last, and again at the last election. The people of, Australia were told that the mills had practically been given away. But what is the position to-day? Those mills are now rendering a greater service to Australia than when they were controlled by the Government. Instead of manufacturing only a limited class of material they are now turning out all kinds of cloth, their output is greater, and they employ more operatives than before they were taken over by private enterprise. That they are paying dividends to their Australian shareholders is probably the reason of Senator Needham’s opposition. Senator Needham said that although in the early stages of its history the Line had experienced industrial disturbances, there had been freedom from such troubleslately.
– That freedom from trouble was probably due to the fear that the vessels would be sold.
– When the transport group in Sydney threatened to tie up all vessls trading to and around’ Australia unless its demands were conceded, the private companiesreplied that while willing to obey Arbitration Court awards, they would not submit to dictation by the union. But the Australian Commonwealth Line of Steamers “ scabbed “ on theother companies when Admiral Clarkson signed the agreement demanded by the union. Before, the Commonwealth Shipping Board gave, way there was a deliberate campaign to harass the Line notwithstanding that its employees enjoyed wages and conditions better than those offered by other companies.
– While vessels belonging to the Line were hung up, other vessels, including those manned by coloured crews, were not interfered with.
– At that time the members of the Commonwealth Shipping Board freely stated that, in their opinion, the leaders of the transport unions were in ‘ the pay of theInchcape combine. Combine ships were left alone, whilst Australia’s own shipping line was constantly held up. We cannot ignore these facts. It was not until the Commonwealth Shipping Board acceded to the demands of the union that vessels belonging to the Line were free from interference. The action of the union leaders has done more than anything else to cause the present agitation for the repeal of the coastal provisions of the Navigation Act. I do not blame the Opposition for opposing the sale of the Line; the nationalization of industry is a plank in its platform.
– The Queensland Labour Government no longer believes in that policy.
– The Labour. Government in Tasmania was glad to get rid of its State steamers; and I believe the Government of Western Australia also sold its steamers.
– The Western Australian Government still has its State steamers.
– Had a Labour Government been in power in the Commonwealth, it would probably have bought the Tasmanian State steamers at any price when they were offered for sale. The Queensland Labour Government indulged in a little nationalization of industry when it purchased some State trawlers, but was glad to get rid of them.
I wish now to turn to another aspect of the case. Queensland has had a very bitter experience of the nationalization of industry, and most of its financial difficulties and much of the exorbitant taxation which is imposed in Queensland at the present time is due entirely to the fact that the Labour Government there became involved in these State industries. Let me make a comparison, if 1 may, between what was done in connexion with the Commonwealth woollen mills, of which Senator Needham is so fond of speaking, and what was done with the Chillagoe smelters in Queensland. The mills were sold by the Commonwealth Government, and to-day they are running with double the capacity they had when they were under, government control, and they employ probably twice the number of Australians. In Queensland we have a large industry in the north known as the Chillagoe Mines and Smelters. It was probably one . of the biggest industries of its kind in the State, perhaps in Australia. These smelters began to fall upon bad times because of the low price of copper, and the increased cost of production. Those in control approached the Government with a proposal that the mines and smelters should be taken over by the State and eventually they sold out at an exorbitant price to the State Labour Government of Queensland. Now the works are shut up, and are likely to remain so. Compare this with the Commonwealth woollen mills, which after being sold, increased their productive capacity two-fold. The Queensland Government bought the smelters, and now, as a result of their being closed down, hundreds of employees have been thrown out of work, while hundreds of thousands of pounds have been wasted.. The mine had practically outlived its usefulness when the private shareholders asked the Government to buy. One of the leading men in the Federal Labour party now, was the man who was mainly responsible for the” purchase of the mine smelters.
– What about Mount Morgan ?
– Mount Morgan has not been foisted on the taxpayers. The shareholders there have carried on their own affairs, and when they struck trouble they did not try to foist the industry on the State. They endeavoured to carry on, and when they were unable to do so for the same reason that brought trouble to most mining enterprises, they ceased production, and bore the loss themselves. But the Chillagoe works were foisted on the Government for something like £800,000 paid in government debentures and in cash.
– The honorable senator’s statement amounts to nothing more than that private enterprise failed to make a success of the mine, and sold it to the Government at an exorbitant figure.
– Which the foolish State Labour Government in Queensland was unwise enough to pay. The Government bought at a price which no sane business man would ever have thought of paying.
– They might not have been so foolish as the honorable senator thinks.
– I do not wish to look at the sinister aspect of the matter. I wish to keep the discussion on a higher level than Senator McLachlan has suggested.
I know that the policy of honorable senators opposite is the nationalization of industry, even though some of them may not believe in it.
– Why does the honorable senator say that? It is not correct that we do not believe in it.
– I do not think that Senator Hoare himself believes in the nationalization of industry any more than I do, because he has had an opportunity of seeing what it leads to. There is not one State in which governments have indulged in State enterprise of this kind where they have not been sorry for it.
– Would Senator Hoare favour the nationalization of the wheat industry ?
– Yes, that is a fair question. Would he favour the nationalization of the wheat industry on the basis adopted in Soviet Russia, with such disastrous results? In Queensland they went in for the nationalization of the cattle industry. They started State butcher’s shops, and bought up cattle stations, with the avowed object of giving the people cheaper meat. Yet to-day every private butcher’s shop can undersell the State shops. The trouble was, apparently, that the sausages were too red. Socialistic sausages never were a success anywhere.
The PRESIDENT (Senator the Hob. Sir John Newland). - I think that tho honorable senator is travelling too far from the subject matter of the debate.
– I admit that there is very little connexion between sausages and ships.
– Does the honorable senator believe in the nationalization of railways?
– Yesterday, when the Minister was speaking, Senator Thomas, I think it was, made some interjection about the Oodnadatta railway. Personally I should be prepared to sell the Oodnadatta railway to-morrow if I could get a White Star Company to buy it, and undertake to run a satisfactory service. I think that a little private capital invested in the running of railways might be a good thing for this country. If the suggestion of Sir Thomas Mcllwraith for a land grant railway in Queensland had been adopted years ago, I believe that where there is one person in Western Queensland to-day there would probably have been hundreds. We have had bitter experience throughout Australia of the nationalization of industry.
By the bargain it has entered into with the White Star Company, the Commonwealth Government has relieved the people of Australia of a loss of hundreds of thousands of pounds a year. The chances are that under the efficient management of this company we shall have as ‘ good, and perhaps a better, service than we have now. That is provided for in the agreement that has been entered into between the parties. I am glad to see the Government get out of this business altogether. Honorable senators on this side of the Chamber do not believe in the nationalization of purely trading interests such as shipping, which is quite a different matter altogether from the nationalization of railways, which are necessary for the general development of the country. This Line did not make a sufficient impression on the general shipping trade of Australia to keep down freights. The Minister proved that the bulk of the cargo from Australia was not carried by this line at all; it was proved also that the Commonwealth ships did not carry 1 per cent, of the coastal cargo. When honorable senators opposite refer to the profits made by the Line in the early stage of its existence, they forget to state that much of this profit was made while the ships were not trading to Australia at all. Many of the ships bought by Mr. Hughes traded all over the world, and did not, for some time, come near Australia. That was when everything that could float was of immense value, and every one in the shipping business was making huge profits. In fact, any one who happened to own ‘ a ship could not help making profits; but after the war when these ships came into active competition with other shipping companies they were no longer able to make profits. Senator Needham said that there, would be a different tale to tell when the elections came on. Personally, I hope this tale will be told throughout the length and breadth of the country. For my part, I want no better tale to tell to my constituents.
– No one can say that the present administration is zealous in the best interests of the country. Such an administration would be seriously anxious for the development and progress of Australia. It would give every possible assistance, financial and otherwise, to the building up of industries, in these southern seas, which would provide employment for Australians. It would show a disposition to foster the creation and development of those industries which would’ have been established here if the right government- had been occupying the Treasury benches in this Parliament. It was once our ambition to build up in Australia a big shipping industry, and for that purpose we sent men overseas to receive training and experience to qualify them for carrying out the work here. A small beginning was made at Cockatoo Island in the building of ships. From time to time I have heard statements in disparagement of Australian workmen, and of Australia itself, in regard to the cost of those ships. There is no justification for those statements. When we first began to build locomotives in Australia it was said by some people that we could not possibly build them here, and that even if we could it would only be at so great a cost that it would be more profitable to import the locomotives from abroad. Nevertheless, we began to build them, and the cost of the first one was greatly in excess of what it costs us to build them now.
Sitting suspended from 1246 to 2.15.
– To-day Australian nationalized workshops are turning out hundreds and hundreds of locomotives, which are equal to any that were imported. They are turned out, too, at a cost lower than was paid for the imported locomotive. The Newport nationalized workshops, manned by Australian workmen, have turned out great numbers of locomotives and by their efficiency, have saved the taxpayers of Victoria thousands of pounds. Recently we had the satisfaction of seeing placed on the State railways of Victoria one of their products^ - the biggest and best locomotive ever manufactured in Australia. For workmanship and finish it is equal to anything turned out ‘ anywhere in the world. That engine is capable of performing the work of two ordinary engines, and it will probably shorten the period occupied in the train journey between Melbourne and Albury by one hour. I had hoped that a similar state of affairs would apply to shipbuilding in Australia. But this Government declared definitely and emphatically that, while it occupied the Treasury bench, there should not in any circumstances be any shipbuilding industry in Australia, nationalized or otherwise.
Honorable senators who support the Government in selling the Australian Commonwealth Line of Steamers speak with varying voices. Senator Foll stated, as one of the reasons why the Line should be disposed of, that it was threatened with industrial trouble. Other honorable senators approve the Government’s action simply because they are opposed to any form of nationalization. Still others claim that the action of the Government is justified because, as they allege, the Line was a non-paying one. Dealing first with the statement of Senator Foll, I remind honorable senators generally that industrial trouble is prevalent throughout the world, and that it applies to a far greater extent to private enterprise than to any nationalized industry. Honorable senators opposite speak with two voices when they claim that they are opposed to every form of nationalization. If they really mean what they say they are more or less hypocritical. The Federal Capital area in which we are now living is a nationalized area. There is not one big private industry in the Federal Territory. To whom does the land belong? Not to private enterprise, but to the people. To whom do the roads, the lighting, the water, sewerage and transport services belong? To the people, amongst whom is Senator Foll. Honorable senators have prated of the success of private enterprise. Throughout the civilized globe there are numerous monuments to the failure of private enterprise. Is there any competition to-day in the shipping world? No. There was in years gone by but, because freights- and fares were so low that it scarcely paid private enterprise to run ships, those concerned put their heads together and came to an “ honorable understanding.” They increased freights and fares and pooled their profits. The shipping interests of the world form one huge combination, an octopus with tentacles stretching out to every section of the globe.
– And do they make any profit from their activities?
– Of course their activities pay. They are made to pay by the raising of freights and fares, the increased cost being passed on to the community.
I remind honorable senators who are opposed to nationalized industry that little or no progress would have been made in Australia had it not been for State controlled activities which, although they may not have paid directly, have, indirectly, paid very generously. There are many railways in Australia that do noi pay, but they are a boon to the people. Senator Thompson stated that he would not support the maintenance of an industry that did not pay. Would the sugar industry in Australia pay if it did not receive aid from the Commonwealth Government ? Would the wine and the iron and steel industries pay if they did not receive substantial bounties from the taxpayers of Australia? Are there any important industries in any part of Australia that have been built up by private enterprise without the assistance of the people ? There are not.
If honorable senators opposite are consistent in their attitude, they must oppose every form of protection which involves the imposition of higher duties or the granting of bounties to any industry struggling to get on its feet. I claim that the Australian Commonwealth Line of Steamers did pay, directly and indirectly. Certainly the people of Australia benefited through its operations. Freights and fares were lowered because of its activities, and increases were prevented. It saved the primary producers of Australia thousands and thousands of pounds. The Line was extensively patronized by thousands of Australians who went abroad, people who spoke, and still speak, in the highest terms of the excellent treatment they received, and of the uptodateness of the ships themselves. Recently a party of Scotsmen, making a pilgrimage to their native country, chose one of the Australian Commonwealth Line of Steamers by which to travel; and I am satisfied that when they return they will be generous in their praise of the ship and of the treatment that they received aboard.
– They carried a resolution to the effect that the Government should sell the ships.
– Probably at the instigation of Senator Pearce.
This is a two-faced sort of Government. It sold the Commonwealth Woollen Mills- because they paid, and now it sells its steamers because, it alleges, they do not pay-
– I was not aware that the Commonwealth Woollen Mills paid.
– No one knows better than Senator Pearce, who was Minister for Defence during the trying period of the war, the favorable price at which cloth was manufactured at those mills, and turned into finished articles in a nationalized industry. No one should know better than Senator Reid, who appears to treat this matter lightly, that what private enterprise has done recently in connexion with those woollen mills, would have been achieved by nationalized industry had a Labour government been in power instead of this Government.
– Did the harness factory pay?
– I think that it did.
– It did not.
– It conferred a remarkable benefit on the community during the war. We know that these ships originally cost about £7,500,000. Undoubtedly those built in Australia took longer to construct than was anticipated, but it must be borne in mind that Australia was then just beginning operations in the shipbuilding industry, and also that high initial costs are not peculiar to nationalized industry. The work of construction was carried out in an eminently satisfactory manner. The workmanship reflected the highest credit upon the artisans and all those associated with the industry. The ships were fitted with turbine engines and the most up-to-date refrigerating machinery - equipment of the greatest importance to the primary producers of Australia. Unlike the private enterprise, British-built submarines, the Oxley and the Otway, the Australian built ships did not break down on their initial voyages. The Australian, British built, sumarines, which are now at Malta undergoing repairs, will in all probability remain there some weeks yet before the defects are rectified. If we had had a similar experience with the Australian-built ships on their first voyages there would have been an outcry from one end of the Commonwealth to the other.
– To which ships is the honorable senator referring?
– I am referring to the two “Dale” ships. Those vessels have been sold for less than half the value placed upon them by the Commonwealth Shipping Board. We have heard something about the keenness of people to attend bargain sales. The sale of these ships was undoubtedly a star bargain sale for the White Star Line, which obtained them for far less than one-fourth their original cost.
– The honorable senator knows that the ships could be built in England to-day for about one-half their original cost.
– I admit that there has been a fall in the cost of shipbuilding in recent years, but to what extent prices have dropped, I am unable to say.
– There has been a decline in prices of about 50 per cent.
– Not only were these vessels sold for less than one-fourth of the value placed on them by the board, but their wages bill will also be cut practically in half by the new owners. The ships will be placed on the British register, and about 1,000 men will be thrown out of employment. It is not at all likely that the White Star Line will continue to employ Australian seamen at Australian rates of pay.
– It is pretty certain that it will not.
– Of course it is. Probably that is one reason why honorable senators opposite are gratified that the vessels have been disposed of. In future seamen employed on these ships will be paid much less, and will not enjoy the same favorable conditions of labour.
We do not hesitate to give the highest form of protection necessary for the encouragement of secondary industries because we realize that under Australian conditions our manufacturers cannot, without assistance, compete against overseas rivals who are permitted to work their employees long hours on lower rates of pay. For this reason we impose high customs duties on certain commodities, or encourage Australian manufacturers and producers by means of bounties. Unfortunately the same consideration has not been given to the ship*, ping industry. The view of honorable senators opposite appears to be that because it could not be made to pay on Australian wages and under Australian conditions, the Line had to be sold. This was the opinion expressed by Senator Poll.
– I said nothing of the sort. What I did say was that a certain number of the men employed on the Australian ships did not deserve the rates of pay which they received.
– The honorable senator’s argument was that, as the ships were not paying, they should be disposed of and British seamen employed on them at lower rates of wages.
– There would, then be a saving in working costs of about £220,000 a year.
– That, I know, is the figure stated in the Public Accounts Committee’s report. In the evidence given it was further stated that the estimated losses on the running of the ships on Australian conditions was about £400,000 a year.
– The figure was £595,000 a year.
– Assuming that the honorable senator is right, what does it mean? Did not we help the wine industry to the extent of £420,000 last year? If we had assisted the Commonwealth Shipping Line to the same extent we could have almost made up the difference in the cost of running the ships under Australian conditions. Senator Chapman, who approves of the sale of these vessels, would work himself into a state of frenzy if a proposal were submitted to abolish the bounty to the winegrowers of Australia. He and other” honorable senators appear to lose sight of the fact that the Commonwealth ships have been of immense value to the primary producers of Australia.
– What section of the primary producers?
– All those producers who export their commodities in abundance.
– -Does the honorable senator include the wheat and wool growers.
– Are wheat and wool the only commodities produced in abundance in Australia?
– Pretty nearly.
– Assuming that the honorable senator is right, surely n was worth while continuing the Line in the hope that later it would include ships capable of carrying the whole of Australia’s exportable produce.
– What would those ships bring back to Australia?
– Does the honorable senator suggest that there would be no back-loading for our vessels?
– If the honorable senator wishes Australian ships to come back fully laden, I am afraid our protectionist policy must go by the board.
– Notwithstanding the higher duties imposed on imports from time to time, there always will be a considerable volume of trade to Australia.
– But not equal to the volume of our exports.
– If freights and fares on Commonwealth ships were lower than in the case of vessels controlled by the combine the nationalized ships would always be assured of full cargoes.
– As a matter of fact, the Commonwealth ships assisted in recent years to keep freights up.
– The evidence on that point does not support the honorable senator’s contention.
I made a strong protest when the proposal to sell the ships was first mentioned. My protest to-day is- as strong as it was then. I believe in the nationalization of all industries which, under government control, can serve the people better than under private enterprise. I am a believer in nationalized railways, and as a nationalized shipping service is just as important to ensure the development and ‘ progress of the country, I believe in governmentcon trolled steamships. This is not the view of the Labour party only. It was the opinion of a royal commission representing all parties in Parliament that inquired into the shipping industry some years ago, and recommended the establishment of a Commonwealth Line of Steamers. ‘ Representatives df- primary producers, in their evidence before that commission, emphasized the disabilities under which they then laboured. . .
– In what year did that commission take evidence?
– That is of no importance.
– Yes it is. We have had experience of a Commonwealth Line of Steamers since then.
– We kept pace with the march of progress in regard to the class of ships built for the Australian trade. The “ Dale “ ships constructed at Cockatoo Island were up to date in every particular.
– What about their cost?
– If every enterprise had been measured by the cost we should have made no progress in Australia. We should have had no railways, no public utilities, and no educational institutions, because they could not have shown a direct return on the capital invested.
How can honorable senators who are supporting the Government in this matter reconcile their views on the sale of the Commonwealth ships with the opinions expressed by them recently in the tariff debate?. It is admitted that bounties granted for the encouragement of many primary industries are paid by the general taxpayer, and that the higher duties imposed for the protection of secondary industries are borne by the general community. We make these sacrifices to encourage the establishment of industries, and to ensure the development of Australia. When we were considering higher duties on timber, Senator Herbert Hays, who interjected just now about the cost of Australian-built vessels, did not then stress the point that higher duties on timber would mean slightly higher coat of buildings. Honorable senators opposite now contend that as the Commonwealth Line did not pay directly, the Government was justified in disposing of it. This is not a logical line of reasoning on the part of those who believe in protection. The sale of these steamers is not in accordance with the wishes of the people. The disposal of modern vessels, from four to six years old, at such a ridiculously low price is inimical to the interests of the taxpayers. In the course of time, when the people have an opportunity of expressing their opinion - and it will not be long before they have that opportunity - 1 believe the majority of the electors will not hesitate to say that the Labour party was justified in opposing the Government in the sale of these steamers.
– I want to deal with one or two of the issues that Senator Findley has raised in his very interesting speech. The first is in connexion with the price which has been received by the Government. I think it is only natural that, as vendors, we should like to see the price a little higher; but we have to consider whether in all the circumstances, it is not a reasonable price to pay for these vessels. Senator Findley made a great point of their cost, which, he said, was £7,500,000. But every one knows that the “ Bay “ boats were ordered by the Hughes Government just at the conclusion of the war, when the cost of shipping was higher than it has been at any other time. The price paid for . the construction of those vessels was 100 per cent, higher than the tonnage rates applying to-day for the construction of even more modern vessels, including the very latest in the improvements that each succeeding year brings forth. Consequently the price we have received for vessels with six or seven years off their lives has properly to be compared with the cost of new tonnage to-day, and in order to do so we have to cut the £7,500,000 in half. It is true that two of the steamers were built at Cockatoo Island, but we all know that the circumstances under which vessels are built in Australia are such that the cost is inevitably very much greater than it would be if they were built in British yards.
A fair price for the “ Bay “ steamers, new, would be about £3,-500,000, and that is the figure we have to use as a fair basis of comparison with the £1,900,000 obtained by the Government for the sale of the Line. But we have to go a step further, and remember that the steamers of the Australian Commonwealth Line have now had six years’ actual wear. A fair amortization charge against the “ Bay “ boats on their original cost would be about £40,000 a year. If we multiply that £40,000 by six and then multiply the result by six, we find that, after making due allowance for an amortization charge on the ordinary average commonly accepted rate at which ships are written down, £2,000,000 is just about the correct price to pay for the steamers of the Australian Commonwealth Line. The Government has, therefore, to be congratulated on having received an offer round about the fair market value of the boats under existing conditions. That disposes of Senator Findley’s charge against the Government that the vessels have been sold at what might be regarded as bargain rates.
The honorable senator also emphasized the desire of our community to indulge in socialistic enterprises, and claimed that as honorable senators supporting the Government believed in the nationalization of the railways, telegraph services and other similar public activities, we were necessarily inconsistent in our opposition to the nationalization of shipping. Where does the honorable senator draw the line? Does he believe in the nationalization of every service done for the community? Does he believe in the nationalization of all industries?
– I believe in the nationalization of every service that is for the common good.
– Let us see where that will lead us. Does the honorable senator believe in the nationalization of the food services of the country? They are services for the common good.
– I believe in the Labour platform. T refer the honorable senator to it.
– I know perfectly well that the honorable senator does not believe in the nationalization of all services.
I should like to point out why a line has to be drawn between services which we think should be nationalized and those which we would not think of nationalizing. There is a very good logical reason for favoring the nationalization of railways and telephone services and drawing the line at the nationalization of shipping. All services which are public utilities are in their very essence in the nature of monopolies. In the case of most of them the door is not open to private enterprise to provide that competition which is so essential to enable the community to gather the best results; and although there are many drawbacks in respect to their nationalization, we think that on the whole it is in the interests of the people that they should be controlled by and on behalf of the people. But shipping is in an entirely different position. Any one can sail a ship on the pathless ocean. In shipping there is no monopoly. On the contrary, there is a system of competition which even under the peculiar conditions of to-day is very real. I am connected with sundry enterprises which have a good deal of produce to ship overseas, and on more than one occasion I have been astonished at the tremendous competition for freight that exists to-day. If one has 10,000 tons of freight to distribute one is surprised at the number of men who are waiting on the doorstep trying to secure the right to convey it to market, and at how many offers made to carry the produce at rates 2s., 3s., and 4s. a ton lower than the quotations of others. As a matter of fact, Senator Findley would find, if he had freight to handle, thai, competition for overseas freight is very real. His argument in this respect is untenable. There is ample competition on the seas, and the conditions under which honorable senators of the Ministerial party would favour the nationalization of a public utility do not apply. But I go further and say that lately - I do not speak without some knowledge on the point - there has been, although not in a definite way, a concentration of energies on the part of the management of the Commonwealth Line of Steamers in the direction of trying to keep up rather than bring down freights, the object, of course, being to prevent the losses on the vessels becoming more gigantic than they have been in the past. We have only to draw upon our knowledge of human nature to thoroughly understand, the motive, which actuated the management in this respect.
-For most of the time the management has been intimately connected with the combine.
– I should not go so far as to say that; but it was acting in collusion with the combine, and there was not much difference between them.
– The management of the Australian Commonwealth Line attended the meetings of the combine.
– The line has had a most unfortunate history. Eor some extraordinary reason, which Senator Findley may appreciate better than I can, it has been for a long time the peculiar bait of those unions which ought to have derived the greatest amount of benefit from its activities. Precisely why this has happened I do not know, but it is undeniable that the attitude of the unions has contributed largely to the losses that have brought about the sale of the steamers. The extraordinary feature of this is that the great champions of the socialization of industries, who are prepared to go to such great lengths as to advocate the retention of the Australian Commonwealth Line of Steamers, despite the heavy loss it has been to the people of Australia, never once to my knowledge raised their voices against the tactics of unions which, in my judgment, have contributed more than anything else to the non-success of the Line. They have allowed, without protest, Walsh. Johannsen, and the rest of the crowd, so to play ducks-and-drakes with the Line as to make it impossible for a government doing its duty to the people of the country to continue its activities; not one word of reprobation has been heard from them.
– They were not game toprotest.
– I have simply given facts. I leave these men to their consciences.
.- Senator Findley said that the selling of the Australian Commonwealth Line of Steamers did not meet with the approbation of the people of Australia. I should like to know on what the honorable senator bases his opinion. If we compare the number of Government supporters in the Senate and in another place with the number in the ranks of the Opposition, we are justified in concluding that the party of which Senator Findley is a member does not represent the people of Australia. The nationalization of industries is distasteful to the majority of people to-day, although some years ago many persons were in favour of further experiments being conducted along those lines. At one time I held views similar to those now professed by Senator Findley. I doubt whether the honorable senator is sincere in his advocacy to-day of the nationalization of industries. He must admit that the system has been a failure.
– I do not admit anything of the kind. I am not a pessimist, but an optimist.
– It is merely a question of facing facts. Apart from public utilities, I challenge Senator Findley to point to one experiment in the nationalization of industry which has been a success.
– What about the Post Office?
– That is a public utility of which the Government has a monopoly. It was because of government control of public utilities, such as the Post Office, that many persons, including myself, at one time favored further experiments being made in government control. The experiments which have been made have all failed.
– The State-owned railways do not pay because of the necessity to build developmental lines.
– That is not the only reason for their failure. They have failed largely because they have been overmanned during the periods that Labour governments have been in office. At one time I was in favour of the Commonwealth entering the shipping business, and of the establishment of the shipbuilding industry in Australia. That the industry has proved a failure is due to the men not having been fair to their employers, the people.
Senator Findley referred to the wonderful ability of Australian -mechanics and other workmen. I do not doubt their ability; but notwithstanding their ability, the workmen at Cockatoo Island, who have one of the best jobs in the Commonwealth, were unable to build two cruisers at a price comparable with that for which the vessels could be built in England. In the purchase of locomotives also various governments, both State and Federal, have had to go outside their own workshops. Even the Government of Queensland, whose socialistic tendencies are well known, had to purchase locomotives from private firms because its own workshops at Ipswich, although well equipped with up-to-date machinery, could not compete with them. When the Commonwealth Shipping Board was established the capital value of the, vessels of which it was given control was written down by about £8,000,000. Yet the Line has been run at a loss. It has been computed that in respect of each vessel the loss sustained since that time is approximately £1,000,000. At the time I opposed the vessels being placed on the Australian register, because I realized that it would he difficult, if not impossible, for the Shipping Board to compete with companies working under different conditions. Had the vessels been placed on the British register, they could still have been manned by Australian seamen; but under Australian articles it was impossible for them to compete successfully with the vessels of other companies not subject to the same conditions.
We have been reminded by the Opposition of the “benefits which the Line has conferred on the people of Australia, particularly the primary producers. But has the Line, after all, been of such a benefit to Australia as honorable senators opposite would have us believe? What about the £8,000,000 by which their capital value was written down ? I admit_ that during the war period the vessels were of immense benefit to this country; but since shipping has returned to more normal conditions, the Line has been run at a loss. For that state of affairs I blame the unions. At no time have they made a determined effort to make the Line pay. On the contrary, they have harassed it on every possible occasion by declaring the ships “black,” and holding stop-work meetings. No other line of steamers was interfered with to the same extent. A mere handful of men set out to injure the Line; and they have succeeded. The failure of the Line lies at the door of the seamen’s, cooks’, and stewards’ unions.
Bather than continue to run the Line at a loss it would be better for the Government to subsidize other companies in order to keep down freights. It is clear the Line cannot charge lower freights than are charged by other companies, and still make a profit.
Senator Findley spoke of the uptodate machinery in the vessels belonging to the Line; but it is not so up-to-date as that in some of the other vessels trading between Australia and Britain. So far as chilling machinery is concerned, the vessels belonging to the Australian Commonwealth Line of Steamers are six years behind the times. They do not offer any better inducements to exporters of butter than do some of the vessels belonging to rival companies ; and as they do not carry much wheat or wool, the benefits they confer on Australian primary producers are purely imaginary. The sale of these vessels will not. seriously affect the passenger trade on the Australian coast. The whole of that trade is now catered for by seven vessels. And even then one cannot say that they are paying. I do not know how much profit the companies have made. Even supposing they combine to put up freights I do not know that there is as much profit in it as we are told. If there were, there would be more ships running on our coast. The Patrick Company set out to cut down freights. They did cut them down, but eventually they themselves had to throw in the sponge. They got all the freight and passengers they wanted; their ships were full for every trip, yet they were unable to carry on. I ask leave to continue my speech at a later date.
Leave granted ; debate adjourned.
page 4451
Motion (by Senator Sir George Pearce) proposed -
That the Senate do now adjourn.
.- On the 8th March, nearly seven weeks ago, I asked the Leader of the Senate a series of questions based on the
Government’s proposal to curtail expenditure in several departments. Among other questions, I asked -
To question c the answer of the Minister was that the information was being obtained. I now ask the Leader of the Senate if he would,’ between now and the resumption of business next week, obtain such information as will enable him to give a definite answer to my questions.
– I shall endeavour to obtain the information which the honorable senator requires.
Question resolved in the affirmative.
Senate adjourned at 3.20 p.m.
Cite as: Australia, Senate, Debates, 27 April 1928, viewed 22 October 2017, <http://historichansard.net/senate/1928/19280427_senate_10_118/>.