10th Parliament · 1st Session
The President (Senator the Hon. Sir John Newlands) took the chair at 3 p.m., and read prayers.
I beg to lay on the table of the Senate the annual report of the tariff board for the year 1927-28, together with summary of recommendations. The schedules containing the board’s specific recommendations are complete, with the exception of a few which have not yet been considered by the Government. When these have been dealt with they will be laid on the table. Many of the board’s reports referred . to in the papers accompanying the annual report have been laid already on the table of the Senate and printed, and formed the basis of action taken in the tariff schedule lately before the Senate. In respect of the board’s recommendations in connexion with the by-law items of the tariff, and other matters apart from tariff revision, the action taken is set out on the schedule to the report in respect of each recommendation, and all such by-laws made have been duly published in the Government Gazette. Under these circumstances it is not proposed to print the papers annexed to the report.
That the report only he printed.
The following papers were presented : -
Development and Migration Commission - Report on Unemployment and Business Stability in Australia.
International Conference for the abolition of
Import and Export Prohibitions and Restrictions, Geneva, 1927 - Report of Australian Delegate.
Royal Commission appointed to inquire into statements in the press in regard to offers alleged to have been made to members to resign seats in the Federal ParliamentReport, dated 2nd July, 1928.
Canned Fruits Export Control Act - Statement by the Minister for Markets regarding the operation of the Act, together with Second Annual Report of the Canned Fruits Control Board, year ended 30th June, 1928.
Dairy Produce Export Control Act - Statement by the Minister for Markets regarding the operation of the Act, together with Third Annual Report of the Dairy Produce Control Board, year ended 30th June, 1928.
Dried Fruits Export Control Act - Statement by the Minister for Markets regarding theoperation of the Act, together with Fourth Report of the Dried Fruits Control Board.
Canned Fruit Bounty Act - Return for 1927-28.
Cotton Bounty Act - Return for 1927-28,
Iron and Steel Products Bounty Act - Return for 1927-28.
Papua and New Guinea Bounties Act - Return for 1927-28.
Power Alcohol Bounty Act - Return for 1927-28.
Shale Oil Bounty Act- Return for 1927-28.
Sulphur Bounty Act- Return for 1927-28.
Wine Export Bounty Act - Return for 1927-28.
Electoral Act and Referendum (Constitution Alteration ) Act - Regulations - Statutory Rules 1928, No. 80.
Papua Act - Ordinances of 1928 -
No. 3 - London Missionary Society Corporation Land Transfer.
No. 4 - Bodies Corporate (Joint Tenancy ) .
No. 7 - Customs.
Public Service Act - Appointment - Post master-General’s Department - R. P. Cunningham.
Seat of Government Acceptance Act and Seat of Government (Administration) Act - Liquor Poll Ordinances - Regulations.
Pastoral, Agricultural, Dairying, and Horticultural industries in Australia - Number of persons engaged, value of products, and value of. production per head in each industry during years 1906, 1910, and 1920.
– On the 31st August, Senator Elliott asked the following questions: -
The Minister for Home and Territories has supplied the following answer: - 1 and 2. The whole question of the extension of the Queanbeyan-Canberra railway to the north is being considered in conjunction with the lake scheme, but it is anticipated that it will be at least twelve months before the present investigations are completed. It may bc mentioned that there has never heen a public line for railway traffic to Ainslie. The line which was previously laid was a constructional tramway only and was put out of commission as a result of heavy floods in July, 1 922, when the trestle bridge over the Molonglo River collapsed and the approaches were washed away.
Temporary ato Exempt Employees.
Number of males and females employed as at 30th June, 1927.
Under Section 82 of the Public Service Act: - Males, 3,764; females, 1,356; total, 5,120.
Under exemption from the Public Service Act: - Males, 10,209; females, 3,950; total, 14,159.
The delay in supplying this information is regretted, but it has been necessary for the Public Service Board to communicate with all Commonwealth departments, and for the desired particulars to be prepared in each State.
– Some time ago I asked the Minister representing the Postmaster-General a question relating to the installation of telephonic communication between Tasmania and the mainland, and the Minister’s reply was that inquiries were being made. I should like to know if those inquiries have been completed and, if so, with what result ?
– I am unable to answer the honorable senator’s question at the moment, but I shall hare inquiries made.
Bill presented by Senator Sir George Pearce and read a first time.
The PEESIDENT (Senator the Hon. Sir John Newlands). - I have to inform the Senate that I have received from Mrs. Grant a letter of appreciation and thanks in connexion with the resolution of sympathy passed by the Senate on the occasion of the death of her husband, the late Senator J. Grant.
Number and Cost
asked the Leader of the Government in the Senate, upon notice -
Will the Minister furnish the Senate with a statement showing the different boards, commissions, tribunals, &c, brought into existence by the Bruce-Page Government, together with the annual cost of each board?
-I would refer the honorable senator to returns furnished in another place on the 15th December, 1927 (Hansard, page 3269), and the 22nd March, 1928 (Hansard, page 4048). The particulars are being brought up to date and the complete information required will be made available as soon as possible.
asked the Leader of the Government in the Senate, upon notice -
– The answers arc -
asked the Leader of the Government in the Senate, upon notice -
– The answers are
asked the Minister representing the Minister for Home and Territories, upon notice -
Senator Sir GEORGE PEARCE.The answers are
Number of Employees and Wages Paid
asked the Minister representing the Minister for Trade and Customs, upon notice -
– The information will be obtained as far as is possible.
asked the Minister representing the Minister for Home and Territories, upon notice -
Referring to the special adjournment motion moved in the House of Representatives on the 30th ultimo, will the Minister make a statement to the Senate explaining the incident.
– It is not usual for Ministers in this chamber to reply to allegations made in another place. I have seen the Minister for Home and Territories (Sir Neville Howse), who informs me that he has nothing further to add to the statements he made in another place on the 30th August, and the 4th September.
asked the Minister representing the Postmaster-General, upon notice -
– The answers are: -
asked the Minister representing the Minister for Markets, upon notice -
– The answers are: -
Motion (by Senator Gardiner) agreed to.
That leave be given to introduce a bill for an act to amend the Invalid and Old Age Pensions Act, 1908-1926.
Bill received from the House of Representatives and (on motion by Senator Sir George Pearce) read a first time.
Bill received from the House of Representatives and (on motion by Senator Sir George Pearce) read a first time
.- I move-
That Ordinance No. 17 of 1928, to amend the Building and Services Ordinance 1924-1925 of the Territory for the Seat of Government, be disallowed.
I assure the Senate that I move this motion in no spirit of antagonism towards the Commission which is in control of the Federal Capital Territory, but because I believe that a grave injustice is being attempted under this ordinance which has been promulgated by it. For the information of honorable senators, I shall quote from the ordinance. It is an ordinance to amend the Buildings and Services Ordinance 1924-25. Clause 2 reads -
This ordinance shall be deemed to have commenced on the fifth day of November, 1925.
I desire honorable senators to make a special note of the date. In a matter of this kind Parliament should be jealous of its rights and privileges. It is not a question merely of kerbing and guttering ; if it were, it might reasonably be said that it was not a matter for consideration by so august a body as the Senate. There is more in it than the mere question of kerbing and guttering. Either ignorantly or deliberately, an attempt is being made to evade an act of Parliament and to circumvent the express wish of Parliament. That is a strong statement, but I shall give my reason for it.
– It is a most extravagant statement.
– I do not think so. Should the Government persist in its attitude and force the unfortunate leaseholders who are being attacked in this way by the Federal Capital Commission to take the case to the High Court, it will find itself in “ queer street.” I want to obviate any such happening, largely because of the expense which necessarily attaches to an action before the High Court. Before that court could be approached the matter would first have to come before a local magistrate; then on appeal, the case would go to a district court, while a further appeal would be necessary to bring it before the High Court.
– Leaseholders would be badly advised to take the case to the High Court as the honorable senator himself will realize presently.
– I have seen the considered opinion of one of the highest constitutional lawyers in the Commonwealth to the effect that the action proposed by the Commission is wrong.
– The High Court has already given a decision in a similar case.
– I hope the right honorable gentleman is wrong. I propose to quote from the Seat of Government Act under which the ordinance is made so that honorable senators may see that there is something more than smoke in the statement I have made. Section 12 of the Act reads -
Every such ordinance shall -
I direct special attention to the words “ a later date.” The ordinance provides that it shall be deemed to have commenced on the 5th day of November, 1925, notwithstanding that the ordinance itself is dated the 27th July, 1928. The ordinance is therefore retrospective. I submit that, except in special circumstances, we should be chary about countenancing retrospective ordinances, regulations or legislation. There may be times when retrospective legislation is necessary, but those occasions ought to be very few, and even then they should be confined to great issues upon which there is little difference of opinion. The issue before us is not of that- nature, for with the exception of the unfortunate residents whom it affects, the ordinance is not regarded as an issue by the people of Australia. This Parliament is being asked to countenance what is really an act of repudiation by the Commission. Indeed, should Parliament agree to the ordinance, it also will be guilty of repudiation. In order that honorable senators will be in a position to register an intelligent vote I propose to trace the history of this case. The ordinance applies to lands sold on the leasehold principle either by the Federal Capital Commission . or by the Government prior to the appointment of the Commission. The original sale was conducted by auctioneers acting on behalf of the Government. The only responsible officer of the Government present at that sale was the then Surveyor-General, Colonel Goodwin, who has admitted in a statutory declaration that at that sale he stated that kerbing and guttering were not charges which would be levied on the purchasers of the land. That statement, which was made with the object of increasing the competition for the blocks, had the desired effect. It was generally understood by the purchasers of land that they would not be responsible for the cost of kerbing and guttering. Acting on the assurance they had received, people bid for the blocks, and later took possession.
– That has been definitely challenged.
– Colonel Goodwin admits in a declaration that he made the statement in the hearing of others.
– Do not use the term “admits”; rather, use “ alleges.”
– Colonel Goodwin made a sworn declaration admitting that he made that statement.
– Had he any authority to make such a statement ? Any person may make wild or stupid statements.
– Colonel Goodwin was the senior responsible officer representing the Government at the sale, and he is not the type of man to make wild or stupid statements. He believed that what he said was absolutely correct. If that, was his firm opinion, how much more forcibly must the idea have been impressed on the minds of the majority of prospective buyers present at the sale? Statutory declarations have been made by other persons present, alleging that Colonel Goodwin did make the statement to which I have referred, and that they acted subsequently in the belief that kerbing and guttering charges would not be levied upon them. Still others have made statutory declarations to the effect that they cannot remember such a statement being made. The auctioneer himself declares that he has no recollection of the occurrence, but he will not go so far as to say that it did not happen. When the Commission proposed to levy kerbing and guttering charges, the matter was raised in another place, and the Minister for Home and Territories made a statement in that House. The honorable gentleman had already been waited upon by purchasers of Canberra land, and made aware that a legal opinion had been obtained that the proposed charges were ultra vires. In all sincerity those people laid their cards on the table and placed all the facts of the case before the honorable gentleman. The Minister admitted by his subsequent action that they were right in claiming that the original ordinance was ultra vires, as he issued the amending ordinance whichI now have in my possession. I submit that the amending ordinance is also ultra vires, and as hideously unfair as the earlier action of the Government and its agent, the Commission. The Government, having fired one barrel which proved to be a squib, should have admitted its mistake and abided by the terms of the original agreement.
– Do residents in the Federal Capital Territory who rent premises pay such charges ?
– I shall deal with that later. Undoubtedly the Government had no legal right to impose kerbing and guttering charges in the first place, and it should have adhered to the terms that were announced on the day of the sale. The original agreement specified the costs that had to be met, and did not in any way mention kerbing and guttering. A opinion has been obtained from Mr. John Garlick, one of the- Commissioners of the City of Sydney, and for many years under secretary of local government for New South Wales. Mr. Garlick is a recognized authority on such matters, and he said -
The Sydney Council constructs kerbing and guttering opposite leases similar to Canberra leases without cost to the lessees.
Similar opinions were obtained from other authorities in Australia, and they all indicate that it is not the practice for municipal authorities in this country to inflict such charges upon lessees.
– Every freeholder has to pay those charges.
– I am dealing only with leaseholders. There is no freehold in the Federal Capital Territory.
– Does the honorable senator contend that a citizen of Perth does not have to pay for kerbing and guttering?
– I am not familiar with the conditions prevailing in Perth. I am aware that freeholders have to meet such costs ; leaseholders have not.
– There are no leaseholds from the Crown in Perth.
– There are any amount of leaseholds from the Crown in all parts of Australia, and everywhere in this country the owner of a freehold, whether he be a private individual or the Crown, is responsible for curbing and guttering charges. Leaseholders pay such costs only when that is expressly stated in their leases, which was not done in this instance. In the circumstances, I contend that the action of the Government and of the Commission is unfair.I know that different legal opinions have been expressed on this matter, but it is customary for lawyers to differ. I do not deal with the matter only from the legal point of view. There is an important moral aspect involved, which I hope will have the consideration of this Senate. We are under a moral obligation to them and we have to stand up to any obligation, actual or implied. The Minister denies that this is an actual obligation, but I have said sufficient I think to establish it as at least a moral obligation.
– It is not neither a legal nor a moral obligation as I shall presently show.
– The lessees are now prepared to organize and submit their case to the court.
– Hear, hear! That is the proper way of testing the matter.
– Having once given the Government the benefit of the advice for which they had to pay, with the result that the Government amended its ordinance, the lessees are not now prepared to give the Government the benefit of the new advice for which they have paid unless the Government will meet them in a more impartial way than it has hitherto met. them. I submit that it is the duty of the Government to meet the lessees in the most impartial way. . It is not for the Government to make up its mind and not budge a point, simply saying “ That is the position, and you must accept it whether you like it or not.” Honorable senators are not in the position of attackers or defenders of the Commission. They are here to see that justice is done and should approach questions of this kind in the most impartial way possible. The Government is in the same position. It must be impartial but it is not if it does not ask the lessees to come to it and state their case fully, and if having done so it is not prepared to say to them “ If it is proved that you are right, we shall drop this ordinance.”
The lessees having been once bitten, are not prepared to be bitten twice. They have no guarantee that even if they prove that the new ordinance is wrong the Government will not come down with an amending ordinance to get over all legal difficulties and all the unsurmountable hurdles that the lessees have been able to put up. It is quite possible that the Government may so amend the law that it may be dated retrospectively over a sufficient period to enable it to do what it wants to do. But that is not the proper way to treat the lessees of the Federal Capital Territory. When the Commission proposed to take a certain course which it was afterwards proved to the satisfaction of the Government could not be taken, an amending ordinance was gazetted, and I think that the facts I have given indicate that even that amending ordinance is as ultra vires as was the original one. If the Government forces these unfortunate people to fight their case through several courts it will not be just to them ; that is certainly not the proper way for a great Federal Government to deal with its tenants. After all, the people concerned are our tenants. The lessees of the Federal Capital Territory should not be put to the enormous expense which will be involved in testing in the courts the legality of this . ordinance. I hope that the Government will view the matter in a reasonable way so that all the difficulties likely to arise through the course of action now proposed by the Federal Capital Commission, may be avoided. Every one recognizes that there is not in the Territory at the present time the spirit of good will and fellowship between the Commission and the lessees and other residents of the Territory that there ought to be. We have now an opportunity to help to build up a new sentiment of goodwill and co-operation that will make all in the Territory work together for its general benefit and for the advancement of the Commonwealth. I hope that the Senate will see that this ordinance is not allowed to stand. We are, under the statute, given power to disallow any. ordinance that we think is not a fit and proper ordinance. We rarely exercise that power because it seldom becomes necessary to do so. But when it does become necessary we should not hesitate to disallow an ordinance. The Administration may be prepared to come to the assistance of any commission or any body that is acting manifestly in an unfair and improper way, but in this matter I do not cast any reflection on the Government. In all probability it has not been consulted to any great extent about this ordinance to which I object. If the ordinance itself is right it ought to stand, but if it is wrong, and I claim it is, the Senate should not hesitate to disallow it.
[3.46]. - At the outset I wish to make it perfectly clear that the Government accepts full responsibility for the ordinance which the honorable senator seeks to have disallowed. The honorable senator, at the beginning of his speech, said that he had no antagonism to the Commission.
– I have none whatever.
– That may be so, but the honorable senator is appearing for those who are antagonistic to the Commission, and therefore I, say at once that the Government takes full responsibility for this ordinance. Its very terms indicate that it was passed with the approval of the Government. The honorable senator therefore must direct his attack at the Government and leave the Commission out of the question. The Government does not desire to shelter behind the Commission. I cannot understand why Senator Duncan should have appealed to honorable senators to be jealous of the rights and privileges of Parliament. There has been no invasion of the rights and privileges of Parliament. This Parliament, because it did not want to become a mere parliament for Canberra, endowed the Government openly, and with full knowledge, with the right to make ordinances with respect to the Federal Capital Territory. It recognized that the people of the Territory were entitled to have a code of laws but it did not want a Parliament, elected by the millions in Australia, to be occupied in passing laws for Canberra. It therefore delegated to the Government the power to make ordinances for the Territory, and in that respect I regret that too much of the time of this Parliament has already been taken up by Canberra affairs. In fact, there is a danger that the National Parliament may degenerate into a parliament for Canberra. A great many of the matters relating to the Territory that have been brought up here, ought to have been left to the people of Canberra themselves. In that connexion the Government hopes to give the residents of the Territory the opportunity they should have of expressing their own views on municipal matters where they ought to be expressed, and that is on the Commission controlling the Territory. When that is done I hope that less of the time of this Parliament will be taken up in discussing what are purely municipal affairs that ought never to be discussed in a national parliament. My remarks on this point are prompted by the honorable senator’s statement that in some way or other the privileges of Parliament have been undermined or given away
Looking at the matter, apart altogether from the points raised by the honorable senator, is it not a fact that if a person has property in any other part of Australia and the municipal authorities lay down a footpath alongside that property the owner has to pay a share of the cost of making it? The property owner pays his share of the cost of making not only the guttering and kerbing, but also the footpath. It is, as a matter of fact, common knowledge in Australia that that is one of the liabilities of the owner of a property. If a person buys land anywhere in Australia, he does so on the assumption that if the municipality in which the land is situated provides a footpath, he will be called upon to pay his share of the cost of making it. Likewise, the persons who came to Canberra in the days of the first auction sale, came here with the knowledge and on the assumption that if they bought leaseholds here they would have to pay their share of the cost of making footpaths. I venture to assert that all. the buyers who attended the first sale had that assumption in their minds - that the common practice all over Australia would be applied here. I have a very distinct recollection of that first sale, because I’ was the Minister who approved of the conditions of sale. I went over them dozens of times with various officers of whom Colonel Goodwin was one. He afterwards ceased to be an officer of the department, but at that time was the officer who advised us on land matters. I went over the conditions of sale with the auctioneer. Certain conditions were printed on the forms which advertised the sale. If we were about to effect a revolutionary change, if we were about to do something in respect of properties in Canberra that had not obtained anywhere else in Australia, and would have added considerably to the attractiveness of purchasing land in Canberra, should we not have included it in the conditions of sale? Should we not have starred it on the plans we issued? Should we not have said on those plans, “ Here you will have a privilege that you have not enjoyed anywhere else in Australia”? Of course we would have done so, but it was not done, and those who are raising the issue now do not claim that it was done. In fact they cannot point to anything in the conditions of sale to support their present contention. It is true that years after the sale Colonel Goodwin made a discovery and told some one certain things, but it is news to me to learn that Colonel Goodwin was authorized to tell any one anything at the sale in regard to the conditions. My recollection is that the announcement of the conditions of sale was to be made by the auctioneer. At any rate he was the only person authorized to announce the conditions of sale. I certainly have no recollection of authorizing Colonel Goodwin to say anything to any one.
– Will the Minister say what was the law in force in relation to these matters at the time?
Senator Sir GEORGE PEARCE.The law in force was the ordinance of 1924.
– What did that provide?
– I shall come to that point in due course. I have told honorable senators the state of mind in which people attended the first sale. Senator Duncan says that an attempt has been made to get round an act of Parliament. Why does he use language which amounts to an accusation against the Minister for Home and Territories? As a matter of fact, no attempt has been made to get round any act of Parliament. No act of Parliament can lay down all the conditions governing the Territory. The Seat of Government Administration Act is simply an enabling act, and in that respect it is just like the Constitution Act. The Federal Convention did not attempt to lay down in the Constitution Act all the legislation that would express what it meant. Year after year since the establishment of federation, there has been passed legislation in which this Parliament has endeavoured to interpret what the framers of the Constitution put into it. Similarly, the Seat of Government Administration Act does not purport to contain all the provisions and regulations under which the people who live in the Territory are to be governed. Parliament directed that that should be done by ordinances.
– I was referring to the retrospective nature of the particular ordinance under review.
-PEARCE.- I am taking the honorable senator’s statements point by point, and am now dealing with his statement that there has been an attempt to get around an act of Parliament. I am saying that there has been no attempt to get around an act of Parliament. But there has been an attempt to do what the Government does every time an act is passed by Parliament - there has been an attempt to express the will of Parliament. The ordinances relating to the Federal Territory are an attempt to express the will of Parliament in respect of the powers conferred upon the Government by the Seat of Government Administration Act.
– They must be within the four corners of the act.
– Of course they must, and we have the power under that act to frame municipal regulations. Does the honorable senator doubt that under the Seat of Government Administration Act the Government has the power to authorize municipal regulations for the Federal Capital Territory?
– Not to date them back.
Senator Sir GEORGE PEARCE.Yes. Let me deal with that point. The first act was passed in 1924; the honorable senator referred to that passed in 1925. The first ordinance was passed in 1924 and provided, in section 4, that -
The. Minister may make regulations prescribing
the charges to be made for services supplied in pursuance of this ordinance.
It did not specify what the services were. It did not specifically mention sanitary, lighting or other services but gave the Minister a general power to make charges for services. The Minister therefore had power to make charges for guttering, kerbing and footpaths. As there might have been some doubt whether they were included in “ services “, we expressly provided for them in the later ordinance. In other words, that ordinance was a declaratory one. It was intentionally brought into operation in the form of an amendment of the Building and Service Ordinance of 1.924. The authorization of 1924 to make charges was intended to cover services such as the provision of guttering and kerbing, but a question having then been raised as to whether guttering or kerbing was a “ service “, the amending ordinance was brought down to remove all doubt on the point. Senator Duncan urged that in 1925 we did not intend to charge for guttering and kerbing, but that in 1928 we made up our minds to do so and accordingly made the provision retrospective to 1925. That is not so. I repeat that it was intended to charge lessees for guttering and kerbing in 1024 when the first ordinance was passed ; that we intended the word “ service “ to cover such charges; and that doubts having arisen on the point, the later ordinance was framed to make it clear that lessees here are so liable, just as they are everywhere else in Australia. The honorable senator has suggested that proceedings will be instituted before the High Court. The Commonwealth will welcome such proceedings.
– Will the Government compensate lessees if their appeal to the High Court is successful?
Senator Sir GEORGE PEARCE.Why should we compensate people who put us to needless expense? When lessees study the cases already decided by the High Court they will realize that their claim cannot be sustained. Why should we feed the lawyers? The power of the Commonwealth to pass retrospective legislation has been questioned in two cases, particulars of which I shall submit to the Senate for the benefit of those who think of approaching the High Court.
In the case of the Colonial Sugar Refining Company Limited v. Irving (1906), A.C., page 360, the right of the Commonwealth to collect duties under new rates of tariff as from the date of the introduction into Parliament of a tariff resolution was challenged by the Colonial Sugar Refining Company. The view of the Privy Council is stated by Lord Davey at page 366 as follows : - “ The Parliament had undoubted power to impose taxation under the express words of section 51 of the Constitution, and it is not now disputed that the Parliament could, if it thought fit, make the act retroactive, and impose the duties from the date of the resolution.”
– Surely the Minister is not quoting that as an authority in this case.
Senator Sir GEORGE PEARCE.I am.
– I am surprised.
Senator Sir GEORGE PEARCE.The honorable senator, who is a lawyer and also a ratepayer in Canberra, has an opportunity to distinguish himself by taking the case to the High Court on behalf of his fellow ratepayers here. The next case is that of the King versus Kidman, 20 C.L.E., page 425, the headnote of which reads -
The Crimes Act 1915, which, by section 2, adds conspiracies to defraud the Commonwealth to the conspiracies which by section 86 of the ‘Crimes Act 1914 are declared to be indictable offences, and by section 3, provides that the act is to be deemed to have been in force from the date of the commencement of the Crimes Act 1914, is a valid exercise of the power of the Parliament of the Commonwealth.
– There was no retrospective legislation in that case.
Senator Sir GEORGE PEARCE.Yes. In 1914 an act was passed and in 1915 Parliament passed an amending act creating an offence and provided that that act should be deemed to have come into operation in 1914.
– But that was an act of Parliament, not an ordinance.
– Surely the Minister is not serious in putting forward those decisions as bearing on this case.
Senator Sir GEORGE PEARCE.I am. The headnote continues -
So held by the whole court. . . .
By Isaacs, Higgins, Gavan Duffy, Powers, and’ Rich JJ., on the ground that within the limits as to subject matter prescribed by the Constitution the power of the Parliament to make laws is plenary, and’ includes the power within those limits to make ex post facto laws. .
On the particular question of the power of the Commonwealth Parliament to enact retrospective legislation Griffith, C.J., disagreed with the majority of the court, but the decision of the other five judges must, of course, be accepted as authority on the question. The Building and Services Ordinance 192S was passed in pursuance of the powers conferred by the Seat of Government Acceptance Act 1909 and the Seat of Government (Administration) Act 1910. Section 12 of the Seat of Government (Administration) Act 1910 provides that “until the Parliament makes other provision for the government of the Territory, the Governor-General may make ordinances having the force of law in the Territory.” The section also provides for the notification and disallowance of ordinances. There can be no question as to the plenary nature of the power conferred by this section and consequently the decision of the High Court in The King v. Kidman must apply to Ordinances for the Seat of Government. It seems clear, therefore, that the Governor-General has power to provide for the retrospective operation of Ordinances for the Seat of Government. So much for the legal side. Let us now come to the facts. On 20th October, 192? the Federal Capital Commission, purporting to act under the powers conferred upon it by the Building and Services Ordinance 1924-1925, made certain regulations known as the Roads and Footpath Regulations. These regulations, which were published in the Gazette on 10th November, 192T, provided, inter alia, for the charging of lessees with a proportion of the cost of the construction of kerbing and guttering adjoining their properties. These charges were resisted by a number of lessees on the ground that it had been officially announced . at the first auction sale of leases at Canberra on the 12th December, 1924, that the cost of these works were included in the reserve prices fixed for the blocks offered. It was alleged that Colonel J. T. H. Goodwin had made the announcement, but he stated that the announcement was made by the auctioneer acting under his instructions. Colonel Goodwin would in the first place have no authority to give such an instruction to the auctioneer.
– Those attending the sales would not know that.
– Colonel Goodwin would have no authority to give such an instruction to the auctioneer unless directed by me, as Minister, to do so. I say unhesitatingly that he had no such authority. Moreover, the instructions to the auctioneer were given long before the sale at Canberra.
– The Minister will see that the point might have been raised at the sale and referred by the auctioneer to Colonel Goodwill as the representative of the Government.
Senator Sir GEORGE PEARCE.The auctioneer made no such statement although Colonel Coodwin said he did. An exhaustive investigation which was made into the matter led to the conclusion that there had not been any announcement of the character referred to. A member of the Ministry and a. present member of the Federal Capital Commission were present at the sale and had no recollection of any such statement having been made. If a statement of such a revolutionary character - differing as it did from the procedure in every other part of Australia - had been made, it must have attracted considerable attention.
– Was any such statement made relating to roads ?
Senator Sir GEORGE PEARCE.I do not know what statements were made in that connexion. I have referred to the files merely to refresh my memory concerning the instructions which were given on this point. I am confining myself to the specific question raised. Statutory declarations furnished by several officers of the Federal Capital Commission, who were also present at the sale, support this view. The auctioneer, Mr. Crammond, said that the question of kerbing and guttering was never mentioned and that this is confirmed by a search made by him of all the records, including a transcript of his remarks in the newspaper. Barely three months after the sale, when referring to a memorandum to him from the secretary of the Federal Capital Commission, Colonel Goodwin stated that “ in making valuations it was considered that the formation of roads would not be a charge against the lessees, otherwise the valuations would have been lower, but that the matter of forming a footpath and kerbing and guttering is quite another matter “. That statement by Colonel Goodwin ip on record on the official file.
– Made some months afterwards.
– Did Colonel Goodwin represent the Government at the sale?
Senator Sir GEORGE PEARCE.No, the auctioneer represented the Government. Colonel Goodwin was the Lands Officer at the time of the sale, but had no authority to make any such statement as is attributed to him. The conditions of sale were to be announced by the auctioneer. As Lands Officer, Colonel Goodwin attended to supervise the arrangements and he had his instructions from me as Minister concerning the conditions of the sale. The statement I have just quoted was made by Colonel Goodwin and is on record. It shows that at the time he never contemplated that kerbing and guttering would be supplied free. If he did, why should he have made the statement to which I have just referred? The other alleged statement is not on record.
– But he has made a statutory declaration that such an undertaking was given.
Senator Sir GEORGE PEARCE.Yes, years afterwards. Colonel Goodwin’s statement on this occasion is inconsistent with his averment that the auctioneer, acting under his instructions, announced at the sale that the cost of kerbing and guttering . had been included in the reserve price of the blocks.
Further, an examination of the figures relating to the reserve prices placed on the blocks shows that it is almost incredible, from a practical point of view, that kerbing and guttering had been taken into account. This contention having been disposed of, certain lessees took up the attitude that the owner of the land - the Federal Capital Commission - and not the lessees should be charged with the cost of kerbing and guttering. In this connexion, it is pointed out that the freehold of land in the Territory cannot be sold, vide the Seat of Government (Administration) Act 1924-1926, but a 99 years’ lease in the Territory is regarded as equivalent to freehold elsewhere.
In such a case, the lessee is regarded as owner and liable for a proportion of the cost of construction of kerbs and gutters. It has been ascertained that, so far as the city of Sydney is concerned, kerbs and gutters were constructed by the council before leases were sold. The prices of the leases would, naturally, bo adjusted accordingly. Further inquries made elicited the information that, id respect of two large leasehold estates, namely, the Holt-Sutherland estate and the Cooper estate, which were subdivided by the lessors and sold on long term leases, kerbs and gutters were constructed by the local councils in each case, and that in both cases, the lessees, not the lessors, had met the payments involved. Some doubt was cast upon the legality of the action of the Commission in imposing charges for kerbs and gutters and it was alleged that the roads and footpaths regulations made under the ordinance were ultra vires. There was, at least, some doubt whether the definition of the word “ services “ covered the regulations made by the Commission, but it is quite clear that it was intended that the term should bear a wider meaning than that placed upon it by objectors to the imposition of the charges complained of. It is not considered that any technicality should outweigh the moral considerations which spring from the intention underlying the principal ordinances, the understanding which evidently prevailed prior to the raising of the technical point now taken, and the inherent reasonableness of the claims made against the lessees. To put the matter beyond doubt, the ordinance objected to, No. 17 of 1928, was ac-‘ cordingly promulgated, to take effect as from the 5th November, 1925, the date of ordinance No. 9 of 1925, which gave the Commisison power to make regulations dealing with the supply of services. Among the points raised this afternoon was one that there is no provision in the leases for these charges. If that contention is to hold, we might as well say that the residents of Canberra shall not be called upon to pay rates, because at the time of the sale there was no provision for the levying of rates. In fact, if that argument is to hold, the lessees of land in Canberra should not be charged for anything which is not specifically set out in their leases. There are charges for other services than kerbing and guttering.
It has also been objected that the definition of kerbing and guttering as services would involve lessees in payment for maintenance of kerbing and guttering as well as the contribution of half the original cost. This is erroneous, as under the definition of “ services “ in the amending ordinance now under consideration the reference is to the construction of footpaths, kerbs and gutters. There is no reference to maintenance. The maintenance of kerbing and guttering will be met from the general rates which are levied annually under the Rates Ordinance.
I ask honorable senators to remember that there are two parties to this case - the residents of this Territory and the general taxpayers of Australia.
– They should not want something for nothing.
-The general taxpayer of Australia has to pay for his kerbing, guttering and footpaths. Having paid for them, is he now to be called upon to pay taxes to provide kerbing and guttering for the residents of Canberra ?
– The general taxpayer of Australia has a freehold tenure.
– Is not the tenure in Canberra equal to freehold ? I have already quoted instances of leaseholders in other parts of Australia being called upon to pay for kerbing and guttering. Are we to make the residents of Canberra a privileged class at the expense of the rest of Australia? I know that there has been a good deal of canvassing of honorable senators in this matter, but I ask them, in dealing with it, to remember that they are responsible to the taxpayers of Australia as a whole. This ordinance does no injustice to the people of Canberra. It merely places them on the same footing as that of other citizens in different parts of the Commonwealth.
.- Some of the legal reasoning of the Minister is beyond my comprehension. The Constitution gives to this Parliament certain absolute powers. Should Parliament attempt to exceed those powers the High Court may intervene. The Seat of Government Administration Act is similar to the Constitution in this connexion.
The powers of the Federal Capital Commission are limited by what is in effect its constitution, the Seat of Government Administration Act, which states emphatically that retrospective legislation shall not be passed. The Minister quoted the decision of the High Court to show that this ordinance must be interpreted in the same way that the Constitution is interpreted. If that be so, what is the meaning of the words in the act, “ every such ordinance shall be notified in the Gazette and shall take effect from the date of notification, or from a later date to be specified in the ordinance.”
– We passed an ordinance in 1924 to make the lessees pay for services.
– That ordinance did not extend to the so-called “ services “ now sought to be included.
– It did.
– Then what is the necessity for this further ordinance?
– It has been prepared to make the position perfectly clear, because previously some doubt existed in the matter.
– Then let the doubt remain, and not place the burden on the unfortunate lessees, some of whom have, paid as much as £135 a foot for their land.
– They paid on their own bids.
– Throughout Australia private subdivisions are now constantly being made on the distinct understanding that roads and footpaths will be constructed by the vendors. The Commission does not deny that the auctioneer stated that purchasers would not have to meet the cost of making roads. Technically, roads do not include footpaths; but to an ordinary layman a statement that the vendor will construct roads is taken to mean that he will also provide footpaths. I had an instance « few months ago at St. Kilda, of an owner, on whose behalf the auctioneer had stated that roads would be made by the vendor, refusing to take advantage of the technicality and insisting that he was in honour bound by the promise to make the footpaths as well.
– Does the honorable senator say that the St. Kilda
Council does not charge for the making of footpaths? I myself have paid for footpaths in St. Kilda.
– I said nothing of the kind. I mentioned a case in which the owner of freehold land which was being subdivided insisted on providing footpaths, because he knew that the purchasers understood the auctioneer to include footpaths when he stated that the vendor would construct the roads. The land at. St. Kilda referred to did not bring anything like the price extorted from purchasers of land at Canberra.
– They paid high prices here of their own free will.
– That is not so. With only twenty blocks available, and 60 or 70 people requiring laud, the price realized is not a true indication of the value of the land. That is shown by the action of many lessees in forfeiting their leases. The Minister said that he hoped the lessees would take the case to the High Court. Apparently the Federal Capital Commission is not so confident. Some time ago the Commission was asked if it would state a case for the opinion of the High Court in order to avoid the delay and expense which otherwise would be incurred by having the case dealt with in the lower courts. The following is the reply of the Commission : -
In further reference to your letter dated the 10th July, I desire to inform you that the regulation dealing with kerb and gutter charges was issued under the authority of the Building and Services Ordinance 1924-25. Some question was raised as to whether the regulation referred to was ultra vvrex. Although there appeared to be no real doubt on the question, the Government decided that, as a charge for the half cost of kerbing and guttering was obviously a fair and just one and in line with universal practice, to remove all possibility of doubt by an amending ordinance, that ordinance has recently been gazetted, and I forward you a copy herewith.
With regard to the question which you ask as to whether you may expect any and what further charges of this nature, so far as the Commission is able to foresee there are no other services of a similar nature proposed to be provided and charged for, but you will appreciate that it is impossible to make any Specific statement on this point.
With regard to the last paragraph of your letter, I am directed by the Commission to say that it is advised by the Crown Law Department that there is no room for doubt as to the validity of the regulation, and under these Circumstances you will appreciate that the
Commission could not consent to a friendly action in the High Court for the purpose of considering the matter.
In this connexion I desire to quote from the Local Government Act of New South Wales the following definition of “ owner “ : - “ Owner,” in relation to land, includes every person who jointly or severally, whether at law or in equity -
That is the position there. Section 243 of the same act dealing with the cost of paving, kerbing and guttering, and footways, reads -
This section shall not apply to any renewal or repair of any paving, kerbing, or guttering in respect of which a contribution has previously been paid. (3 The provisions of this act with respect to-
This section shall bind the Crown -
Undoubtedly if the Crown or any statutory body such as the Federal Capital Commission operated in New South Wales and offered land for auction under the conditions that prevailed at the original sale in Canberra, the owner of a freehold but not of a leasehold would- have to pay kerbing and guttering charges. Presumably it was the intention of the Government at the time to pass a Local Government Act, but no definite provision then existed, and purchasers naturally concluded that the provisions of the New South Wales Act would apply. That act makes it perfectly clear that if a man buys a leasehold from the Crown, the Crown has to pay kerbing and guttering expenses. That contention is borne out by the opinion which has been received from one of the commissioners of the city of Sydney, who stated that in circumstances such as prevailed in Canberra at the date of the original sale, purchasers in New South Wales would not be called upon to meet these charges.
– There are no Crown leaseholds in the cities of New South Wales.
– But I understand that the Sydney Council grant leases for 99 years and that tenants who build are not asked to pay the cost of kerbing and guttering.
– That is a different thing altogether.
– I fail to appreciate the difference. I do . not know whether the Minister is familiar with the terms of Canberra leases, but I find that these charges are not to be limited to those holding 99 year leases. There is now an endeavour to make lessees with shorter terms pay, so that the simile drawn by the right honorable gentleman between freehold and leasehold fails.
Here is another serious aspect. The Minister has talked about footpaths, but I am afraid that he does not understand the position. Those familiar with the Civic Centre know that it embraces a very extensive and elaborate arcade which has a footpath running under it. That footpath has been constructed and paid for by the tenants, and under the terms of their lease they must maintain it in perpetuity. Now, they are asked to bear the cost of additional footpaths which run at right angles to the shops, and naturally they have rebelled. These are really ornamental’ paths and clearly should be a charge only upon the Commission. It was certainly not the fault of the tenants that elaborate geometrical paths were put down. There again the parallel attempted to be made by the Minister fails. Again, under this ordinance the Commission may charge for kerb crossings. In the case of a lease with which I am familiar, which originally consisted of four blocks, but is now consolidated into one, and has only one entrance, the lessees have been charged £20 for four kerb crossings. Yet an inspection discloses that not even one crossing is provided. After making a number of threats about prosecution the Commission, at the last moment, experienced a spasm of pity and wrote the following letter on the 1st August : -
Kerbing, guttering, and footpaths adjoining shopping blocks - contribution by lessees.
A lessee has advised the Commission that he considers it unfair that, in addition to bearing the whole cost of the footpath within the arcade surrounding the shopping blocks at Sydney and Melbourne Buildings, City, holders of leases of shopping blocks should also be charged half the cost of the alighting footpath adjoining the kerb and of the concrete footpaths leading from it to the main footpath.
This matter has been reviewed by the Commission, which has now directed that no charge shall be made to lessees for these auxiliary footpaths, and for the concrete edging to the plantations.
In view of this decision the Commission is issuing notices to lessees of shopping blocks indicating the amounts- now payable in respect of half -cost of kerbing, guttering, and footpaths in front of shopping blocks, and you might therefore take no action with respect to any notice received prior to this date, but make payment in accordance with the notice now being sent to you.,
If you have already made payment as a result of the first noticeof demand the Commission will make an adjustment and refund the amount equivalent to half-cost of the alighting and leading up footpaths.
Yours faithfully, (Sgd.) C. S. Daley,
But the Commission absolutely refuses to give an assurance that lessees will not be subjected to further imposts, which neutralizes the Minister’s assurance that they will not be charged additional maintenance costs.
I appeal to honorable senators to look at the facts squarely. I ask them to realize that lessees have paid as much as £135 a foot, and that they have already met the cost of expensive concrete footpaths. It is held in Victoria that if the holder of a lease constructs a gravel footpath, he cannot be called upon to bear any additional cost for that item should the local authorities decide that a more expensive footpath is desirable. Here tenants are compelled to maintain as well as to build footpaths, and in addition are called upon to bear the cost of ornamental paths. Can it be wondered that the worm turns?
– I certainly have an open mind on this subject, upon which I have not arrived at a considered opinion inasmuch as I have not had an opportunity to give it lengthy consideration. There appears to be a difference of opinion as to what Colonel Goodwin said, but that does not seem to me to come up for consideration, because if he declared that tenants would not have to meet kerbing and guttering charges, he apparently did so without the authority of his Minister. I am concerned about the power conferred by the Seat of Government Act to make ordinances; whether the ordinance should be allowed or disallowed on account of its retrospective character. The Seat of Government Act says distinctly that ordinances made under it shall take effect from the date of notification or at a later date. 1928 is admittedly a later date than 1925.
– Since I resumed my seat I have obtained the opinion of the Attorney-General on this matter. It is that section 12 does not prevent the making of an ordinance having retrospective operation. It merely provides that such an ordinance shall not take effect until notified in the Gazette. After it has been so notified, it may apply retrospectively if it contains an express provision to that effect.
– I have a great deal of respect for the opinion of the Attorney-General, and do not think that it is altogether fair to ask honorable senators to pit their opinions against those of lawyers. But the act seemsto be very clear to me. It says -
Every such ordinance shall -
That does not imply that it shall take effect retrospectively.
– Although the ordinance itself then comes into operation, the retrospective provision may also take effect. The High Court upheld that view in connexion with an interpretation of the Crimea Act.
– I can merely say that if I were called upon to interpret the Seat of Government Act I should say that an ordinance would take effect from the date of notification and not previously. Otherwise there would be a stipulation for retrospective action.
– There is another point. The Government had already passed regulations under the previous ordinance making tenants liable for the kerbing and guttering costs.
– Then why the necessity for a fresh ordinance?
– To make the position clearer.
– I merely wish to record a fair vote, and in my opinion the act seems perfectly clear. I will consider the matter.
.- I am not at all concerned about the dispute between the tenants of the Federal Capital Commission . and the Commission. That is a matter to be fought out between the parties themselves. I am concerned, however, about the points raised by Senator Duncan and referred to by Senator J. B. Hayes - the wisdom of passing a retrospective ordinance, and whether the ordinance itself is constitutional. If Senator Pearce is correct in saying that the Commission had power under an ordinance of 1925 to impose the kerbing and guttering charges, to my mind it would be much better for the Government to withdraw its later ordinance and’ rely entirely on the original one.
– No.It was done in 1925 by regulation, which at that time was considered to be satisfactory ; but we have since discovered that it was not a satisfactory way of dealing with the matter, and have, therefore, replaced that regulation by an ordinance expressing what was expressed in the regulation.
– It is an undesirable practice to legislate retrospectively.
– I have often heard Senator Ogden object to the Government’s providing by regulations what ought to be set out in a statute. All that the Government has done in this case is to provide by ordinance what was previously set out in a regulation.
– The fact remains that there is a doubt about the constitutionality of the ordinance, although, as I say, that is a matter to be fought out between the tenants in the Territory and the Commission or the Government. I do not want to have the territorial quarrels brought into this chamber.
– They have no right to be brought here.
– Probably not; but the residents of the Territory may have no other court of appeal.’ As a matter of fact, the best course for the residents of the Territory to take, if they feel they have been badly treated in this matter, is to test the legality of the ordinance in the courts.
– Yes. They may win their case, but lose £500 in doing so.
– If they win their case they will get their costs.
– Not their full costs. The costs are taxed.
– I think the whole position has been badly handled. That has been proved” by the necessity for gazetting an ordinance retrospective in character. I feel disposed to support the motion, but I have no desire to embarrass the Government. I would rather the Government withdrew the recent ordinance and relied entirely on the old one.
– When Senator Duncan put forward the point about the constitutionality of the ordinance which he is asking the Senate to disallow, I fully expected the Government to seek an adjournment of the debate with a view to consulting the Crown Law officers.
– They have already been consulted.
– I am inclined to think that Senator Duncan’s contention is unanswerable and that the Government is trying to do by ordinance what the statute prevents it from doing. I am not at all anxious to embarrass the Government although I suppose I am on safe ground when I see Senator Duncan rising and speaking in opposition to something the Government has done; but I am on safer ground when I am in opposition to a body that is not responsible to the people. I refer to the Federal Capital Commision which is not responsible to the residents of the Territory. On this, the first occasion that the Senate has been asked to defend the interests of the community of Canberra from some action taken by the Commission, I think it would be well advised to take steps to prevent the Commission from seeking legal authority to make charges retrospective as far back as 1925, possibly on the ground that it has found that those charges cannot legally be imposed under the old ordinance. I realize the responsibilities of the Commission, but I have my own responsibilities and one of those is to defend a body of people who are not represented on the body that governs them. The people of Canberra having no representation on their governing body must look to this Parliament for protection from possible danger, and one danger that threatens them is that the Commission is desirous of charging lessees for the construction of kerbing and guttering. I know the practice of municipalities in New South Wales. If a municipality provides the kerbing and guttering in front of my property it promptly bills me with half the cost, but I am in the happy position that the kerbing and guttering adds to the value of my property and I reap the benefit of that increased value. The value that the Federal Capital Commission adds to the land by the provision of kerbing and guttering does not go to the occupier or lessee, because as soon as a new valuation is made the occupier, who has borne the cost of the work is compelled to pay an increased rental. By this ordinance the Commission is thus seeking to compel the residents of Canberra to expend money that will ultimately compel them to pay more rent. To my mind tha.t is not fair, and in the interests of the residents of Canberra I think the Senate could well force the Government to hold this ordinance in abeyance until the legal points raised by Senator Duncan have been cleared up. Otherwise the courts may declare that what we have done is illegal and the whole of the cost of any law proceedings that are taken may fall on the Government. We should give the matter serious consideration before we permit a doubtful ordinance like this to be gazetted and become law. I candidly confess that I have not given the subject the time or attention I should have given to it. Had I paid more attention to Senator Duncan’s remarks I possibly could have spoken more clearly on the subject. But I ask honorable senators either to hold their hand and allow the matter to be adjourned until the opinion of the Crown Law Office is obtained or to order the ordinance to be withdrawn with a view to its re-gazettal in an amended form.
Question resolved in the negative.
Debate resumed from 31st August (vide page 6255), on motion by Senator Pearce -
That the papers be printed.
– Speaking to this motion it is my intention not only to criticize the budget, but also to review the work of the Government during the last three years. In doing so it is possible that I may be going over some ground that has already been traversed; but the record of the Government is so bad that many of its defalcations cannot be over-stressed. Many of its acts of mal-administration, and much of it extravagance, ought to be brought once more to the attention of the people. When the Treasurer was introducing the budget in another place he did not give any evidence of modesty. He applied the brush of self -flattery very thickly. He praised himself for many things he had done. I gather from a perusal of his speech that he does not place much reliance on the old saying that “ self-praise is no recommendation.” He spoke about the excellent record of the Government, and about “ his statesmanlike financial schemes.” If the financial administration of Dr. Earle Page is statesmanlike, I have yet to learn what the administration of a statesman would be. The only chance of learning what statesmanship would be like is to relieve Dr. Earle Page of his present position. The Commonwealth might then secure a Treasurer who would act in a statesmanlike way. The right honorable the Prime Minister, Mr. Bruce, is also not averse to self-flattery. A little while ago he and his lieutenant, Dr. Earle Page, issued a statement, in which they laid the flattering unction to their souls that they had done a lot of good to Australia during the time they had been the responsible heads of the Bruce-Page Ministry. Referring to that statement, the Melbourne Age said -
In throwing bouquets at themselves the writers are taking serious liberties with the virtues of personal modesty and the cause of political truth.
Despite this self-flattery I am here to state that the finances of the Commonwealth are not in a sound condition, that they are far from sound, and that the longer we have got Dr. Earle Page at the head of the Treasury, the less sound they will become. There is throughout Australia a general wave of condemnation of the financial record of the Bruce-Page Government.
We are informed by financial experts that we are borrowing too much money overseas, and from whatever aspect this matter is viewed we must admit that our present financial position is anything but satisfactory. A leading article in the Age of the 27th August states -
Financially Australia is simply drifting. The drift has been most marked during the lifetime of the present Government. Unfortunately, its members hold out not the slightest hope that the process is likely to stop.
The only way in which to stop the financial drift with which we are confronted to-day is to change the present Government. When the present Treasurer was a private “member he strongly condemned Mr. Bruce, who was then Treasurer, and with whom he is now associated, for the manner in which the budget was compiled. Shortly before the Treasurer became associated with the Prime Minister he stated -
Is the slovenliness of the budget a reflection of the irresponsibility and general methods of the administration of the Leader of the Government?
The Treasurer has held office for some years, and the Auditor-General has levelled stronger criticism against the method in which he compiles his budgets than Dr. Page levelled against the present Prime Minister. The Auditor-General in his 1927 report said -
I say unhesitatingly that the method of presenting the accounts is such as to obscure the true position. . . . Last year I criticized, on the ground of want of clearness, the method which has been adopted of separating the main account of Consolidated Revenue Fund into three parts. That criticism I consider well founded, for it requires considerable study to ascertain the true position of the Consolidated Revenue Fund and its transactions.
As the Auditor-General of the Commonwealth has stated that the method of presenting the accounts is such as to obscure the true position, it is necessary for honorable senators to analyse very carefully the Treasurer’s financial statement. The financial year which closed on the 30th June last shows a deficit of £2,628,743, so that during a period of twelve months we have drifted to the extent of £5,263,743. At the end of the financial year of 1927 we had a surplus of £2,635,000, but at the end of the last financial year we were faced with a deficit of £2,628,743. Although confronted with this large deficit, with the prospect of an early general election the Government is endeavouring to find a way out of the difficulty without offending any section of the community. It is afraid to increase taxation, and it declines to reduce expenditure.
– Which course does the honorable senator suggest?
– When I occupy the position of Treasurer I will tell the honorable senator which course I shall pursue. What does the Treasurer suggest? He intends to suspend the deficit and to mortgage future surpluses. If that is the kind of business acumen that the Treasurer would display in a private concern he would soon find himself in financial difficulties. I repeat that neither the Treasurer nor the Government has the courage on the eve of a general election to attempt to balance the ledger by increasing taxation or by reducing expenditure. Ever since the inception of federation no Treasurer has handled such substantial amounts of revenue as has the present occupant of that office. In a school-boy fashion he is running away from the financial problem he is supposed to overcome. Since the war Australia has, with two or three exceptions, enjoyed prosperous seasons, and our revenue has been buoyant, as the following figures show -
Revenue, not including interest on loan? raised for States: -
When the present Treasurer was a private member he strongly criticized every budget that came before Parliament, and on more than one occasion trenchantly condemned the then Treasurer for not attempting to stem the stream of extravagance.
– He was in opposition then.
– Yes, and he constituted himself the high priest of economy. One would have thought that on becoming a responsible Minister he would practice the economy which he so frequently preached. In one of his outbursts as a private member, when speaking on the 1922 budget he said -
I own to being very disappointed that . . . . . there is the same old wartime scale of expenditure, and that there is no cessation of new appointments, and that the Commonwealth has not even begun to follow the example of Canada, New Zealand, and Great Britain in trying to get back at the earliest possible moment to something like a prewar standard of finance.
If the Treasurer was disappointed with the conditions then prevailing, I wonder if he realizes how the taxpayers of Australia feel to-day when they study the financial position, as disclosed by his latest budget. Perhaps the Age in a leading article of the 27th August best expressed the feelings of the community when it stated -
The Bruce-Page Government has administered national finance in a glaringly spendthrift fashion.
Some of the gentlemen who support the Government, of which the Treasurer is a member, have endorsed every word which that journal publishes in its leading article.
– The Age is suffering from bad circulation, which makes it somewhat irritable.
– In the matter of new appointments the present Government has broken all records.
No Government, Federal or State, has been guilty of shirking its responsibilities as this Government has. It has appointed commissions, boards, and committees galore. The honorable member for Henty (Mr. Gullett), a staunch supporter of the Government, has already condemned the Federal Treasurer for his extravagance, but notwithstanding his condemnation, he still continues to support the Administration of which the Treasurer is a member. A study of the expenditure since 1923, when the Treasurer first took office, will give honorable senators an idea of how the money has been squandered. The figures are -
From these figures it will be seen that during the period the present Government has been in office expenditure has increased to the extent of approximately £16,500,000. As our expenditure has increased so has our debt per head of population. The figures are: -
We have thus had an increase of £78,000,000 in our public debt since the Bruce-Page Government took office, and an increase of £4 10s. 7d. a head.
Let us now deal with the net debt which shows our financial position more accurately than does the public debt. Our net debt in 1921-22 was £339,002,000. In 1927-28 it had grown to £347,168,000, an increase of nearly £8,166,000. The Treasurer stated that the increase in the net debt since 1926-1927 was £6,189,025. He pointed out that, of that amount, £3,477,176 represented the difference between the amount of purchase money outstanding in connexion with the sale of the Comomnwealth ships, and the face value of the debentures of the Commonwealth Shipping Board held by the Treasury. Let us examine that statement in its relation to our present financial position. Allowing for this adjustment it will be seen that our national debt has increased by £4,688,000 since 1921- 22, despite the fact that the Treasurer has received £33,000,000 more revenue than he would have received had the revenue remained on the 1922-23 level. In addition he utilized the £7,428,574 surplus that existed in 1922-23.
Dr. Earle Page has again emphasized the reduction in our war debt which, on the 30th June, 1922, amounted to £333,093,834. On the 30th June last it was £293,420,106, a decrease of £39,673,728. It is true that the war debt has been decreased to the extent mentioned, but in emphasizing that decrease, Dr. Page conveniently omitted to mention “ other debts “ which, excluding debts incurred by the States, amounted to £31,745,756 on the 30th June, 1922. Up to the 30th June last “ other debts “ amounted to £79,363,982, an increase since 1921-1922 of £47,618,226. Thus, it will be seen that “other debts” exceed by approximately £8,000,000 the reduction in the war debt during the same period.
During his term of office, the Treasurer has enjoyed a total revenue of about £33,000,000 more than he would have received had the revenue remained on the 1922-23 basis. In addition, he has dissipated an accumulated surplus of £7,428,574, which existed when he assumed office as Treasurer. That is the record of this high priest of economy - this man who, as a private member, was a thorn in the side of governments. Since he became Treasurer and assumed control of the public purse, he appears to have run wild.
The Treasurer continually boasts of the reduction in taxation brought about by the Bruce-Page Government. Let us examine the figures to see whether that boast has any substantial foundation. It is true that taxation on personal incomes has been reduced, but it is equally true that during his term of office as Treasurer taxation as a whole has increased.
– The people have enjoyed such prosperity under this Government that although the rates have been lowered, they have paid more in taxes because they have had larger incomes.
– I disagree with the right honorable gentleman. The people who have enjoyed the bigger incomes have indeed had the burden of taxation lessened, but the men and women on the bread line have had to take it up.
– They have been purchasing motor cars.
– A man receiving the basic wage can scarcely afford to ride in a tram, let alone in his own motor car. I submit the following interesting table dealing with direct and indirect taxation since 1921-22 : -
That is my answer to the Treasurer’s statement that the present Government has reduced taxation. While direct taxation during this period has decreased by approximately £7,000,000, indirect taxation has increased by nearly £14,000,000, a net increase of approximately £7,000,000. It would be well to consider this matter on the per capita basis. Taking the average taxation per head of the population, we have the same position -
Here we see that whilst the direct taxation has been reduced by £1 lis. 3d. per head, indirect taxation has increased by £2 12s. 7d. per head, whilst both direct and indirect has increased by ls. 4d. per head.
The attitude of Dr.. Earle Page toward financial matters has changed considerably during his term of office.
– Is the Treasurer not well?
– I understand that his health is good, but the finances of Australia while under his control have got into a very unhealthy condition. Seeing that the Country party has been absorbed by the Nationalist party, I am not surprised at the startling changes which have taken place in the Treasurer’s outlook. I remind honorable senators that the present Minister for Works and Railways, allegedly a member of a hypothetical Country party, stated according to the Melbourne Age of 9tb February, 192-8-
The two parties in the composite Government were now practically the same. That is how they will go to the country, and that is how they will come back.
A few years before that, the present Treasurer said, as recorded in Ilansard of 12th October, 1922-
The electors must know, and will know as far as it lies in the power of the Country party to inform them, that the proposed reduction in taxation cannot continue unless there is a permanent reduction in the cost of government.
– That is a long time ago.
– I presume that the Treasurer, adopts the same attitude as the Right Honorable W. M. Hughes, who, when confronted with some of his earlier statements, said “ It is not what I said yesterday, it is what I said now.”
– Supposing that the honorable senator got into office, would he say the same as he says now?
– I would be the same in every way as far as my principles are concerned. A principle is something to which one should adhere staunchly. Unfortunately, some individuals accommodate their conscience to changing circumstances much the same as the chameleon changes his colour to harmonize with his environment.
– The honorable senator is a “ dead end.” A man may justifiably change his convictions to suit his environment.
– The honorable senator has had some experience in such gymnastics.
Unhappily for the country) our expenditure has increased during the term of office of the present Government by approximately £16,500,000. In passing, I may say that I am curious as to the reason for the volte face of members of the Country party. On the 13th October, 1920, the Treasurer said -
I make no complaint of the incidence of taxation. 1 do not complain of its being high because, in my view, now is the time when we should tax ourselves with the object of reducing our public debt.
In 1921-22 the amount received from income tax amounted to £16,790,000, while last year the Treasurer collected £10,165,000 from the same source, a reduction of over £6,000,000. Again, I contend that the people in receipt of smaller incomes received no advantage from that reduction ; it benefited the wealthy classes exclusively. It would have been far better to continue the taxes and apply the amount collected to a reduction of the war debt.
– Instead of which the money kept thousands of people in employment.
– It is preposterous for this Government to boast that it has kept thousands of people in employment. Its policy has been to deprive the workers of employment, and it has failed lamentably to keep its promise to the electors in this respect. In his budget speech of 1924-25 the Treasurer pointed out that the Federal income tax was imposed to meet war necessities, apropos of which he said -
These are continuing obligations, and though the war is over there are still heavy commitments for war pensions, interest, and sinking fund on the war debt.
That statement is as true to-day as when it was uttered. That is all the more reason why our finances should be more carefully guarded. Had Germany won the war and collected reparations from us the rich man would have suffered. The rich man had more to lose if the Allies lost, and victory was more to his advantage than to any other section of the community. That being so, he should have been prepared to contribute more than he has done towards the cost of the war. Actually, he is paying less and less taxation each year.
I come, now to our trade balance. I have in my possession a quotation from a speech made by the present Treasurer, on the 30th October, 1920, when he was a private member. The honorable gentleman stated -
It seems to me that it is not very creditable to Australia - either on the part of the Commonwealth or the States - to be continually appealing to the Old Country for money when so in udi is needed there for the purpose of building up industries and the reconstruction of her commercial stability.
At that time the Treasurer condemned the practice of overseas borrowing. Great Britain is in an even worse position today than, in 1920, both as regards unemployment and her industrial problems. Yet we find the Treasurer perpetuating the policy of overseas borrowing which he so strongly condemned when a private member. The following figures showing the amount of our public loans floated abroad since the present Treasurer took office indicate whether he was really sincere when he deprecated oversea borrowing : -
Those figures show conclusively that during the six years of the Bruce-Page regime our borrowing overseas has increased by approximately £80,000.000.
– When money is borrowed from abroad do we receive the amount in cash or in goods?
– We receive it in goods, and that is what concerns me so greatly. Last year Mr. M. Sayre, a leading New York banker, when speaking on Australian loans, said -
It seems to me that Australia is borrowing too much money for current expenses.
Another recognized financial authority, Sir S. Raws, when addressing a meeting at the Rotary Club in February, 1928, declared -
Oversea, borrowings by the Government are primarily responsible for the Australian adverse trade balance, and the financial depression which is affecting commerce and industry.
That statement can be well understood when we read it in conjunction with the following one by Mr. Winston Churchill, Chancellor of the Exchequer in Great Britain, who said -
I have always been led to believe that loans must leave the country in the form of goods.
That, I contend, is one of the greatest contributing factors towards our existing unemployment.
– The honorable senator is destroying his own argument. Previously he said that by taking money out of the Old Country we were interfering with its industries.
– I merely quoted the statement of the Treasurer, who then condemned the policy of overseas borrowing, but who has since borrowed £80,000,000 more than his predecessors.
– Would the honorable senator have raised all that money in Australia ?
– I remind the honorable senator that, when the toscin of war sounded and we were in financial difficulties, over £400,000,000 was raised in Australia. Here is a statement of our overseas trade since 1923-24: -
Those figures disclose that we have experienced an adverse trade balance aggregating £32,500,000 since the present Treasurer has been in office.
Another feature of the budget that is worthy of attention is our loan expenditure. One of the complaints of financial critics is that the Commonwealth Government is spending too much loan money on unreproductive works. That state of affairs should not be allowed to continue. The Treasurer himself, as a private member, condemned the idea of spending loan money on unreproductive work, yet I find that in 1921-22 our expenditure from loan money on works, &c, was £5,246,000, whereas last year it was £6,888,000, an increase of £1,642,000. Each year the expenditure from loan funds on works has increased while expenditure out of revenue on works has decreased, as the following figures will show : -
Of course it is obvious that the less the Government spends out of revenue on new works the more money it will have to spend on other things and the better surplus it will show. While this Government has been in office, nearly every year it has spent approximately £2,000,000 less out of revenue than was spent in 1921-22. Reduced to simple language it means that the Government has borrowed to show its surplus.
– It has borrowed money in order to provide postal facilities in country districts that would never have been provided if the money had to come out of revenue.
– While the Labour Government was in power all those facilities were provided out of revenue. But even with this glaring anomaly we find the Treasurerwith a deficit of £7,500,000 for the last financial year. It is not to be wondered at that he is called a spendthrift, and that we are in such a financial muddle to-day. (Extension of time granted.)
I have completed my review of the budget, but there are one or two other matters I wish to mention. The Government has definitely decided to go to the country, and on the 17th November next will appeal to the people for a renewal of power. There is every indication that it will resort to somewhat similar tactics to those it employed three years ago, when by false pretences and misleading statements it secured the suffrages of the people. On that occasion the Prime Minister, assisted by his lieutenant, the right honorable the Leader of the Senate, put forward the red bogey. He saw red, talked red and dreamt red. So to speak he played a game of political billiards and “got in off the red.” He is now starting another game of political billiards, and will again endeavour to “get in off the red.” At the last election he said that the paramount issue before the people was the maintenance of law and order and the supremacy of constitutional government. Having gained a majority in both Houses, having appealed successfully to the people for power to crush the extremists, the communists, the revolutionists, who he declared were a danger to the country, he passed a Crimes Bill, but that measure has not been of any avail. He said that the people stood on the edge of a volcano which at any ‘moment might belch over them its lava of red revolution, that there were in our midst men who were a source of danger to Australia, and that these men would have to be deported and their illegal organizations dealt with. Yet not one man has been deported; not one illegal association has been dealt with. Unless the Government has been false to the pledges it made to the electors, it is clear that no one has been a danger to Australia and that there have been no illegal organizations in existence in Australia. Yet Ministers, I presume, will go to the country again on a similar election cry. When introducing the Crimes Bill in the Senate, Senator Sir George Pearce said -
He would . be a bold man who would say that there is no necessity to take legislative action with regard to unlawful associations.
He went on to say that there were associations that declared themselves to be against law and order and against constituted society and proclaimed their intention to wreck and change existing society. In his concluding remarks the right honorable gentleman said that the Government did not intend to place the Crimes Bill on the statute-book, and allow it to remain there unused. The Ministry had told the electors that the communist party was one of the associations to which they referred, and that the methods of communism were revolutionary. Addressing a meeting at Loch in Victoria, the Prime Minister said -
I am determined to see that these false doctrines which can only lead to ruin, shall not be allowed to permeate our people further. It is for mc to see that the activities of these few men are definitely stopped.
But according to an answer given to me by the Leader of the Senate, the Government has done nothing in that regard.
The Crimes Bill which was drafted and introduced to enable these associations to be dealt with and suppressed, gave the Government unlimited and autocratic powers. The Attorney-General was given the sole right to say whether a person convicted under the act should be deported. But years have elapsed and we are still in the same position to-day. On the 30th August last I asked -
Have any deportations been made under the Crimes Act?
Have any organizations been disbanded under the Crimes Act?
The answer was -
Recently, Mr. McCormack, the State Labour Premier of Queensland, said -
The communists must go. We have dealt with them here. Now it is up to Mr. Bruce to do something about it for Australia. He talks a lot about them, but he does nothing.
The Melbourne Age recently said -
One of the Government’s avowed intentions was to establish industrial peace. That intention became embodied in the Crimes Act which has proved of scant use. It is puerile to whine that there are wilful disturbers of the industrial peace. The Government made pretence and boast that it could deal with them. It has utterly failed.
So much for the Crimes Act.
It is interesting to note how this Government has worked and how it has kept Parliament going since it has been in office. During the last three year3 it has been in office Parliament has sat for 190 days. If the Government could show that during that short period it had done something to assist the development the progress and the prosperity of Australia, and that it had made some legitimate attempt to carry out its promises to the electors something might be said in its favour; but to my mind it is a national disgrace for a government that has done so little not to ask this Parliament to sit more than on an average nine weeks a year. During the previous three years, from 1922 to 1925, this Parliament sat 171 days or an average of about eight weeks a year, and the whole of the six years this Government has been in power Parliament has sat 361 days, an average of about81/2 weeks a year. Speaking of the Government the Age said -
During the life of Parliament it has employed its strength mainly to keep itself safe, not to achieve anything great for the national good. It has not even produced an average proportion of legislation. Hosts of citizens are tired of the Government’s dalliance and impotence.
On another occasion the same journal said -
Australia has probably never had a government which did less.
And again it said -
The ardour of many a once enthusiastic supporter has been chilled by the Government’s meagre record of achievement.
I think the Age has summed up the situation very well.
A little while ago I referred to the tragedy of the continuous appointments of boards and commissions by the present Government. Since the inception of federation no government has shirked its responsibilities and delegated its authority in the way this Government has done. Whenever it is confronted with a problem it appoints a board or commission to do the work that it should do. The function of government is to govern. The Government is an executive body consisting of persons chosen by the people to administer the affairs of State. This Government has failed in that respect. It has neglected its duty by delegating its authority to more or less irresponsible boards and commissions. Why does it not tackle the problems with which it is supposed to deal? The Leader of the Government in the Senate, in endeavouring to defend the Government’s action, said some time ago that some of the problems facing the Government were so intricate that it had to obtain the services of men possessing expert knowledge on various subjects to advise it as to the best course to adopt. But when these experts have made reports their recommendations have been rejected. For instance, the Western Australian Disabilities Commission was appointed to inquire into the financial position of Western Australia, and after an investigation which lasted approximately twelve months, it recommended that £450,000 should be paid by the Commonwealth to that State for a period of 25 years. The Government did not accept the commission’s recommendations; but agreed to pay that amount for only one year.
Wherein lies the intricacy associated with the subject of child endowment, or a system of national insurance against unemployment? There is ample evidence available in the parliamentary library to place the Government in possession of all the information it desires to enable it to formulate a policy to give effect to a system of child endowment and insurance against unemployment. Instead of using the information at its disposal, the Government appointed a royal commission to inquire into the matter of national insurance. The Leader of the Government in the Senate claims that the Government of which he is a member has fulfilled every promise made prior to the last general election. I submit that ithas not. The electors were promised a system of national insurance against unemployment, and child endowment.
– When speaking of national insurance, the Prime Minister said -
One of the main causes of industrial unrest in Australia is the ever-present dread that haunts the worker of the misery that will be brought upon his dependents in the event of sickness, unemployment and old agc.
He further said it was the desire of his Government that the misery and destitution that followed in the wake of unemployment should be prevented, and that it was his intention to remove that dread by legislation. The people of Australia were led to believe that this Government would provide a system of national insurance against unemployment. The introduction of a measure to give effect to its promise in the dying hours of a parliament is not a fulfilment of its pledge. We have yet to learn that the National Insurance Bill, which we have been informed will be introduced before Parliament prorogues, will contain provision against unemployment. The Prime Minister further stated -
His Government recognized its duty in this regard, and as soon as the further report on unemployment is received the Government will legislate on such lines as will enable the worker to be insured against this most deadly cause of his anxiety and unrest.
The commission that was appointed in 1923 presented its final report in March, 1927, or fifteen months after the Government was returned to power. The Government has, however, taken no steps whatever to fulfil its promise to pass the necessary legislation, despite the fact that the report has been in its possession for eighteen months. If this promise had been fulfilled a great deal of the destitution and misery which follows unemployment would have been avoided.
The Minister has stated that the people of Australia were not promised a system of child endowment.
– The Leader of the Opposition should quote what the Prime Minister said in his policy speech.
– When appealing to the people in 1925 the Prime Minister emphasized the importance of a child endowment scheme, and stated that this question was one of vital importance. He said that a man with a family was the greatest asset to the community, and that it was essential and desirable that the greatest encouragement and assistance should be given to such men. With that statement we all agree. Our children should be so reared and trained as to be well fitted to carry on the burdens of life, and so be able to assume the responsibilities of citizenship. The Prime Minister, as I have said, stated in his policy speech that the question of child endowment was of vital importance.
– He said more than that. The honorable senator has left out an important portion.
– Although the Prime Minister promised to. refer the subject of child endowment to Commonwealth and ‘ State Arbitration Court judges, he has not done so.
– He promised to have an inquiry conducted.
– He said that child endowment could not be adopted by the State governments individually without dislocating interstate trade and commerce, and that the matter would have to be considered on a national basis. Although the Prime Minister said that child endowment was a vital question, and that a man with a large family was an asset to the Commonwealth, the Government of which he is the leader has not made any effort to give effect to his promise.
It is true that the subject was discussed at a conference of Commonwealth and State Ministers, but at that gathering the Prime Minister said it was a matter for the States and not the Commonwealth. The right honorable gentleman further stated that, under such a system, industry could not carry on profitably on the existing basis and wages would have to be adjusted.
In a full page advertisement in a Sydnew newspaper these words appeared: “ You and yours are safe under a National Government which ‘ provides for motherhood endowment.” Was not that a definite promise? That statement has never been refuted. In another portion of the same publication the following appeared -
Australian womanhood. Reasons why you must vote Nationalist - because I will legislate to protect the mothers of our race through motherhood endowment.
Notwithstanding that definite promise nothing has been done. In the opening remarks of his policy speech of 1925 the Prime Minister said that he would not make elaborate promises in order to get different sections of the community to support him. Indeed, he strongly deprecated the practice of political parties endeavouring to outbid each other for the people’s favour, stating that such promises appealed to the cupidity and the lowest instincts of the community. Let me quote his exact words -
That course I refuse to follow. The times are too critical. For any national leader to-day todeceive the people by promises which, either for financial or constitutional reasons, he could never redeem, would constitute a betrayal of the obligations and duties resting upon him which would never be forgiven.
I say definitely that the people of Australia were led by the Prime Minister’s statement to believe that, if returned to power, he would introduce a scheme of child endowment. The Prime Minister has betrayed his trust as anational leader. When he made that statement no mention was made of constitutional orfinancial limitations. It was only when he met the State Premiers in conference that he turned a political somersault. After the election the Prime Minister stated that any scheme of child endowment would have to be introduced by the States, because the Commonwealth could not finance the scheme. If, with its annual surpluses, the Commonwealth could not finance such a scheme, how could the States be expected to do so when, even now, they are at their wits’ ends to balance their ledgers? Mr. Bruce also said that industry could not afford to pay for an endowment scheme, and suggested an adjustment of wages to provide the necessary funds. His proposal was that the men on the basic wage should bear the cost of the scheme. In this connexion I wish to emphasize that any system of child endowment must be kept entirely separate from the basic wage; there must be no confounding- of the two things. Industry must pay its proportion of the cost, and the general community the rest. More than rights and privileges, for the preservation of which it is said that the recent war was fought, are involved; there are also the maintenance of proper living conditions, and our duty to our children. All political parties in Australia agree that a scheme of child endowment is essential. Indeed, they all advocated it during the last election campaign. Had the Labour party been returned to power, a scheme of child endowment would now be in operation; but the present Government has made no genuine effort in that direction.
– Did not Mr. Mccormack, the Premier of Queensland, ask that the matter he referred to a royal commission ?
– The State Premiers agreed to the question being referred to a royal commission. I am, however, not concerned so much with the views of Mr. McCormack as with the broken pledges of the Prime Minister. Before the election he said that child endowment was a matter for the Commonwealth, but after his return to power he said that it was a matter for the States, and that as industry could not bear the expense, the wage-earners would have to shoulder the burden.
Whenever the subject of national defence is mentioned in this chamber, honorable senators opposite charge the Labour party with having no defence policy. T shall show not only that this party has always had a defence policy, but also that its policy is sound.
– Its policy is one of negation.
– That is not so. The Labour party, hating war with an intense hatred because of the suffering and misery it causes, has always striven for peace, and advocated the adjustment of international disputes by peaceful methods. In that view it does not stand alone, for in a statement made in London recently, Sir Ian Hamilton said “ Once I loved war; now I want to stop it.” The policy of the Labour party in international affairs has been justified by recent events in Paris, where the representatives of the great powers assembled to sign a pact for the outlawry of war. America’s great President, George Washington, discussing the militia, once said -
If I were called upon to declare on oath whether the militia had been the most serviceable or hurtful upon the whole, I would subscribe to the latter.
Coming to more recent times, Lord Beading, speaking in the House of Commons, said -
For the first time the Powers were asked to agree with the United States of America, that in future every dispute, whatever its origin and implication and consequences, should bo settled by pacific means by some tribunal to be agreed upon.
That has been Labour’s attitude throughout. I express the hope that what was accomplished recently in Paris is but the forerunner of greater achievements towards universal peace. Between the signing of the armistice in November, 1918, and June, 1919, Australia spent about £3,000,000 on defence. Since June, 1919, a further sum of approximately £55,000,000 has been expended for defence purposes, making a total of about £58,000,000 since the cessation of hostilities. One might reasonably expect that Australia would have something to show for that huge expenditure, but that is not the case, for the defences of Australia to-day are in a worse condition than ever before. I make that statement on the authority of Sir John Monash and others in a position to speak with authority.
– They have not said so.
– Speaking a little over a year ago, Sir John Monash summed up the position when he said “We are less prepared for war to-day than we were in 1914.”
– Since then we have established a modern navy.
– All we have is a couple of cruisers and a number of submarines. The report of Sir Harry Chauvel, Inspector-General of the military forces, bears out my statement that we have very little to show for the vast expenditure for defence purposes.
Sitting suspended from 6.15 to 8 p.m.
– This Government stands condemned for its incapable handling of the finances of Australia, for its reckless borrowing and its extravagant spending policy. Last year it proposed to raise £62,725,000, and this year it budgets to raise £63,310,000. Actually it collected last year £1,441,000 more than was estimated. It was estimated that the Post Office would show a surplus, which hope has not been realized. It was also estimated that the Commonwealth railways would show a shortage of £227,000, whereas the actual deficit was £438,000. The sooner that the finances of Australia are stabilized the better. The sooner that we have as Treasurer a man with a better idea of controlling the public purse than the present occupant of the office, the sooner will Australia journey along the road of progress. The time is not far distant when the Government, its supporters, and those in opposition will have to render an account of their stewardship; and I am confident that the people will then decide in favour of a party that can establish more effective control over the finances and destiny of this country than is evidenced by the present Government.
– I take it that although many of us hold certain differences of opinion we believe unanimously that a swift, accurate and cheap means of communication throughout the British Empire will tend to assist Empire trade and migration, and consolidate our great empire. Until quite recently the only way in which we could have swift and accurate communication between countries separated by oceans was by cable. For many years the cable systems of the world were in the hands of private companies which held an absolute monopoly, because in every case where these lines traversed the same route they entered into an agreement amongst themselves that they would not compete unnecessarily one with the other. They used that monopoly ruthlessly. They had but one object : to wring as much as possible out of their customers in order to make their dividends as large as possible. It is known to all of us that that monopoly was used so ruthlessly that at last the business people protested. Those who protested were not bolsheviks, or even associated with the Labour movement, but hard-hearted business men. They made repeated requests that the governments of their countries should break up the cable monopoly, but it was a long time before the British Government acquiesced in the proposal, apparently because it had more thought for the dividends of capitalism than for the welfare of the Empire. Sir Joseph Cook, when a private member of the House of Representatives, said -
I have repeatedly pointed out that we should never have had the Pacific Cable but for the way we were treated by the Eastern Extension Company. They would make no concessions to us, but the moment arrangements were completed for the construction of the Pacific Cable, the Eastern Cable Company rushed in, and by a bribe - for that is what it amounted to - in the shape nf reduced rates, they obtained concessions that have enabled them to relegate the Pacific cable to the background. It was no part of our duty to put this weapon into the hands of our opponents to enable them to flog us as they are now doing. I believe that all the great cables, such as the Pacific cable, should be owned by the governments interested. However patriotic and lenient a company may be, we should not allow it to hold us at its mercy.
As the outcome of a good deal of agitation, the Pacific Cable Board came into existence, and rates were slightly reduced. Owing to the fact that it was necessary for a message from Australia via the Pacific to travel over a privatelyowned telegraph line in Canada, and a privately-owned Atlantic cable, the Pacific Cable Board was very seriously handicapped. Now these handicaps have been removed to some extent, and the Pacific Cable has been more able to stand - alongside the other cable companies. %>
In the last few years wireless has come into the arena, and is not merely challenging the supremacy of the cable companies, but jeopardizing their very existence. In the other House the PostmasterGeneral recently made this statement, which is curious, emanating as it does from the Government -
We have a cable system which operates between different places, and if we take the value of those cables operating to Australia we find that it amounts to £12,000,000 of money. Who is going to operate a £12,000,000 machine when they can get a £120,000 machine which will give the same service?
The cable companies, realizing the strength of the competition of the wireless companies, moved hell and earth in order to endeavour to come to an agreement with the wireless company. To be in a better position to do so the companies bought up a large number of shares in the Marconi and wireless companies in order to secure some say in their control. I do not wish this evening to object to the amalgamation of private companies in the ordinary way, as that is their own concern. But in this case a conference was held between the wireless and cable companies, at which the British and Australian Governments were represented, and the cable companies expressed a desire to lease from the British Government its rights in respect of beam, wireless in Great Britain. That completely altered the position. We in Australia are not justified in dictating a policy to Great Britain, and if that Government is prepared to hand over to the merger the beam service, we cannot question its action. But as a citizen of the British Empire, I should regret the action. It may lead to a proposal that Australia should hand over its control of the beam service to the merger. Due to the genius and foresight, of the Eight Honorable W. M. Hughes, the Australian Government has 501,000 shares in the beam service - a controlling interest - and Parliament should certainly have a voice if the handing over of that interest to the merger is contemplated. I shall read an article from the Sydney Sun which covers the ground far more ably than I can do. It says -
When the public reads a cabled despatch to the effect that a conference’ has been arranged between the Eastern Cable Company and Marconi for the purpose of making a report for submission to the two boards ‘ regarding a possible arrangement for the protection of their mutual interests,” the full significance of the proposal may not at first strike home. Even when it is observed that Marconi shares have risen on the Stock Exchange, the public may be but mildly interested. Yet these things affect the Australian people directly and adversely in a substantial measure. Even’ the Postmaster-General, “although impressed by the rise in Marconi shares,” is inclined to scepticism regarding the rumoured merger between the two companies, which practically control communication with the world from and to Australia. He has not been advised. Beyond a passing suggestion that in a matter of such immense importance, affecting so closely his department, Mr. Gibson should become advised as soon as possible, it is not necessary to dwell on that part of it. Millions of pounds have been spent by the Eastern Telegraph Company and allied corporations in laying cables, and upon that capital excellent dividends have been made. When the possibility of world-wireless was considered only a few years ago, the company was not perturbed. Wireless, with its lack of secrecy, and its uncertainty, would not interfere with the cable traffic - that was the comfortable opinion. Now that wireless has arrived, and it is possible to build a transmitting and receiving station which will cover much of the globe for as many hundreds of thousands of pounds as it takes millions to lay a cable across one ocean, the danger to the company which has sunk so much capital, literally in the sea, is that a cheaper means of communication may render that capital in part useless. While it is possible to sympathize with the point of view of the shareholders and directors of the cable company, there is another and larger point pf view - that of the people of Australia. It may be to their misfortune that, a number of investors shall lose part or all of their capital because science has moved on, but such accidents happen every day. The cable company seeks, therefore, to do what many other companies have done, to buy in its competitor and acquire a monopoly which enables it, in the gentle language of commerce, to arrange “ for the protection of mutual interests.” It is an old trade device for keeping up prices. It will be astounding if the British and Australian Governments, both interested as they are in wireless communication, stand quietly by while an amalgamation so adverse to their interests is proposed and completed. A scientific discovery instead of being used for the benefit of mankind, may be used to bolster up old interests and capital. If the history of the mismanagement of wireless by the ‘Marconi Company be now completed by a characteristic action, which will hamper communication all over the world - and particularly in Australia - the people will call governments to account. It is certainly time that the governments of the dominions and of Britain took steps to decide whether the people’s interests or the interests of a few shareholders in two companies, shall be the determining factor in the future of wireless.
I think that article puts the case very clearly. The question is whether we ought to consider chiefly the interests of the cable companies or those of the community in general. If we brought the price of wireless messages down to one penny a word, as no. doubt we could do, and thus place this means of communication within the reach of the ordinary householder we are told that it would mean the scrapping of the cables. I believe that I am correct in saying that the cable companies have threatened to go out of business - I do not think they would do so - if wireless competes with them, as they describe it, unfairly, by “accepting messages at Id. a word, a rato which would pay.
During the recess I read a very interesting article by Sir Godfrey Clark who was for many years in charge of Posts and Telegraphs in India. The article was reprinted in the Sun from the London Times. It must have beeu written twelve months before the Beam service was able to do what it is doing at the present moment. The writer pointed out that there were, people who argued that if wireless were to be allowed to have full fling the cables would have to go, but he said that in certain circumstances the cables could still compete with wireless in some parts of the world. The writer of the article contended that both cables and wireless should work side by side, but that the cables must not be allowed to prevent wireless from doing its full work, because if wireless were allowed to do its best it could send 100 words for 10s. or about 11/4d. a word. He claimed that if the cost of messages could be reduced to a price approximating11/4d. a word there would be such a tremendous traffic throughout the Empire that there would not be enough cables and wireless services to carry it. Thus it does not necessarily follow that cables will have to go even if wireless is allowed to do its very best.
The cable companies tell us that they will have to go and that if the cables are scrapped it will be a very serious thing for the Empire in time of war. I think the real fear is that the dividends of the shareholders in cable companies will have to go. Obviously it would not be a good election cry for a conservative government in Great Britain or a Nationalist Government in Australia to raise, that the cables must be kept going because of the dividends of the snareholders of the cable companies. It is, therefore, necessary to get another cry, and that cry is that the Empire will be in danger in time of war if the cables are scrapped because wireless is not secret. Marconi says that wireless is secret but the cable companies say that it is not. In order, therefore, that secrecy may be observed in time of war we are told that the cables must be retained ! It is amusing to read the objections that are always raised when a reform is advocated. For a number of years it was thought necessary that commissions in the British army must be obtained by purchase, and when some people advocated that it would be better to allow people to earn their commissions by their merits so much opposition was raised that even the House of Lords threw out Mr. Gladstone’s bill to abolish the practice of buying commissions. Mr. Gladstone had subsequently to bring about the reform on the warrant of Queen Victoria. On that occasion so eminent a man as Sir Walter Scott asserted that it would be a terrible tiling to do away with the buying of commissions; that the British constitution would not stand the strain and that the very safety of the Empire depended on the purchase of commissions. When opals began to compete with diamonds the people interested in the latter started the cry that it was unlucky to wear opals. There are people to-day who still think that it is unlucky to wear opals. I suppose that there are quite a number of people who’ on being asked who introduced penny postage into England would reply : “ Rowland Hill.” As a matter of fact in the reign . of Charles II., practically 200 years before the time of Sir Rowland Hill, private enterprise was carrying letters in London at1d. each. It was a successful venture but vested interests was up in arms against it and one of the arguments used in opposition to it was that if letters could be carried at1d. each the Jesuits would more easily be able to issue propaganda for their religion.
The business men of London disregarded that cry, and had the advantage of penny postage until vested interests successfully interfered. The Duke of York, who was a brother of - Charles II., received a pension from the Postal Department, and as the reduced rate affected his pension, it was discontinued, and the British people had to wait 200 years before they were again able to derive the benefit of penny postage. I am always sceptical when I hear cries of the Empire being at stake owing to any interference with the cable or any other system of communication.
– The honorable senator does not suggest that we should reject the system because some people consider that the wearing of opals is unlucky.
– Certainly not. I am only giving some illustrations of the absurd nature of the objections raised to certain reforms.
– It should be comparatively easy to demonstrate whether wireless is at all times suitable for international communication.
– That may be so; but at the same time I have my doubts concerning the suggestion that the retention of the cable system is absolutely essential in the interests of the Empire.
– Does the honorable senator not think that right?
– It all depends upon the aspect from which it is viewed. E am of course strongly in favour of the interests of the Empire being safeguarded in every way; but I object to the statements that have been made that the retention of the cable system is essential in the Empire’s interests when those who make such statements are more concerned with the dividends of the cable companies. I agree with the utterances of a great ambassador who once said that if rapid and cheap communication is provided we shall have greater cordiality between nations. If there is every facility for cheap communication, it will naturally lead to more cordial relations, which must, of course, reduce to a minimum the possibility of international disputes. The inference to be drawn from the utterances of some interested persons is that while high cable rates are maintained, the security of the Empire is assured; but that with their disappearance the British Empire, like many great empires of the past, will totter and fall, and be but as the memory of a mighty pageant. When reading the other day of the death at Dubbo of a young immigrant, who had no relations in Australia, but a widowed mother and sister in England, I could not help feeling what a blessing it would have been if that mother had been able to communicate by wireless with those who had been in close touch with her deceased son, at the low rate I have suggested. But the introduction of Id. a word messages would endanger the Empire, whereas a charge of ls. lOd. a word’ ensures its safety!
– That may be good sarcasm, but very poor reasoning.
– Vested interests are already at work.
– They were at work the other day.
– And they won. Have honorable senators considered the arguments used by those who were on the winning side? One of their slogans was “ Liberty is at stake “. Over twenty years ago the late Sir Henniker Heaton advocated cheap communication throughout the Empire, and when being banquetted prior to leaving for a visit to South America, suggested in the course of a speech, a rate of Id. a word for cable and telegraphic messages. A very distinguished person who was present at that gathering said to Sir Henniker Heaton “Your case is unanswerable; but there is one difficulty which is insurmountable and that is vested interests.” I sometimes wonder whether that was the reason why the PostmasterGeneral of Australia, when asked to institute Id. a word wireless system, said that’ it was impracticable.
As I have said, the introduction of cheap wireless communication would tend to consolidate the Empire, and be largely instrumental in the prevention of war. Sir Herbert Samuel, a very distinguished and able Postmaster-General in Great Britain, when speaking at a dinner of the Pilgrims’ Society - a society consisting of
Americans and Englishmen who hold an annual dinner alternately in London and New York - said that his idea was to bring the nations closer together. He stated that the American people and the British people were united by a common language, common laws and by religion. He also said that the postal service was a means of bringing the two nations closer together. This remark caused some laughter; but he supported it by saying that if there was an absence of cable communication and of interchange . of letters, lettercards, postcards and magazines, cordial relations would not last very long between the nations. With that I agree. A deputation comprising a number of Great Britain’s leading journalists waited upon Mr. Asquith when he was Prime Minister of Great Britain after the Boer War and before the Great War, and Mr. Moberley Bell, the manager of the London Times, speaking on behalf of that journal, said, in pleading for cheaper communication, that before the Boer War he sent a cable in code to Mr. Cecil Rhodes, but unfortunately it was not decoded satisfactorily. Later he sent a letter confirming the cable. Some time after the Boer War he met Mr. Cecil Rhodes, who told him that if the cable could have been properly decoded, in all probability the position in regard to the Boer War, which cost Great Britain many millions of pounds, as well as a large number of valuable lives, might have been different. He did not say that Mr. Cecil Rhodes told him that the war would actually have been avoided; but that the position would have been very different. He would have sent the cable in plain language if the rate of Id. a word had been in operation. Sir Henniker Heaton on one occasion said that be wished the telegraph system to be used a great deal more than it was, and that he had been told that in time of war the telegraph lines might be cut. There are, of course, he said, long periods in which such a service could be effectively utilized. He also said “ Wireless is coming, and will be able to do the work.”
Whenever we speak of the cable companies being concerned in the interests of the Empire, we naturally wish to consider the patriotism which they have displayed in times of peace. Prior to the Great War - I do not know what the conditions are now- if one wanted to send a message from London to India, it cost 2s. a word for traversing a distance of 6,000 miles .by cable. Cable messages could, however, be . sent to the Continent and then, by using a land line of 3,700 miles, to India. The cost in Australia to-day of constructing a land line is about £70 a mile, but in those days I suppose a similar line could be erected on the Continent for from £20 to £30 a mile. The cost of sending .a message from London to India over this line of only 3,700 miles was, however, 2s. a word, the same as the charge for sending a message over 6,000 miles of cable costing £200 a mile, the reason being that the Eastern Extension Telegraph Company also had a controlling interest in the land line. They maintained a charge of 2s. a word in order that there should be no competition with the cables. A Britisher in London wishing to do business with a fellow Britisher in India had to pay 2s. a word whereas he could send a message from London to Vladivostock, in Siberia, a distance of 7,000 miles, for 6£d. a word. That is an example of the patriotism of the cable companies. Were it not so tragic, the Government’s treatment of the wireless and cable companies would be amusing.
So far I have been unable to get the information I desire regarding the profits made by the wireless company. The Minister said that, having handed over the control of wireless communication to a private company, the Government would not interfere with the directors, and that we shall have to look to Senator Millen and Mr. Hughes to safeguard our interests. I should like to know whether the Government interfered in connexion with the charge for messages to Canada. It was consulted, we are told, and it would be interesting to know whether there was . any stipulation that the rate should not be brought below a certain amount per word or whether it should be raised.
If the policy of the Government is to retain both the wireless and the cable, it seems foolish, from that point of view, to allow the wireless company to charge even. 10 per cent, less than the cable companies, because the lower rate will attract the business. Even now the Beam wireless is competing more than satisfactorily with the cables. The Beam system has not yet been in operation eighteen months, yet of 14,000,000 words sent between England and Australia it has transmitted 8,000,000 words. By permitting the wireless company to charge 10 per cent, less than the cable rates, the Government is condemning the cable companies to a lingering death. So long as the charges remain what they are now, neither the wireless nor the cable will attract business from ordinary citizens, but if the price per word of wireless messages is reduced there will be a greater volume of business, of which the Government will reap’ the advantage. We should know whether the wireless company has a free hand in the matter of price. If the position were reversed, the Eastern Extension Cable Company would not consider the interests of its competitor.
I enter my emphatic protest against any attempt to hand over the Beam system to the merger. In a long discussion in the House of Commons in relation to this matter, Mr. Baker, the member for East Bristol, in an impassioned speech, objected to handing over our means of communication to a private company. Sir Hamar Greenwood, who in the Coalition Government was Secretary for Ireland, said during the debate -
The great experiment of State-owned cables and beam system has been excellent, but it was time it was transferred to private enterprise.
He concluded his speech by saying that the time was opportune to make a good bargain on a rising market. What an idea! Mr. President, the great object of companies is to earn large profits, and to pay their shareholders huge dividends; but the policy of maintaining a profitable monopoly is not always compatible with great public needs. In the present case, the progress of the Empire and the requirements of the British people have far outstripped the narrow policy which best suits private companies.
– I have listened with great interest to the speech of Senator Thomas, who has dealt with a fresh subject in a thorough and interesting manner. He has given us some food for thought. That wireless messages should be sent for a Id. a word may at this stage of wireless development appear rather fantastic, but in the years that have gone other proposals, no less idealistic, have been realized in time. It may be that another four or five years will see the realization of Senator Thomas’ dream. If so, he will then get the credit that is his due.
Unfortunately, all honorable senators do not approach the consideration of the budget in the right spirit. The speech of the Leader of the Opposition (Senator Needham) was characteristic of the hourorable senator. He condemned the budget, the Treasurer, as well as the Government, its friends and supporters. He could see nothing but ruin before this country unless there was a change of government, and he and his associates were placed in control of the destiny of this fair land. The consideration of the nation’s balance-sheet should be above party considerations.
– Why has the honorable senator at times worked himself into a frenzy when dealing with the control of the country’s finances by Labour Governments ?
– For the sake of illustration, I shall probably be compelled during this speech to refer to the way in which various Labour governments have handled the finances of the country.
– The honorable senator said that the consideration of the budget should be above party.
– It should be ; but, unfortunately, the speech of the Leader of the Opposition has placed the discussion on another plane. The statements made by him must be answered. I propose to refer to one or two of them.
When considering this budget we should bear in mind the extraordinary circumstances in which the Treasurer finds himself. The honorable gentleman, before he can give his attention to finding money for the pressing problems of our national life, such as defence and development, must first make provision for certain statutory and other obligations. These absorb such, a considerable portion of our total revenues that the Treasurer has left at his disposal but a comparatively insignificant amount. It is’ easy to criticize and attack a Treasurer. Apparently every honorable senator imagines that he is a potential Treasurer, equipped with the necessary wisdom to control the financial destinies of the country. Senator Needham has intimated that he could do the job better than the present Treasurer, but he did not explain how he would do . it. I thought that, speaking as he did on behalf of the Labour party of Australia, the honorable senator would indicate how Labour would initiate reforms in the existing system.
– Why expect impossibilities ?
– No doubt Senator Needham is keeping the informa-tion a secret until after the election; but if its publicity is contingent upon his attaining ministerial power, I am afraid that it will remain a secret for evermore. All who are fair-minded will admit that the Treasurer has a very difficult task to perform, a task that was particularly difficult during the year that is just closed. There has been a big falling off in revenue, principally in customs receipts.
– That is to be expected if protection is to be effective.
– That is so. The Treasurer is not to blame for that, as it is the result of the considered judgment of this party. Evidently it also has the approval of the Labour party, because that party does not favour the collection of heavy revenue through the customs. Honorable senators opposite even consider that too much revenue is now being collected through the customs. Apparently it is impossible to please the party opposite. Had there been a big increase in customs revenue we should have been told that the duties were too low, and that it was most improper to allow overseas goods to come in so freely. They cannot have it both ways. Either our policy of protection, with its consequent falling off of customs revenue, is a good thing or it is not. If it is a bad thing, as one is led to believe by the speech of Senator Needham, why does not the honorable senator’s party pluck up sufficient courage to declare that they do not favour it, and fight the forthcoming elections on that issue.
– The Labour party contends that it will make the customs duties so high that nothing will come in from outside sources.
– They will even impose an embargo on imports.
– If they take either action how will they finance the affairs of this country? By the imposition of direct taxation?
Senator Needham told us that this Government is extravagant. I assume from that that if a Labour government came into office its first economy would be to reduce our public expenditure, no doubt the first big reduction being in connexion with defence. My belief is that we are not spending sufficient on defence in Australia.
– What can the Government show for the money that it has spent ?
– A great deal, in-, deed. Had the party that the honorable senator represents had its way we should not be so nearly advanced as we are today. We certainly have the nucleus of an effective fleet, which would not have been the case had our ships been built at Cockatoo Island. We know that the Labour party has discarded its old defence plank, but it is not prepared to tell the people of Australia exactly where it stands in that regard. Would Senator Needham reduce the amount expended to assist industry generally? Does the honorable senator contend that that money has not been wisely spent? Would he reduce the amount that the Commonwealth is finding to assist the States? I do not believe that he would. The honorable senator claimed that Western Australia is not receiving enough assistance. No doubt if he had his way - that is before the elections take place - he would not limit the amount given to the States, but that would be only a temporary expedient. Would the honorable senator reduce expenditure on the constructional work that this Government is undertaking throughout Australia? Would he dare to tell the trade unions that, if his party came into office, he would reduce the vote for postal and other construction works, and throw hundreds, and, perhaps, thousands of men out of employment? He would not have the courage to do so. Therefore, it is idle for him to attack the Treasurer and the Government, and say that they are doing wrong in spending far greater sums of money than the condition of affairs in Australia warrants. For the purpo.se of saving money would the honorable senator advocate reductions in the Civil Service, reductions in pensions, or reduced assistance to the primary producers? 1 do not believe that he would be in favour of a reduction in any of these directions. But, when we consider these matters in relation to the speech which has just been delivered by the honorable gentleman, we see just how little there is behind the high-sounding words he uttered, and how empty were the criticisms he directed at the Treasurer and the party behind ihe Government.
– The honorable senator complained that the Government had not committed itself to an expenditure of hundreds of thousands of pounds on child endowment.
– Of course he did, and I shall have quite a lot to say about what has been done by his friends who, in the various States, have had the opportunity to do what he would be prepared to do in the Commonwealth, and quite a lot to say about the result of their efforts on the various States.
I have referred to the headings under which the Commonwealth Government has been committed to expenditure in the budget now before us. There is very little room for the suggestion that expenditures have been too heavy under those headings. A great expenditure is involved in paying interest on borrowed money and in other directions that could be mentioned; but the fact remains that, despite all he said, Senator Needham made not one suggestion as to where he or his party would be able to reduce expenditure. In spite of his very violent criticism of the Treasurer as to the amount of money spent last year, the honorable senator said that he was opposed to the reductions that had been made in the income tax. He said that we lost revenue by those reductions, and that the financial position of the Commonwealth would have been different if these reductions had not been made. Will the honorable senator be honest enough to tell us that, during the coming campaign, his party will advocate an increased income tax for the Commonwealth, and that, if his party is returned to power, there will be an immediate heavy increase in the rate of the tax? Such honesty would be magnificent, hut the honorable senator is not foolish enough to tell us that he would advocate an increase in the income tax. While telling us that the income tax should not have been reduced, he would rather go before the electors and say, “Look what this wretched Government is doing. It is imposing all this taxation.” While complaining that the present Government is getting in taxation more than any other government, he says that taxation should not have been reduced to the extent to which it has been reduced. Let me remind the honorable senator that the income tax has been reduced, not by the Government on its own authority, but by the authority of both Houses of Parliament. A great majority in both chambers agreed that the time had come when not merely because the revenue was not required - we can always find something to do with the revenue we receive - but for other reasons of policy, it was well that the income tax should be reduced. It was felt that the imposition of a heavy income tax meant that we were taking out of industry money that should remain in it, and that it was far. better to leave in the pockets of the men who were engaged in industry as much money as possible, so that they ‘ might extend their enterprises and thus enhance the wealth of the community and make Australia a better place to live in. That course, which was followed by -Parliament as a matter of definite policy, was endorsed by a great majority of the people of Australia, and certainly by almost the whole of the press of Australia. Yet Senator Needham tells us that we should not have reduced the income tax. I do not remember Senator Needham making any particularly strong protest against the action of the Government when the bill to reduce the tax was before this chamber. I cannot remember any herculean fight put up by him. At any rate, the fight, if any, he did put up was not worth remembering. I believe that I should have remembered it if he had fought against the proposal with half the zeal and earnestness that he has shown in opposing other proposals.
The honorable senator ought to answer the question - Will Labour, if it comes into office increase again the income tax which this Government has decreased ? But before he answers that question I want him to ask himself who pays taxation. The man who pays income tax is not the man who runs a big business. The capitalist, as the honorable senator’s friends describe him, is merely an agent for the collection and payment of the tax. The man who pays is the consumer, and as the workers of any country constitute the great majority of the consumers, it is the workers who pay practically the greater part of the taxation levied by the Government of any country. Senator Needham thus claims that the burden upon the shoulders of the workers should be increased, and that the Government was wrong when it decreased the income tax.
– I have said nothing of the sort.
– Inferentially, the honorable senator said that the burden of taxation should be increased because it was wrong to decrease it.
– The honorable senator should quote me fairly. He has made an incorrect statement.
– I thought that when the honorable senator had time to reflect he would be sorry for what he said. In fact, I think he is already extremely sorry, and when he has another opportunity to speak on the financial proposals of the Government he will tell us that he did not mean what he said in his speech this afternoon.
– It is apparently impossible for the honorable senator to be fair.
– The honorable senator waxed very indignant about the policy of borrowing overseas, and he quoted figures to support his argument that all our borrowings from overseas came into Australia as imports. I hope I am not misquoting the honorable senator.
– It is the second occasion on which the honorable senator has misquoted me. I said that the major portion of our borrowings came here in the shape of imports.
– Even with the substitution of the word “major” the statement made by the honorable senator is quite wrong. Most of the borrowing by the Treasurer during the past year has been for the redemption of existing loans, either on behalf of the Commonwealth or on behalf of the States.
– I was speaking of a six years’ period.
– If I keep on, we shall know exactly what Senator Needham did mean.
– The honorable senator is low enough to misrepresent another senator.
The PRESIDENT (Senator the Hon. Sir John Newlands). - The honorable senator must withdraw that statement.
– I withdraw it, but it is good enough for him all the same.
– I withdraw that statement also.
– The honorable senator must not make a personal reflection on another honorable senator.
– But I object to his misrepresenting what I said.
– The honorable senator must make his objection in accordance with the Standing Orders.
– Even to take the honorable senator’s amended statement that the major portion of our borrowing from overseas comes into Australia in the shape of manufactured goods from other countries, how does the honorable senator account for the recent decrease in the customs revenue? The one thing kills the other. This fact should convince the honorable senator that he is wrong in his contention. Actually our borrowings do not come here in the shape of pounds, shillings and pence, but represent a credit created for us in Great Britain or America, or wherever the money may be borrowed, which may be operated on by bills of exchange and so forth. We may receive a portion of the money in the shape of manufactured and other goods, but, as I have already pointed out, a considerable portion of it is required to pay interest in London and to provide for renewals, redemptions and other obligations.
The honorable senator has already attacked the Government . for referring to what he has called the red issue at the elections. He has accused the Government - I think he used the words - of telling untruths to the electors and of deliberately misleading them. He urged that what we said about the red issue was entirely unjustified, and that there was no reason for it - in fact that there was no such thing as a red menace in Australia to- day. It is strange, but nevertheless true, t hat in this connexion the honorable senator finds himself out of step with a very considerable section of his own party. There is to-day from one end of this country to the other a growing realiza- tion on the part of all men who really understand the position that this menace is a thing which does exist and must be met. Will Senator Needham tell his colleague, Senator Barnes, general president of the Australian Workers Union, that there is no red menace in Australia to-day? Will he say that the Australian Workers Union is not fighting for its continued existence against that very menace ? When the executive of the Australian Workers Union - the greatest labour organization in the Commonwealth - is compelled to take the drastic steps it has to effectively fight this insidious influence which is working into their organization and tending to destroy it, the Leader of the Opposition should realize the seriousness of the situation. Would Senator Needham say to the Premier of Queensland, another Labour colleague of his, that there is no red menace in that State? Would he deny that there is in South Australia and in other States certain individuals who hold such extreme views that they are a danger not only to Labour organizations, but also to Australia? Does he say that there is nothing in this menace? Of course there is. The statements made by the members of this party during the last election campaign and which are being made to-day are fully borne out by facts. There are good Labour men, it is true, who see the position just as clearly as we do, and, to their credit, have pointed out to the people the danger confronting them.
The Leader of the Opposition made a similar statement a few months ago when I submitted a motion to the Senate in relation to the Pan-Pacific Trade Union Congress. The honorable senator even went further and credited the Labour party with having originated the idea of a Pan-Pacific Congress. He also said that I was wrong in bringing the matter before the Senate, and that I did so in order to make an unjustifiable attack upon the Labour party. Since that time the people of this country have learned a great deal about the congress, who is organizing it, and what is its objective. We have gained more information, and possibly the Leader of the Opposition now knows a good deal more about the matter than he did when he last spoke on that subject in the Senate. Does he still say that the Labour party should take the credit for the Pan-Pacific Congress and what it stands for? Will he now repudiate the hideous policy that that organization advocates? Upon reflection and the exercise of more mature judgment, I do not think he will repeat the statement he made on that occasion. He is adopting the same attitude in regard to the red menace. It is time that the Leader of the Opposition and those associated with him realized that the red menace does exist instead of closing their eyes to facts. The honorable senator is quite out of step with a considerable section of the organization which he represents, and is, I am afraid, proving to the people that his judgment upon this matter, as it is on finance, and a few other subjects, is not as reliable as it might be.
I wish now to refer to the subject of child endowment. The Leader of the Opposition charged the Prime Minister, the Government and its supporters, with not having kept their promise to the electors on this important matter. It is true that we made certain promises - not quite as the Leader of the Opposition said - during the election campaign in regard to child endowment. The Government, with a view to arriving at some modus operandi, referred it to a conference of Commonwealth and State. Ministers because it found that some of the
States had committed themselves to certain schemes and had very definite plans as to the way in which the system should be conducted. During the discussion at that conference the Prime Minister endeavoured to discover a means whereby the Commonwealth Government in co-operation with the States could introduce a scheme acceptable to all parties. What happened? The action taken was not at the instigation of a Nationalist Premier. The representative of the Queensland Labour Government at that conference, Mr. Forgan Smith, said that the problem of child endowment was very intricate, and as the introduction of the system would cost a lot of money, the Governments would have to be very careful. He therefore moved that the subject be referred to a royal commission. That action was not proposed by the Prime Minister or the leader of any Nationalist administration, but by Mr. Forgan Smith, a member of the Queensland Labour Government. The Prime Minister acquiesced, and the question was referred to a royal commission. It is hoped that when a report is received, and is considered by the Government in conjunction with the representatives of the States, it will be possible to devise a scheme whereby child endowment may be brought into operation. The Government has done everything possible, in the circumstances. There has been no breach of any pledge, and I feel sure that when the ‘supporters of the Government place the position before the electors their action will receive the endorsement of the people of Australia.
I have endeavoured to answer briefly some of the attacks made upon the Government by the Leader of the Opposition, particularly in connexion with the budget, which, in the circumstances, I regard as very satisfactory. It is certainly not as attractive as some of us would like, but there are exceptional circumstances which have to be considered, and over which neither the Treasurer nor the Government has control. The budget has been well received throughout the country, and the criticism levelled against it has not been serious, due largely to the fact that it covers an extremely difficult period. I regard it as a good budget, and I feel that the Treasurer and the Government should be congratulated upon it. I am confident that when the people of Australia have an opportunity to consider its contents, the Government need have no fear that it will not secure the support of a great majority of the people of Australia.
– I endorse all that Senator Duncan has said, but more particularly the concluding portion of his speech, in which he congratulated the Treasurer (Dr. Earle Page) upon the clarity of the budget which has just been presented to Parliament. It is a matter for regret that the financial year closed with .a deficit, but, owing to the unsatisfactory season and to the difficulty in estimating the revenue, that was not surprising. It is, however, pleasing to note that the Treasurer has been able to budget for a small surplus this year. He will perhaps be criticised for not budgeting in such a way as to wipe out last year’s deficit; but the only -way in which that could be done would be by raising more revenue or by reducing expenditure. The raising of additional revenue would necessitate higher taxation, which is undesirable, and the difficulty in reducing expenditure is apparent. Fully 60 per cent, of bur Commonwealth expenditure is represented by statutory commitments in the form of interest, repatriation, pensions, and other charges. Expenditure in that direction cannot be reduced, and some of it may possibly have to be increased. It is necessary, however, to study our loan expenditure very closely. At the present time a reduction of loan expenditure also presents some difficulties, since a large proportion of the workers in Australia are obtaining their wages on works provided by loan moneys. Unfortunately, at present, there are a large number of men out of work, and although some of us may feel disposed to vote against some of the items on the loan estimates, it is extremely difficult to reduce such expenditure unless we wish to create further unemployment.
Our present position is due largely to the fact that we have been legislating on wrong lines. I have spoken on this subject before, and I wish to repeat that our high customs duties are seriously interfering with primary production. High customs duties increase the cost of living, which results in an appeal to the Arbitration Court for higher wages, which are invariably granted, and these in turn lead to still higher duties, and so it goes on. I do not wish it to be thought for a moment that I am an advocate of low wages. I am not. I should like the workers to receive real wages, and not sham wages. The system we have been pursuing in the past has resulted in men receiving, say, an additional 2s. a day, and the cost of living at once being increased by 2s. 6d. a day. This is simply throwing dust in the people’s eyes.
I do not believe in the day-labour system. I hold the view that men should be paid for the work they do, not for the time they take to do it. The day-labour system means that the cost of a job is determined not by the amount of work to be performed, but by the time it takes. We have reached such a position that a full and careful consideration of the effect of our tariffs and arbitration laws is imperative. We shall not progress towards real prosperity until there is a lowering of the cost of production. There is scarcely a thing which can be exported from Australia without assistance of some kind. Even wool, which is our best exportable commodity, is getting perilously near the stage when it will not show a profit. Some time ago an inquiry was made into the pastoral industry. I commend to honorable senators the very fine report issued as the result of those investigations. In 1911, the average price received for wool grown on certain stations was 8.71d. per pound. That left a profit of 3.32d. per pound. In 1925, although the average price of wool grown on the same station was 15.26d. per pound, the profit was only 2.8d. per pound. The tendency throughout the world is for prices to revert to pre-war levels. While at the present time the price of wool has not reached a dangerous level, I desire to point out that with the tendency towards lower prices any product which brings twice as much as it did before the war is in danger of seeing a reduced .price.
Australia enjoys natural conditions favorable to the growing of wheat.
Our wheat, therefore, should be able to compete in the world’s market. In addition, we have probably the best machinery in the world for the cultivation of wheat. The price of wheat in the world’s market is declining. Wheat in England is about 5s. 5d. a bushel, which would give us 4s. or 4s. Id. a bushel at the sea-board. After allowing for railway freights there is no margin of profit. Although it is rather early to forecast, the indications point to a bumper wheat harvest this year, but, unfortunately, the price of wheat is not encouraging. Canada expects to produce 600,000,000 bushels of wheat this year. Should Russia and Siberia re-establish themselves in the world’s wheat market Australia’s wheat farmers will be working at a loss. Our costs of production must be reduced. The first thing to be done is to amend our tariff. I do not suggest any drastic legislative amendments, such as freetrade, for that would cause chaos. But we must start to round off the edges.
Although Australia exports large quantities of butter, that would not be possible were it not for the Paterson stabilization scheme. I believe in that scheme, although I would rather see a reduction in the cost of production. Were it not for the 4d. a lb. assistance to butter under the Paterson scheme, and the fact that dairy farmers work for much less than the rates awarded to ordinary labourers by the courts, we should export no butter.
This year Australia exported about 3,000,000 bushels of fruit. From the time the fruit was picked until it was sold, handling costs represented about 9s. a case. Yet a large proportion of that fruit realized much less than 9s. a case; some of it brought only 7s. 6d. a case. In pre-war days 9s. or 10s. a case represented a fair margin of profit, but to-day that is not so. Tasmanian members of this Parliament have asked for a bounty on dried fruit, but so far without success. I do not like bounties; but the fruit industry is in need of some assistance, and is as much entitled to a bounty as are other industries which have been helped by that means. In Tasmania we have some of the most up-to-date fruit evaporating factories in the world. The cost of production, however, is so great that it does not pay to evaporate fruit for export, and as soon as the Australian market is supplied they shut down and the rest of the fruit rots.
The potato industry in Tasmania is also in a bad way. Thousands of tons of potatoes will not be dug this year in Tasmania because of the high cost of handling them. Labour and machinery are expensive, while the high freights due to the Navigation Act make it unprofitable to ship potatoes to Sydney. Digging, bagging, cartage and rail charges and steamer freights represent from £4 5s. to £4 10s. a ton, whereas the price of potatoes in Sydney is from £4 to £5 a ton. That leaves absolutely nothing for the grower for all his work. There are thousands of people in Australia to whom those potatoes would be invaluable; but production costs force growers in Tasmania to let them lie in the ground or to be used as food for stock.
– Yet the Development and Migration Commission urges increased production.
– The idea of the Commission is to obtain the same crop from a smaller acreage. If anything should make the people of Australia think, the present position of the coal industry should do so. While coal is imported from England, coal-miners in the Newcastle district are out of work.
– South Australia is saving 8s. a ton by importing coal from England.
– Probably the “ freight on coal from England to Adelaide is less than from Newcastle to Adelaide, owing to the Navigation Act. It is possible to convey Scandinavian timber to Adelaide for about one-half the cost of shipping it from Hobart. The same thing probably applies to coal. High costs are killing everything. The chairman of directors of one of the best mines at Broken Hill, which has shut down, said recently that he could find employment for 1,000 men if they would accept wages which would enable the company to compete in the world’s market. Metals had come back to pre-war prices, and as labour costs had kept up the mine was shut down, and the men were thrown out of work.
Until we face the position squarely, we shall not achieve real prosperity. The greatest barriers to progress are the tariff, the Arbitration Court, and the Navigation Act. Of these the greatest obstacle is the Navigation Act. It has created two big monopolies - the steamship owners and the seamen. They are both relentless. Southern Tasmania is worse off than it was 60 years ago in the matter of steamship services. A majority of the members of both the Navigation Royal Commission and the Public Accounts Committee reported_ in favour of the repeal of the coastal sections of the Navigation Act. I hope that the Government will give effect to their recommendation. I do not want to use extravagant language, but I say unhesitatingly that no better scheme to cripple Tasmania could have been devised than the passing of that legislation. In speaking of these matters, I speak of that which I know. I have been forced to travel from Hobart overland by night to another port in order to catch a small boat to take me to the mainland when, were it not for the Navigation Act, I could have boarded a well-appointed passenger steamer at the first port. People from other parts of the world doubt our sanity when they see the effect of the Navigation Act, and wonder why we submit to it. Tasmania, being an island State, should have the best means of sea transport possible. The coastal sections of the Navigation Act should be repealed immediately, so that Tasmania may have free intercourse with the rest of Australia and other parts of the world. I am prepared to take any steps and go to any length to have them repealed. Tasmania is dependent upon shipping, yet it has always been badly off in this respect. It is faced continually with the handicap of Bass Strait, and it is the duty of this Parliament to minimize that handicap as much as possible. Some little time ago, as a member of the Parliamentary Committee of Public Accounts, I was associated with an investigation into the Tasmanian shipping problem. That committee recommended that three services should be established. Some people believe that one service is sufficient, but Tasmania now has several ports in order to give access to its producers, and it needs an adequate shipping service. It is not right that Tasmania should be worse off under federation than it was previously. Had there been a desert instead of a strip of water between Australia and that State the Commonwealth Government would certainly have constructed a railway to afford the necessary communication, and it is but fair that it should give effect to the various recommendations that have been made for the provision of proper shipping facilities. One of the recommendations made by the Public Accounts Committee was that an old vessel, which has been 40 years in service on the northwest coast of Tasmania should be replaced. I should like honorable senators to travel in that vessel as the representatives of Tasmania have to do - sometimes twice a week - in order to appreciate her extraordinary condition. It was also suggested that when the boats at present on the Launceston service are due for replacement, steps should be taken to provide better vessels. In regard to Hobart, it was recommended that a subsidy should be granted during the summer months in order to effect a better service. At the time when that committee inquired into the matter at Hobart a very good service was running. Had it discontinued then as it did a few weeks afterwards, I have not the slightest doubt that the committee would have recommended an alltheyearround subsidy. I understand that the Government has received a tender for these services, and that the amount quoted is large. Whether it is too large is a matter for experts; but we want better services. Ordinarily my advice is to “sell, rather than purchase vessels, but being .so keenly aware of the suffering to which the people of Tasmania are subjected owing to the lack of communication I advise the Government to take any steps, even to the extent of purchasing boats, in order to afford relief. I urge the Government to give every consideration to the reports that have been submitted, feeling confident that if that is done there will be a repeal of the coastal sections of the Navigation Act, and the subsequent establishment of satisfactory communication between Tasmania and the mainland.
After a long series of conferences and examinations the Government sent Sir
Nicholas Lockyer to Tasmania to inquire into the disabilities which it suffered under federation, and as a result of that inquiry the Commonwealth made an annual grant of £378,000 to Tasmania for two years. It was urged at the time that the grant should be extended to five years, but the Government proposed to review the situation at the end of two years. I understand that that has now been done, and that the grant has been cut down to £220,000 per annum. I admit that the Tasmanian Government showed a surplus this year. But there is very little incentive to show a surplus if, as a result, the Commonwealth grant to that State is to be cut down. A great many people in Tasmania will be very disappointed that the grant has been reduced. This Government also sent the Development and Migration Commission to Tasmania to make inquiries and devise a scheme to increase the prosperity of the State. That commission did excellent work. Finally, Dr. Findley was instructed to inaugurate an agricultural bureau scheme, in order to strengthen the Agricultural Department. I take the keenest active interest in the work of that bureau. Everybody in Tasmania was under the impression that its upkeep, amounting to something like £30,000 a year, was. to be paid for by the Federal Government. Now we have received the bombshell that the Tasmanian Government has to meet that amount, which actually cuts down its grant of £220,000 to £190,000. There is not the slightest doubt that the Tasmanian Treasurer will now have to budget for a deficit instead of a surplus. I have no idea how the amount of £220,000 was arrived at. Although Tasmanian representatives in the Federal Parliament were at all times anxious to assist in the matter, the basis of the calculation was determined in private conference between the Treasurers of the Commonwealth and Tasmania.
I ask the Government, in justice to the island State, to be a little more liberal in supporting the grant to Tasmania, and I urge that, as the Development and Migration Commission has been instrumental in instigating the existing agricultural drive in Tasmania, the Federal Government might see its way to pay for it.
Debate (on motion by Senator Verran) adjourned.
Bill received from the House of Representatives, and (ou motion by Senator Sir George Pearce) read a first time.
Senate adjourned at 10.10 p.m.
Cite as: Australia, Senate, Debates, 5 September 1928, viewed 22 October 2017, <http://historichansard.net/senate/1928/19280905_senate_10_119/>.