12th Parliament · 1st Session
The President (Senator the Hon. W. Kingsmill) took the chair at 3 p.m., and read prayers.
Senator HOARE, as Chairman, brought up a report of the Printing Committee, and - by leave - moved -
That the report of the Printing Committee, brought up this day, be adopted.
.- Before honorable senators are asked to vote for the adoption of this report, they should be made acquainted with its contents. Without seeing the report, or having an explanation of what it proposes, honorable senators have nothing to guide them. In any case, as a matter of principle, I object to voting for the adoption of a report the contents of which are not known to me.
– The position can be rectified by an honorable senator, who has not spoken, moving the adjournment of the debate.
Debate (on motion by Senator Sir George Pearce) adjourned.
Senator DOOLEY brought up the report of the Parliamentary Standing Committee on PublicWorks, together with minutes of evidence, relating to the proposed establishment of an automatic telephone exchange at North Sydney, New South Wales.
The following papers were presented : -
Defence Act - Regulations amended - Statutory Rules 1930, No. 67- No. 68.
War Service Homes Act - Land acquired at Brighton, Victoria.
Arbitration (Public Service) Act - Determinations by the Arbitrator -
No. 18 of 1930- Commonwealth Public Service Clerical Association.
No. 19 of 1930 - Fourth Division Officers Association of the Trade and Customs Department.
Public Service Act - Regulations amended - Statutory Rules 1930, No. 64.
Wine Overseas Marketing Act - Regulations -Statutory Rules 1930, No. 66.
New Appointments - Temporary employees - Overtime.
– On the 25th June, Senator Herbert Hays asked the following questions, upon notice : -
Information which has been prepared by the Public Service Board in regard to part 1 of the question shows that the number of persons appointed to the permanent staff of the Commonwealth Public Service during the period 1st December, 1929, to 31st May, 1930, was 615. while the number of persons who left the Service during the same period was 441. The appointments made were, with few exceptions, to junior positions in the
Public Service, vacancies for some of which had existed prior to the commencement of the period in question. While the number of positions created during that period was 540, the positions abolished numbered 616. The resultant decrease in the number of new appointments would not be wholly shown in the figures given for the period 1st December, 1929, to 31st May, 1930, but would be reflected in returns for subsequent periods. Replies in regard to parts 2 and 3 will be furnished as soon as complete information is available from the several Commonwealth Departments.
asked the Leader of the Government in the Senate, upon notice -
– The answers to the honorable senator’s questions are as follow : -
SenatorSir GEORGE PEARCE asked the Minister representing the Minister for Trade and Customs, upon notice -
– The information will be obtained.
Inspector-General’sreport - Voluntary Enlistments : Senator H. E. Elliott’s Efforts - Senator Sampson’s Emoluments as Commanding Officer.
asked the Minister representing the Minister for Defence, upon notice -
– The Minister for Defence will endeavour to arrange for a copy of the report of the InspectorGeneral to be presented to Parliament before the Defence Estimates come before the Senate for consideration.
asked the Minister representing the Minister for Defence, upon notice -
In view of the statement of the Minister for Defence in the House of Representatives recently -
General Elliott’s command, the highest percentage of enlistments in the State of Victoria?
Government in Parliament addressed any meetings to encourage recruiting; if so, in what localities?
– Inquiries will be made, and a reply will be furnished as soon as possible.
asked the Minister representing the Minister for Defence, upon notice -
– Inquiries will be made, and a reply will be furnished to the honorable senator as early as possible.
asked the Minister representing the Minister for Trade and Customs, upon notice -
Grand Prix Ho. 12 shot cartridges were sold in Western Australia for 17s. 6d. per 100, and that similar cartridges made in England by the same firm were sold at 18s. per 100?
– Full inquiries will he made in the matter.
Bill received from the House of Representatives.
Standing and Sessional Orders suspended.
Motion (by Senator Daly) proposed -
That the bill be now read a first time.
Debate (on motion by Senator Sir George Pearce) adjourned.
Motion (by Senator Daly) proposed -
That the bill be now read a third time.
Senator Sir GEORGE PEARCE (Western Australia) [3.16]. - I called “not formal” to the third reading of the bill to enable me to explain why I intend to vote against it, if given the opportunity. As I stated, when speaking on the second reading, the bill continues, on a diminishing scale, until it finally expires, the bounty provided for in the act passed by the Bruce-Page Government. I prefer to see the bounty terminate in that way rather than abruptly, as provided in the existing act. I intimated that in committee I would move to amend the provisions relating to the regulation of wages and labour conditions, in order to bring them into line with all other bounty acts. I endeavoured to effect that uniformity when the bill was in committee, but was unable to induce a majority of honorable senators to support me. I, therefore, feel justified in opposing the third reading of the measure, because the bill contains an innovation of a most dangerous character, one foreign to all bounty acts. I fail to appreciate why that innovation should be introduced in it, and propose, if honorable senators will support me, to call for a division on the motion for the third reading.
– I hope that the Senate will not support the Leader of the Opposition (Senator Sir George Pearce) and vote against the third reading of the bill. I repeat what I said on the second reading, that although this is an innovation it is one that, I should have thought, would meet with the approval of both political parties. It is calculated to make conciliation practicable in connexion with this scheme and, if both parties are honest in their opinion that, after all, conciliation is the best method to decide wages and working conditions. I sincerely hope that in every other bounty bill that comes before the Senate a similar provision will be inserted. For honorable senators to deny that principle in this bill would be definitely to state to the people of Australia that they stand for the litigious atmosphere of the Arbitration Court in preference to the conciliation tribunal that the Government seeks to set up.
Question - put. The Senate divided. (The President - Senator The Hon. W. Kingsmill.)
Majority . . 10
Question so resolved in the affirmative.
Bill read a third time.
Debate resumed from 25th June, (vide page 3192) on motion by Senator Daly -
That the bill be now read a second time.
– Yesterday, when I obtained leave to continue my remarks, I was quoting from an official statement by the Canadian wheat pool issued on the 7th February, of this year. The statement continues -
If the pool had been forced to sell large quantities of its wheat on the present market, the result would have been disastrous. Prices would have been forced down to a level which would have involved a loss of millions of dollars to the Canadian nation.
It was at this point that the Governments of the Prairie Provinces came into the picture of the pools and the banks. By Premiers Bracken, Anderson and Brownlee, letters were addressed to the chairman of the lending banks committee, stating that in the event of the pools’ margin becoming impaired the Provincial Governmentsstood ready to guarantee this margin.
It is generally admitted that the possibility of wheat prices going to levels which would endanger the pool s security with the banks is almost inconceivable in view of the world wheat situation.
Not Guaranteeing Advances.
There is no reason whatsoever for pool members or the public to feel uneasy about our financing. In a statement issued on the 5th February, George McIvor, general sales manager for the Canadian Wheat Pools, emphasized the fact that the Provincial Governments are not guaranteeing the banks’ advances to the pool. These advances or loans are already adequately secured by collateral in the form of wheat equal in value to more than 15 per cent. over. and above the actual borrowings. The Governments are guaranteeing only the margin of 15 per cent., which we are still maintaining without assistance.
The world wheat situation is such that we are fully satisfied that our marketing policy is sound, and we have every confidence that when the present abnormal conditions are cleared away our actions will result in greatly increased prosperity for Western Canada.
This information and the quotations which I have already given from leading authorities on the wheat position, including representatives of chambers of commerce and other bodies, give a version of the wheat position entirely different from that outlined by opponents of the bill. It is significant that, prior to the Canadian wheat pool, wheat prices in Canada were uniformly below those ruling in the United States of America. Im mediately the Canadian pool was established the Canadian position distinctly improved, and it has since maintained its improvement, average prices now being above those obtaining in the United States of America. Statistics relating to wheat prices from 1909 are to be found in the Year-Book of the Department of Agriculture of the United States of America. These show that in 1923, the year before the Canadian pool was established, the average year’s price at Minneapolis, United States of America, was 4s. 10½d. a bushel, and the average price at Winnipeg, Canada, was 4s. 2d. The average price for the eight years 1909-23, excluding the world war period, was 4s. 6¾d. at Minneapolis and 4s. 3d. at Winnipeg. In September, 1924, after the pool was established, the average price in Minneapolis, United States of America, was 5s. 5d. and in Winnipeg, Canada, 5s.11d. a bushel. In October of the same year the prices were, Minneapolis, 6s.1d. ; Winnipeg, 6s. 8d. a bushel. The November and December figures in the same year show practically the same margin. For 1925 the year’s average in Minneapolis was 6s. 6d., and in Winnipeg 6s.11d. a bushel. According to the Melbourne Argus of June 24, 1930, practically the same margin exists to-day. Before the pooling system was introduced the Canadian wheat was lower in price; but ever since Canadian wheat has averaged a higher price. The quotations in the Melbourne Argus, of June 24, show that the futures price of wheat for Chicago for July, 1930, was 92½ cents, and for Winnipeg 96½ cents, and for December wheat 100 cents, and 102½ cents respectively. This fact should influence honorable senators in favour of the pooling system.
Reference has been made to the extent to which the price of bread may be affected if the compulsory wheat pooling system is introduced. Some have said that the price of wheat cannot advance without the price of bread being increased while others take an opposite view. I do not intend to argue that if the price of wheat increases by, say1s. per bushel, the price of bread will not be affected. A handful of men who now control the business have power to increase the price of bread even if the price of wheat should drop. As we cannot debate the subject on that basis, I shall endeavour to argue it from the point of whether an increase in the price of wheat by ls. a bushel economically justifies an advance in the price of bread.
– How does the honorable senator know that the price of wheat for local consumption will not be increased by 2s. or 3s. a bushel?
– In January, 1927, wheat was bringing up to 6s. 6d. a bushel. For some time it was about 5s. 3d. a bushel, although it has dropped recently to 4s. a bushel. During that period the price of wheat varied and the price of oread in South Australia has remained stationary, which shows that the bakers were evidently making a fair profit out of bread when wheat was 5s. 3d. a bushel. In these circumstances are not the farmers more entitled, to receive the ls. 3d. a bushel, which is the difference between 4s. and 5s. 3d., than are the middle interests and bakers who have been receiving it? At the prices mentioned the bakers were evidently making a good profit when wheat was 5s. 3d. a ‘ bushel, but costs have probably dropped since that time. I contend that the farmers, who in, some instances last year reaped only three or four bushels to the acre, which cost them over 10s. a bushel to produce, are more entitled to the ls. 3d. a bushel than are the other interests. The farmers have a right to have a voice in the fixing of the price of wheat to enable them to secure what is really their own, rather than that the difference should go to those interests which operate between the time when the wheat is purchased and when it is sold in manufactured form to the consumers.
A great deal of misconception exists regarding this phase of the business. This is largely due to the fact that the cost of the wheat in a loaf of bread is comparatively small. It is interesting to note that 60 lb. of wheat produces 42 lb. of flour, 7 lb. of pollard, 10 lb. of bran, and 1 lb. of waste. In a 4 lb. loaf of bread there are about 3 lb. of flour. It takes about 4 2-7 lb. of wheat to produce 3 lb. of flour, and from that quantity of wheat, bran and pollard are also obtained. Therefore 4 2-7 lb. of wheat is the wheat contents of a 4 lb. loaf of bread. Roughly we can estimate - I am only giving the figures roughly - 1 lb. of wheat to 1 lb. of bread. With wheat at 4s. a bushel, the value of wheat in 1 lb. of bread is considerably under Id., less the value of the offal. As the exact figures were given by the honorable member for Wimmera (Mr. Stewart) in another place, I shall not quote them in detail. ‘ The conclusions of that honorable member on the basis of 4s. 6d. a bushel for wheat were that, allowing for the value of the offal, the net value of wheat in a 4 lb. loaf of bread ib 2.69d. Honorable senators can see that with this small quantity of wheat in a loaf of bread, the price of wheat should rise from ls. 6d. to 2s. a bushel before a rise of id. in the price of the 2 lb. loaf of bread is justified.. Bakers were no doubt making a fair profit with wheat at 5s. 3d. With wheat at 4s. other people interested, not the farmer, would be making a greater margin of profit. In such circumstances, the farmer is surely the person most entitled to the difference. If he has a voice in the fixing of the price of wheat he may be able to do himself justice. Even if the people of Australia were asked under abnormal conditions to pay id. more for a 2-lb. loaf of bread we should not forget that the Australian manufacture ‘ by legislative enactment, gets for his goods the world’s market price, plus freight, . charges and duties, and that the working man has his wages and conditions of employment fixed by the Arbitration Court. For a farmer to get the same treatment as other people receive, he would have to get the world price for his wheat, plus freight and ‘ charges. But he is not asking for that, although the primary producer is the only one who gets the London price, less freight and charges. For years the producers of Australia have been battling to reduce the cost of production; but Parliament, by tha imposition of high tariffs, and the Arbitration Court, by means of its awards, have made that impossible. The farmer is told to be satisfied with something that he cannot get. Surely honorable senators will not deny him some measure of that assistance which is given to others.
Senator Sir HAL COLEBATCH (Western Australia) [3.43]. - Each week when honorable senators arrive at Canberra they find in those capacious, but frequently overcrowded, lockers in the club room a very interesting typewritten report covering the activities of the several departments of the Commonwealth. The latest of these reports refers to the Wheat Marketing Bill. On page 28 there appears the following state-, ment : -
A new clause 3 has been inserted to provide that, in .the event of any section or sections of the act being declared invalid, such declaration shall not affect the validity of the other sections of the act.
There must have been some reason for inserting that new clause at the last moment. It was not in the bill as originally drafted, but was put in just before it left another place. I suggest that the reason for the insertion of the clause is that the sponsors of the bill believe that certain portions of it are invalid. It, therefore, behoves the Senate to consider what portions of the bill are likely to be declared invalid. If the measure represents anything at all, it represents an agreement between the Commonwealth, the States and the wheat-growers. It is obvious that a bill embodying an agreement, and containing a clause providing that if any section of it is declared invalid the rest shall stand, leaves the door open to manifest injustice.
What are the clauses the validity of which are likely to be attacked? The principal provision likely to be attacked is that which provides for payment by the Commonwealth of a sum of money to the wheat-growers. The new clause deliberately states that if that provision is successfully attacked, so that the Commonwealth can pay nothing, the rest of the bill shall stand; the compulsory pool will remain. The Government deliberately contemplates that the validity of this legislation will be. attacked. “What are the grounds for supposing that that will be so? If the payment is a bounty, it is obviously unconstitutional, because section 51, paragraph iii., of the Constitution provides that bounties shall be uniform throughout the Commonwealth. There is no uniformity in this case. Indeed, the bill is deliberately otherwise, for it provides for a guarantee of 4s. a bushel at sidings, plus whatever may be required to convey the wheat to the port of shipment. In the case of New South Wales, the guarantee amounts to 4s. 8d. a bushel, whereas in respect of Western Australia and South Australia it is only 4s. 6d. a bushel. Therefore, if the payment is to be in the nature of a bounty, it will be invalid because it will not be uniform throughout the Commonwealth.
I think, however, that the best opinion is that the payment will not be in the nature of a bounty. In that case, under what provision of the Constitution can the money be paid? Such payment cannot come within that provision of section 51 of the Constitution, which empowers the Commonwealth to make grants to necessitous States.. How can the money be provided otherwise ? The powers of this Parliament to appropriate money are, by section 81 of the Constitution, limited to the purposes of the Commonwealth, those purposes being set out in the Constitution. This is a point which has not yet been raised, or decided by the High Court ; but I suggest that this Parliament knows well the intention of the framers of the Constitution in that connexion. Parliament knows that it has no right deliberately to contemplate an appropriation of money for purposes outside its constitutional powers. Even if that were not the case, we should still be up against the provisions of section 99 of the Constitution -
The Commonwealth shall not, by any law or regulation of trade, commerce, or revenue, give preference to one State or any part thereof over another State or any part thereof.
This bill clearly contemplates giving such preference. It gives a decided preference to the wheat-grower whose farm is situated at a distance from the port of transhipment and in whose case the freight might he as much as 8d. a bushel as against a wheat-grower whose farm is closer to the port of transhipment, in whose case the preference would amount to only 2d. a bushel. The bill will guarantee 4s. 8d. a bushel to a farmer in one portion of a State, whereas another farmer in a different portion of the State will be guaranteed only 4s. 2d. a bushel. It will therefore be seen that whether the payment is a bonus or a grant it comes up against the provisions of the Constitution in that it does not provide for equality of treatment as between States and parts of States. For these reasons I suggest that the Government has the strongest reason to fear that that portion of the bill will be declared to be unconstitutional; that it will not be permitted to make these payments, whether by way of a bounty or by means of an appropriation.
The bill also contemplates an interference with trade between the States. That is a contravention of section 92 of the Constitution, which provides that -
On the imposition of uniform duties of customs, trade, commerce, and intercourse among the States, whether by means of internal carriage or ocean navigation, shall be absolutely free.
I am aware that in recent decisions the High Court has taken the view that section 92 is a prohibition against States only, not against the Commonwealth. I do not think it is disrespectful to the High Court to say that that opinion is still strongly contested by probably some of the finest legal minds in the Commonwealth. But we know that when the Constitution was framed and adopted by the States, it was understood and intended by the people that trade, commerce and intercourse between the States should be absolutely free, and we in this Parliament, particularly in this section of it, who have been sent here to protect the rights of the States, are not entitled, even though we think the Constitutional powers have been extended by judicial interpretation, to say that free intercourse between the States can be interfered with by the Commonwealth in whatever way it suggests. These are some directions in which it is probable that the provisions of this bill may be upset. It is worth while for the Senate to remember that even if those provisions are upset, the rest of the measure will stand. That is to say the compulsory pool will remain; the disadvantages to the Commonwealth may disappear and the disadvantages to the States remain.
– Why discuss remote possibilities ?
Senator Sir HAL COLEBATCH.Parties to an agreement who think that they will derive an advantage out of something or other should understand whatever disabilities are attached to it. A man may readily enter into an agreement knowing there is some doubt as to the validity of it and knowing that if it is proved invalid, he has nothing to lose, though he may get nothing out of it. In this case, however, the agreement is entirely one-sided. An agreement is entered into. The validity of the portion which imposes a burden on the Commonwealth may be successfully attacked, but the rest of the agreement will stand. One party may lose everything; the other party, which gives everything, may get nothing. That, I suggest, is inequitable and improper.
My strongest objection to this bill is its financial unsoundness. My fear is a fear that I think honorable senators will share - I know it is shared very widely throughout the community. At the outset a statement was made by the Minister for Markets and Transport that the Com. monwealth Bank had arranged to finance this scheme. When this statement was brought under the notice of the Prime Minister and the Treasurer in another place, they were unable to confirm or deny it. They knew nothing about it. But some little time afterwards, the Prime Minister made a statement that he had conferred with the Minister for Markets and Transport and that the Commonwealth Bank could make some such arrangement. Then there was a telegram published in a newspaper containing a denial from the Chairman of Directors of the Commonwealth Bank.
– Only a portion of the telegram was published.
Senator Sir HAL COLEBATCH.Quite so. We know very little about it, but the whole point I wish to make, and one which I hope the Leader of the Senate (Senator Daly) will clear up, is that we do not know to this day the method by which the first step is to be carried out. I refer to the financing of this wheat, the payment of the 4s., leaving out for the moment any loss that may arise.
– The note issue will be inflated.
Senator Sir HAL COLEBATCH.That is the idea that necessarily must come into one’s mind. The passing of this bill will undoubtedly drive out of the wheat business in Australia the private wheat buyer. I am not concerned much about defending him against the attack made upon him by the Leader of the Senate, but no one can deny that the private wheat buyer does bring to Australia the cash or the credit necessary to finance the purchaseof wheat, and having been brought here it remains here. Our wheat has gone, but we have an equivalent for it. He has taken the wheat to London, and has replaced his cash or credit there. There is an exchange of the commodity for the credit. Now, if he is driven out of the business, where is the money to come from to finance this scheme? We know that it may be obtained by buying wheat and paying for it with Commonwealth notes.
– Where did the money come from during the war period ?
Senator Sir HAL COLEBATCH.During the war period the wheat was not parted with until the money was paid.
– But the farmer was paid the first advance.
Senator Sir HAL COLEBATCHOf course, he was. But if wheat is paid for in Commonwealth notes, and is then transported to London and sold there for gold or used there for the purpose of improving Australian exchange rates, or Australian credit, or for meeting Australia’s liabilities overseas, the equivalent of the wheat will not be brought back to Australia, and hereweshall have an inflation of the note issue. I do not take much notice of denials of governments that they are ever going to inflate the note issue. I do not think any government ever admitted its intention of inflating the note issue. Note inflation does not come deliberately. It comes because it happens, and it will happen in this case if this method of financing the wheat, which I fear is the only method available to the Government, is adopted. We shall have note inflation of a very serious character. This is probably the most vital objection to the bill, because if we have such note inflation, there will inevitably be a large increase in prices all round, and the farmer, like every other section of the community, will find his last state very much worse than his first.
– The Minister in another place, in introducing this bill, said definitely that the Commonwealth
Bank had assured him that it could finance the pool.
Senator Sir HAL COLEBATCH.Quite so, but how?
– By the only known means of financing - by creating credits against production, which is not inflation.
Senator Sir HAL COLEBATCH.It has to be remembered that this guarantee of 4s. is really a guarantee of only 3s. 9d. Let the farmers get that firmly into their heads. The Government is taking, in the first place, the exchange advantage that would otherwise belong to the farmer. For instance, if the London parity price at the siding is, say, 3s. 9d., it would amount to 4s. from the point of view of the farmer, because the 3s. 9d. in London is worth 4s. out here.
– The farmer would get the benefit of that. Through the pool he will get all those perquisites.
Senator Sir HAL COLEBATCH.The point is that the Government might easily pretend to the farmer that it has given him 3d., whereas it has given him nothing.
– There will be no change of Government, and the present Government does not pretend anything.
Senator Sir HAL COLEBATCH.That is all very well, but that element must be taken into account, and also the element mentioned by the Leader of the Senate (Senator Daly) in connexion with the increase in the weight of wheat. I suggest to the Minister that he is a little, to say the least of it, careless in the use of noughts. He said -
I secured figures from the Victorian compulsory wheat pool, which showed that the net gain in weight of the wheat handled by that pool during the period that it operated was 8,415,000 bushels.
This is obviously exaggerated. This figure equals 225,000 tons. The Minister should have checked his figures.
– It looks like a mistake.
Senator Sir HAL COLEBATCH.Nevertheless, it is advanced as an argument. As a matter of fact, wheat in South Australia last year actually lost weight. But the point is that the wheatgrower and the wheat-buyer have always known of this increase in weight, and the latter has made allowance for it in fixing his price. In the present circumstances, in addition to the advantage of the exchange rate, the Government will have the advantage of the increase in weight to set against the 4s. guarantee.
– This is a farmers’, and not a government pool, so that whatever advantage is gained by the pool will go to the farmer.
Senator Sir HAL COLEBATCH.The Government has to make up the price to 4s. at the sidings. But I shall come to that point later on. I quite agree with Senator Daly in that I do not think the Government has the slightest intention of making up a single penny. I suggest that there is a great deal that is purely political about this bill.
When we re-assembled after the Christmas holidays, a statement was submitted to Parliament by the Prime Minister (Mr. Scullin) in the course of which he said, “It would be a policy of despair to declare that costs of production and development are too high to permit of the expansion of our industries “. I do not know that the Government has recanted that expression of opinion. This bill is an alternative to an attempt to bring down the cost of production. Ever since it has been in office, the Government has been increasing the cost of production by new tariffs and prohibitions, which are among the things that particularly harass the farmer.
I direct attention now to what I consider not only an injustice against the farmer, but also a gross breach of faith towards this Parliament. In the closing hours of the half session before Christmas, we were induced to agree to the payment of an increased bounty of 18s. a ton on galvanized iron which the farmer uses very freely, because we were told that the Government, without coming to us at all for a bounty, could have increased the customs duty by £1 a ton. The Government could have increased the duty by £2 or £3 if it saw fit to do so. The bonus was granted, but last week a new tariff was brought down increasing by £1 a ton the duty on galvanized iron. We were induced to agree to a bounty on the statement that it was an alternative to the duty, and it is a gross breach of faith for the Government now to put on the extra duty as well. I sug gest that it .is in order to obviate the clear duty of the Government to decrease the cost of production that bills of this class are introduced. They are the alternative; a pitiable and hopeless alternative.
We heard a statement from the Leader of the Senate that any one in favour of the voluntary pool must necessarily favour a compulsory pool. As a piece of logic, that does not appeal to me at all. It is as much as to say that any one who believes that people should be free must believe that they ought to be bound. I neither support nor condemn a voluntary pool; that is not the position at all. My attitude, and I think that of most honorable senators, is that the farmer, having grown his wheat in the face of many and great disadvantages, should be at liberty to dispose of it as he pleases. If he wishes to put it into a voluntary pool, by all means let him put it there. If he wishes to sell to the merchant, by all means let him do so. Senator Daly made a statement to the effect that the farmer’s wheat must ultimately be bought by the merchants at their own prices. What is the farmer’s position at present? He has a. pretty wide choice. He. can put his wheat into a voluntary pool; he can sell outright for spot cash to merchants or millers; he can store his wheat with merchants or millers, getting a liberal advance; or he !can consign it to a commission agent. What good are we doing to the farmer by depriving him of these choices, and telling him that there is only one course he may pursue, and that is to put his wheat into a compulsory pool? A statement that Senator Chapman to some extent corrected last night has been made that two firms practically control the wheat trade in the United Kingdom. Senator Daly said -
Two firms - Rank Ltd. and Spillers - practically control the whole of the buying for the United Kingdom. Not only do they buy two-thirds of all the wheat imported into the United Kingdom but they buy further considerable quantities for smaller mills.
Actually those two firms buy about 20 per cent. The Co-operative Wholesale Society of Great Britain handles 22$ per cent, and other concerns handle 37$ per cent. Since reference has been made to the firm of Spillers, it may not be without interest- and incidentally it indicates that the farmer does noi: always get the worst of the deal - to know that that firm in its balancesheet last year disclosed a total loss of over £170,000. The farmers are not always penalized ‘ because they sell through private buyers. Very often they receive more from that source. We were also told that the whole of the wheat is controlled by the merchant system. I suggest that’ a very large percentage of it goes into the voluntary pools. I do not intend to discuss the war-time pools at length. To begin with, .those pools were a necessity ; they were forced upon us because it was’ impossible to obtain shipping. Our wheat had to be stored for months, and even for years, and it was impossible for the farmer or any one else to carry on without those pools. The result obtained from them was not so successful as the Minister would have us believe. Generally .it was that the Australian farmer realized about 2s. a bushel less for his wheat than’ did the, Argentine farmer, who had a free market all the time. I am not blaming our war-time pools for that. They were forced upon us; -we were bound to them. But if we had had shipping, and, had npt been compelled to have those pools, our farmers would have obtained better results. As soon as the necessity imposed by war conditions was over, everybody was anxious to get rid of the pools.
– Where did the Argentine farmers sell their wheat ?
Senator Sir HAL COLEBATCH.Wherever they could.
– Some of it went to enemy countries. Does the honorable senator stand for that?
Senator Sir HAL COLEBATCH.Whilst I have nothing whatever to say against voluntary pools’, I do not think that the farmer, who is the best judge of whether it pays him to sell to the merchant or to a voluntary pool, shares the opinion of the Leader of the Government in this House, that the merchant is always robbing him. I draw attention to the pools operating in New South Wales, South Australia, “Victoria, and Western Australia, beginning with 1921, and coming down to the present time. In almost every case there has been a substantial reduction in the quantity of wheat sent to those pools, and a substantial increase in the percentage that has gone to private merchants. The New South Wales pool began in 1921 by handling 58 per cent, of the wheat of the State. By 1927-28 that was reduced to 5 per cent., and the pool has now disappeared altogether. Victoria started off in 1921-22 with 78 per cent., got down as low as 12 per cent, in 1927-28, recovered to 28 per cent, in 1928-29, and, with the short crop from last season, I understand that another increase, amounting to half the Victorian harvest, went into the pool. South Australia has remained fairly constant, 36 per cent, in 1921-22, dropping to 19 per cent, in 1927-28, and improving to 44 per cent, in 1928-29. Western Australia began with 96 per cent, in 1921-22, and went down to 58 per cent, in 1928-29. Those figures suggest, at any rate to my mind, that a great majority of the farmers would feel that they had been deprived of their best method of marketing if they were forced to pool the whole of their wheat. Now they have a free choice between pooling and selling to the merchants. They exercise that free choice, and apparently both methods are entirely acceptable to them. We shall be doing them a great dis-service if we remove either.
There was another instance in which Senator Daly was a little careless with his noughts. In an endeavour to demonstrate how much cheaper it would be to handle this wheat through one agency rather than a number of agencies, he said, “ The increase of id. a bushel in an agent’s commission meant a dead loss to wheat-growers of £10,000 for each 1,000,000 bushels . of ‘ wheat produced “. If honorable senators take the trouble to make a calculation for themselves, they will find that id. a bushel represents a little over £1,000, and not £10,000 for every 1,000,000 bushels. I think that it will be admitted that the weight of the argument is considerably destroyed if one of those noughts is struck off.
– The honorable’ senator is unfair, as he is quoting from an uncorrected proof.
Senator Sir HAL COLEBATCH.I am quoting partly from my own notes, and partly from the proof. At any rate, it is just as well that we should understand what the position is.
Senator Chapman gave us a number of quotations from Canadian journals dated, I think, the 7th February last. I should like to make a couple of quotations from Canadian newspapers, one a little before that date, and one a little after. On the 17th October, 1929, Mr. McPhail, President of the Saskatchewan wheat pool, in a long report, which is not entirely hostile to pooling, but which i3 hostile to compulsory pooling, made these observations which are worthy of consideration by every honorable senator: -
The idea that the end justifies the means is the most heinous and fatal thought ever conceived by the mind of man. The truth is that there is no spiritual difference between the means used and the end sought. The means gradually and inevitably become the end. Employ tyranny to secure liberty and you will achieve a worse despotism than the one you meant to abolish.
He goes on to say -
The statement can be made as one of simple fact that compulsion and co-operation are quite the opposite of each other in meaning and effect. Will the possible results (that is, even the results claimed by its most ardent advocates) from the introduction of such a principle, offset or more than make up for the loss of co-operative principles? Lincoln once said, “This country cannot live half slave and half free.” Can a co-operative organization live while trying to reconcile within itself two such utterly antagonistic principles?
Again, he stated -
Just from a purely practical standpoint, can a large number of intelligent men be compelled against their will to submit for any length of time to any form of compulsion?
That is a sentiment that I would commend to honorable senators. I am sure that the farmers of Australia, who are an independent and self-reliant body of men, cannot be compelled against their will to submit to this form of compulsion, and that those who object to it will go out of wheat-growing rather than have their property confiscated in the manner now suggested.
– The wheat agents, who rig the market, also apply compulsion.
Senator Sir HAL COLEBATCH.The agents do not compel the farmers to trade through them. Mr. H. W. Wood, President of both the Alberta Wheat Board and the United Farmers Association of Alberta, speaking on the 8th May, 1930, some three months later than the date of the quotation used by Senator
Chapman, with three months’ experience of what was happening, said -
The agitators want the non-pool man’s rights to sell his wheat in his own way taken away from him. They also want the rights of the pool member taken away from him. They wa.nt to pollute and stagnate these waters with legislative curtailment of citizenship rights. They are tired of a pool. They want a puddle!
I make the suggestion that it would be a very muddy puddle. If one were permitted to use the Shavian adjective to which I am’ sure you, Mr. President, would object, and also to indulge in a Spoonerism, I think that the “muddy puddle” might be converted into something more expressive. The quotation continues -
No wheat-grower, under this legislation, will be a free man with free citizenship rights. The present contract signer will be bound exactly the same as the non-contract signer. We will all be in a trade slave pen together.
That emanates from the president of a pool in one of the largest wheat-growing States in Canada, He continues -
Unless there is a miraculous change in the sentiments of the wheat-growers of Western Canada, there will be an overwhelming majority against the institution into which they have been forced.
Then there is this other very pertinent remark, pertinent to our own position - .
A wise man once said, “ Be very careful about putting out your hand further than you can draw it back”
It has been suggested that at the end of the present contract period we can go back to the old trade systems if so desired. But there will be no trade system to go back to. Both the voluntary contract system and the present open market system will have been destroyed.
That is what we are threatened with here. If this scheme fails, as I am sure it will, we cannot go back to the old satisfactory condition. Senator Chapman said, “We all know that there is a world surplus of wheat.” If so, does it seem to be a very wise thing on the part of the Commonwealth Government to encourage the growing of more wheat ? I do not think it is true that there is a world surplus of wheat. Insofar as there is a world surplus, it has been artificially created by the holding back from the consumers of the commodity that they ought to have had. The holding-up by the American and Canadian wheat pools has checked consumption. It has meant that there are more hungry people in the world than there ought to be. It has incited increased production both of wheat and of substitutes, and so has had the effect that all schemes of this kind must have. I suggest to honorable senators that they read Broomhall’s report that appeared in yesterday’s issue of the Sydney Morning Herald,. There they will see clearly set out the position as to the congestion caused by those methods. So long as governments continue to interfere by means of pools, subsidies, and things of that sort, there will always be more wheat produced than the world can consume at the price, with the result that there will always be loss to governments and growers, and a still more tragic loss to the consumers.
America takes up the only logical stand in a case like this. It says, “If we are to bolster up the price, you must cut down production.” Out of a total production of 864,000,000 bushels. the United States of America itself consumes 636,000,000 bushels. Her exportable surplus is only one-third of the quantity that she consumes. Her position, therefore, not only because of her great financial strength, is such that she is very much better able to face a situation like this. She has only, to push out a fourth of her production, and she can stand a pretty big loss on that without greatly increasing the cost of the two-thirds consumed locally. I do not hesitate to say that the American attitude is an utterly selfish one, entirely indifferent to the world’s welfare. But still that country is in an exceptionally strong position. What is our position ? We can use for seed and food only about one-fourth of what we produce - about 50,000,000 bushels out of a crop which may amount this year to 200,000,000 bushels. As a wheat producing country Australia has proved ‘natural advantages which the legislation of this and preceding governments has seriously impaired. If unduly heavy burdens had not been placed upon our primary producers, we could produce wheat cheaper than almost any other country, and sell it in England at a price which the English farmer could not look at, notwithstanding that the average production per acre of the English wheat-farmer is three times greater than in Australia. We could do this for the simple reason that with our natural advantages the Australian farmer can work about ten times the area per man that the English farmer can ; even if the English farmer gets three times the yield, the Australian wheatgrower can still produce three times the volume of wheat per man employed. Unfortunately, by the character of our legislation, we have saddled ourselves with so many burdens that we now find it impossible to compete successfully in the markets of the world.
Let us face the facts. In 1927 - only three years ago - France, Germany and Italy purchased from Australia no less than 33,000,000 bushels of wheat, representing about 52 per cent, of our exportable surplus. What has happened since then? Increased production in those countries, the use of substitutes, high tariffs and retaliatory tariffs, in some cases, against Australia have closed the markets of France and Germany to us, and last year we sold to Italy only about 3 per cent, of our exportable surplus. By our legislative interference with the natural currents of trade we have closed market after market to our primary producers and imperilled the financial stability of the Commonwealth.
The argument has been advanced by some honorable senators that this is a socialistic measure. I am content to leave this matter entirely to the Leader of the Senate; to allow him to say whether or not it is in accordance with the policy of the Labour party.
– It certainly is in accordance with our policy.
– I have no hesitation in saying that any system of compulsory pooling of production is tantamount to the socialization of commerce in bread-stuffs. This is a conclusion from which there is no escape.
Honorable senators will be interested to learn the views of the farmers themselves on thi3 important question. During the last few weeks I have received no fewer than 100 letters and telegrams from farmers, principally in Western Australia. Every letter and every telegram has urged me to do all I can to oppose the passage of this measure. I do not say that I am influenced by them. My own convictions on this proposal would compel me to do that in any case. Although I am not able to say anything about the standing of the individuals or organizations whose communications I have received from other States, I can say of the letters and telegrams received from individuals or organizations in Western Australia that they come from responsible bodies in the different farming communities, and where the centres are too small for the maintenance of larger organizations, the letters are from the leading farmers in those districts. When it became known in. Western Australia that the ‘farmers were sending these messages to their representatives in this Parliament, Mr. W. D. Johnson, a member of the Labour party, and a man well known and highly respected - at one time he was a member of the State Labour Ministry - wrote to the Perth newspapers, urging all those farmers and organizations that were in favour of the scheme to write to their representatives in this Parliament. That letter was written some time ago, but, so far as I am aware, up to the present it has not provoked a single response. I believe that only one fellow senator has had a communication expressing qualified endorsement of the scheme. The writer, I understand, urged that, it should be supported if the Commonwealth Government would agree to accept full responsibility for any loss that might be incurred from the operations of the pool, and if the pool period were limited to the period of the guarantee.
– The Government will not accept that compromise.
Senator Sir HAL COLEBATCH.This morning I received a telegram from Sir James Mitchell, the Premier of Western Australia, and I feel it my duty to read it for the information of honorable senators. It is in the following terms : -
Wheat scheme. Could it be arranged that Federal Government take full responsibility for guarantee of four shillings same people pay under divided responsibility-
The loss would be a charge against the community in any case - or failing that guarantee four shillings less part of loss if any that would fall upon State leaving State to cover that loss at its option. Inform other Western Australian members. Farmers no doubt want the guarantee and must he given a chance of deciding on pool.
We all know that the farmers are in dire need, and should receive every penny that they can get. If the Leader of the Senate can give us an assurance that he will agree to such an amendment of the bill as would relieve the State of Western Australia from any financial responsibility in respect of probable loss in connexion with pool operations - that is to say, if the Federal Government will agree to carry the whole of the burden - his assurance may influence the votes of some honorable senators in favour of the second reading of this bill. I am, however, bound to tell him that it will not influence mine. I have so many vital objections to this proposal that I would not accept it even on those terms. Repeated attempts were made in another place to have this amendment inserted. All were rejected - I might almost say contemptuously rejected - by the Government; but I put the proposal to the Minister now because I consider it to be my duty to do so, although I have no expectation that he will consider it favorably.
Even if the Government did accept this proposal, there would still be a number, of serious defects in the bill. . The most serious, in my judgment, is the omission of any provision to indicate how the Government intends to provide for any loss that might be incurred in the operations of the pool. There is a stipulation that the ultimate loss shall be divided equally between the Commonwealth and State Governments that are parties to ‘ the ‘agreement; but no one can say what the loss will be, or how it will be determined. Is it to be the difference between London parity and the prices realized, or is to be the difference between London parity and the price paid less such an amount of the difference that may be recovered by charging excess prices for wheat intended for local, consumption? Whichever method is to be adopted should have been clearly set out in the bill, as it is misleading. I go so far as to suggest that had the method, which ever it may be, been stated, the bill would have been found to be entirely objectionable to one or other section of the Australian wheat-growers. If, as seems to be generally accepted, the second method is to be adopted, that is to say, if the Government has determined that any loss must be covered largely, if not entirely, by an. excess price to be charged to local consumers what is the position of those States with the larger populations? I shall give some details on this point before I resume my seat. If the former method is to be adopted, and if the whole of the loss resulting from the difference between London parity and the price realized is to be divided between the Commonwealth and the States, it is clearly impossible for States like Western Australia or South Australia to look at the scheme. Senator O’Halloran last night raised this issue, and gave us to understand that the Government of that State was nervous about its position. Probably we shall soon hear more about this aspect of the scheme. I have had an opportunity, since the debate of yesterday, to read a report on this question in the Adelaide Advertiser. It bears out the statement made by Senator O’Halloran yesterday. It is clear that the Government of South Australia is worried about the present financial position, and it does not see how it could accept any responsibility for a loss in connexion with pool operations.
– Whichever method is to be adopted it should be made known.
Senator Sir HAL COLEBATCH.Tes. This bill differs in one respect from other proposals for the payment of bounties or gifts to industry, in that the States) that join the pool will be expected to share in any loss that may result from its working. This principle is not to be found, -in the Cotton Industries Bounty Bill or any similar measure containing provisions for the payment of bounty.
I have taken out some figures relating to our probable wheat-production which may throw some light on the subject. I do not suggest that they will prove to be exact, because I do not pretend to be a prophet in these matters ; but I think that when we are embarking upon a scheme of this nature we should consider its probable cost. Senator Pearce yesterday suggested an amendment which the President declared to be irrelevant. I have no doubt that every honorable ‘ senator accepts the President’s ruling; but if the bill could be amended in the way indicated, we should know that the Commonwealth would be committed to a definite expenditure. We should know exactly what this proposal is likely to cost. Let us examine the position. The Government Statistician’s forecast, published a few days ago, of the area sown for grain in Australia is 17,000,000 acres. The average yield for the Commonwealth for the last ten years has been 12.20 bushels. It is impossible to say that the coming harvest will give that return, but, looking at this proposal from the point of view of what it is likely to cost, we should pay due regard to the average yield over the last ten years. If the yield next season equals the average, the total wheat-production in Australia will be about 207,400,000 bushels.
– We shall not get that much.
Senator Sir HAL COLEBATCH.Probably not; but if the acreage under wheat is up to the Statistician’s forecast and if the yield is up to the average that is what the production will be. Of that quantity 17,000,000 bushels will be required for seed. The usual quantity reserved for seed is 16,000,000 bushels, but if this scheme is going to encourage wheat-farmers to increase their acreage_we must provide an additional quantity for seed purposes, and 17,000,000 bushels will be about the figure. That will leave 190,400,000 bushels. For food purposes the average requirement is 5 bushels per head of population or a total of 32,000,000 bushels, leaving a surplus to be sold either as wheat or flour of 158,400,000 bushels. If it is sold as flour it will be made from wheat to be supplied to millers at London parity. That is provided for in the bill. I agree with .Senator Ogden that the Statistician’s estimate is probably somewhat high, but we have to accept his figures. Of this I am sure, unless seasonal conditions from now onwards prove disappointing, the figures which I have quoted will be very much nearer the mark than the conservative estimate quoted by Senator. Pearce yesterday. I think he suggested, by way of illustration, an exportable surplus of 75,000,000 bushels. We may not reach 158,000,000 bushels, but it is likely to be nearer that quantity than 75,000,000 bushels. A probable loss of 6d. a bushel would represent some £4,000,000 and if we wished to make up that loss by raising the price of the 32,000,000 bushels sold for local consumption, it would involve an increase of 2s. 6d. a bushel. In this connexion I am sorry to note that within the last two days - even since I made these calculations- there has been a drop in the price of wheat. A couple of days ago, I made my calculations on the London price of 36s. a quarter, or 4s. 6d. a bushel - Liverpool December options - on the basis of Australian wheat being of higher value than that quoted in the Liverpool options, 4s. 9d. a bushel. But to-day, Australian wheat, on the basis of the December Liverpool options, is not worth more than 4s. 7d. a. bushel. There is to be a cash payment at sidings of 4s. a bushel, railage and charges f.o.b., amount to 8d. and freight, 30s. a ton, which is equal to lOd. In connexion with freight alone, there is every probability that the recent action of the Government, under its policy of prohibiting certain importations, will increase the freight against growers of this product. The allowance of freight at 30s. a ton or lOd. a bushel may not prove sufficient. The total of the advance, railage to seaboard and freight at 30s. a ton makes 5s.’ 7d. a bushel, from which has to be deducted the advantage on exchange which is equivalent to 3d. a bushel, leaving a balance of 5s. 4d. a bushel to be paid, and 4s. 9d. to be received on the figures quoted two days ago, or 4s. 7d. on the latest figures - a loss of 7d. a bushel if the market recovers, or of 9d. if it remains as it is to-day. If the loss is to be 9d. a bushel, it will represent, instead of a loss of £4,000,000 a loss of probably £6,000,000.
– Will not the whole of that loss have to be recovered from the whole production of wheat ?
– It has been suggested by those supporting this proposal that it will be recovered from the sales of wheat for local consumption.
– Still the loss would be on the whole crop.
– Of course it would. But if it was desired to make up this loss on the wheat sold for local consumption it would be necessary to take the wheat at 4s. a bushel at sidings, add 8d. per bushel to the point of consumption, and 2s. 6d. a bushel to recoup the loss on wheat sold overseas, which would make the price 7s. 2d. a bushel. I do not know who is going to pretend that we can increase the price of wheat to that extent without increasing the price of bread.
I wish now to come back to the point I previously made concerning the necessity for the Government to state clearly in the bill the method intended. Let us take the case of Western Australia and New South Wales. It may be assumed that each of those States will deliver at railway sidings something like 40,000,000 bushels of wheat. There is no necessity to make anything like an exact calculation for the purpose of these estimates, but 40,000,000 bushels would be about the quantity which these two States would each deliver at railway sidings. If there is a loss of 6d. a bushel, the farmers in each of these States will receive an advantage of £1,000,000 as compared with London parity. If this amount were made up by direct contribution out of the Consolidated Revenues of the Commonwealth and the States, New South Wales and Western Australia would each contribute £500,000. The State in each case would contribute £500,000, and the farmers in each State would get back £1,000,000. Assuming the amount is made up in the other way - by increasing the price of wheat for local consumption by 2s. 6d. a bushel - Western Australia, with its comparatively small population, would contribute only £287,500 and receive £1,000,000- an advantage of £713,000. On the other hand, New South Wales, because of its large population, would contribute £1.312,500; so that the scheme would be a disadvantage to that State to the extent of £312,500.
The bill provides that the State boards shall fix the price of wheat for local consumption. No other provision can be made, because thi3 Parliament has not the constitutional power to fix the price of any commodity for sale for local consumption. In these circumstances, the fixing of the price has to be left to the State boards, but there is no guarantee that the State boards will fix a uniform price all over Australia. The State Wheat Board in Western Australia would say, “ We know our Government cannot find £500,000. We must take it from the local consumer. We are not concerned with the fact that this will relieve the Commonwealth of the necessity of paying £500,000.” The New South Wales board would, say, “ Let the Commonwealth Government pay its £500,000; we will pay our £500,000 and will be £500,000 to the good. We shall get £1,000,000 for £500,000; but if we increase the price in order to cover this loss, we shall be charging our own people £1,312,500 for the £1,000,000 they are to get.” How can it be assumed for a moment that these State boards will come to a like decision when their interests are so opposed to each other ? [Extension of time granted.]
I wish now to refer to paragraph 7 (2) of the schedule, which reads -
That means that all the wheat at present held over from the previous harvest is to be confiscated. I do not know the quantity, although I have endeavoured to get the information, but I understand that it is in the neighbourhood of £4,000,000 worth- probably 20,000,000 bushels or perhaps a little more. That quantity is to be confiscated and those who produced it will not receive any portion of this subsidy. They will be deprived of any opportunity they may have to market it. Because we cannot constitutionally provide for the confiscation of the wheat, we are insisting, by means of this bill, that before any State shall be allowed to become a party to this agreement, it must undertake to be associated with this confiscatory work. I cannot see that there is a single element of justice in the confiscation of wheat grown before the operation of this pool.
My main point in this regard is that the method of meeting the loss should have been clearly stated in the bill. The Commonwealth Government has no right to say, as it does practically say in this bill, that it will meet one-half of the loss, if it is the intention that that loss shall be spread over the consumers in the States. The
Government’s objective, however doubtful, should be clearly stated. in the bill. I would also suggest that if we are to have this increase of prices that factor compared with the increase of prices that is likely to follow a note inflation - which seems to be inevitable under this measure -will rob the farmer of far more than the advantage he will get out of this guaranteed price.
I regard the bill in its present form as frankly dishonest, because it conceals the intention in a case where the intention should be clearly stated. No one sympathizes more than I do with, the position of the Australian farmer, who, as we all know, has been increasingly burdened from year to year for a long time. I am utterly opposed to the system of bounties or bonuses, and would not in any case go further than has been suggested by the economic committee, which recommended that where there is a probability of an industry being firmly established, and where that industry is at a comparatively small disadvantage as compared with other countries, the granting of some assistance may be legitimate. To that extent I should be glad to support any motion to .give the wheatgrowers a portion of what has been taken from them in the interests of other industries over so many years. The Prime Minister, replying to a deputation which waited upon him yesterday,’ said that the policy of the Government was to encourage by bounties and bonuses only such industries as could establish themselves and stand upon their own footing. I have yet to discover a single industry in this country that has been favoured by high protection or bounties which has been able to stand on that basis, and which has not come to Parliament again and again clamouring for higher protection as in connexion with the galvanized iron manufacturers to which I have referred. I shall have no hesitation in voting against the bill. I sincerely hope, not only in the interests of the State which I represent, but in the interests of Australia generally, that this measure which is bound so profoundly to disturb the whole financial and commercial life of this community, will be rejected by the Senate, having, as I am sure it has, a full sense of the responsibility it owes to the people of Australia.
– I am not surprised to learn that Senator Colebatch intends to vote against this bill, because he has opposed every measure introduced by the present Government. Surely the honorable senator is prepared to find some good in the policy of the Government?
– I hope I shall find it some day.
– If the Government were disposed to grant a bonus on gold, the honorable senator would applaud it; but anything in the nature of a bounty to benefit States other than Western Australia meets with his opposition. I propose to read an extract from the Sydney Evening News, which cannot be described as an organ of the Labour party-
The world’s wheat production since the Great War, excluding the production of Russia and China, has varied from 3,000 to 4,000 million bushels per year. When only 3,000 million bushels represent the world’s harvest competition is keen, and prices are high, whereas when the harvest reaches 4,000 million bushels pressure to sell reduces the value to what is regarded by wheat-growers as non-paying rates.
China’s wheat harvests vary, according to their poorly-collected records, from 320 to 450 million bushels, but as China’s population is somewhere about 450 millions, it only represents a bushel per head of her population, while Australia consumes an average of about 6 bushels per head.
The article goes on to point out that the people of Eastern countries, including China, Japan, and the Straits Settlements, are acquiring a taste for wheaten bread, although for many generations rice has been their staple food. The article in the Evening News continues -
Before the war India produced from 320 to 340 million bushels per annum, and frequently exported from 50 to 80 million bushels. Since the demobilization of her army, India has been producing the same amount of wheat annually, but her exports have practically ceased, the inference being that the Indian population has acquired a greater taste for a wheat diet.
Japan has been yearly increasing her wheat consumption, and last year the Canadian Voluntary Pool exported from Vancouver to Japanese ports nearly 30 million bushels of wheat.
The trade was so good that they did not have sufficient wheat to export, as the following paragraph indicates: -
In addition, she purchased from the Pacific Coast of the United States of America, and a small quantity from Australia. Evidences point to an increase in the consumption of wheat in most Eastern countries, and Australia’s proximity to these centres should afford trade advantages.
Later, the article referred to lost markets in the following terms : -
About 1909 Canada, Argentine, and Australia exported approximately the same quantities of wheat yearly, namely, between 50 to 66 million bushels. In 1928-29 Canada exported 400 million bushels, Argentine about 280 million bushels, and Australia less than 100 millions.
It is obvious, therefore, that there are valuable overseas markets that we are not exploiting to their full advantage, and our slogan might well be “ Grow More Wheat.”
The slogan of the Scullin Government is, “ Grow more wheat.” If during the war, when the nation was fighting for its life, Nationalist Governments found it necessary to resort to compulsory pools, should we not in these days of financial stress, do the same? That the farmers of Australia realized the wisdom of increasing their wheat production is shown clearly by the statistics concerning wheat contained in the Commonwealth YearBook. On page 675 ofthe latest issue of that publication, there appears the following statement: -
Since that time, the area under cultivation has increased to 17,000,000 acres.
– That is so. The statistician’s figures are a complete answer to the arguments of the Leader of the Opposition (Senator Pearce), and Senator Colebatch. On the same page that I have mentioned, the following paragraph appears: -
Progress of wheat-growing: - Area and production. What is the principal crop raised in Australia, and its development during the past 30 years constitutes the most interesting feature of Australian agriculture. Since 1895when the area under wheat amounted to 3½ million acres, an average of 265,000 acres has been added annually, until in 1927-28, more than 12¼ million acres were cut for grain.
Those figures show that the farmers of Australia have been prepared to respond to the invitation to grow more wheat. Within the last 48 hours Senator Lynch, who has spent a lifetime in the cultivation of wheat, has sent a telegram stating that he is opposed to the pooling system, lock, stock, and barrel.
– He is a big grower of wheat.
– I am aware of that. The honorable senator’s opinion has changed considerably since the 28th August, 1919, when he moved in this Senate -
That as the safety and advancement of the Commonwealth demand the adoption of a spirited public policy that will aim at utilizing to the utmost its great advantages of climate, soil, and ample territory; and as the present baneful tendency of the time is to encourage and aggrandize urban life and urban activities at the expense of and injury to rural prosperity; and as a consequence the tide of population has steadily set towards the city to the abandonment of the countryside, and as the wheat industry, which stands out immeasurably over all industries, rural or urban, in providing homes and employment for the greatest number of people, shows signs of arrested development, if not actual decline; therefore, the Senate is of opinion that -
Neither the vital needs of the nation nor the highest principles of social or industrial equality require that -
That parent industry should be any longer sweated for the benefit of other industries without countervailing advantage, nor
a vast number of people employed in it should be condemned to a joyless existence of excessive hardships and ill-rewarded toil, nor
the industry itself should be called upon to contribute an undue share to the upkeep of the nation; wherefore in respect to these considerations the Senate is further of opinion that -
1 ) to insure a living wage for the wheat cultivators of the Commonwealth; and
to successfully reclaim the immense areas of light and semi-arid soils for which the wheat industry offers the only hope for their profitable utilization ; and
to cause a permanent and prosperous peasantry to be rooted in the soil.
The Commonwealth Government should guarantee a fixed minimum of 5s. per bushel at ports of shipment on the exportable surplus for the next five years, with a corresponding value for the quantity required for home consumption; and
Should the London parity be above or below such guaranteed minimum the National Treasury to be debited or credited to the extent of the difference in each year.
– His proposal was entirely different from the one now before us.
– Why has Senator Lynch changed his opinion?
– He has not.
– In 1919, Senator Lynch spoke of the necessity of protecting the farmers,but since that time his views have changed. Like other honorable senators, I have received numbers of letters and telegrams from persons and bodies interested in the wheat industry. I do not regard them as a form of intimidation, for I realize that the wheat-selling agents are entitled to present their case to this Parliament. I compliment Senator Chapman on the able manner in which he shattered the arguments of Senator Pearce in opposition to this bill. Senator Chapman quoted statistics from all over the world. So far as wheat go-getters are concerned, I remember on my return from overseas at the end of 1919. that the public mind in New South Wales was greatly exercised over the maladministration of a wheat pool by a board appointed by a coalition government, representing the Country party and the Nationalist party, which was at that time controlling the political destinies of New South Wales. I do not blame that Government. It had no voice in the matter under the regulations controlling that particular wheat pool. But the result of the mal-administration of the board was that, although some made fortunes, others suffered material losses. The condition of the pool was chaotic. Ample provision has been made for the protection of the farmers in the provisions of this bill. Farmers will be represented on the board in control of the pool in each wheat-growing State. Because the Scullin Government has decided to take the buying and selling of wheat from the agents the latter have gone into the highways and by-ways and by means of shoals of letters and telegrams attempted to set up the bogy that if this pool is created everything will be all wrong. Senator Lynch went on to say -
This motion may strike some honorable senators as being, perhaps, rather long; but I may allay any fears by stating that while there may be a few extra words in it, I find it impossible to drop out any without taking from it some of its significance and weight. Stripped of its necessary preamble, the motion asks the Federal Government to guarantee to the wheat-growers of the Commonwealth for a stated period a certain sum per bushel for their produce; to standardize, or - if I may borrow a word that has been largely used during the war period - to stabilize that industry in this country.
– Senator Lynch did not ask the State Governments to join in the giving of a guarantee.
– The Scullin Government has gone into this business with clean hands. It has asked the State Governments to co-operate with the Commonwealth Government. In this connexion I want to refer to an article in the Labor Call, a little weekly issued in Victoria. Senator Pearce quoted from it yesterday in an attempt to lead the people of Australia to believe that the Scullin Government was following in the footsteps of Russia in its endeavour to socialize industry. The right honorable senator seemed to infer that the Commonwealth Government is taking orders from Moscow. Socialization of industry was an objective of the Australian Labour party long before the Russian revolution was ever thought of. It is an objective of which ho one need be ashamed, and, so long as it remains in the forefront of the Labour party’s policy, and, so long as I am a member of the Australian Labour party and a senator representing New
South Wales, I shall stick to it. The extract I wish to read from the Labor Call is as follows: -
Wool Growing v. Grain Production. illustrations of prosperity under wheat growing.
A gathering was held on Saturday, as a response to an appeal by the Premier (Mr. Hogan) by the heads of State Departments, to consider the questions of economy and efficiency, combined with the questions of more production and unemployment. . . .
Mr. Hogan said
The Government was not trying merely to prune; it was endeavoring to induce the production of more wealth that would, incidentally, produce more revenue and more prosperity.
The Labor Call comments as follows : -
Where the Land Is.
We have become used to slogans to assist the producer in his various occupations, such as “Eat More Fruit,” “Drink More Wine,” “ Use More Wool,” &c. ; butnone of them, apparently, have helped the grower to any appreciable extent. The Premier has invented a new one - “ Grow More Wheat.” It looks well on paper, and has made a stir in farming and commercial circles, but the question is: Where are the 1,000,000 acres in Victoria suitable for the purpose. It is one thing to say sow more grain, and another to reap the harvest.
Victoria is blessed with any quantity of good agricultural land suitable for the purpose of growing wheat or any other product; but, alas! this land is in the hands of the land monopolists, who graze a few sheep, cattle or horses on acres that would produce millions of bushels of grain. He iswell entrenched in his selfishness, and is not likely to give his land up to wheat-farming even in a national crisis. And we are in the midst of a crisis which will become worse before it improves. . . .
This is good solid advice, but will it be complied with? We think not. If the land in question was shown to be ideal for the purpose it would never be allowed to revert back to its present occupation. The trouble with Victorian wheat-growing, except in certain districts, is the production of grain is too much of a gamble. The rainfall is insufficient and uncertain, and farming is too precarious for inexperienced men to undertake. People are now “ settled “ on land which is impossible. Sons of Victorian farmers are leaving the State because there is no suitable land to farm. They migrate to the Northern State, and the West, where wheat-growing is now progressing beyond all expectations on land formerly held by land monopolists and speculators. The Midland Railway is a case in point. Formerly the land adjacent to the railway was cut up in blocks. The good land was held by the Midland Company, and the poor areas thrown open to the public. This lias been altered of recent years; and now Westralia, under a sound Labour Government, is becoming the granary of the Commonwealth. This Australian State, one time ridiculed under the appellation of the Three S’s ( “ Sand, Sorrow and Sore eyes “ ) is under shrewd legislation becoming a marvellous land in transformation.
Under the six years’ administration of the Collier Government, the wheat industry has extended in Western Australia and vast holdings of private enterprise have been subdivided in the interests of people coming from the other States to
Duy land in Western Australia. I remember reading some remarks made the other day by Sir James Mitchell, the new Premier of Western Australia. He said that he was not totally opposed to the Scullin Government’s appeal to grow more wheat; that, while he did not go out and support it holusbolus, he would not say anything that would be likely to injure what Mr. Scullin was endeavouring to do in the interests of the nation. In this chamber we have heard references to the Australasian Council of Trade Unions. Honorable senators opposite have termed the Australasian Council of Trade Unions a bolshevik organization, a collection of communists, strikers, disloyalists, and have applied to it many other abusive epithets. Mr. Duggan, its president, in reply to some remarks made by a Mr. Linton, said - “ If Mr. Linton devoted his efforts to getting employment for the unemployed he would then get more production.” Mr. Duggan continued : “ The appeal by Messrs. Scullin and Hogan for greater production of wheat was not an appeal to those already engaged in this work to work harder or longer. It was a sensible suggestion that land now used for other purposes should be devoted to wheatproduction. In other words, to increase the acreage for the production of this necessary commodity. The workers are already producing more than they can buy back, and it is only natura) that with more employment for the thousands of unemployed increased production would be the inevitable result.”
Many of : the arguments advanced by the Opposition have been to the effect that we should not produce more wheat. Personally, I think that there is an underconsumption of wheat in Australia.
I believe that I shall be in order if I refer to the lengthy diatribe of the right honorable the Leader of the Opposition (Senator Sir George Pearce) upon Russia and wheat-growing on State farms in that country. The right honorable senator contended that the Australian Labour Government was following in the footsteps of the Russian Soviet. Following a very wearisome custom he trotted out a very dilapidated bugbear, and indulged in a considerable amount of hysterical piffle about the red bogy that threatens Australia. That was all bunkum. I have in my hand a work by a very eminent’ gentleman who is known throughout the English-speaking world, Dr. E. J. Dillon, one of the most prominent scholars of Europe. Dr. Dillon spent many years in Russia under the regime of the czars in the capacity of professor in a Russian university, and he wrote this very interesting work on that country. The volume was issued last year. It is in the library and will be available to honorable senators who desire to peruse it. Here is an extract -
European Russia, when I wrote my report many years ago, comprised nearly 1,237,000,000 acres, of which 1,019,000,000 were registered. Nearly one-fifth of that surface was found to be unproductive and two-fifths were at the time under forests. The remainder was partly meadow and pasture ground, and partly arable land, in the ratio of two to three. Two-fifths of the registered acres were the property of the Crown, one-third (317,000,000 acres) was held by the Feasants’ Communes, and onefourth part was owned by some 500,000 private proprietors. The system which obtained amongst the rural peasant proprietors was, to a very large extent, that of communal holdings. The peasant in those days was prevented from improving his method of agriculture owing, mainly, to usages which he was powerless to break through. One of these was the three-field system, which was firmly established and religiously observed. The distance of the peasants’ abodes, often in large villages as much as 10 or 12 miles from thu holdings of the bulk of the inhabitants, was another deterrent. Then, again, security of tenure, an indispensable incentive to improvement, was made impossible by the periodical redistribution of the holdings. To-day, therefore, despite many adverse circumstances, the annual output is potentially much greater than in that epoch; in fact, if the country has not yet become again the granary of Europe the reason is not in the quality of either soil or labour.
Since the Soviet Government has been in power in Russia that country has adopted a different system of wheatgrowing, wi;th considerable, ((success. Now, I do not think that the United States of
America possesses business men of higher calibre than those to be found in the Motherland. I hold the belief that the British Empire has just as shrewd business men as has the United States of America. Unfortunately, the Mother of Parliaments has been controlled by Conservatives, while the House of Lords has been guided by the blue-blooded nobles of - England. That combination decreed that Great Britain should not trade with Russia until that country liquidated its national financial obligations.
– I cannot see the least connexion between the remarks of the honorable senator and the bill before the Senate.
– I am leading up to my point, Mr. President. As a result of that attitude, the Soviet Government was compelled to go elsewhere when, it desired to do business, and it placed an order with the United States of America for thousands of farm tractors. They were distributed -to the Russian people, and were the means of placing immense areas of country under cultivation. Dr. Dillon intimates in his work that the Russian people have acquired a taste for wheaten bread, and says that for many years the vast population of that country will be more than capable of consuming all the wheat that is harvested there. What a splendid opportunity the Government of Australia missed. We are only a few weeks steaming from Vladivostock, a great Russian seaport, and the doorway to a market for vast quantities of our wheat.
– Nonsense! Russia will be exporting millions of bushels of wheat.
– There is no nonsense about it. Because of our much vaunted British integrity we refused to exploit the markets of Russia. Again, we made absolutely no effort to establish markets in Japan for our products.
– We have been sending many tons of our wheat to Japan.
– Senator Colebatch is aware that Japan, with its population of 48,000,000, relied at one time on the soya bean as its staple diet, but that it has now developed a taste for wheaten products.
– The honorable senator’s Government is destroying the Japanese market by shutting out that country’s exports.
– The following leading article appeared in the Sydney Pictorial of the 25th June, 1930 :-
Undeterred by present low prices and. past bad seasons, the wheat-farmers of Australia are making a gallant effort - one that promises well both for- themselves and the country. ‘
The aggregate area under wheat is expected to be in the .vicinity of 17,000,000 acres. This is 4,000,000 acres, more than the previous best in 1015-10.
I remind honorable senators that in 1916 we had a government in power, of which the present Leader of the Opposition in the Senate (Senator Pearce) was, a prominent member. Under the stimulating effect of the Labour Government’s administration, Australia has increased its crop by 4,000,000 acres over that under cultivation at the time that the right honorable senator’s government was in office. Does that not indicate the confidence of the people in what honorable senators opposite term a wild, Bolshevik Government, one that allegedly takes its orders from Moscow? The article continues -
The average yield per acre throughout Australia has, over the ten-year period, 1918-28, been 12 bushels. If the present favorable indications are a criterion, the crop should reach 200 million bushels, or more than 20 million above the 1910 record.
In any event the optimism, courage, and resource of the growers are a splendid example to the rest of Australia.
Even Providence is on the side of this Government, as is demonstrated by the bountiful rains which the country has enjoyed recently. During the maladministration of the Bruce-Page Government the country was, unfortunately, subjected to devastating droughts; That condition, coupled Avith shocking administration, reduced a glorious country to its present precarious financial position. A further article taken from the Sydney Pictorial of the 25th June, 1930, reads -
17,000,000 Acres under Crop this Year.
The Commonwealth Statistician has figures on which he predicts a new wheat record for Australia of 17.000.000 acres under crop.
On latest returns, Canada (nearly 38 per cent.) has displaced Russia as the world’s greatest wheat exporter.
Australia has climbed from lowest to fourth position, contributing nearly 12 per cent. of the world’s supply.
The time is rapidly approaching when the Commonwealth as a world’s wheatproducing country will come into its own. Official publications issued by the Government of the United States of America suggest that the most serious problem likely to come before it in the near future is the feeding of its vast population which already numbers 125,000,000. It would seem, therefore, that in the course of a few years Australia should be in a particularly favorable position as a supplier of wheat to other countries.
– The honorable senator spoke at length about the position of the Argentine Republic and the United States of America as wheatexporting countries. Great Britain should, if possible, obtain its wheat from within the Empire. During the war Australia stood loyally by the Mother Country in her hour of danger, so it should be the duty of those who control the huge business agencies in Great Britain to look within the Empire for their wheat supplies. Australia and Canada are in a position to meet the Empire’s needs.
– A great deal of British capital is invested in the Argentine.
– I am aware of that. But the Latin Republics of South America have nothing in common with the British Empire, so all our efforts should be directed, to inducing the Mother Country to secure her requirements in foodstuffs from Australia or the sister dominions. During the war, the Argentine supplied immense quantities of foodstuffs to Germany through Norway, Sweden, Denmark and Holland. Russia at present is fully occupied in endeavouring to meet the requirements of its own people in wheat, so Australia’s future as a wheat-growing country should be assured.
New South Wales, Victoria and South Australia have agreed to join the pool, and Sir James Mitchell, the recently elected Premier of Western Australia, has adopted a sportsmanlike attitude,declaring that he will not use his influence for or against the scheme, but will allow the farmers themselves to decide. We shall take him at his word. All the evidence from Canada strengthens the case for a compulsory wheat pool in Australia. Prior to the inauguration of the Canadian wheat pool, the Canadian wheat harvest was controlled almost entirely by operators in the Chicago wheat pit.
The Sydney Worker, in a recent issue, strongly supported the Government’s scheme. I take the following extract from an article that appeared in that journal : -
In the Federal Parliament last week an Australian Wheat Marketing Board was provided for, consisting of one representative of each State Board vested by State law with power to acquire on behalf of the producers all wheat produced in the State, to give the wheat as security for advances, and to sell the. wheat tothe best advantage. This Board would not come into existence unless three or more States appointed their Marketing Boards and the producers had a majority of the representatives on the State Boards. The powers of the Australian Wheat Board would be, in respect of wheat and flour . . .
To encourage production it was pointed out that the general policy of the Government was to stimulate and encourage both primary and secondary industries, and the bill was an endeavour to give legislative sanction to the things which the leaders of the wheat industry and all prominent organizations concerned had agreed upon as being necessary for the protection and encouragement of wheat-growing. The proposal was to assist the wheat-growers to control their own business by providingthe necessary legislative machinery for compulsory wheat pooling, and when the scheme fully functioned the boards would be able in each year to make satisfactory arrangments for the handling, transport, selling and financing of wheat. World importation conditions had undergone a great change since the war, and if they did not organize in Australia the industry would be at the mercy of overseas combines and manipulators.
I have worked in the wheat fields of New Zealand and Australia, and I know something of the difficulties of our primary producers. This Government desires to help our wheat-farmers just as it wishes to help our manufacturers and the workers generally. Obviously, it would not be to its interest to bring forward any scheme that would not be for the benefit of our primary producers. In several of the State Parliaments farmers are sitting in the ranks of the Labour party, and subscribe to its policy. In this Parliament also there are several primary producers in our party, and throughout the country thousands of wheat-farmers are supporting it. This great body of farmers is behind this scheme.
Senator Colebatch is entitled to his opinion concerning the character of this project. All I need say to the honorable senator is that this Government is thoroughly honest in its purpose to assist the wheat-growers, and I am convinced that many thousands of producers will vote in favour of the scheme because they know they can trust this Government to deal fairly by them. [Extension of time granted.] The Leader of the Opposition (Senator Pearce), in his speech endeavoured to mislead the people into ene belief that this proposal meant the socialization of all industries. All that the right honorable senator said about Labour’s policy being influenced from Moscow was so much camouflage. I tell him now that the Australian Labour party does not accept dictation from Russia. I give the right honorable gentleman’s . allegation an emphatic denial. I have been identified with the Labour movement for over twenty years, and I know what I am talking about. This scheme has been introduced in the interests of the farmers of Australia. I wish it every success, and I urge honorable senators opposite to assist the Government to pass the bill.
– This is one of the most important measures which the Government has introduced during this session. It affects directly many people in the wheat-growing States, and, indirectly, the welfare of the people of Australia. Since the scheme was enunciated by the Minister for Markets and Transport (Mr. Parker Moloney), honorable senators have received a good deal of correspondence in the form of letters, circulars, and publications urging them to vote against the bill. During the debate many of the old objec tions to a compulsory wheat pooling system have been resuscitated in a new form, and one or two new objections have been propounded by the Leader of the Opposition and Senator Colebatch. 1 intend to pay very little attention to the propaganda which has reached me through the press, and from different organizations urging us to vote against this measure, because the marked similarity between many of these publications strongly suggests that they have originated from the same source. A little later I shall be able to make a few comparisons to show that there is something in this contention. I think it is a matter for regret, from the stand-point of those trying to defeat the measure, but a matter for rejoicing on the part of those who consider that it is in the interests of the farmers and of the nation, that there has not been more cohesion among their forces. For instance, the Wheat Producers Freedom Association of South Australia has sent a document urging me to vote against the bill for reasons which it sets out. One reason is -
You would reiterate that the proposed compulsory wheat pool-
This was in reply to a speech made by the Minister for Defence in another place- merely gives the control of the farmer’s wheat to the elected representatives of farmers. We must emphatically deny this. So long as the public funds are employed to finance a wheat pool, so long as the taxpayers of the States and Commonwealth are committed to a guarantee of, say, 4s. per bushel at country stations, then so long must the Government’s nominees on the State and the Australian Wheat Boards, respectively, exercise the final voice in all matters of policy affecting .the marketing of the wheat. . . .
That association urges us to reject the bill, because it says that the system of control which the bill proposes, and which the Government assures us it insists upon, is only a snare, and will not actually operate.
– In what clause of the bill is that system of control mentioned ?
– I shall deal with that shortly. Another communication has been circulated by a Mr.’ Joseph, a gentleman in Sydney who has been very active in writing letters almost daily for some time past. Mr. Joseph gives reasons why we should reject the bill.
– Who is he?
– Apparently, he is a mercantile broker and manufacturers’ agent, whose activities are confined to Sydney. This gentleman asks us to reject the bill for reasons the reverse from which I have just quoted. He states - . . One is that the whole scheme is under the control of a board composed of one representative (only) of the Commonwealth, and three or more members appointed by authorities outside the control of the Commonwealth. This means that Parliament is vesting the control of an indeterminate appropriation from the Consolidated Revenue Fund to a more or less fortuitous body together with the control of the export of all Australian wheat and interstate traffic in same.
Surely this is a large order. But the matter does not rest there: The board may delegate most of its powers and functions to the State Wheat Boards, and if they choose to do this the Commonwealth is virtually handing constitutional powers exclusive to itself to a body over which it has no control whatever. . . .
Mr. Joseph asks us to vote against the measure because we are vesting too much control in the wheat production of this country in the hands of elected farmers’ representatives.
– Does he not refer more particularly to the method of appropriation ?
– He does not confine his remarks to the appropriation of money, but deals with the handling and export of wheat as well as the traffic in that commodity between the States. The Leader of the Opposition asked in what clause of the bill provision is made for the representation of farmers on the Wheat Board. The bill -‘confers upon the Commonwealth Government the power to make agreements with State Governments accepting the principles embodied in this measure. The main principles to be incorporated in the general scheme of wheat pooling were agreed upon at the conference held in Canberra some time ago, one of which was that the growers and the State Governments should elect a representative to the board.
– Where is that provided for in the bill?
– It < is not in this measure, but is in the agreement adopted at the Canberra conference, and that is the principle accepted by the
State Governments which have agreed to co-operate with the Commonwealth authorities. If the growers have a majority of representation on the State wheat boards they will also have a majority representation on the Australian Wheat Board.
– That is provided in clause 5 of the bill.
– Yes ; but such details can be discussed in committee.
At this juncture we should consider the acceptance, or rejection of the principle of an Australian compulsory wheat pool. The Leader of the Opposition raised many objections, and produced arguments, many of which have already been submitted to honorable senators in the form of propaganda. The right honorable senator maintains that, the present system of a voluntary pool operating in competition with wheat merchants is preferable to anything in the nature of a compulsory pool. He replied to the contention of the Minister (Senator Daly), that that the purchase of wheat in Great Britain is becoming more and more a monopoly, by saying that the same number of buyers are operating there to-day as was the case last year. A multiplicity of buyers or buying organizations in Australia necessarily leads to a multiplicity of sellers, and everyone with a knowledge of the wheat business knows that a multiplicity of sellers has a tendency to affect markets. If a multiplicity of buyers in Australia leads to competition between the buying agents, in their desire to secure wheat from the producers, one might counteract the other, but, as pointed out by Senator Chapman last night, and on many other occasions by royal commissions and other authoritative bodies that have investigated the problems associated with wheat producing and selling, there is always an agreement between the wheat merchants in Australia as to the conditions under which they will purchase the Australian crop.
– Does the honorable senator suggest that similar conditions exist in connexion with wool?
– Surely the honorable senator realizes that the method of selling wool is just the reverse. Wool is sold by public auction in the open market to buyers who come from all parts of the world, but wheat is sold to buyers’ agents throughout Australia, who in turn become the sellers of the produce in the open market. The Leader of the Opposition said that in Canada the pools had failed, and that their operation had caused a slump in prices in that dominion. The right honorable gentleman has misinterpreted the position. The pools in Canada have not failed, and had it not been for the influence of the Canadian voluntary pools, the price of wheat in Canada would be lower to-day, as also would be the price in Australia. The Canadian pools have been subjected to attacks from two sources. First, from the private dealers of wheat in America and Canada, who desire to destroy the contract pool of the Canadian provinces in order to secure the whole field for themselves. Secondly, the principal wheat markets have been severely attacked by the competition of subsidized wheat produced in France and in Germany, which has brought about a reduction in the price of Australian and Canadian wheat sold in Great Britain. Had it not been for the stiffening influence of the Canadian pool, the price of wheat would have slumped considerably more than it did, and there would have been a repercussion in Australia.
After discussing the bill for some time, the Leader of the Opposition (Senator Pearce) diverged altogether from the subject, and, as it were, crossed the seas to Russia to give us a long dissertation upon the methods employed by the Soviet Government. That he did so is clear evidence of the weakness of the arguments of the opponents of the bill. Instead of discussing it on its merits, they tell us what is going on in Russia in order to lead us to believe that the things which are happening there will also happen in Australia if the Labour party is allowed to give effect to its policy.
– The full effect of the Labour party’s policy can be seen in Russia.
– It has been said that the Labour party is out to take possession of the farms, the wheat, the stock, and plant, and everything else which is now the property of the farmers of this country. The party is accused of desiring to conscript everything associated with agriculture. That statement has been repeated again and again by men who ought to know better. Unlike the party represented by honorable senators opposite, the Labour party makes no secret of its policy. Indeed, it is only too pleased to publish it abroad so that all who care to interest themselves may read it. The Labour party knows that a proper understanding of its policy will attract to it many thousands of new supporters. Seeing that the policy of the Labour party has been brought into this discussion, I desire to refer briefly to that section of it which deals with the subject before us, and underlies the decision to place this measure on the statute-book. Under the heading “Labour’s Country Policy” appears the following: -
The promotion and extension of the agricultural and rural industries by the establishment of a Federal Bureau of Agriculture to co-operate with similar State bodies, with a view to organizing all those engaged in primary production into a unified body, so that they may be able to more effectively place their views before governments, and to generally co-operate and assist in giving effect to the following policy: -
The encouragement of co-operation among primary producers, in order to bring consumers and producers into direct communication;
The provision of more up-to-date methods of marketing our products, both locally and overseas.
In the . spirit of co-operation mentioned, this bill has been introduced.
Having dealt briefly with the objections of the Leader of the Opposition (Senator Pearce), I desire now to refer to some of the matters referred to by Senator Colebatch. The honorable senator seems to be very concerned as to how the wheat pool will be financed. I remind him that during the war a compulsory pooling system was in operation for a number of years, and that at one period on account of a dearth of shipping we had practically the whole of the exportable surplus of two harvests stacked in the Commonwealth. At the same time, there was a tremendous drain upon our financial resources due to the necessity for training, equipping, and sending abroad hundreds of thousands of soldiers to fight for the Empire. Even in those difficult days, Australia found it possible to finance a wheat pool. The farmers were paid a first advance on their wheat as soon as it was delivered by them.
– When they parted with it, they got the value back in Australia.
– That is so. At times it took twelve months, or. even two years, to part with a bushel of the exportable surplus.
– It was not paid for.
– A first advance was made. At one time the overdraft was something over ?17,000,000. If we could do those things when the country was at war, we ought to be able to do them in. a time of peace. I suggest that there is no real difficulty in financing the purchase of the Australian wheat crop. The millions of pounds which the merchants are supposed to bring from abroad to pay the Australian farmers for their wheat are mythical; the Australian farmer provides the payment for his own wheat. Unlike Topsy, wheat does not merely grow; the land has to be carefully cultivated, super-phosphates must be purchased and the seed planted before a crop can be obtained. When that has been done, the farmer must wait for several months before the result of his labour is known. Even then he must harvest the crop and cart it to the receiving depot before he receives a penny for it. Up to that time, the whole of the cost of production has been met by the farmer himself. The only amount to be supplied by the purchaser, so far as the national credit is concerned, is that very small percentage of profit made by the farmer, because he, or someone on his behalf, has provided either cash or credit to produce every bushel of wheat reaped. The moment he sells it to the merchant it becomes available for sale abroad. In fact, merchants will not buy wheat unless it is available for sale abroad. ‘ The moment it is placed on board ship for its oversea destination, it is covered by insurance, and becomes liable for advances made at the other end against documents for wheat delivered. I do not say that the wheat merchants have not to arrange for credits; but I do say that those credits are provided by the work of the farmer in producing wheat, which forms a portion of the wealth of the country. The bulk of the cost of producing the wheat is provided by the farmer. If private wheat-buying firms can arrange for credits to purchase hundreds of thousands - of bushels of wheat, it is obvious that, under a pooling system, Commonwealth and State Governments would have no difficulty in that connexion. Senator Colebatch also suggested that the extra value created by the present exchange position - a premium of 3d. a bushel, which is made available to those selling wheat outside of Australia to-day - might not go to the farmers, because the Government might take it. I ask in what way could the Government take it?
Sitting suspended from 6.15 to 8 p.m.
Private, business taking precedence after 8 p.m.,
In committee: (Recommittal). Consideration resumed from 19th June (vide page 2925)-
Senator Rae has moved
That the following new clause be inserted: - “ 04a. No person shall insure the life of another, over the age of sixteen years, without the written consent of such person.”
– I have examined the proposed new clause as I promised to do, and I regret that I cannot accept it. Notwithstanding the remarks of Senator Daly, I feel that in its application the provision would be too drastic and too far-reaching. The cases cited by the honorable senator as to an unfortunate couple at Gawler are covered by an amendment already inserted in the bill at the instance of the honorable senator. I was prepared to accept a limitation as to the amount of the policy, but, unfortunately, Senator Rae did not see fit to accede to that, and, as I feel that the position of industrial insurance companies would be too greatly disturbed by the insertion of this proposed new clause, I cannot agree to it.
Question - that the proposed newclause be inserted (Senator Rae’s amendment) -put. The committee divided. (Chairman - Senator Plain.)
Majority . . 7
Question so resolved in the negative.
Proposed new clause negatived.
Bill reported with further amendments.
Debate resumed from page 3291.
– When my remarks were interrupted I was pointing out that the contention advanced by Senator Colebatch that the farmers are likely to lose the benefit of the exchange position, and any other perquisite that may attach to the marketing of wheat under a pool system, cannot be seriously sustained, because the bill proposes a form of co-operation which will be substantially under the control of the farmers’ representatives on the Federal and State Boards. Senator Colebatch sought to use as an argument against the bill the fact that voluntary pools in Australia have waned in popularity in some of the States, and quoted figures to show that the volume of wheat delivered to voluntary and contract pools has diminished in recent years. One can readily understand why the wheat delivered to these pools has diminished, when one knows of the extent of the assault that has been made upon them in the press and by propaganda posted to individual far mers. I can speak with some authority of what has taken place in South Australia where I happen to be a wheatgrower in a small way, because I have been the recipient of propaganda distributed by wheat merchants against the voluntary or contract pools operating in that State. The propaganda which has been forwarded to honorable senators by some of those in South Australia who are opposing the present Government’s policy, bears a remarkable similarity to that which was issued against the voluntary pooling system in South Australia. The South Australian voluntary pools were working on a contract basis; that is to say, the farmers signed contracts to deliver their wheat, or a proportion of it, to the pool for a specified period with the right of cancellation during the term of the contract. Practically all the wheat-farmers in the State were circularized by the Wheat Merchants Association, pointing out that a provision in the contracts gave them the right to cancellation and offering them free legal assistance to enable them to exercise the right. Wheat merchants in South Australia were certainly not doing this in the interests of the wheatfarmers of the States; nor is the propaganda now being disseminated, some of it obviously coming from the same source, calculated to benefit the farmers of the Commonwealth. Its purpose is to benefit those who have profited handsomely in the past by handling the wheat produced by the farmers.
Senator Colebatch, after elaborate calculationsdesigned to show that the Commonwealth Government would be involved in a huge loss if this system of pooling is adopted, eventually assured honorable senators that the loss would amount to about £6,000,000. He professes great sympathy with the wheatfarmers. Is it not obvious that the farmer gains if the nation, that is to say, the Commonwealth and State Governments, loses upon the guaranteed price proposed by the Commonwealth Government. If the nation does not lose, then the farmer cannot gain. Summed up, the honorable senator’s argument is that we should transfer the burden, if any, to the backs of the farmers of Australia. The honorable senator dealt with another pointthat merits a reply. He referred to clause 3 of the bill. During the dinner adjournment I made some inquiries as to the purpose of that clause, and was assured by the Attorney-General that its insertion is considered necessary in the bill, and that it will be inserted in all similar legislation introduced in this chamber. It is in no way an attempt on the part of the Government to make a certain section of the measure binding while another section conferring benefits and privileges may not be binding. I am told that it is inserted to safeguard officials and those who may be called upon to take action under the measure, and that it is a perfectly proper proceeding to take in the circumstances.
– Is it not somewhat dangerous in this case?
-The danger or otherwise of the provision should be debated in committee. Honorable senators opposite appeal to us to reject the measure because they claim it represents a form of conscription imposed upon the primary producers of Australia. Continuing that line of argument, it may be claimed that probably every law passed by this or any other Parliament is a form of conscription. What Parliament has to determine is what will provide the greatest good for the greatest number. I submit that the Senate ought to consider the bill from the following three aspects: -
There can be no room for doubt as to No. 1 on the part of those who have been associated with wheat-farming in Australia, or those who have studied the subject closely. I believe that the wheat- farmers of Australia are the most exploited section of our community. The price of everything that they have to purchase to carry on their production is fixed by those who sell the commodities to them, and the price of their wheat is fixed by those who buy it from them.
It has been claimed by those who oppose the measure that it is the duty of the wheat-farmers to grow and not to sell wheat. Why do not honorable senators advance a similar argument against those who manufacture the machinery that the farmer uses to produce his crops, or against the superphosphate firms who supply him with fertilizers to improve the soil from which he gathers his crops? None of those who oppose a wheat pool would have the temerity to go to the firm of H. V. McKay Limited, or the International Harvester Company, and suggest that it is their business to make agricultural machines and . other tools of husbandry, and not to sell them. Nor would they be rash enough to go to the big manufacturers of superphosphates in Australia and inform them that it is their business to manufacture superphosphates, but not to sell them. When it comes to the gentleman who is so often heralded as the backbone of the nation, as the individual for whom all should be done and to whom everything is owing, he is told that his job is to grow wheat, and that he should allow some one else to dispose of it on his behalf - not under his terms and conditions, but under those determined by the other fellow.
Despite the statements made during this debate that the farmer has an open market for his wheat, I submit that no open market exists to-day in the real sense of the term. The ambit of that “ open market “ is becoming more and more circumscribed year by year. Quite recently we read in the columns of our press that the three largest organizations that purchase wheat on behalf of Great Britain have formed a merger, so eliminating any competition that might hitherto have existed between them when buying our wheat. I pointed out before dinner that we have abundant evidence that, while there may be competition for our available business in so far ‘as deliveries of wheat are concerned, there is no competition in the prices offered to the farmers. I shall give an illustration. I know that it is an old one, but it is, nevertheless, effective. In South Australia, prior to the war, the Government suspected the existence of an “ honorable understanding” among the wheat-buying firms of that time, and a royal commission was appointed by Parliament to investigate the subject. That body, com posed of representatives of all the parties then in Parliament, rendered a unanimous report indicating that an “ honorable understanding” did exist; that it was detrimental to the farmers of the’ State, and that its operations resulted in those farmers receiving a lower price for their wheat than was received by neighbouring farmers in Victoria, taking everything into consideration.
– The buying was done by private firms in the State of Victoria.
– Yes ; but according to the information elicited by that commission, the arrangement between those private firms was not as complete or as effective as it was in South Australia. It was further proved that when the beneficent Government of the day reduced rail freights on wheat by approximately £4,500 for the harvest, in an endeavour to help the farmers of the State, the merchants did not pass that benefit on to the farmers from whom they purchased the wheat. They coolly pocketed it. …
We have been told that because of the compulsory pools that operated in Australia during the war our wheat-farmers were placed at a disadvantage compared with their fellow farmers in the Argentine. I shall not traverse the ground already covered by other speakers. But what of the position to-day? Only about six weeks ago we read in our press that wheat was sold in the Argentine for 3s. 1-Jd. a bushel at a time when wheat was selling in Canada, where a voluntary pool operates, at 4s. 4d. a bushel, and in Australia, where we have the benefit of the competition of voluntary pools, at about 4s. a bushel. That is a complete reply to those who uphold the Argentine and its methods of handling and selling wheat as against Australian conditions. According to investigations conducted by a Victorian royal commission, 80 per cent, of the wheat sold in the Argentine is purchased by three buying firms. One can readily understand why the wheatgrowers of that country are at a disadvantage as compared with the wheatgrowers of Canada and of this country, who have the benefit of the competition initiated by voluntary pools. We are told, also, that the beneficent, wheat merchant has inaugurated different sys tems for the benefit of the farmer, among them being that of free storage and the granting of liberal finance against the wheat stored. I believe that “ free. “ storage has proved a snare and a delusion so far as Australian wheat-farmers are concerned. I am confident that had our farmers sold their wheat from the tail of the wagon on delivery, instead of taking advantage of that scheme, they would have been many hundreds of thousands of pounds in pocket over a period of years. While the storage may be free, the wheat does not, in fact, belong to the farmer. If I deliver my wheat to a certain merchant and accept the benefit of his “ free “ storage, to all intents and purposes that wheat belongs to the merchant. But if I desire to take it out of his control and sell it to some competitor, who is offering a better price, I shall be prevented from doing so.
– In what way?
– By the imposition of charges that would not be made if the wheat remained the property of the merchant with whom it was stored. It must be perfectly obvious that the merchant would not defray the cost of carrying that wheat into his store from the wagon, and again from the store to his competitor’s wagons. It becomes a charge on me. This practice prevents every farmer from selling free stored wheat to ‘any merchant other than the. one with whom it is stored. This has been the experience of every producer who has accepted this alleged benefit of free storage. Advances to farmers against stored wheat are the outcome of the pooling system. Prior to its introduction it was not the practice of wheat merchants to make such advances, so credit for this innovation must be given to the pooling system.
A strong argument in favour of a compulsory pool may be found in the fact that in those States where voluntary pools have, in the past and are to-day, strongest, that is to say, where the voluntary pools handle the bulk of the wheat produced, the prices realized by the farmer have been better than in States where the organization of voluntary pools has been weak. _ From this we may deduce that if wheat is handled by one selling agency, the wheat-grower must benefit through the orderly marketing of the grain.
During this debate opponents pf the scheme have attacked the Canadian wheat pool from almost every angle. Senator Chapman who spoke in support of the bill quoted figures relating to the wheat position in Canada which, I think, would bear repetition, but I have no desire to quote the whole of the’ figures submitted by him. It will be sufficient for my purpose if I say that an analysis of the comparative average prices realized in Canada and the United States of America prior to and after the inauguration of the Canadian wheat pool shows that the pooling system has been of substantial benefit to the Canadian wheat-growers. Before the inauguration of the pool the average price for Canadian wheat was 4s. 3d. a bushel, compared with 4s. 6fd. a bushel in the United States of America, a difference in favour of wheat-growers in the latter country of 3d. a bushel. After the Canadian pool had been established the average price in Canada rose to 6s. Hd. a bushel compared with an average price in the United States of America of 6s. 6d., an advantage to the Canadian wheat-grower of 5d. a bushel. It has also been stated that the Canadian pool, by its policy of holding up supplies, was responsible for a glut and finally a crash iri Canadian prices. Earlier in the session I referred to this matter. If honorable senators care to look up the records dealing with the fall in the price of wheat in Canada they will find that on two occasions the Canadian pool was subjected to an onslaught by wheat speculators who desired to destroy it. On the second occasion the position was aggravated by intensive competition by wheat produced in Germany and France with the aid of a substantial government subsidy. Recently honorable senators received information per medium of the leader of the Empire freetrade crusade in Great Britain showing that the Australian wheat-farmer, as well as the Canadian, suffered as the result of this competition, and also that the British consumers had not benefited to any extent. It is difficult to say to what extent prices would have fallen had the Canadian wheat pool not been in existence and been instrumental in bringing about the orderly marketing of 60 per cent, of wheat grown in that dominion.
Another aspect of the Wheat position as it is affected by the pooling system is well worthy of serious consideration. . I refer to the gambling on the part of stock riggers and market manipulators and speculators, particularly in the United States of America. From time to time wis read newspaper reports of panic selling in the Chicago wheat pit, and of the great losses sustained by speculators. Naturally market fluctuations caused by this unrestricted gambling in wheat affect materially the prices received by wheat-farmers of Australia for their export surplus. Reliable authorities estimate that each year 40 times more wheat is sold in the Chicago wheat pit than is actually handled by those who sell it.
– This proposal will not remedy that.
– This bill will do something, because it will reduce the gap between the producer in Australia and the consumer in Great Britain, Italy, Japan and other countries which purchase our wheat - a gap which at present is bridged by this system of speculative buying and selling. Undoubtedly the result will be beneficial to our wheatgrowers, because sharp rises and sharp declines in the price of this basic primary product have far-reaching effects on the lives and conditions of those engaged in wheat production. These fluctuations affect land values, equities in mortgages and other conditions that strike almost at the root of our national existence. Sharp movements in wheat prices should be avoided as far as possible. The only means to that end is an orderly marketing scheme as outlined in this bill.
Let us examine another point. Honorable senators opposite have argued, in their speeches and by way of interjection, that the wheat merchants have always given the farmers the benefit accruing from the increase in the weight of the grain in store. It is well known that, because of the warm climatic conditions obtaining when wheat is harvested in Australia, it gains approximately onehalf per cent, if stacked for a period of three months or more. Honorable senators opposite have stated that wheat merchants have always credited the growers with this added weight. As .a matter of fact that has not always been the practice of the merchants. Prior to the introduction of the compulsory pool system the farmers received no consideration with regard to the increase in the weight of stored wheat. I know, because I was engaged in wheat production before the inauguration of the compulsory pool in South Australia, and I recall the arguments we used then to persuade the merchants to credit us with the added weight. We were told that this increase in weight represented the merchants’ margin of safety against loss from mice, weevil and other sources of damage. On one occasion a wheat-buyer, a friend of mine, was frank enough to acknowledge that a comparatively small stack of wheat which he had purchased had gained 1,000 bushels from the time it was purchased until it was re-trucked for transhipment overseas. At 5s. a bushel, the then ruling rate, this added weight represented a substantial gain to his principals. In South Australia the wheat merchants also gain by what is known as the balance of the scales. Wheat in that State is weighed bag by bag. Under this system the fanners suffer considerable loss. I understand that in Victoria, wheat is weighed four hags at a time, but in my State it is weighed in single bags, and the merchants have always fought against any alteration in the system. A few years ago. when I was a member of the State Parliament, a municipal council in a wheat-growing district established weighbridges, the idea being to weigh each load of wheat in bulk and bv deducting the tare of the wagon, arrive at the net weight in the load. For a time the merchants refused to accept the weights determined bv this method, but when the voluntary pool organization agreed to accept the weights they were compelled to come into line. [Extension of time granted.”] There is another point in favour of the pooling system which supports the remarks I made a few moments ago concerning the difference between the price of wheat in South Australia and in Victoria. Taking the figures for the last two years of the compulsory pools - 1919-20 - the compulsory pool in Victoria realized 5s. lid. a bushel, and in South Australia 5s. 6d - a difference in favour of South Australia of 4$d. a bushel. For the season 1920-21 the price in Victoria was 7s. 7d., and in South Australia 9s. - a difference in favour of South Australia of ls. 5d. a bushel. The compulsory pools were then abandoned, and in the last two years - 1927-28 - the average price of wheat in Victoria, according to figures published in the press, was 5s. 6d., and in South Australia 5s. 4d. - a difference of 2d. per bushel in favour of Victoria. For the year 1928-29 the position was the same, as the average price in Victoria was 4s. 8d., and in South Australia 4s. 7$d. - a difference of -Jd. a bushel in favour of the Victorian farmers. If under the compulsory pooling system it was possible for the South Australian farmers to receive more than the Victorian farmers, then, under the open marketing system boomed by honorable senators opposite, South Australia should have received at least the same price.
– How does the honorable senator arrive at the average price?
– I have quoted the average for the whole year. The average price for this year shows that the position is the same. I have taken thirteen quotations from the Adelaide Advertiser between the 1st January this year and the middle of June, which show that the average price of wheat in South Australia for that period was 3$d. a bushel below the average price in Victoria. In South Australia there is a slight difference in the handling charges as compared with Victoria. This is brought about by higher wharfage or port dues, which, I think, amount to ls. 2d. a ton, or less than id. a bushel. Allowing for this there is still a margin against South Australia of 3d. a bushel, and on last season’s production, of 25,000,000 bushels, amounts to approximately £300,000 lost by the farmers of that State.
– Did the pool in South Australia pay a lower price than in Victoria.
– The pool price is determined over the whole period, and, as I pointed out, the South Aus- tralian pool paid less because the quantity handled was smaller than in Victoria, where the pool was stronger, and consequently was able to influence the market.
I wish to quote from the Queensland Primary Producer, which is the only newspaper in Australia which I have been able to find, that really represents the views of the primary producers of this country. This newspaper, while opposed to the Labour party in politics, is fearless in its advocacy of the claims of the primary producers in Queensland, as well as in the other States. In a leading article, published in its issue of 2nd April of this year, it states -
The efforts being made by the Commonwealth Government to bring into existence a’ Commonwealthwide wheat pool will meet with thu approval of all producers in this State who have been associated with the marketing organizations established here. There is, however, a lamentable lack of organisation among the primary producers in most other States in the Commonwealth, and any attempt to introduce any form of compulsory organisation, which, after all, is the only form of organization which can get results, is viewed with disfavour mainly because the belief is held that it is the thin end of the wedge towards government domination in the matter of the marketing of primary produce. Many of the most ardent advocates of compulsory pools in Queensland at the present time were the most bitter opponents of the scheme when it was originally introduced by the Theodore Government.
That is a considered statement of a journal which represents the primary producers of this country, and which has studied the subject from both the practical and academic view-point. We are told that the advent of a pool will increase, the cost of bread to the consumer. It may do so. One cannot tell what is likely to happen in the future; but it is most remarkable that when the price of wheat is reduced there is no corresponding reduction in the price of bread, whereas immediately wheat rises 2d. or 3d. a bushel, the price of bread is increased. When, in 1920-21, wheat in South Australia was sold at 9s. a bushel, bread was sold in the metropolitan area at 6d. and in the country districts at 6£d. a 2-lb. loaf. To-day, when wheat is quoted at 4s. 4d., bread iu the metropolitan area is 5d. and in country districts 6d. a 2-lb. loaf.
– To what extent have wages been increased?
– There has been a very slight increase in wages during that period, and in the past twelve months the wages and conditions of employment of those engaged in the baking trade have not been improved. During one particular period in that twelve months the price of wheat in South Australia dropped from Os. 9d. to 3s. lOd. a bushel, but there was no reduction in the price of bread. Either the bakers or millers or both are exploiting the people of this country. Senator Chapman pointed out that there is 2 1/3 d. worth . of wheat in a 2-lb. loaf of bread which to-day is being sold over the counter in South Australia at 5d. a loaf. On that basis the price of wheat would have to rise by ls. a bushel to justify an increase of -Jd. in the price of a 2-lb. loaf of bread. Unless some form of control is exercised by the State Governments, one cannot guarantee that the bakers or millers will not pirate the consumers in the future, as has been their practice in the past. If they should do so, it will not be the fault of the compulsory wheat pool, or of this Government, because if the Commonwealth Parliament had the power to fix prices as it had during the war, it would exercise its authority. If profiteering is engaged in, the responsibility will be upon the State Governments who have power to legislate in that direction.
In the interests of the nation, this measure should be passed, particularly at the present juncture, when we are seeking every possible means to increase our exportations to improve our financial position overseas. Wheat is a commodity which is readily saleable and for which there is a great demand abroad. Wheat can be quickly produced and readily converted into cash, and if we are to reduce the enormous adverse trade balance which confronted this Government on taking office, we should increase our wheat production and that of other commodities suitable for export. If by the orderly marketing of our exportable surplus, the price of wheat can bc increased by 3d. a bushel, it will be of great financial advantage to Australia. That is not an impossible figure when we realize what has-been done by the wheat pools in Canada. An increase of 3d. a bushel would represent oh the average exportable surplus of wheat a gain of £1,250,000 to Australia.
– Why not increase the gain to 6d. a bushel, and make it £2,500,000?
– The increase I have mentioned is not impossible. If we can encourage the Australian farmers to increase their production, every 5,000,000 bushel increase in the export able surplus will at present prices represent a return to the nation of £1,000,000. These facts should be carefully studied by honorable senators who may think that there is a danger of the Commonwealth being involved in a loss. I have a lengthy but interesting table showing the wheat production, area under crop, average prices, &c, in South Australia from 1861 to 1928, which has been prepared by the State Statistician’s Department. It is as follows: -
The statement shows that over a 67-year period the average price realized for wheat in South Australia is 4s. 9¼d. a bushel. Why do not the merchants who. according to the opinion of honorable senators opposite, are supposed tobe such firm friends of the farmers, contract to give our farmers 4s. a bushel for wheat delivered at railway sidings as the Government proposes under this bill? In the final analysis honorable senators should be guided by what is best in the interests of the primary producers, and if they wish to help them they should assist in placing this measure on the statute-book, since it will operate not only in the interests of the wheatfarmers, but also for the benefit of the whole community.
Debate (on motion by Senator Carroll) adjourned.
SUPPLY BILL (No. 1), 1930-31. First Reading.
Debate resumed from page 3268, on motion by Senator Daly -
That the bill be now read a first time.
Senator Sir GEORGE PEARCE (Western Australia) [9.0]. - The first reading of this bill gives honorable senators an opportunity to deal with subjects that cannot be discussed in connexion with the various measures that come before them from time to time. I desire to bring one such matter before the notice of honorable senators. From various platforms throughout the country, as well as in their various organs, the Labour party is endeavouring to create the opinion that the present financial position of the Commonwealth is taxing its resources to the utmost, and that the difficulties with which it is faced have been inherited from the Bruce-Page Government. I want to give a few facts in refutation of those allegations. One of the favorite statements of the supporters of the Government is that the late Government, on assuming office, inherited from previous administrations an accumulated surplus of about £7,000,000, which it dissipated, and that when it went out of office it handed over a deficit. It is true that the Bruce-Page Government inherited a surplus of about £7,000,000; but it paid more than that amount - about £7,500,000 - for the redemption of debt during that period. That was not extravagant or wanton expenditure. During its term’ of office that Government received further surpluses amounting .to approximately £10,000,000. That money, was well expended. Some of the items of that expenditure were: Naval construe-, tion,- as a result of which the Australian fleet, so far as it is permitted to exist to-day, was established free of debt and interest, £7,000,000; grants to the States for the development of main roads, £1,250,000; science and industry investigations - than which there could be no wiser expenditure of public money - £600,000; assistance in the marketing of primary products, to which no honorable senator will offer objection, £500,000 ; air service equipment, £250,000; civil aviation, £200,000; prospecting for oil and precious metals, £220j006 ; radium for the treatment of cancer, by which relief has been brought to many sufferers, £100,000. In such directions were the accumulated surpluses expended. I challenge any honorable senator to say that one shilling of that expenditure was wastefully expended.
Another charge against the late Government is that it was extravagant in borrowing. In this connexion the press of Australia has been grossly unfair to the Bruce-Page Government in that in referring to governmental borrowing, it makes no discrimination between borrowing by the Commonwealth and by the States. For the facts I refer honorable senators to Finance Bulletin, No. 20 which was distributed to honorable senators within the last fortnight. I desire especially to direct attention to the figures given on page 32 of that bulletin. Let me refer first to Australia’s war debt. In 1921-22, it stood at £333,093,834. By 1928-29 that debt had been reduced to £287,817,745. During the same period the works debt increased from £31,745,756 to £89,803,827. Of that increase of £58,058,071 no less than £33,000,000 was expended on postal works and war service homes, the return from which has provided interest and sinking fund charges. Not one penny in respect of that amount has had to be paid by way of taxation by the general public.
The total result of the loan expenditure during that period was that the debt of the Commonwealth increased from £364,839,590 to £377,621,572. In other words, although the debt increased during those seven years by £12,781,982, Australia had additional assets in postal equipment and war service homes to the value of £33.000.000. In the same seven-year period the public debt of the States advanced from £519,537,643 to £726,406,490, a net increase of £206,868,853. My point is that during the period that the public debt of the Commonwealth, under the Bruce-Page Government, ‘increased by less than £13,000,000, the debt of the States inr creased by nearly £207,000,000.
Let us examine the same matter from another aspect. On the same page of the Bulletin mentioned, appears a statement showing that in 1921-22 the per capita debt of the Commonwealth was £65.539, and in 1929, £59.251, the decrease in the seven years being £6 5s. lOd. per head. In the same period the per capita debt of the States increased from £93.439 to £114.202, an increase of £20 15s. 3d. per head. It is only just that, when considering governmental’ borrowing, these figures should be carefully examined. It should be remembered that the only portion of that debt over which the late Government or this Parliament had any control was the Commonwealth debt.
A very interesting announcement was recently made by the Treasurer in another place. He said that in the forthcoming budget provision would be made for a tax on the American film companies in connexion with the tribute which they are taking from this country annually. That statement is the more interesting because legislation along similar lines was proposed by the Bruce-Page Government. That Government proposed to impose a tax of 124 per cent, on the payments made to film companies in the United States of America as rental of films exhibited in Australia. Honorable senators, no doubt, still remember the reaction of those who now sit on the Government bench to that proposal. I have here an extract from the policy speech of Mr. Scullin, which he delivered at Richmond Victoria, on the 19th September, 1929. The Melbourne Age of the following day, in reporting that speech, said -
The burden of taxation recently imposed by the Bruce-Page Government on life assurance companies fell mainly on the dependants of hundreds of thousands of bread-winners. “ Revenue duties on commodities and taxes on amusements were also spread over the mass of the people, irrespective of the amount of their income. The basis of the amusement tax announced by the Treasurer was contrary to sound principles of taxation. To tax gross earnings was unjust. The accepted principle of income taxation was to tax the net income, which was the amount received after expenditure in earning that income had been met.
A tax on gross earning of a business might mean that a firm would be called upon to pay a tax, although the business showed an actual loss. It was argued that such methods were justified when applied to amusements. But was it proposed to tax all forms of amusement? Because a business catered for the pleasure or amusement of the people was no reason why methods of taxation should be applied to it that would not be considered for a moment in connexion with other businesses.
Amusement was a luxury, it was said; so was jewellery. But no one suggested that the gross takings of a jeweller’s business should be taxed.
A Voice (apparently that of a jeweller) : Hear, hear! (Laughter.)
Mr. Bruce, speaking as Treasurer on 14th September, 1922 (Ilansard, page 2230), said, “An entertainment tax is one of those things in which a Federal Government with a broad national policy should not be concerned.” Instead of leaving that field of taxation the Bruce Government proposed to make further inroads. . . .
During their campaign speeches, both Mr. Scullin and Mr. Theodore announced that the policy of the Labour party was “Hands off the amusements of the people “. As a result of the Labour party’s attitude towards the taxation of the film companies, the Nationalist and Country parties, who, in their innocence, hoped to use the hoardings throughout the country in the interests of their can didates, found that every hoarding in the Commonwealth had been fully booked. On inquiry, they learned that those hoardings had been booked by the people represented by Mr. Stuart Doyle. Electors who previously had seen on such hoardings pictures of Douglas Fairbanks, Mary Pickford and other Hollywood celebrities, were somewhat surprised to see. instead pictures and advertisements in favour of Labour party candidates. The hoardings invited them to “ Vote for Labour and save our amusements”. Candidates opposed to the Labour party found it utterly impossible to advertise on any hoardings throughout Australia; the picture interests were so grateful to the Labour party for its promise to exempt them from taxation that they monopolized them all. That was not all. A person could not go into a picture theatre in any part of Australia during the campaign without being compelled to listen to a raucous voice appealing to him in piteous tones, by means of a loud speaker, to save the people’s amusements from taxation by voting for the Labour party. I have never known such a wonderful campaign of publicity waged on behalf of the party represented by honorable senators opposite.
The unfortunate thing about the methods I have mentioned - at least, from the stand-point of the parties in opposition to Labour - is that they were successful in inducing the electors to support the Labour party. One can imagine that when the results of the election were telegraphed throughout the world there was no place where they caused more rejoicing than in Hollywood. Motion picture publications from the United States of America were not slow to express their delight at the return of a Labour Government. But, later, a black cloud loomed on the horizon. The depression which the Bruce-Page Government foresaw, and was preparing to meet, reached Australia. The gentlemen who, during the campaign, spoke so optimistically about what the Labour party would do, if returned to power, became somewhat timid, for they realized that the innocent might suffer because of their action. Soon afterwards we read in the press of . the inauguration of the Optimists League - a league formed by Mr.
Stuart Doyle. Probably no person in the Commonwealth was more fitted to organize such a league. The league was fittingly inaugurated by a speech broadcast by the Prime Minister. One could understand Mr. Stuart Doyle’s need for optimism. His organization had provided so much money in the interests of Labour ; it had gone to endless trouble to secure a glorious victory, and, naturally, it did not want to be robbed of the fruits of victory. And so these people said, “Let us keep smiling and hope for the best.” But the Government now proposes to go back on them.1 “We are told by the Treasurer that in regard to the £2,000,000 which goes away from Australia to the picture interests in the United States of America the present Government is going to adopt the very principle of taxation proposed by the BrucePage Government. I do not know whether it will adopt the same rate of tax, the 12^ per cent, we proposed, but X venture , to say that we shall soon have another league formed. The motto of the Optimists League was, “It can be done.” It- seems to me that when these people’s hopes have been blighted, as they have been by the Treasurer’s announcement in regard to the taxation of picture companies, they are likely to form a Pessimists League. I do not know who would broadcast the address on the occasion of the formation of that league; possibly, it would be the Treasurer ; but I cannot help thinking that no motto would be more appropriate for it than, “We have been done.” As an act of justice, the Labour party ought to make some refund to the picture interests of the expenditure to which they were put, otherwise there is just a possibility that the Optimists League may bring an action against it for having obtained money by false pretences. We know that a court always takes notice of previous convictions, and we know that Mr. Theodore, during the election campaign, announced that he would open the coal mines within fourteen days if Labour was returned to power. On the strength of that promise, the Coal Miners Federation contributed £1,000 to the election funds of the Australian Labour party. If the Optimists League cared to bring that out in evidence, it would make out a very strong case for a refund of the money it expended on hoardings. Before these picture people in future commit themselves to any political party they would do well to have it in black and white that the goods are to be delivered. I sympathize with them because they have been more than “ sold.”
An ex-senator who is now on his way to Great Britain, has written me a letter in which he says that one day the wireless news posted up on the steamer on which he was travelling created a great deal of excitement, and on investigation, he found, much to his astonishment and disgust, that the news was that a terrible revolution had broken out in the Northern Territory. He said that, of course, those who were Australians knew of the eccentricities of the population of Darwin and readily recognized what had happened, but that those who hailed from other countries got a very bad impression of what was really occurring in Australia. He asks me to bring the matter under the notice of the Government to see if something cannot be done to exercise a proper form of control over this wireless news service to vessels. I agree with him that this should be done. I suppose that these messages are issued with the approval of the Postal Department, and I trust that the department will do something to see that a proper control is exercised over them.
– My mind goes back to the recent election and the many promises that were made. I listened to Mr. Scullin speaking in Hobart. He was very emphatic. Of course he enlarged upon the sins of omission and commission of the Bruce-Page Government, and he promised that the Labour party would do certain things for Tasmania. The first plank in the Tasmanian part of his platform was that the State would have the benefit of a fleet of federal steamers. He said that his party if returned to power would do away with private steamship companies and would provide a federal shipping service for Tasmania. He also declared that in no circumstances would private companies be subsidized. What has been done towards the fulfilment of those promises? The Labour Government’s first step was to subsidize a private shipping company to conduct a service between Hobart and
Sydney. I am pleased that the Labour party has abandoned its principles to the extent that it has gone back on that promise.
– Then why is the honorable senator growling?
– I am not growling. I am endeavouring to show that the present Government has not kept its platform promises. What has been done in regard to a federal steamship service? Some kind of an inquiry was instituted by an official but his report has not been made public. It has been buried. There are no federal steamships. The old Oonah is still ploughing her way across the straits, and the private steamship companies are still operating the other two steamships to Launceston.
So serious did this non-fulfilment of Labour promises become, that the Government recently sent Mr. Lyons, one of its Ministers, to Tasmania. He went to the Trades Hall in Hobart to meet his supporters. I was not at the meeting, I was not invited, but I met one or two who were there and they told me what happened. Mr. Lyons was not too well received. He said “ Gentlemen ! We made you a lot of promises at the elec-‘ tion ; we promised you federal steamships but we are not able to give them to you. We find that the financial horizon is so dark that we cannot possibly fulfil our promise to give you a federal steamship service.” When Mr.> Lyons was a candidate for Wilmot, he told the electors that one of the first things Labour would do would be to establish a federal steamship service, not only across the straits but also between Hobart and the mainland. He’ has been . obliged to tell the people of Tasmania that he cannot do it.
Labour also promised that Tasmania would be linked up with the mainland by telephonic communication. It said, “ The Bruce-Page Government has delayed this matter for years. It is time’ Tasmania was placed on the same footing as the other States.” As a matter pf fact, the Bruce-Page Government put a sum on the Estimates submitted by Dr. Earle Page in October last to carry out this work, but the present Government has made :no attempt to fulfil that promise. Mr. Lyons promised that it would be done, but the work has not been done yet, and there seems to be no prospect of the promise ever being fulfilled.
I have been reading some of the pamphlets issued by Mr. Theodore, campaign director for Labour during the last election, and in every one of them appeared the definite statement that Labour, if successful, would greatly reduce unemployment if not eliminate it altogether. When Labour came into office the rate of unemployed among trade unions was about 11 per cent. It is now 14 per cent., and is still growing. Why should Labour have made these rash promises knowing very well that there was no possibility of carrying them into effect? Labour said that the Bruce-Page Government was attempting to reduce wages. The Bruce-Page Government made no attempt to reduce the standard of living, or reduce wages, whereas already the present Government has already done so. The rationing which has been put into effect by it is distinctly a reduction of wages. A great democratic party wins an election on the cry of’ “ No reduction of wages,” yet one of its first administrative acts is to betray this pledge.
The Government has been unable to fulfil’ its wild platform promises ; nevertheless, it has been able to do quite a lot of harm. It began, and has persisted’ iri, the destruction of our defence system. While emasculating that system,’ and “leaving Australia defenceless, ( the 1 Government has preached the principle of voluntary enlistment for an inefficient army, concurrently propagating’ the doctrine of compulsion in the marketing of our wheat, and compulsory unionism. The two things do not square.* It has, in addition to’ reducing wages, increased unemployment, and by its extraordinary action in increasing tariff charges, and imposing prohibitions, has destroyed the credit of the country. It has also shaken the confidence of the people, and closed the money market of Great Britain to us. One never knows where one stands. We have already had five different tariff schedules in seven months. I am wondering when the next one will come along. No one is given an opportunity to consider those schedules, or to discuss the prohibitions. The Government is tending fast to destroy the very breath of our country, our export trade. I shall not enlarge on those prohibitions at this stage.
– This is the only opportunity to discuss them.
– I believe that it is. Although I agree that the Government was justified in debarring the entrance of some commodities to this country, because of the existing financial stringency
– For instance, hops.
– I am in no way parochial, and have never been heard to unduly press the subject of Ta3manian hops. The Labour Government has failed to give any scientific consideration to its tariffs or embargoes. I realize that it is a plank of the Labour party’s platform to prohibit all imports. No doubt this comprehensive prohibition of commodities is not designed so much to stop our trade slump as to put into effect that section of its platform.
The Government is pursuing a policy of economy by cutting down expense in_ some directions and increasing it in many others. For the moment I am unable to calculate the number of bounties that it proposes to pay. There is one on wine, another on flax, on cotton, on 3hale, and dried apricots, and an embargo on peanuts.
– Everything is included but gold.
– And I hope that gold will never be included. I tender to Senator Daly a little friendly advice. I suggest that the Government should tell Western Australia, and Tasmania, too, for that matter, that it will not consider the granting of a gold bonus until some foolish people cease to talk about secession. Those people cannot hope to participate in a gold bonus if they are going to cut the painter. After the conclusion of this session wc shall have to keep a tally of these bounties. It will be found that the total sum involved will, amount to millions of pounds.
– The cotton bounty alone involves an expenditure of £200,000 per annum.
– That is so. The Government is saving money in a few directions that may result in arresting the development of Australia, and at the same time is spending hundreds of thousands of pounds on bounties. I am opposed to bounties. But when it becomes a general policy we must all put out our hands for some of the plunder. I cannot refuse to. accept a bounty for my State when bounties are granted indiscriminately to others on cotton, sugar and so forth.
– There is no bounty on sugar.
– There is something better than a bounty on sugar. There is a total embargo on the importation of foreign sugar, and the people of Queensland are able to fix their own prices.
– That is not so. The .price is fixed by a special board.
– These bounties are going to every State.
– Western Australia has not yet received one.
– I am afraid that the Government will eventually have to pay a gold bonus to Western Australia, but that will not be done’ with my consent. I shall draw the line there.
-Order ! I point out to honorable senators that their remarks give rise to a difficulty when they tend toanticipate debate. If honorable senators dwell on special subjects during this debate I shall have to check them. So long as they refer to such matters in passing I shall not restrict them.
– I intended to refer casually to these subjects. I remind the Leader of ‘the Government in the Senate (Senator Daly) that a rather dangerous time lies ahead. I believe that the Government is manufacturing a rope that will eventually hang it politically. I am not prepared to cut that rope, but will let events take their own course. The Government is precipitating an avalanche that will engulf it. What has it done to further the prosperity of Australia? It has brought down a bill for a reserve bank, and a proposal to give preference to unionists. Neither assists to develop the country. It is also bringing down an arbitration act. That cannot assist the welfare of the country. It has failed to get down to basic economic facts and do something to aid the development of Australia. All itf* efforts have beer* directed towards placating the people who supported it at the last election. No one has a greater respect for the worker and for trade unionism than I, but we must not make those people a glorified section, and endeavour to persuade them that they are the only pebbles on the beach. After all it must be remembered that the trade unionists of Australia number only a few hundred thousand people. I urge the Government to abandon these superficial attempts to please a section of the community. “What is the use of wasting time discussing abstract questions when it is necessary to deal with matters of vital concern to the community ?
So far as I am concerned, the Labour party is quite welcome to its term of office under existing conditions. If the Government were a little more generous it would agree that the existing depression was not brought about by any particular government. The la3t Government was blamed and is still being blamed for the difficulties that confront us. It played no part in bringing about the depression, a good deal of which is attributable to the action of militant trade unionism and to the unwise counsels that prevailed among the supporters of the Labour movement. The Labour party takes its orders from the Trades Hall, and turns a deaf ear to expert advice. Only the “ other day a strike of meat employees occurred in Sydney, and the New South Wales Labour party immediately announced that it was behind it. Strikes have contributed largely to our existing unemployment and depression, but the Labour party has never yet had the courage to tell the workers that they are wrong. I hope that the Government will settle down in earnest in an endeavour to overcome the difficult problems that face Australia, and that it will. not waste so much time discussing superficial matters that have no bearing on the welfare of the country.
.- The motion for the first reading of this bill is, I think, an opportune occasion to bring before the1 Government certain matters of importance to the people. I suppose th’e greatest problem which we are called upon to solve is that of unemployment. If one section of the com munity is out of work, a great deal of hardship is inflicted upon a large number of people, especially women and children. One cannot help feeling deeply for those who are in distress, and, naturally, one endeavours to ascertain the real cause of all this trouble. On other occasions I have stated that in my opinion much of the distress resulting from unemployment is due to the attitude of the leaders of industrial organizations during recent years. Dislocation in industry has had the effect of forcing up the prices of all commodities beyond the ability of the people to purchase to the extent to which they have been accustomed. Consequently, there has been a slackening off here and there in industrial establishments until to-day many large concerns are employing not more than 25 per cent. of their usual staff.
I have been waiting since October last for the Prime Minister (Mr. Scullin) and those associated with him to make an appeal to the leaders of industrial organizations to come to the aid of the Government and help Australia out of its difficulties. They can do this by keeping their hands off the workers, by declining to ‘ call men out of employment on trivial pretexts, and by refraining from telling them that it is better to starve than work 48 hours a week. This interference on the part of industrial leaders has been very prevalent during the last two years, and I am convinced that it is responsible for many, of the troubles that confront us to-day. When I was in Sydney some time ago, I attended a meeting held in the Sydney Town Hall to discuss matters in connexion with a dispute in the timber industry. There was a large attendance, and if I am any judge of men, I am satisfied that those present had no desire to leave their work. They were, however, forced to go on strike. On the platform at that meeting was a gentleman who occupies a high- ministerial office in this Government. I refer to the present Treasurer (Mr. Theodore), and alongside him was my friend Senator Rae. I listened carefully to the addresses delivered by these two gentlemen, thinking that they would give some sound advice to the workers; that they would urge them to return to work pending a settlement of the dispute; but the whole tenor of their remarks was in the direction of advising the men to starve rather than sacrifice the principle of a 44-hour week. I saw two or three men, evidently timber-workers, walk out from the meeting in disgust. I have no doubt that they expected to receive useful advice and help from their leaders in their difficulty. Instead, they were told, in so many words, not to surrender their principles. These political leaders are careful always never to offend the susceptibilities of those upon whose votes they depend for their continued political life. Lately the Prime Minister (Mr. Scullin) has made an appeal to the farmers and rural workers to produce more wheat, and now nearly every letter sent through the post bears on it the impressed stamp, “ Grow more wheat.” It would be more to the point if the Prime Minister and his ministerial colleagues urged industrial leaders and workers generally to work harder; and by that means help to reduce the cost of living.
Reference has been made to certain incidents that occurred during the last election campaign. I have rather an interesting story to tell, indicating how wrong advice sometimes recoils, upon those who accept it. Not long ago, when I was walking through the streets of a town in Tasmania, I met an old gentleman, who said to me, “ I shall be glad if you will explain something. I was told by a Labour candidate during the last election campaign that if I voted for a candidate supporting the Bruce-Page Government, I would have my old-age pension reduced.”
– That story is old enough to qualify for the old-age pension.
– This old man then said, “ I voted Labour, and my pension has been reduced during the last month.”
– Will the honorable senator give me the name of that man?
– Yes. I realize that whatever government was in power this man’s pension would have been reduced because of a change in his circumstances. But the point is, he was told distinctly that, if he voted for a Nationalist candidate, his pension would be reduced. Naturally, he voted Labour, and was surprised and pained afterwards to find that ‘ his pension payment was lowered. The story shows the extent to which certain candidates are prepared to mislead the people in order to secure votes.
Two or three weeks go, when I was in Brisbane, I attended service in a Presbyterian Church one Sunday morning, and listened to an address from a cultured clergyman. In the course of his sermon the minister said he had never yet met a politician who, on the hustings, did not tell a pack of lies. The following day I wrote to the clergyman, telling him that I was under the impression that the bulk of his congregation would go away from the service in the full belief that all members of parliament were untrustworthy and would do anything to get votes. I furnished him with the names of a number of Queensland members of Parliament, and asked him if he would dare to include those gentlemen in his sweeping denunciation of politicians. In his reply to me he said - I quote his letter from memory -
I am in receipt of your letter, and I am glad you wrote to me on this subject. If you had been an ordinary member of my congregation you would have known that I have spoken on this subject more than once, and I have always differentiated between politicians and statesmen. Politicians, I have always explained, are men who promise to open coalmines within a fortnight. Statesmen, I should say, include men whose names appear in the list which you furnished to me.
I have another charge to bring against the Government’. During the election campaign the right honorable the Prime Minister’ (Mr. Scullin) promised definitely that if his party were returned to power he would link up Tasmania with the mainland by wireless telephone, and would also extend the telephone service to Western Australia. I pointed but at the time that he knew quite well’ the BrucePage Government had placed on the Estimates the initial sum for the proposed linking up of Tasmania with the mainland and also that the Public Works Committee, of which I was a member, had visited Western Australia, taken evidence with regard to telephonic communication with the Eastern States, and had recommended the project to the previous Government. The present Prime Minister in the circumstances was on perfectly safe ground. But tas he fulfilled his promise? I do not know whether Western Australia is linked up with the eastern States by telephone, but I do know that, for the time being at all events, the proposal to link Tasmania with the mainland by wireless telephone has been abandoned. I should like to know why this undertaking has not been honored, and why the Prime Minister, when it suits him, can disregard his pledge to the people. He said also that if his party were returned to power, the Labour Government would not suspend the coastal provisions of the Navigation Act to allow passengers to travel in some comfort by the large mail steamers between the mainland ports and Tasmania; but that, on the contrary, it would tighten up the provisions of the act, and make them more rigid. But what happened? Shortly after Labour was returned to power there was a by-election for the division of Franklin in Tasmania, and, apparently for the purpose of securing a party advantage, the Labour Government issued a proclamation declaring that the coastal provisions of the Navigation Act would be suspended in the interests of tourist traffic. Immediately the seamen’s union got to work, and the following Thursday another proclamation, published in a special number of the Commonwealth Gazette, repealed the first proclamation. It was, however, too late to undo the damage, because the electors of Franklin, believing that the Government intended to ease up the restrictions imposed by the Navigation Act, returned a Labour candidate. The information that the proclamation had been repealed came too late as the election was on the following Saturday.
Various reasons were assigned for the defeat of the Nationalist candidates at the last election. It may not be out of place if I retail a conversation which was overheard in a town in Tasmania between two women voters employed in a State public department. On the morning of the election one said to the other, addressing her by her christian name, “ We have to go down to vote this morning. We might as well go at once.” “Yes,” replied the other, “ So-and-so “ (mentioning the name of an estimable member of the House of “Representatives, who, fortunately, was returned) “ is far and away the best candidate offering.” “Yes,” said the first one, “ He is a very good man, and looks after the interests of the district, but it is unfortunate he is not a Labour candidate, because we have to vote Labour this time.” It transpired that these ladies were informed that if the Bruce-Page Government were returned to power their salaries would be reduced and they must vote Labour. I may add that these two ladies are entrusted with the education of the rising generation. They evidently, with others, were misled by emissaries of the Labour party, who, during the campaign, travelled from shop to shop impressing upon assistants that they must vote Labour as the Bruce Government was out to reduce wages.
Recently several measures have been passed providing for the payment of bounties on certain commodities, but notwithstanding the fact that repeated requests have been made to the Government to provide for a bounty on the production of evaporated apples for export nothing has been done. Although only £4,000 to £5,000 a year was required for three years to assist the evaporated apple industry in Tasmania, the amount was refused and over 200,000 bushels of good wholesome apples have been compelled to rot. on the ground. If this amount had been made available the quantity I have mentioned could have been prepared for the export market, and a ready sale for them found. In consequence of the rigid legislation governing exports, the .Tasmanian fruit-growers are prevented from exporting apples which do not reach a certain standard. The quality of the fruit is perfect, but owing to skin blemishes they cannot be exported. If treated under the evaporating system they could be readily marketed. A bounty on a sliding scale and’ not exceeding 2d. a pound was all that was required, but the request was refused.
– Why did not the Government, of which the honorable senator was a supporter assist the industry ?
– I mention this matter, because the Government is at present assisting other industries by the payment of bounties, and it seems peculiar that such a reasonable request should have been refused. The honorable senator should not endeavour to draw a comparison between the past and present Governments, because when Mr. Bruce was Prime Minister, he approached the members of the present Government and asked them to co-operate with him in an effort to prepare for the crisis which is now upon us, but they definitely refused to meet him in conference. It is too late to do anything this season in the direction of payment of a bounty to assist the apple producers, but I trust that the Government will seriously reconsider its attitude towards this small, but important industry, and thus eliminate as far as is possible the unwarranted waste which is now occurring in consequence of the absence of funds. The Government should give more consideration to those producers who work from daylight till long after dark in an endeavour to make their work remunerative. While appealing to wheat-producers to work harder they should ask other sections to co-operate in the interests of the community, as the future prosperity of Australia depends upon the co-operation of all sections.
; - I wish to take this opportunity to briefly refer to the subject of disarmament, but more particularly to our defence expenditure. The present Leader of the Opposition (Senator Pearce) when a member of the Bruce-Page Government was Australia’s representative at the Disarmament Conference held at Washington, where he performed excellent work on behalf of the Commonwealth. Since that time several similar conferences have been held, the last of which was the Five-Power Naval Conference, convened by the British Prime Minister and held in London^ and at which the Minister for Trade and Customs (Mr. Fenton) was Australia’s representative. The subject of disarmament has been somewhat prominently before the principal nations during recent years and in this connexion it is interesting to note the expenditure which has been and is being incurred by the Commonwealth. In Supply Bill No. 2 of 1929-30, which was assented to on the 30th September, 1929, when Mr. Bruce was Prime Minister, provision was made for the expenditure of £1,164,360 in the Defence Department. Under the present measure introduced by the Scullin Government, the expenditure in this connexion is £985,620, or a saving of £178,740. I should like to ask the Leader of the Opposition whether he believes in the saving which the Government is making in the defence expenditure ?
– We can argue that out when we are in committee.
– It is interesting to go back a few years and to read the views expressed by the present Leader of the Opposition on the subject of defence. According to the report of the debates in this chamber of the 22nd January, 1902, Senator O’Connor moved -
That this House affirms Australia’s readiness to give all requisite aid to the Mother Country in order to bring the present war to an end.
On that occasion Senator Pearce, who was then a member of the; Labour party, said -
I cannot support a motion which pledges the support of Australia’ in men and money to carry the war to any extremity which the British Government may decide is “ advisable or right.
I lift my voice in protest against the second paragraph being, passed in these definite terms.
While we must be loyal to the Empire we must remember that our first duty lies to Australia. The Ministry who rule the destinies of the Empire in Westminster may not always have the best interest of this part of the Empire at heart.
I believe’ the time is ripe for overtures for peace to be made, and it would be generous if the British Government were to concede terms that a brave foe, such as the Boers are, could accept.
I wish honorable senators to particularly note the following: -
We have to consider at the present time whether Australia is justified in offering further aid in the prosecution of this war, or of any other war which Great Britain likes to enter upon.
Seeing that we are the junior partner, and a very junior partner, in this concern, are we not taking upon ourselves more of the responsibilities of the Empire than we should be called upon to bear?
Are we not neglecting our duty to ourselves in taking upon ourselves so much of the responsibilities of Empire?
Have we so many of the young and best that we can spare them for the purposes of war?
We have to be careful that we are not sacrificing too many of our wealth producers i;o the God of war.
I, for one, if asked for a vote upon this question, will say that there should be no further contingent sent to this war.
The Labour party strongly believes in universal peace, which can be brought about only by a general policy of disarmament. The Leader of the Opposition has criticized this Government, which, he says, takes its orders from Russia. for its action in connexion with the defence forces of Australia, in consequence of which a saving of £178,740 is to be effected. Speaking at a meeting of the Nationalist party at its club rooms, Bligh-street, Sydney, in, I suppose, an atmosphere of coffee and meat pies, the right honorable gentleman told the world of the evils of the Scullin Government, and how the country is being Russianized When I endeavoured the other day to quote the remarks of Senator Pearce in 1902 - remarks which I have just read - I was prevented from doing so, but I have managed to “get it in” tonight.
– On the first reading of a money bill I do not think any subject can be regarded as irrelevant.
– I am pleased that the Government has had an opportunity to work in with the League of Nations in the interest of world peace. I admit that the right honorable the Leader of the Opposition (Senator Pearce) - a worthy knight of the British Empire - is entitled to put his case in his own way, but he cannot expect to say one thing in 1902 and another thing to-day without having attention called to his change of front.
Senator Sir HAL COLEBATCH (Western Australia) [10.16]. - Although the Standing Order governing this discussion specifically provides that the debate need not be relevant to the subject-matter of the bill, I take it that I shall not offend against it if I make passing reference to the bill itself. It behoves all sections of the Senate to give the heartiest support to any genuine attempt that the Government may make to reduce public expenditure. It is as useless for us to blame the States, and to say that they are borrowing and spending too much, as it is for them to , blame the Commonwealth. Each has its own job to do. We have, undoubtedly, reached a position in which the cost of government is becoming a heavy and serious burden on our industries. I put it to the Government that the standard of living of that section of the community that it claims peculiarly to represent, must inevitably go down unless the present burden on industry can be lightened. The Australian standard of living has been built up, not by legislation, but out of the profits of industry. To some extent it has also been artificially bolstered during recent years by excessive borrowing. That borrowing must cease. I repeat that, our Australian standard of living owes its existence to the profits that industry has made. And only by restoring those profits to industry, can our standard of comfort be restored. Honorable senators will not deny that, at least so far as the great army of unemployed is concerned, the standard of living has already gone to a very great extent.
On four occasions since the present Government assumed office, tariff increases have been made. Some of these increased duties have now been in operation for seven or eight months. I am aware that it is the practice in a few other countries for new rates of duties to come into operation directly a tariff schedule is laid on the table of Parliament. That is not 30 in the United States of America, however, for in that country the new rates do not operate until the schedule has been passed. The Australian system, by which the new rates apply from the date of the tabling of the tariff schedule, is probably the fairest way of imposing customs duties. But the adoption of that system was never intended to take away from the representatives of the people the exclusive right of imposing taxation. A government’s right to bring in tariff schedules, and to collect the proceeds immediately, implies that the earliest possible opportunity will be taken to submit the new duties to Parliament for its approval, in recognition of the fact that Parliament alone has the right to impose taxation. No government has any statutory power under the Constitution to impose taxes on the people. A government may only suggest taxation. In this connexion, I do not suggest that the present Government has acted differently from its predecessors; but I do contend that the power given to governments ought to be accompanied by an obligation on their part to bring the tariff under review at the earliest possible moment. This Parliament has been in session for several months, but, so far, it has not had an opportunity to discuss any of the tariff schedules which the Government has introduced. The chances are that we shall have no adequate opportunity of considering the new duties, for it is probable that we shall be asked to consider them during the rush that seems inevitable in the closing hours of the session.
Another objection to the course adopted is that when the time for the consideration of the tariff arrives, the duties will have been collected for seven, eight, nine, or even ten months, and that any attempt which the Senate might make to reduce them will be met with the argument that, if the duties are reduced, the Government will be compelled to make refunds of duty to importers, who, having passed on the higher duties to the consumer, will have no just claim, to a refund. The delay in dealing with the tariff practically robs the representatives of the people of their right to review, or to reduce, the duties. There is an even stronger objection to this long delay. The prohibition of many imports has. meant that individuals who for years have been carrying on lawful businesses have been deprived of their means of livelihood, that the organizations which they have built up will be destroyed, with the result that their staffs, and possibly, also, the principals themselves, will be faced with ruin or forced into the ranks of the unemployed. Unfortunately, such instances are not so rare as some honorable senators might imagine. But even if they were rare, would it not be a serious result of an action taken by this Parliament? How much more serious would be that result if it were the outcome of an action taken arbitrarily by a government? The manufacturers of this country, who are supposed to be the people to benefit from the tariff, have already suggested that they are not benefiting to the extent that they expected. The reason is that the people have not the money to spend. I suggest that the only way by which the Government can restore prosperity to this, country is by making it possible for in- dustries to be carried on at a profit. One of the means of achieving that result is to reduce materially the cost of government. The debate that we had this afternoon on wheat production showed clearly that we must produce more wheat and wool as well as those other commodities for the production of which this country is adapted. But the mere increased production of these things will not profit us a penny if we do not produce them at a cost which will enable us to sell them to advantage, thereby enabling us to restore a standard of living of which we ought to have reason to be proud.
– What about the purchasing power of the people?
Senator Sir HAL COLEBATCH.The purchasing power of the people depends on the production of wealth, and on nothing else. If we were to distribute, say, £500 to every man in the community, without creating any additional wealth, we should not increase the purchasing power of the people to the slightest degree. Only by increasing wealth can we increase the purchasing power of the community.
– The warehouses of the country are full of goods which the people cannot afford to buy.
Senator Sir HAL COLEBATCH.The warehouses are not full. The time is not far distant when the people will realize that they have too little rather than too much of the good things of life.
– The leader of the Australian party (Mr. Hughes) said that we produced too much.
Senator Sir HAL COLEBATCH.He has been contradicted by the Labour Premier of Victoria, Mr. Hogan, and by honorable senators on both sides of this chamber, who realize the true position.
I say nothing in criticism of the Government in connexion with the present financial position, for I ‘realize that it has inherited enormous difficulties. When we have the full Estimates before us, I for one, will support the Government in any genuine effort it might make to decrease the present crushing burden of the cost of government upon the industries of this country.
.- I shall not delay the Senate- long. I remind Senator Colebatch that the prohibition of imports is a part of the Government’s economic policy, which it is pursuing on the advice of leading economic and financial experts in this country.
– That does not take away the right of Parliament to consider such prohibitions.
– That is so. No one sympathizes more with the men who have been thrown out of work as a result of that policy than does the Government. But, if we attempt to purchase goods overseas, we must first have credits on the other side of the world to pay for them. The biggest difficulty which the Government has had to face has been in connexion with the position overseas. Senator Colebatch will probably have seen an intimation that the tariff will be discussed soon.
I realize that, on the first reading of a supply bill, a certain amount of laxity, and, perhaps, levity, is permissible. But even a statement made in jest may be taken seriously. Senator Payne, in the course of his speech, told us two old chestnuts; but in the telling of them his memory failed. Honorable senators will remember that, in speaking of the recent election, he said that only one Nationalist member from Tasmania was elected to the House of Representatives, and that one woman elector had said that she had voted for the Labour candidate, although the Nationalist party candidate was a better man. She said that, as a public servant, she had to vote for Labour. That statement can scarcely be correct, seeing that the only Nationalist member for Tasmania in another place, Colonel Bell, was returned unopposed.
– That is not correct. He was opposed, and his previous majority was greatly reduced.
– I am indebted to Senator Sampson for the correction, and hasten to apologize to Senator Payne. Anyhow, the old-age pension story told by Senator Payne I heard from the lips of Senator Pearce when I first entered this Parliament.
I do not propose to answer Senator Ogden’s tirade against the trade union movement. Knowing that he owes a good deal to the movement, I think my most effective reply is to remind him of the words of Shakespeare -
But ‘tis a common proof
That lowliness is young ambition’s ladder,
Whereto the climber-upward turns his face:
But when he once attains the upmost round,
He then unto the ladder turns his back,
Looks in the clouds, scorning the base degrees
By which he did ascend.
I hope that the honorable senator when he studies those lines will not turn his back upon the ladder “ by which he did ascend “.
As the hour is late, it would be impossible for me to reply fully to the financial figures given by the right honorable the Leader of the Opposition (Senator Pearce). I invite honorable senators to read the report of the Auditor-General. It contains the most effective argument that could possibly be put up in reply to the right honorable gentleman’s contentions. I am surprised that Senator Pearce mentioned civil aviation. We all know that when the Commonwealth did not know what to do with all the money it had, it built railways and then subsidized aeroplane services to compete with them. I do not think the Labour party has ever claimedthat the Bruce-Page Government was responsible for the bad seasons the country has experienced or for the present depression. Its complaint is that instead of safeguarding the resources of the country in times of prosperity so as to carry it over any times of adversity the late Government spent all the cash it had with the result that when bad times came there was no money available. Had the Bruce-Page Government taken precautions to guard against the depression which Senator Pearce says it predicted as inevitable, our financial position to-day would be very much better than it is. The Mary Pickford and Douglas Fairbanks business is an old chestnut.
– That does not make the argument any less effective.
– The honorable senator claims that the Bruce-Page Government proposed to tax films from overseas. As a matter of fact the BrucePage Government’s proposition was a tax of12½ per cent. on the gross takings of theatres.
– The proposal was to impose a tax of 5 per cent. on gross takings and 12½ per cent. on the money sent away to pay for films from overseas. They were two distinct proposals.
– Labour’s opposition was to the gross taxation of the theatres. Early in the reign of this Government, I told honorable senators, and my announcement was greeted with approval, that the Commissioner of Taxation was considering ways and means by which picture films could be taxed.
– Why has not the tax been put on during the present financial year?
– I always understood that the Nationalist party was opposed to retrospective legislation. When the bill is before the Senate any request made by the Senate, if it is practicable, will be given serious and sympathetic consideration by the Government. Candidates cannot be prevented from making promises or giving pledges, but the party which was returned to power at the last election made no promise to the American or any other picture interests ; it owes no allegiance to any particular interests. Each and every interest that operates in Australia must bear an equitable share of the taxation of this country.
I am indebted to Senator Pearce for drawing my attention to the need for control of wireless news at sea. I have had an experience similar to that which he has narrated. I was travelling from Adelaide to Perth on one of the coastal steamers and on examining a magazine which is issued every morning on the boat I found that there was a lot in it about some man shooting his wife in a church in Paris - I had read about it in Sydney a few days before. There was also a description of a rugby football match in New South Wales, and there were a few lines about a threatened strike in Sydney. But there was nothing about Adelaide. That city was not on the map. It seems to me, now that attention has been focussed on the matter, that the wireless people should be told that messages blackening the fair name of Australia will not be permitted. The Darwin affair was only an ordinary “ scrap “. I shall ask the Postmaster-
General to see if the matter cannot be rectified.
Question resolved in the affirmative.
Bill read a first time.
– I move-
That the bill be now read a second time.
It is estimated that the sum of £7,636,270 will be required for supply purposes during the first three months of the next financial year. This amount includes the following sums for ordinary services: -
These items are based on the appropriation passed by Parliament for the present financial year and the provision will cover the first pay day in October next. By reason of economies which have been effected, the provision is, in some cases, below the annual rate of expenditure last approved by Parliament. Consequent upon the change in the administration of the Territory for the Seat of Government, it is necessary to include in this bill provision to meet the ordinary services of the Territory. Formerly these requirements were met from moneys made available to the Federal Capital Commission by the authority of Parliament.
In addition to the items mentioned the usual provisions are made for “Refunds of Revenue”, £350,000; and “Advance to the Treasurer”, £1,500,000. The latter amount is required mainly to enable loan works and services in progress at the 30th June, 1930, to be continued, pending the passing of a loan bill for the next financial year. Requirements for “Additions, New Works, &c,” payable from Revenue, and Miscellaneous Unforseen Expenditure are also covered by this sum.
The sum of £750,000, set down as a grant by the Commonwealth to the States for the relief of unemployment is an unusual item in a bill of this nature. It has been included in accordance with the announcement made by the Prime Minister on the 12th June, that the Government had decided to place on the Estimates for the next financial year the sum of £1,000,000, as a grant for the relief of the unemployed. It is proposed that the full grant shall be available to the States during the first four months of the financial year as immediate action is necessary. Accordingly, three-fourths of the grant has been included in the bill. The Government arrived at this decision after consultation with the Loan Council. Final details and conditions of this expenditure have not been definitely determined, but the States will be given a certain amount of latitude so that they may, at the one time, alleviate unemployment and carry on necessary works.
With an exception in favour of South Australia, where the position merits special consideration, the grant will be distributed, broadly speaking, on a population basis, and the allocation is as follows :-
When the budget for the coming year is brought before Parliament early next month, honorable senators will have a full opportunity to discuss Australia’s financial position.
Debate (on motion by Senator Sir George PEARCE) adjourned.
Senate adjourned at 10.43 p.m.
Cite as: Australia, Senate, Debates, 26 June 1930, viewed 22 October 2017, <http://historichansard.net/senate/1930/19300626_senate_12_125/>.