12th Parliament · 1st Session
The President (Senator the Hon. W. Kingsmill) took the chair at 3 p.m., and read prayers.
asked the Minister representing the Treasurer, upon notice-
Is it the intention of the Government to further assist the Shale Oil Commission in its work in the production of shale oil by a grantof money, larger than the present sum of £93.000?
– The Treasurer baa supplied the following answer to the honorable senator’s question: -
The sum of £93,000 was allocated by the Commonwealth Government for the repatriation of surplus mine-workers in New South Wales, and the Shale Oil Development Committee was established for the purpose of administering this fund in connexion with the development of the shale oil industry. There is no present intention of increasing this allocation.
asked the Minister representing the Minister for Defence, upon notice -
In view of the close approach of Christmas, and the amount of unemployment in the shipbuilding industry, will the Governmentat once instruct the Naval Board of Australia to send all obsolete warships to Cockatoo Island in order that the work of breaking them up may bc put in hand!
– The Minister for Defence has supplied the following answer to the honorable senator’s question : -
All naval vessels now in reserve are earmarked for specific naval duty in emergency. None of them is obsolete, and it is regretted that none can be made available for breaking up.
asked the Minister representing the Minister for Defence, upon notice -
Is there any regulation or act in force that would allow the Commonwealth Government or Defence Department to conscript persons for oversea naval or military service?
– The Minister for Defence has supplied the following answer fo the honorable senators question : -
No power exists for compelling oversea military service. The relative portions of the Defence Actare: -
Section 59. - All male inhabitants of Australia (excepting those who are exempt from service in the Defence Force) who have resided therein for six months and are British subjects, and are between the ages of eighteen and 60 years shall, in time of war, be liable to serve in the Citizen Forces.
Section49. - Members of the Defence Force who. are members of the military forces shall not be required, unless they voluntarily agree to do so, to serve beyond the limits of the Commonwealth, and those of any territory under the authority of the Commonwealth.
In regard to the Naval Forces, section 33 of the Naval Defence Act 1910-1918 provides as follows: - “ Members of the Naval Forcesmay be required to serve for training or any naval service either within or beyond the limits of the Commonwealth.”
asked the Minister representing the Treasurer, upon notice -
Is it the intention of the Government to sot aside a sum of money for the purpose of assisting the Lynns Bros., engineers, of Newcastle, in their research on the subject of the production of motor fuel from coal byproducts ?
– The Treasurer has supplied the following answer to the honorable senator’s question : -
Arrangements have been made for Dr. A. C. D. Rivett, chief executive officer of the Council for Scientific and Industrial Research, who is an authority on the question of the productionof oil from coal, to inspect the works of Messrs. Lyons Brothers, on or about the 26th November next. Fending the receipt of a report from Dr. Rivett, it is not possible to determine what further action, if any, is desirable on the part of the Commonwealth Government.
asked the Minister representing the Prime Minister, upon notice -
In view of the fact that the Government recently instructed that all officers of the Public Service must take their furlough before reaching the age of retirement, willhe ascertain and inform the Senate -
How many officers underthe control of the Public Service Board have been allowed to remain in the service longer than the period laid down by the Government’s decision; what are the names of such officers and the reasons for making exceptions in each case?
How many officers in the parliamentary service have been allowed to remain in the service longer than the period laid down hy Government decision; what are the names of such officers and the reasons for making exceptions in each case?
– The information asked for in the first portion of the honorablesenator’s question is being obtained. The second portion of his question should be addressed to the presiding officers of Parliament.
Regulations and Rulings
asked the Minister representing the Treasurer, upon notice -
Will the Government consider the compilation, at an early date, of a uniform set of regulations and rulings dealing with the sales tax, especially those which relate to the Sales Tax Acts passed last August?
– The Treasurer states that the Commissioner of Taxation has had this matter in hand for some time, but has been unable to complete it owing to the great volume of pressing work under the Sales Tax Acts. The handbook will, however, be issued as early as possible.
The following paper was presented: -
Report o£ the Imperial Geophysical Experimental Survey, edited by A. B. Broughton Edge and T. H. Laby.
Bill received from the House of Representatives.
Motion (by Senator Barnes) proposed -
That so much of the Standing and Sessional Orders he suspended as would prevent the bill from being passed through all its stages without delay.
Senator Sir GEORGE PEARCE (Western Australia) [3.11]. - I do not intend to oppose the motion; but I do not wish my acquiescence in it to be misunderstood. I have had an opportunity of reading this bill, as it was distributed to honorable senators this morning. It is a complicated measure, which deals in the most intricate manner with a very important subject. It does not appear to me to be the class of bill which should be rushed through the Senate without full consideration. Perhaps the Minister’s explanatory speech may make clear to me things which are not clear at present; but I suggest that, after the Minister makes his second-reading speech, the Government should agree to adjourn the debate until a later hour this day, or until to-morrow, so that we may have an opportunity of studying the probable effect of certain obscure clauses. Very often honorable senators, before being asked to deal with measures, have the advantage of reading the Ilansard report of the speeches made on them in another chamber, but that is not the case in this instance, because the bill was onlypassed by the other House last night. I’ have read abridged press reports of thediscussion that occurred there, but I do not understand how it is proposed to make the measure effective. I shall not be prepared to continue the discussion immediately after the Minister concludes hiss second-reading speech.
. - I agree with the right honorable senator that the bill is somewhat intricate. The Government has no intention of asking honorable senators to pass it without due consideration. Every opportunity will be given to discuss the different clauses at the committee stage; but I accept the suggestion of the Leader of the Opposition (Senator Pearce), and, at the conclusion of my second-reading speech, I will move that the debate be adjourned until a later hour this day.
Question resolved in the affirmative.
Bill (on motion by Senator Dooley) read a first time.
. -I move -
That the bill be now read a second time.
I feel sure thathonorable senators opposite will agree that the Government has left no stone unturned to give the farmers that assistance which it considers they rightly deserve; but many obstacles have been put in the way of its doing so. Through the rejection by the Senate last year of the Wheat Marketing Bill, our farmers were left in a desperate plight. Many of them were faced with ruin. A return recently prepared for the Attorney-. General (Mr. Brennan) showed that a large number of farmers have been compelled to file their schedules in the Bankruptcy Court. Many other farmers who are in bankrupt circumstances are being carried by their creditors in the hope that, with returning prosperity, they will be able to liquidate their obligations. Realizing the paramount need of granting assistance to the wheat-growers,the Government swallowed the rebuff administered by the Senate, and brought down lim Wheat Advances Bill. This measure wai passed through both Houses of Pari liament, but the refusal of the Commonwealth Bank to provide the necessary advances rendered that scheme nugatory. The Government, however, was able to arrange with the bank to increase its advance on wheat from 2s. to 2s. 4d. per bushel f.o.b. The advance was made to voluntary pools on all unsold wheat in their hands, and those farmers who were participants in the voluntary pools profiled to the extent mentioned.
The Premiers Conference held in February, 1931, gave’ consideration to ways and means of providing financial assistance for wheat-growers. The proposition considered was the raising of a loan of £6,000,000 to provide a bounty of 6d: a bushel on the 1930-31 wheat, crop, and, iu addition, to enable loans to be made to farmers in necessitous circumstances. However, it was subsequently decided that the time was inappropriate for an approach to the loan market. It was then proposed to grant the necessary relief in another manner, and the Fiduciary Notes Bill was introduced, with the concomitant Wheat Bill. The rejection by the Senate of the Fiduciary Notes Bill closed this avenue.
Meantime, the plight of the farmers was growing more and more desperate, and a further attempt was made, by means of the Wheat Marketing Bill, to give the assistance so urgently required. That measure was similar to the 1930 Wheat Marketing Bill, with the exception of the provision for a guaranteed price. Once again the Senate refused to approve of the assistance proposed to be given by the Government.
The matter was further considered’ at the Premiers Conference held in August, 1931, and the conference endorsed a proposal for the payment of a bounty of 6d. per bushel for wheat produced in the 1931-32 season, provided that the bounty would not bring the f.o.b. price above 3s. per bushel. The matter was referred to the Commonwealth Bank and the trading banks with the object of arranging for the necessary finance, and the chairman of the Commonwealth Bank submitted a basis on which a bounty might be provided. This bill has been drafted along those lines. The banks could not see their way clear to include in the scheme the wheat harvested last season, and the bounty is, therefore, limited to the 1931-32 season.
The main feature of this proposal ‘is that the bounty will be payable to the grower of wheat upon its delivery to a licensed purchaser - that is, a wheat merchant, flour miller, wheat pool, or other prescribed co-operative organization. On. the delivery of the wheat to the licensed purchaser, the wheat-grower will receive a certificate which will indicate the quantity of wheat purchased, and the f.o.b. equivalent of the price paid per bushel. Upon presentation .of the certificate at the Commonwealth Bank, the wheatgrower will receive payment of bounty. As there is no straight-out price fixed in the case of wheat pools, the certificate will bear an estimated price, and provision is made for an adjustment, if necessary, when the price can later be ascertained.
The purpose of requiring purchasers of wheat, to be licensed is that control may be exercised to secure compliance with the terms of the act. With regard to wheat sold for consumption in Australia, the bill provides that the licensee shall, pay to the Commonwealth Bank as agent for the Government an amount equal to the bounty . paid, but not exceeding 6d. per bushel. In this respect a separate Wheat Charges Act is necessary to give power to collect the charge not exceeding 6d’. per bushel to which. I have ‘ just referred. This measure provides for a charge hot exceeding 6d. per bushel to be paid by persons or organizations licensed under the Wheat Bounty Act 1931 on all wheat, in respect of which such licensees have been issued a certificate under that act, and which such licensees (a) have on or before the 31st October, 1932, sold for consumption within Australia; (h) have on or before that date used in the production of flour for consumption within Australia; or (c) have on hand on that date.
– The Assistant Minister has not informed the Senate why the Wheat Advances Act of 1.930 is being repealed.
– It was my intention to refer to the repeal of that measure in committee. The Commonwealth Bank could not see its way clear to finance the scheme, and doubtless, as the farmers have commenced to feel that they have been humbugged by legislation, it is thought desirable to repeal the act.I submit that the farmers have no occasion to blame the Government in this connexion as it has endeavoured to place on the statute-book legislation to assist them. Although they may have thought it was only so much eye-wash, in reality, the Government left no stone unturned to provide some form of relief to the wheatgrowers, and the Senate has to takeits share of responsibility for the rejection of’ certain measures introduced by the Government, to assist the wheat-growers. It has been found impracticable to bring the Wheat Advances Act of 1930 into operation, and it is just as well to tell the farmers that the Commonwealth Bank has refused to make the money available. If we do so, they will know exactly where they stand. We should at least tell them that it is impossible to give effect to the provisions of that measure, and that the only alternative is not to dabble further with this question which, I contend, has already been dabbled with too much. Had the Senate agreed to the Government’s first proposal, which provided for the payment of a guaranteed price of 4s. per bushel, something could have done, because at that time the Commonwealth Bank was prepared to make an advance. As time went on, the price of wheat commenced to fall, and eventually dropped from 4s. or 5s. to1s. 6d. per bushel. No one could then foresee that such a drop in the price of wheat would occur just as it could not be foreseen two or three weeks ago that the price would increase to the extent it has. The farmers wish to know where they stand. We must be honest in matters of this kind. The Government, having been refused financial assistance by the Commonwealth Bank in respect of the Wheat Advances Act of 1930, is now endeavouring to place on the statute-book a measure which will be of practical assistance to the wheat-growers.
Debate(on motion by Senator Sir George Pearce) adjourned.
Bill received from the House of Representatives.
Standing and sessional orders suspended, and bill (on motion by Senator Dooley) read a first time.
Motion (by Senator Dooley) proposed -
That the report- be adopted.
Senator Sir GEORGE PEARCE (Western Australia) [3.26]. - I rise to correct a statement which I made in speaking yesterday on the subject-matter of this bill. I said -
There is associated with this committee - the Public Accounts Committee - a secretary who doubtless has some staff to help him. So longas the committee is maintained under existing conditions the members of the staff must be retained in their positions, even if there may be no work for them to do.
I further said that the staff could have only a limited amount of work to do at present. At the time I made those remarks, the committee was, I understand, engaged upon an inquiry - and is at present conducting that inquiry - which does give the secretary and staff associated with the committee a normal amount of work to perform. I have no desire to reflect upon any officer of the Public Service, and as my remarks may be construed to mean that, although the committee is functioning, its officers are not fully employed, I wish to correct that statement. I am sure that if the committee is engaged on an inquiry, as I understand it is, its officers are fully employed.
Question resolved in the affirmative.
Debate resumed from the 20th October (vide page 870), on motion by Senator Dooley -
That the bill be now read a second time.
– I have no desire to be known as the defender of the Public Accounts Committee, the Public Works
Committee or other similar parliamentary bodies. But having had some experience with bodies similar to the Public Works Committee in the State political sphere, and having been associated with the Commonwealth Public Accounts Committee, I feel justified in defending them from the attacks of some honorable senators. I do so, not from any personal motive, or from a belief that I may some day become a member of the Public Works Committee; but because I believe that such committees are an essential part of the parliamentary machine, and should be functioning in order to exercise some control over public moneys, whether derived from revenue or from loan funds. I listened with considerable attention to the explanation of the activities of this committee that was furnished to the Senate by the Minister who moved the motion for the second reading of the bill, and to the very lucid explanation of its work that was given by Senator Sampson - who, I understand, has been for some time associated with it, and can speak from experience.
Honorable senators ought to be guided by the experience of, not only the Commonwealth, but also the States. For a number of years there has been in South Australia a body known as the Parliamentary Railways Standing Committee. It was instituted about the year 1912, for the purpose of investigating proposals for the construction of new lines of railway, and reporting to Parliament as to the advisability or otherwise of proceeding with them. Under the provisions of the act which constituted that committee, it was mandatory on the government of the day to refer to it any proposal for the construction of a new line of railway, the cost of which was estimated to exceed £25,000, and, if the report of the committee on the project was an adverse one, the government was precluded from going ahead with the work. I understand that similar legislation is in operation in almost every State in Australia. I became associated with this body in South Australia. In the course of our investigations, I and the other members of it learned that, as a result of the restraint that had been placed upon governments and parliaments, expenditure upon new railways that would have run into many millions of pounds had at different times been prevented. While I was chairman of this body, the government of the day was keenly desirous of opening up a new tract of country for the absorption of some of the migrants brought to Australia under the £34,000,000 migration agreement entered into by the Commonwealth Government with the Government of Great Britain. A proposal to construct a line that would have cost approximately £500,000, which had the support of officers who had carried out a certain amount of investigation, was referred to the committee.
– Where was this country ?
– On Eyre Peninsula. There were a number of practical men on the committee, and they refused to even conduct the inquiry until a proper investigation had been made into the likelihood of there being an adequate rainfall. An inspection of the locality revealed evidence of dry conditions, which the practical man could readily recognize, having studied the plants that grow in districts with a rainfall which makes possible the production of wheat, and those that are indigenous to territory which is suitable only for pastoral pursuits. Although good seasons had been experienced in this district for a number of years, it was ultimately proved that the opinion formed by the committee was the correct one, and that its prevention of the construction of this line was justified.
– Did the Public Works Committee of South Australia approve of the expenditure upon the Adelaide railway station?
– I shall reply to the right honorable senator in due course. This district has since passed through one of the worst periods of drought in the history of white settlement, and, had the line been constructed and the unfortunate migrants placed on the land there, one of the greatest tragedies in the settlement of that State would have been witnessed. Through the foresight of this body, not only was the money which would have been wasted on the railway saved to the State, but the expenditure of the further huge sum that would have been involved in the placing and maintenance of the settlers on unsuitable land, was rendered unnecessary. To-day the Government of South Australia is seriously contemplating closing down a number of railways which were constructed us the result of parliamentary agitation and the desire of the Government of the day to please certain of its supporters and their constituents, because, not only are they not making any contribution towards the interest that has to be paid on the capital invested in them, but they are not even earning anything like working expenses.
The right honorable the Leader of the Opposition (Senator Pearce) has referred to the new Adelaide railway station. The only section of what subsequently became known as the South Australian railways rehabilitation scheme, which was the subject’ of inquiry by the Kailways Standing Committee of South Australia, was a short section of gauge broadening between Brinkworth and Gladstone. That work was rendered necessary by other operations connected with the rehabilitation scheme. The balance of the expenditure, running into something like £11,500,000, was incurred on the authority of the Railways Commisioner, who acted under the powers that were vested in him by the Railways Commissioners Act. I venture to affirm that had these proposals for rehabilitation, which were virtually new works, been inquired into by the body to whom I have referred, many of the mistakes that were made would have been avoided, and a number of extravagances, such as that mentioned hy the right honorable senator, would not have been perpetrated. The continuously good work that was performed
I ry this committee gained recognition from succeeding governments, which converted it into what in reality was a Public Works Committee; under an authority which enabled works other than railway works to be referred to it; and the practice grew up of referring to it practically aU important public works. In 1927, the Parliament of the day altered the constitution and the procedure of the committee by converting it into a Public Works Committee, in which form it is functioning at the present time. I wish particularly to stress this aspect The conferring of wider powers and the conversion of this body’ into a Public Works Committee were effected as late as 1927. With the experience of fifteen years to guide it, the Parliament of South Australia had such confident in this method of investigating proposal for the construction of new works, that it not only accepted the principle in iM entirety, *but also gave to the members oi the committee a status which the members of the Commonwealth Public Works Committee do not posses to-day; that is to say, instead of making provision for the payment of fees or allowances, provision was made for each member of the committee to receive a specified salary per annum for the service that he thus rendered to the State. Although the great need for economy has been forced upon the people of South Australia, the work of the Public Works Committee during these years of depression has been so successful that it has not even been suggested by any one in the State that the committee should be either abolished or suspended, as was suggested by certain honorable senators during the course of the debate, on the Committee of Public Accounts Bill should be the fate of the standing committees of this Parliament. My experience in a State Parliament, and in this Parliament, has led me to the conclusion that Parliament is too unwieldy a body to deal effectively with many of the questions it is called upon to control, or with many of the problems it is asked to solve in the interests of the people; and I am firmly convinced that the committee system is a necessary adjunct to the efficient functioning of any legislature, particularly in respect of proposals for the construction of new works. I cast no reflection on the officers of th/j Commonwealth Department which may be associated with proposals for the construction of new works in various parts of Australia, when I say that, unless there is some body to which Parliament Can look to accept responsibility for the proper investigation of those proposals, there will be demands of individual members on the Government, of the day, which the Government will not be able to resist. Very often, in order to increase their numbers, members from one State in which some work is contemplated will seek the co-operation of members representing other States on the principle that those members will support them in the hope that in three months’ time they in turn will be supported in pressing for the construction of a ‘ work in perhaps another State.
– That is log-rolling.
– The demand upon the Government of the day from individual members makes its influence felt on the officers of the departments, and, conscientious men though they may be, they are not able to withstand the apparent will of the Government of the day. The honorable senator was right in calling it log-rolling, of which we have had abundant instances in the past; but I think it can be -said that, since the appointment of parliamentary standing committees, we have not had so many instances of it as characterized government activities before they were appointed. ft has been suggested, tentatively, of course, that because wc cannot secure loan money, the Public Works Committee should be suspended for a period. There may be much to commend that suggestion, but if it is looked at from every aspect, I am sure it will . be found that there is a prospect that within the twelve months, for which period it has been suggested the committee should be SUSpended, the Commonwealth will be able o go on with certain urgent works that ought to be proceeded with at the earliest possible moment in order to afford some relief to that unfortunate class of people who for years have followed the occupation of navvies on public works in different States. The earliest opportunity should be taken by this Parliament to proceed with any public works which can be justified in order to minimize, to some extent at any rate, the condition of that most: worthy class of citizens. But if ii should be decided to suspend the activities of the Public Works Committee, the authority of this Parliament and the Government would be nullified to the extent that it would, for the period of suspension, not be able to engage upon the construction of new works of any marni.ude. As a matter of fact, I believe that a sum of money has been made available from revenue for works purposes during the current financial year, and it may be found as time goes on that inquiries into the expenditure of this money are necessary. But if the Public Works Committee is suspended the inquiry cannot take place. What could be saved by a suspension ? The secretary of the committee would have to be retained in the Public Service in some other capacity. 1 understand that his valuable services have already been employed in one of the departments iu connexion with thiFederal Capital Territory.
– At the present moment he is chairman of the milk inquiry board.
– I am sure that, other opportunities will present themselves for the utilization of any of his spare time. It must be remembered thai the members of the committee draw allowances only for attending sittings of the committee. They cannot institute inquiries of their own volition. Any inquiries commenced by the Public Works Committee must be on specific references from the Government or from Parliament. I deny that there is any tendency on the part of the members of the committee to work simply for the sake of holding meetings. From experience I know that there is no profit in being associated with these inquiries. At most, a member of a committee derives only approximately sufficient to meet his out-of-pocket expenses in connexion with the work hris called upon to do. But apart from that, I have sufficient confidence in the men selected by the respective branches of this legislature to know that no chargeof tho kind I have mentioned can be sustained against them.
I hope that the hostility which the Senate showed to the Public Accounts Committee will not be extended to the Public Works Committee. This bill is a measure of efficiency rather than a measure of economy. The Government has already effected in regard to the Public Works Committee an economy much greater than has been effected in regard to any other activity of this Parliament. But in order to promote efficiency and standardize both standing committees the Government has suggested that the membership should be reduced to seven in both cases. In the case of the Public Accounts Committee the Senate has further reduced the number to five, but I hope that, after mature consideration of the arguments advanced in this chamber by those who have had experience on these committees, the proposal of the Government that the Public Works Committee shall be reduced from niue to seven will be accepted, and that in all other regards the committee will be allowed to function without any further interference on the part of this chamber.
Senator DUNN (New South Wales) 3.50J. - I appreciated -very much the remarks made by Senator Sampson in the discussion on the bill relating to the Public Accounts Committee. The honorable senator had given the subject-matter of his address very careful attention, and furnished much interesting and useful information about the work of that body. I . also congratulate Senator O’Halloran on his defence of the Public Works Committee, of which he is a member. Because of his long association with the State Parliament of South Australia, the honorable senator has an intimate knowledge of the working of parliamentary committees, and naturally he wishes to st.e them continued. But, to-day, there is n definite call for economy. The reli chiliitation scheme, which has the endorsement of all Governments, State and Federal, involves drastic economies in every direction. I believe that the efficiency of the Public Works Committee would not bc impaired if its numbers were reduced, and when the measure is in committee, it is my intention to submit an amendment on lines similar to that made to the Public Accounts Committee Bill. All governments, not only in Australia, but in other countries, are committed to the economies. In Western Australia, recently, the State Government closed down on contemplated expenditure for additions to the wharf at Busselton, and, as the Commonwealth Government has no money available for public works, this committee will have nothing -to do for some time to come. I hope, therefore, that honorable senators will give me their support when 1 submit the amendment of which I have just given notice.
.- It is rather encouraging, and perhaps it augurs well for the future of Australia, that the representatives in this chamber of the Beasley party are so anxious to ensure economies in governmental expenditure. I may, however, inform Senator Dunn that, for all practical purposes, the Public Works Committee exists only on paper. There ha3 been no meeting of that body for at least six months.
– What has the staff been doing?
– I do not know what work is being done by the secretary, but I understand that one member of his staff has been transferred to another government department, and the messenger has been absorbed in the general staff of parliamentary messengers. As honorable senators are aware, this committee functions only when works estimated to cost more than £25,000 are submitted to it, for inquiry and report, and as no works are in hand, the committee is incurring no expenditure. Since its appointment, it has saved the taxpayers of Australia thousands of pounds on the various public works upon which it has reported. No one will suggest that works proposals prepared by departmental officials are always perfect. On numerous occasions, expert information obtained by the committee from sources outside the department, have resulted in substantial economies.
– Did the committee report on the Flinders Naval Base wharf which was constructed at considerable’ expenditure on’ a site where there is no water at low tide?
– Naval works are exempt from the provisions of the Public Works Committee Act.
– I have no recollection of that particular work having come before the committee; but, as Senator Foll has pointed out, the Navy Department is solely responsible for all expenditure on naval works. If a mistake was made in the matter referred to, the fault must lie with the Navy Department. The secretary of this committee is one of the most efficient officers in the Public Service. He is a man of long experience and marked ability, and has rendered very useful service in his present pOrntion, We should, I think, take a somewhat longer view of the work of this committee. Everybody hopes that Australia will soon emerge from the present, depression, and that the Government will be giving its attention to Commonwealth works schemes for the absorption of unemployed. I, therefore, consider that it would be wise, if the Government has in mind any particular projects, to submit them to the committee for inquiry and report, so that when our financial position improves, they may be put in hand without a moment’s delay. An amendment of the bill in committee to reduce the number of members will not mean an economy, because, as I have stated, the committee is not now functioning. I think also that it would be a mistake to reduce the number to five, because, for various reasons, it is difficult always to ensure the attendance of all members at meetings, and if the personnel were reduced to the number stated, it might be difficult to obtain a quorum. 1 am just as anxious as any other honorable senator to see all possible economies effected, but no economy will be achieved through interfering unduly with this committee, because it is not costing anything at present.
– Is the work of thi* committee more important than that of the Accounts Committee?
– -I do not know much about the work of the Accounts Committee ; but I know that the Works Committee only makes such inquiries as Parliament directs it to make. The Accounts Committee, which can initiate inquiries, has done useful work ; but its reports are often ignored, whereas the reports of the Works Committee are always carefully considered by the Government. The Works Committee is in an entirely different category from the Accounts Committee. Every public undertaking estimated to cost more than £25,000 must be inquired into by the Works Committee. This committee has done very useful work, in the past, and I have no doubt that it will do equally useful work in the future.
– An impression was created during the debate on the Public Accounts Committee Bill that the officers of the committee were not doing any work. The Leader of the .Opposition (Senator Pearce) made a personal explanation yesterday in regard to his statements in that connexion. It may also be thought that the officers of the Works Committee have nothing to do while the committee is not functioning. But I point out that the secretary of this committee, Mr. Whiteford, is the chairman of the committee appointed to inquire into the milk supply of Canberra.
– Will he also be asked to inquire into the circumstances surrounding the establishment of the hog farm in the Federal Capital Territory?
– No investigation has been ordered into that subject. If the honorable senator can advance sufficiently good reasons for the making of it, it will doubtless be made. The officers of these committees are not simply waiting about for something to turn up. Their services are fully employed in various ways. When officers of other departments are absent through sickness or other causes, the officers of these two committees are available for relief purposes. I hope that the Senate will pass this bill, and also that it will accept the proposal of the Government in regard to the membership of the committee.
Question resolved in the affirmative.
Bill read a second time.
Clause 1 agreed to.
Clause 2 -
Section three of the principal act is repealed and the following section inserted in its stead: - “3. - (1.) As soon as conveniently practicable after thu commencement of this section, and thereafter at the commencement of the first session of every Parliament, a joint committee of seven members of Parliament, to be called the Parliamentary Standing Committee on Public Works ( in this act referred to aa ‘ tin* committee ‘ ) , shall be appointed according to the practice of the Parliament with reference to the appointment cil members to serve on joint select committees of both Houses of the Parliament. “ (2.) Two of the members of the committee shall be members of and appointed by the Senate, and five of the members of the committee shall bc members of and appointed by the House of Representatives.”.
Amendment (by Senator Dunn) proposed -
That thu word seven proposed new section 3 sub-section 1. be left out with a. view to insert in lieu thereof the word “ five “.
– I hope that the committee will not accept the amendment. My two years’ experience on this committee has shown that it is, at times, extremely difficult to obtain a quorum. If the membership of the committee is reduced to five the difficulties in that respect will be very greatly increased. Such a limitation of the membership of the committee will undoubtedly mean that at times the committee will not be able to function. Even with a membership of nine, there have been times when, through sickness and other causes, the attendance of a quorum has been assured only with great difficulty. No economy will be effected by reducing the membership of the committee to five, because only those members of the committee who attend the meetings can draw fees. I realize the vital need for economy in these times ; but we shall delude ourselves if we think we are effecting an economy by further reducing the membership of this committee. Moreover, we shall make it difficult to apportion the membership fairly between the two Houses of Parliament and the different parties. If a membership of seven is agreed to, some latitude will be allowed.
.- I also hope that the committee will reject the amendment. I reiterate the statement of Senator Sampson that no economy will be effected by reducing the membership of the committee to five. “We must remember that the interests of efficiency deserve consideration. Economies are needed in these days, but so is efficiency. If the membership of the committee is reduced to five, the efficiency of the committee will be greatly endangered. I ask the honorable senators to accept the assurance of Senator Sampson and myself on this point. It is extremely difficult at times, even under existing conditions, to obtain a quorum. Seeing that the committee will only function when Parliament asks it to do so, we shall not be running any risk of incurring great expenditure by accepting the clause as it stands.
.- A day or two ago this con>mittee indicated by an- unmistakeable vote that,’ under “ present conditions, a membership of five was sufficiently large for these committees. If there has been a difficulty in the past in securing a quorum, I suggest that it has been due to the fact that the wrong members have been appointed to the committee. Hitherto honorable senators have been willing to accept appointments to these committees, because they have realized that it would not always be necessary for them to be in attendance. I will go as far as to say that the attendances at the committee meetings have been more or less perfunctory. If honorable senators, or the members of another place, accept the duty of membership of these committees, they should do the work that is required of them. They should at least make arrangements to attend the meetings regularly. It is hard to believe that sickness has been an important factor in making it difficult to secure a quorum at the meetings of a committee the effective membership of which is 10; but if that is so, I suggest that the remedy is to appoint healthy members to the committee. There is a great similarity between the Public Accounts Committee and the Public Works Committee, and it would be absurd for us to say that, although five members are sufficient for the former, seven are necessary for the latter. When the financial situation eases somewhat, and there is a large amount of work for the Public Works Committee to do, the act could be amended to provide for the appointment of additional members.
– I hope the committee will reject the amendment. Many of the arguments used in opposition to the proposal to appoint five members to. the Public Accounts Committee apply with equal force to this proposition. An inquiry may be necessary in New South Wales. If the committee has two Tasmanians and two Western Australians included m its membership; it may be difficult for them to attend^ for I remind honorable senators that these committees do most of their work during the parliamentary recesses when members like to be in their constituencies as much as possible. If the committee had only five members’ on * it, I am sure many inquiries would ‘ have to be made with only three members present. It would be farcical, I suggest, to reduce the membership so greatly.
– Five members should be ample when the committee has uo work to do.
– The honorable senator has himself suggested that when the committee has more work to do, five members would not be enough. Should we not bear in mind that we are legislating for a committee which will have work to do? It seems to me that the amendment has been moved in a spirit of contrariness. Certain honorable senators wish to be “ ag’in the Government.” information furnished to me shows that on many occasions not 50 per cent, of the members of this committee are present al its sittings. Many reasons apart from sickness may be advanced to explain this. As Senator Reid has pointed out, inquiries are often made in States far distant from those represented by some members of the committee, and this makes attendance at the committee meetings very difficult. If an inquiry is being held in New South Wales, it might be very awkward for Tasmanian or Western Australian members of the committee to bc present.
– A member of a committee who cannot attend its meetings should resign.
– They are frequently prevented from attending at the last moment. In view of all the circumstances, I ask the committee to agree to the clause in its present form. If public works are to be undertaken to relieve unemployment, as I hope will be the case, it may be necessary for the Public Works Committee to function before the end of the year.
.- I consider that the committee should consist of not less than seven members. T hold no brief for this committee, particularly when I realize that it was responsible, among other things, for rejecting a scheme to provide ornamental lakes in Canberra which, if constructed, would have been of great benefit to those who are compelled to reside here. It would be interesting to know why the Government has introduced this measure at this juncture, when other important legislation is awaiting our attention. Notwithstanding the fact that a Debt Conversion Bill, a Debt Conversion Agreement Bill, a Customs Tariff, a Wheat Bounty Bill, and many other small but important measures are awaiting our consideration, the Government places at the top of the noticepaper a bill which merely provides that the number of members of the committee, which is not even functioning, shall be reduced from ten to seven. It would appear that the Government is anxious to delay a discussion of important measures, otherwise it would not give prominence to such «n unimportant ill.
.- In view of the vote which I recorded on the Public Accounts Committee Bill J must, in order to be consistent, support the amendment. Having had experience as a member of the Public Works Committee, I feel that a committee of five could function as efficiently as a committee of seven. The important work undertaken by this committee from tun? to time could be more efficiently performed by a smaller committee, With an unnecessarily large number of members there is a good deal of wearisome repetition in the cross examination of witnesses, and, consequently, unnecessary expense in the printing of evidence. The committee of which I was a member did excellent work, and I believe that with a smaller committee closer attention could be given to the proposals which it has to consider.
– It is sometimes difficult to get a quorum, and with a committee of five the difficulty would be intensified.
– If a careful selection were made it would be easier to get. a quorum with a smaller committee than under the present system. Parliament could select a representative committee, the members of which would attend regularly and devote their time to the important work they are expected to perform. It is easy for a member to attend meetings of the committee and claim his fee without giving the slightest attention to the proposal before it. On numerous occasions very important matters have been investigated by a sectional committee consisting of three members.
– Because a quorum could not be secured.
– That is not so. It was done to save unnecessary expense.I could readily select a committee of five members who would attend every sitting of the committee. I support the amendment.
– Having had a fairly long experience as a member of the Public Works Committee I am able to speak with authority on the excellent work it has performed on behalf of this country. The Government favours a committee of seven because it, realizes that, owing to the attention which some of its members have to give to the requirements of their constituents, a smaller committee may not be able to efficiently carry out the important work entrusted to it. Moreover, on a committee of. five each State could not have representation. The members of such committees do not profess to be experts, but as practical men they are able to sift the evidence tendered by technical and other witnesses, and come to a satisfactory decision. It has been shown that during the time the committee has been functioning it has investigated public works costing approximately £26,000,000, and has saved the country no less than £5,000,000.
– Where is that £5,000,000?
– It was spent by the Government which the honorable senator supported. Each State should he represented on the committee.
– At present Victoria is not represented on either the Public Accounts Committee or the Public Works Committee.
– After all, that is a matter for Parliament to determine. I consider that every State should be represented on a committee of this character. While I was a member of the Public Works Committee, it inquired into a profiosal to construct a railway in South Australia - a matter of widespread interest in that State. Certain recommendations were made, and the representative of South Australia on the committee possessed first-hand knowledge which enabled him to explain the matter fully to the public men of his State and to the people generally. The amendment should not be considered for a moment, but should be thrown out, so that an opportunity would be afforded for every State to have representation on the committee.
– I am still unconvinced and unrepentant, and would move for the suspension of the operations of this committee for a limited period ifI thought that a majority of honorable senators would support me. On the principle that “ half a loaf is better than no bread,” I intend to vote for the amendment.
. - I hope that, even at this late stage, honorable senators, particularly those who represent the smaller States of the Commonwealth, will change their attitude towards this proposal. They must already realize how difficult it is, in view of the weight of representation of two of the States in this Parliament, to secure the appointment of their representatives to bodies of this nature. The fewer the number of members, the less chance will their States have of securing representation. It may be advantageous for certain States to be represented on the body that conducts an investigation into proposals for new works within their borders. There would be less opportunity of that occurring if the amendment were agreed to than if the proposal of the Government, were accepted. As Senator Sampson and others have pointed out, this is not a measure of economy, because the Public Works Committee is not functioning at the present time, and is not likely to function until the opportunity is afforded to it to investigate works with which the Government can proceed.
– I agree with Senator Payne, that it is not mere numbers which make for case in obtaining a quorum, but that, on the contrary, the very knowledge that there is a. number of spare members may be responsible for some degree of laxity in regard to attendance which would be absent if members of the committee knew that should they not attend, a meeting might lapse. That fact, I consider, would be likely to lead to their making a special effort to attend.
There is a good deal to be said for the view expressed by Senator Payne, that better concentration of attention is obtained from a smaller than from a larger number of members. I dissent entirely from the view of the Leader of the Senate (Senator Barnes) that there is any suggestion of State representation in relation to any of these committees.
– Have not all the States the right to be represented?
– That may be so when an investigation is being made into matters in which a State should have a voice. I should think, however, that it would be almost a disadvantage for a State to be represented when the inquiry was into a matter in which it was interested. Senator Barnes recalled a ease in which a South Australian member of this committee was able to explain fully to the public men of South Australia why it had recommended against a proposed railway in that State. He must have been a spartan member; because the tendency would be for a South Australian member to throw all his weight behind what he regarded as in the interests of the State and not of the Commonwealth. I consider, therefore, that we should not lend our support to the view that this is intended to be a body on which all the States must have representation. As Senator Duncan has pointed out, the force of that argument, if it ever had any force, is entirely negatived by the fact that what I call the most important State, and what he calls the second State, was not represented on either this or the Public Accounts Committee when the membership numbered nine. It is quite clear, therefore, that the question of State representation was not taken into account in the past. I agree that the amount of economy to be effected is not very large. It has been said that this committee is doing no work at the present time, because no money is available for expenditure upon public works. Consequently, Senator McLachlan might meet with’ a greater measure of success if, in the different circumstances which operate in the present case, he moved for the suspension of the operations of this committee for a definite period.
– Its operations are suspended now.
– If they are suspended in fact, no harm would be done if they were suspended under a definite provision in the act.
– The major consideration ap pears to be that we ought to construct a committee upon which all States would have representation. We must bear in mind, however, the fact that when the committee had a membership of nine, the obligation rested upon those responsible for the selection of its members to give to some States greater representation than was given to others. Therefore, those States which had only one representative, or which were not represented at all, had a more pronounced grievance than any State could have if all except one were represented on a committee of five members. There must be anomalies, whatever is done. There are some cabinets in Australia which consist of only five Ministers, and the duties that they discharge are more onerous than are those for which this committee is responsible. Surely we are not asking too much when we seek to reduce its numerical strength to their level.
Question - That the word proposedto be left out (SenatorDunn’samendment) be left out - put. The committee divided.
Majority . . . . 6
Question so resolved in the affirmative.
Amendment agreed to.
Further amendment (by Senator Dunn) agreed to -
That the word “five “, proposed new section 2, sub-section 2, be left out with a view to insert in lieu thereof the word “three”.
Clause, as amended, agreed to.
Clause 3 -
Section seven of the principal act is amended by omitting the word “ five “ and inserting in its stead the word “four”.
Section proposed to be amended -
Any five members . . . shall form a quorum. . . .
Amendment (by Senator Dunn) agreed to-
That the word “ four “ be left out with a view to insert in lieu thereof the word “ three “.
Clause, as amended, agreed to.
Clause 4 agreed to.
.- I move -
That the following new clause be inserted : - 4a. Section 39 of the principal act is amended by omitting the word “ Two “ (wherever occurring) and inserting in its stand the word “ One “.
The object of this amendment is to reduce from £2,000 to £1,000 per annum the sum allocated from the Consolidated Revenue for the work of the Public Works Comanittee. It is a similar amendment to that which the Senate inserted in the Committee of Public Accounts Bill. In view of the reduction of the personnel of the committee to five, £1,000 should be ample for the payment of fees to members of the Public Works Committee.
Proposed new clause agreed to.
Clause 5 agreed to.
Title agreed to.
Bill reported with amendments.
Debate resumed from page 1029.
Senator Sir GEORGE PEARCE ( Western Australia) [4.55]. - The Minister who moved the second reading of this bill agreed to the adjournment of the debate until a later hour in order that I might have an opportunity to peruse his remarks so as to help me in elucidating the provisions of the hill. I find that 95 per cent. of the speech was a misrepresentation of the action of the Senate in regard to the oilier wheatbills, and 5 per cent. of it an elucidation of this measure.
It is a pity the Government cannot look on. the question of wheat except in terms of votes. It is said that the mouse values the world in terms of cheese. I am certain that the Minister for Markets looks on wheat in terms of votes. His speech reeks of an attempt to appeal for votes for the Government for what it has done, and against the Seriate for what it has done. I am not sure that it would not be a good thing to impose a restriction on speakers by compelling them to adhere to facts. It would most certainly be a severe limitation upon some of them. It would cramp their style considerably. We have this fine example in the speech of the Minister -
Through the rejection by the Senate of the Wheat Marketing Bill our farmers were left last year in a desperate plight.
The drop in the world price of wheat had nothing to do with the plight of the farmers ! It did not affect them in the slightest! All would have been well if only the Senate had passed the bill for a guaranteed price of 4s. a bushel and a compulsory pool ! The farmer would have been happy and prosperous, thanking God for the existence of the Scullin Ministry, and, in particular, Mr. Parker Moloney ! Was there ever such a travesty of the facts as is contained in the speech of the Minister?
First of all, the Senate was not responsible for the drop in the price of wheat on the world’s market. That was a matter entirely beyondthe control of the Senate, and in regard to which it has no voice or vote. Nevertheless, it is the principle cause of the plight of the farmer, not only in Australia, but also in every other country in the world. But the Minister blithely takes no notice of that fundamental fact.
Would the passing of that’ bill by the Senate have saved the farmer? I venture to say that it would have put him in an even worse position. Does the Minister think that we are so blind to all that has passed since that bill was rejected not to realize that if the Senate had passed the measure, the Government could not by any means have found the £20,000,000 which would have been necessary to implement the guaranteed price in that bill? The disproof of that suggestion is in the fact that when, later, the Senate passed a bill introduced by the Government, which required the raising of only £3,000,000, the Government found that it was unable to raise even that amount.
We remember another little instance in connexion with that particular bill. A small clause provided that if any provision of the measure was found to be unconstitutional, the unconstitutionality was to affect that provision only ; the rest of the bill was to stand. I think that honorable senators pointed out at the time that there was a grave doubt about the constitutionality of the provision relating to the payment of a guaranteed price.
Realising the paramount need of granting assistance to the wheat-growers, the Government swallowed the rebuff administered by the Senate, and brought down the Wheat Advances Bill.
I have said before, that this Government will swallow anything. When we think of the indignities and dictations Ministers have swallowed from their own party, and from the No. 2 section of the Labour party, the section known as the Lang party, itis very unkind, I suggest, for one Minister to draw attention to the swallowing capacity of the Government. Then the Minister went on to say -
The Wheat Advances Bill was passed through both Houses, but the refusal of the Common wealth Bank to provide the necessary finances rendered that scheme nugatory.
If the Government, plus the Commonwealth Bank, could not finance 3s.a bushel, how could it have financed 4s. if the Senate had passed that particular bill ? Then we have another gem from the Minister well worth repeating. He was referring to various conferences which had been held, and said -
It was then proposed to grant the necessary relief in another manner, and the Fiduciary Notes Bill was introduced with the concomitant Wheat Bill.
This meant that our wheat-farmers were to be paid in a discredited currency. They must be thankful that the Senate saved them from that misfortune. The Minister went on to say -
Meantime the plight of the farmers was growing more and more desperate, and a further attempt was made to give the assistance so urgently required. This was the Wheat Marketing Bill, which was similar to the 1930 Wheat Marketing Bill, with the exception of provision for a guaranteed price Once again the Senate refused to approve of the assistance proposed tobe given by the Government.
I think it may be said of that bill that it went to its grave “ unwept, unhonour’d and unsung”, even by those who spoke in support of it. But while that measure was under consideration the Senate did indicate a proposal that would have been of some practical help to our farmers in respect of last season’s wheat. The Senate declared clearly and unmistakably that if the Government would agree to introduce a bill imposing a sales tax on flour, the Senate would pass it. This would have provided real money for our wheatgrowers, instead of a discredited currency under the Government’s proposal. The Government did not take advantage of that offer, because Ministers were afraid that it might mean an increase in the price of bread, but they have now introduced a measure, the indirect result of which will be to cause an increase in the price of bread.
Senator Sir GEORGE PEARCE The Minister’s elucidation of the bill has left honorable senators as uninformed concerning its provisions as they were before he spoke. We must, therefore, attempt to elucidate its involved and complicated clauses as best we can.
Senator Sir GEORGE PEARCE.This sum, we are told, is to be distributed among our wheat-farmers, but the limitation of the amount realized to 3s. per bushel will, I suggest, lead to all sorts of complications and difficulties. As we understand the scheme, the banks have agreed to make this amount available provided the price of wheat does not rise above 3s. per bushel f.o.b. If it does, no bounty will be payable, and, in any event, the bounty payable must not exceed 6d. per bushel.
What I regard as a serious defect in the scheme is the fact that it. will take away from the private wheat-buyer, or the authorities controlling the pools, the incentive to obtain a higher price per bushel for any of the wheat sold, because it is obvious that if there is to be a price limit of 3s. per bushel, it will not matter to them what price it realizes, provided it is not less than 2s. 6d. per bushel, as the balance will be paid in the form of the bounty.
Senator Sir GEORGE PEARCE.Because of our present difficult financial position, it is of the greatest importance that we should obtain the highest price possible overseas for our primary products. For this reason, we should not insert in this legislation any provision which may damp the ardour of private buyers and pool authorities; on the contrary, they should be stimulated to secure the highest prices possible.
I see another danger in the scheme. As honorable senators are aware, under existing arrangements, Australian wheat is not sold and sent overseas immediately it is harvested. It is disposed of in an orderly manner, and there is always a reserve held to meet home requirements, and also to take advantage of any increase that may take place in the world’s market. If this bill is passed in its present form, the incentive will be to dispose of the wheat and ship it overseas as quickly as possible. There will be no encouragement to hold any portion of the harvest for a further rise in the market, and unless the price exceeds 3s. nobody will benefit from the improvement in the market, because, under this proposal, the payment of the bounty will ensure that the farmer gets that amount.
The provisions of clause 6 appear to me to be rather mysterious. That clause provides for differentiation in the procedure to be adopted in respect of pools and private wheat buyers. It stipulates that the private wheat buyer must state, in his certificate, the price which he has paid for the wheat. It reads -
In the case of a prescribed co-operative organization, the same procedure is to be followed, except that the licensee will be required to state the “ f ree-on-board “ equivalent of the price per bushel estimated by the organization to be that at which the wheat will be sold “. I cannot understand why there should be this differentiation between wheat handled by a pool and wheat handled by a private buyer, but it seems to me that it will open the door to manipulation that would be to the disadvantage of the Government while not being advantageous to the grower. Furthermore, I point out that in this bill, and in the concomitant measure, there is no reference whatever to a limit of £3,000,000. Apparently the banks have intimated that they are able and willing to make available that sum but no more.
Surely in considering such a measure as this which, after all, is a bounty bill applied to production, we should, as far as possible, insert provisions similar to those precautions included in other measures relating to the payment of bounties. In the bills dealing with the payment of bounty on cotton, steel, and iron, and other products, we specifically provided for the payment of a bounty of so much per ton, or so much per lb., and stipulated also the total amount of bounty payable under the respective acts. We did not concern ourselves with the market price of the commodities concerned, nor did we insert intricate provisions relating to the manner in which the product is sold, or who sold it. All that concerns the taxpayer is the amount of his liability. Why could not the same simple procedure be followed in this hill? Why did not the Government provide for the payment of a bounty not exceeding 6d. per bushel on all wheat sold, and definitely fix the total amount of bounty payable at £3,000,000 ?
Senator Sir GEORGE PEARCE.Under existing arrangements, our wheatfarmers have to wait twelve months for the final payment. I understand that the pool’s final dividend on last season’s wheat was distributed only a few months ago in Western Australia.
Senator Sir GEORGE PEARCE.At any rate, there would be room for manipulation. No one who remembers the scandals associated with the wheat pools towards the end of the war would say that it was impossible for history to repeat itself.
Senator Colebatch mentioned a point to me which I hope he will not mind my referring to as it is of considerable importance. Is there not a possibility of the farmers being treated unfairly by this cumbersome method of granting them assistance? Supposing one farmer sells his wheat to a pool for 2s. 6d. per bushel, and later another farmer sells to the pool for 2s. 8d. per bushel. It seems as though both farmers will get the same price for their wheat. Should not the farmer who sold his wheat for 2s. 8d. get the advantage of the 2d. perbushel?
Senator Sir GEORGE PEARCE.That is so. There are difficulties in regard to freight and other charges. I can see many ways in which inequalities might fall on the farmers by the operation of the machinery of this bill, which could be avoided if a straight-out bounty act, with a limit to expenditure, were passed. For the life of me, I cannot understand why there is necessity for such a complicated scheme. I suggest that, even at this late stage, the Government should redraft the bill along the lines of other bounty measures. The administrative procedure in connexion with ordinary bounty bills is well understood by our departmental officers, and has proved effective. Here we have an intricate and complicated system which has never been tried. I am afraid that there will be hopeless confusion and numerous inequalities if this scheme is adhered to. I shall vote for the bill, but I suggest that before the committee stage is reached, the Government should consider the advisableness of devising a simpler proposition for the granting of assistance to the farmers. It should be possible to draft a scheme which would be simpler in its operation, more equitable in its effects, and less liable to manipulation than the one laid down in this bill.
– I agree with the Leader of the Opposition (Senator Pearce) that a good deal of difficulty may arise in giving effect to the provisions of clause 6 of the bill, andI have promised Senator McLachlan that, before we reach the committee stage, I will discuss with the Crown Law authorities the possibility of recasting the clause with the object of preventing any possibility of the occurrence of such mischief as that referred to by the Leader of the Opposition. The Government would have welcomed the opportunity to introduce a simple bounty scheme if our financial authorities would have agreed to fina,nce it. I am instructed that at the conference with the banks, the Minister for Markets (Mr. Parker Moloney) submitted several schemes for granting assistance to the wheat-growers, and the scheme of this bill was the one which the bank authorities accepted.
– Was the proposal for the payment of a straight-out bounty submitted to the bank?
– I understand that it was; but I make that statement subject to correction.
SenatorO’Halloran. - The difficulties were caused by the banks fixing the limit at 3s.
– The possibility of imposing a tax on flour was explored some time ago, but it presented certaiu constitutional difficulties. As honorable senators know, Commonwealth legislation, in so far as it is inconsistent with State legislation, overrides States acts. But, the Governments of New South Wales and Queensland have imposed a tax on flour, and if the Commonwealth Government superimposed an additional tax on it, the consumers of bread in those two States would have to carry an additional burden. We have no constitutional
Dower to rid ourselves of the State legislation which prevents us from imposing a Commonwealth-wide flour tax, because neither Queensland nor NewSouth Wales would agree to repeal their existing acts.
– Is it uot a fact that at one stage the Commonwealth Government could have imposed a tax on flour?
– I do not think that the honorable senator would suggest that under existing conditions we should impose a super tax onflour which would inevitably fall heavily on the bread-eaters of New South Wales and Queensland.
– In that circumstance would it not be the responsibility of the State Governments to relieve their people of the double taxation?
– We have to face the fact that certain legislation has been passed by the Parliaments of New South Wales and Queensland.
– Unconstitutional legislation, I should say.
– It may or it may not be unconstitutional ; but surely the farmers are not to be left to suffer until the question of the constitutionality of certain State legislation can be settled by litigation. The practicability of the Commonwealth Government imposing a tax on flour was inquired into by Professor Giblin, and in consequence of his report, the Government felt that it would have to seek other means of assisting the farmers. In view of the fact that any scheme for the granting of assistance to the farmers would require finance, the Government was compelled to consult the financial institutions on the subject. I am instructed that the maximum measure of relief which the banks are prepared to grant to the primary producers is provided for in this bill.
– Did the banks declare that assistance must be granted in this particular way?
– I understand that they did. I am informed that the wishes of the banking authorities were submitted to the Crown Law authorities, and that this bill has been drafted in this way in accordance with the request of the Chairman of Directors of the Commonwealth Bank.
– The bill has undoubtedly been drafted in the hope that, the price of wheat will lift.
-That is so. If the price of wheat rises to 3s. the taxpayers of Australia will not be required to provide any money for, the payment of a bounty. I cannot blind my eyes to the fact-
– Did not the Government, at the Melbourne conference, promise 3s. 6d. per bushel to the wheatgrowers ?
– It may have done so.
– According to press reports, it did so.
– The Government stated that it would endeavour to get the hanks to agree to provide sufficient money to pay 3s. 6d. per bushel.
– I understand that the Minister gave an assurance that 3s. 6d. per bushel would be paid.
– 1 was not present at the conference, but my information, is that the Minister for Markets said that he would endeavour to get the banks to provide sufficient money to pay 3s. 6d. per bushel.
– The impression I gathered from newspaper reports was that the conference agreed that 3s. 6d. per bushel would be made available.
– The Minister for Markets undoubtedly endeavoured to arrange for 3s. 6d. per bushel to be paid, but honorable senators must. realize that the Government cannot get money out of the air; it can only get. it out of the banks. If the Government had been permitted to increase the value of Australia’s equity, it would have enabled the financial institutions to grant more credit than they will grant at present.
– Credit can best be obtained by giving the country a good name; it cannot be obtained by inflating the currency.
– It would not be necessary to inflate the currency if production were maintained. After all, the amount of currency available is determined by the degree to which production can be. kept up.
– That is so; production must be kept up.
– I am glad to have the approval of Senator Lynch to that statement.
– “Why did the Minister mention the fiduciary notes bill in this debate?
– I did not mention it. All that Senator . Dooley did in introducing the bill was to refer to it in a general way as one of the proposals of the Government for assisting the farmers. My principal object in taking part in the debate at this early stage is to assure honorable senators that the Government has obtained from the banks the maximum amount that they arc prepared to provide to assist the wheat-growers. My instructions are that this hill has been drawn in conformity with the wishes expressed at. the conference with the banks. Another reason why I am speaking at this early stage is to assure the Leader of the Opposition that there is no trap in the 3s. per bushel proposal of the Government. The provisions which the right honorable gentleman referred to as a “ trap “ are contained in our dried fruits legislation which has been the subject of judicial interpretation by the High Court. I wish also to make it clear that the proposal for the imposition of a tax on flour has been fully considered by the Government. It was dropped, not because nf any spineless attitude by the Government, but chiefly because of fear of the legality of certain proposals in regard to the embargoes, and so on. This bill has been introduced in the hope that at least £3,000,000 will be made available to assist the primary producers of this country.
Senator Sir HAL COLEBATCH (Westtern Australia) [5.34]. - I do not wish to say one word in regard to any previous bill in relation to the wheat industry. This bill is sufficiently important, sufficiently intricate, and sufficiently difficult to occupy our attention. It is unfortunate, I might even go so far as to say it might be the subject of complaint, that the Senate should be asked to deal with a difficult bill like this under conditions which do not provide time for a proper consideration of it. The introduction of the bill was delayed until the last moment. Another House is almost ready to rise, and on the Senate is cast the responsibility of passing this bill after immature consideration, or of exposing itself to the charge that it is standing in the way of the farmers receiving some concession which the Government wishes to give them. Whether or not we have ground for complaint on that score, we have reason to complain of the Government’s failure to give the Senate full information, and a complete outline of the proposals embodied in this bill. We are told that it is understood that the banks will not do certain things, but will do others. Why should we have a vague statement of that kind? Why cannot we have the position from the view-point of the banks clearly placed before us? A most complicated and intricate sub-clause was inserted in the bill in another place last evening. Was that inserted at the request or with the knowledge of the banks? I am fully convinced that there is no banking institution in this country which wishes to see an entirely complicated scheme put up.
– This is the scheme they submitted to the Government.
Senator Sir HAL COLEBATCH.Did the hanks submit what is contained in this bill? Were the proposals embodied in clause 6 submitted by the banks ?
– They submitted a memorandum to the Prime Minister, a copy of which is now in the chamber.
– It would be very interesting to know what that memorandum contains. It is a pity it was not submitted when the bill was introduced. I ask leave to continue my remarks after that memorandum has been read.
– by leave - The memorandum from the chairman of the Commonwealth Bank Board to the Prime Minister is dated the 7th October, 1931, and reads -
RE WHEAT BOUNTY.
Pursuant to the arrangement with you 1 have been in conference with Mr. Drummond and the Governor, Mr. Biddle, with the object of endeavouring to evolve a practical working plan in accordance with the proposal to pay a bounty up to6d. per bushel on export wheat, provided the f.o.b. price does not exceed 3s. per bushel.
The procedure necessary to carry the plan into effect is necessarily somewhat complicated, and we have consulted with representatives of the wheat shippers, flour-millers, and wheat pools so as to meet as far as possible any practical difficulties which might confront them in carrying on the business.
There would appear to be no doubt that the export bounty proposed will give the greatest benefit to farmers, particularly where such is most necessary; this is as against the proposal to pay a lesser bounty upon production.
After careful consideration, we have evolved * provisions which we think are necessary to carry out the plan. These are embodied in the enclosed memorandum for your consideration and adoption if deemed advisable in legislative form.
Proposed System Under Which Wheat BonusShould be Paid.
The licensee shall, on the 31st October, 1932, be called upon to account for every bushel of wheat upon which he has issued certificates to the grower, and he shall pay to the Commonwealth Bank, as agent for the Commonwealth Government, a price equal to the average of the bounty in respect of all certificates issued by such licensee on every bushel of such wheat which he has not shipped at that date. 6. (a) Where the licensee is a flour-miller he shall account to the Government every fourteen days for the total amount of the flour sold for internal consumption iu Australia, and for every bushel of wheat sold for the same purpose, and he shall pay the Commonwealth Bank as agent for the Government 6d. per bushel for every bushel of wheat disposed of for internal consumption. The number of bushels for which he shall account, when such has been converted into flour, shall be based upon bushels per ton of flour. On the 30th November, 1932, the flour -miller shall pay to the bank an amount calculated at the average of the bounty in respect of certificates issued by the flour-miller, on the total number of bushels” for which certificates have been issued, less the equivalent in bushels actually exported, after allowing for fortnightly adjustments during the period up to the 30th November, 1932. 6. (b) Every miller on day of 1931(a date to be fixed prior to new crop deliveries commencing )submit a return to the Commonwealth Government of stocks of wheat and flour on hand. Such stocks on hand shall be included in returns rendered in terms of the act, but shall bc excluded from the operation of the act. 7. ( 1 ) In the case of wheat pools the certificates issued shall show, in addition to the arranged advance, the amount of bounty payable to the grower.
That is the basis upon which the bill has been drafted. Slight alterations which have been made to the bill have been agreed to by the hanks.
Senator Sir HAL COLEBATCH.The first point which strikes me in connexion with the memorandum read by the Assistant Minister (Senator Dooley) is this : It contains a reference to an amount “ not exceeding 3s.” Is that “ not exceeding 3s.” something that is definitely insisted upon by the banks? 1 am entirely with Senator Pearce iu contending that this is not a matter of banking policy at all..
– The memorandum seems to suggest that the proposal had been put up to the banks.
– It suggests to me that a proposal of that kind has been put up to the banks. It is surely a matter for the banks to decide how much money they can find for the Government for the purpose of subsidizing the wheat-growers.
– If the banks and the Government are satisfied what is wrong with the proposal?
– I am not much concerned as to whether the Government is, or is not, satisfied; I want something with which the wheatgrowers will be satisfied. I repeat, with all due respect to the hanks, that the question of how the money shall be distributed is more a matter for the Government and the Parliament than it is for the banks. If the banks say - and I understand that they have - that it is possible for them to provide £3,000,000, I suggest that it is easier for the hanks to provide the sum of £3,000,000 if it will bring the price of wheat up to a figure which will show the farmer a small profit, than it is for the banks to supply £3,000,000 when it will still leave the total price of wheat at a figure which will involve the farmers in a loss. It would be a much sounder proposition from the view of the banks and of the States, if we are going to find the £3,000,000, to provide it in a way that will enable the farmer to make a small profit, than so to provide it that it will still leave the farmer at a loss and in danger of being driven off his holding. Many attacks have been made upon the banks, but I put it to the Senate, that if the banks have contended that they will only provide this money conditionally upon the farmers receiving no more than 3s. a bushel, they are adopting an extremely patriotic and self-sacrificing attitude. Surely it is better for the banks to have the Government as their creditor rather than the needy farmer, and if they can get 6d. a bushel from the Government and put it to the credit of the overdrawn account of the farmer surely it would be advantageous to them. I find it difficult to believe that, if this matter were strongly and clearly presented to the banks, they would not infinitely prefer to provide this £3,000,000 as a loan to the Government and have nothing more to do with the job. They would certainly prefer that to a difficult and intricate proposal of this kind, which is bound to lead to an enormous amount of trouble and confusion.
– This proposal was submitted to the banks by the Premiers Confference
– I know the history of the proposal. I should think that clause 6, in its present form, has never been submitted to any authority, and on that account I find it difficult to reconcile that clause with the paragraph in the memorandum from the chairman of the Commonwealth Bank Board to the Prime Minister, which deals with that particular feature of the case. I do not think that this bill, in any event, can be quite so simple as Senator Pearce has suggested it might be. It is not merely a matter of providing 6d. a bushel, because £3,000,000 would not provide the wheat-growers with that amount per bushel if given as a straightout bounty on production. I think we are fairly safe in assuming that. Naturally a good deal of it is speculative
– It would just about be equivalent to the estimate of the export.
Senator Sir HAL COLEBATCH Quite so. That is the reason why this bill cannot be so simple as the right honorable senator has suggested. Supposing we assume that the export is equivalent to 120,000,000 bushels, and that the quantity for local consumption is about 40,000,000 bushels. With a population of 6,500,000, an estimated consumption of under seven bushels per head, including seed, feed and other purposes, gives a total of 40,000,000 bushels. In any case that is only a rough estimate. This £3,000,000 would provide 6d. a bushel on the 120,000,000 bushels exported. At one time, there was an alternative idea that there should be a payment of 4£d. per bushel on the total production. The same £3,000,000 would have been required to provide for that alternative.
I consider that certain of the provisions of this bill are quite excellent, and ought to work simply enough. They are. the provisions under which the buyer gives a certificate to the farmer, the farmer collects his money, and the buyer is no longer affected so far as his export wheat is concerned; he has paid the ordinary price, and he exports in the ordinary way. Hut in regard to all the wheat, that is to be used for local consumption, he is required to pay the amount of the bounty to the Commonwealth. Naturally, he will add that amount to the price that he charges the miller. By that means this same £3,000,000, which would not be adequate to provide a bounty of 6d. a bushel on the entire crop, is to be made to do that work, because the Commonwealth is to be recompensed the amount of the bounty on all the wheat sold for local consumption.
– It is the equivalent of the sale3 tax.
– It is, with this difference, that under the sales tax proposal it was a tax of £7 4s. a ton on flour, which would have been equivalent to an increase of about 7d. a bushel on all wheat produced. I should not think that this tax will increase the price of flour to more than one-fourth the extent of the other; therefore, the increase in the price of bread should not be more than one-fourth as great. At the present time, the intention is that the money borrowed by the Government from the banks shall provide 6d. a bushel on an export of 120,000,000 bushels, and that ti tax on flour will be required to provide the bounty only on the 40,000,000 bushels that are consumed locally. So that, instead of having to raise considerably over £4,000,000, as would have been necessary under the proposed sales tax in order to pay a bounty of 7d. a bushel on the entire production, the amount required to be raised by means of an extra price to the local consumer will total only £1,000,000. While it” is unquestionable that a sales tax of £7 4s. a ton on flour would have made an appreciable difference in the price of bread, I should think it very unlikely that the present, impost will increase that price at ail. In fact, it would not interfere with reductions being made in the price of bread if proper economies were observed in its making and distribution. Considering that Queensland, with a high sales tax on flour, is selling bread at practically the same price as New South Wales, with a very much smaller tax, it is obvious that if the thing is worked reasonably and properly, bread can be sold more cheaply even though a shade more has to be paid for the flour. From that point of view I have no quarrel with the bill, and consider that, the arrangement which it embodies is a good one. But trouble is likely to be encountered because of the fact that the amount of the bounty is not definitely fixed. I entirely sympathize with the officers as well as with the Government, who have had to endeavour to draft a scheme that will meet this extremely difficult position. In the first place, I do not believe that this limitation is in any way justified.
Let us consider the matter first of all from the point, of view of the farmers. There can be. no doubt that the farmer is’ entitled to feel very much aggrieved at the fact that none of the promises of assistance that have been made have been realized. Let us disregard, for the moment, the question of who is responsible. We can all agree that a number of promises have been made, and that not one of them has materialized. The farmer is entitled to be given something. It must be remembered that when the Government passed its last bill, it was prepared to distribute the amount involved provided that that amount was made available by the banks. The figure then was certainly considerably in excess of the £3,000,000 now involved. Therefore, it seems to me that if the wish previously expressed by this Parliament, as well as the desires expressed by the Government, are to be given effect, this £3,000,000 of borrowed money should be absolutely the minimum amount distributed among the farmers. Looking at the matter from the point of view of the necessities of the farmer, is it not absurd to suggest that if by some fortunate rise in the price of wheat the f.o.b. price reaches 3s. a bushel, he is no longer in need of assistance? I venture to think that out of this period of depression great advantages to Australia will be realized in the future. One such advantage is that production C03ts are being steadily reduced below the abnormal figure of a few years ago. I can recall conscientious and capable farmers having asserted that it was impossible to grow wheat at a co3t of 4s. 6d. a bushel. That figure has been materially reduced, and it ought to be reduced a great deal more. I hope that the operations of this Senate in regard to another matter which will come up for consideration will result in a further reduction of those costs. I made it my business, while visiting “Western. Australia a few weeks ago, to inquire carefully into this matter. Much of the information then furnished to me was of a confidential character ; but I feel at liberty to say that although there has been this considerable reduction, a price of 3s. a bushel f.o.b. would not pay the wheat-farmer to-day. There may be exceptional cases of very good crops that were put in under exceedingly favorable conditions in which 3s. a bushel would return the amount of the outlay. Generally speaking, however, farmers would be at a loss with wheat at that figure. Why, then, say to them, “ We will- give you no bounty that will make it possible for you to cover the cost of your production.” Surely that would be an ungenerous attitude to adopt towards a section of the community, to whom promises have been made over and over again during the last two years. It would be unfair to say to the farmer, “ We are going to do something for you, but no matter to what extent you may be helped by what happens outside, no matter how favorable the conditions may bo, we will not allow you to get your money back; the total amount that you receive shall be less than the amount that you have expended.” Such an attitude would be a rather foolish one to adopt from the point of view of the State. Surely it would be far better to make an advance that would return to him at least what he had spent this year, than to give him something. less and thus make his position at the end of the year worse than it was at the beginning. Is it not essential not merely to the prosperity, but we may almost say to ti.continued existence of Australia tha. th.’ farmer shall be kept on the land? i: a curious fact that at the present time we in Australia are depending almost entirely upon two industries that are being carried on at a lo3s. Why is ii that those industries can keep going? .1 take it the reason is that they are still almost entirely individualistic industries. In the development of what my friend, Senator Rae, would term the capitalistic system, within recent years the tendency has been for the majority of industries to get into the hands of big corporations with large accumulations of capital. What has been the result? Directly those industries fail to pay interest on that large capital, or the wages that are prescribed by arbitration courts, or agreed upon by some trade union, they have to close down. That, I think, is one of the reasons why the present world-wide depression if more severe and prolonged, than were similar depressions in the past, when a greater number of industries were conducted on the individualistic basis, and had to continue whether they paid or not In the old days if a bootmaker could not, on account of depression, obtain 17s 6d. a pair for his boots he had to work harder, make two pairs, and sell then: for 7s. 6d. a pair. If he could not mab? sufficient to provide himself with threemeals he had to he satisfied with two Because he and everybody else carried on, the world lifted itself out of iw troubles more quickly than we are emerging from ours to-day. The two industries to which I have referred, however, cannot carry on at a loss indefinitely. Farmer after farmer is being driven off his land. It is essential in the interests of Australia that this bounty be given for the purpose of keeping men on the land. If they are given what will bring their total return up to the cost of production, something will be done towards that end. It is up to the Government to place before the banks the strongest possible case on this point. I should like to see, not a statement from the chairman of the Commonwealth Bank that this is a proposal based on such and such an assumption, but the result of a deliberate and vigorous conference between the Government and the banks with a view to obtaining the whole of this £3,000,000, which the batiks say they are able to provide, and which this Parliament should, under proposals brought forward by the Government, distribute in a manner which will best serve its purpose.
I come now to what to my mind is the most difficult feature of this bill; that is, the provisions that are contained in clause 6. I do not think that any of us wish to do an injustice to the co-operative pools; and 1 hope none of us wish to do an injustice to the ordinary wheat buyer. I confess at once that the securing of fair and just treatment between those two sections is almost impossible if this system be followed. It would be the simplest matter if there were a clear bounty of 6d., and if the provisions in regard to sales for local consumption were maintained as they appear in the bill. There would then be no difficulty between the ordinary buyer and the co-operative pool. But under this system there are difficulties that to my mind are entirely insurmountable. You say to the ordinary buyer, “ You shall buy the wheat, give the farmer a certificate stating the amount you have paid, and that, is the end of- your responsibility from that point of view.” The same cannot be said to the co-operative pool, because it does not buy the wheat, but receives it with a view to selling it throughout the season and of distributing the whole of the proceeds among its suppliers. If a co-operative pool took a fanner’s wheat for 2s. 6d. a bushel, and a private buyer offered at the same siding 2s. 9d. a. bushel, there would be no advantage to the farmer in taking the 2s. 9d., because he would get a 6d. certificate in the one case and only a 3d. certificate in the other.
– The advantage would be rather the other way.
– Yes; because, if the wheat was worth 2s. 9d., he would know that ultimately he would get it out of the pool. He would score both ways. No doubt something can be done by regulation to tighten up the position, but I doubt if anything can be done which will remove the possibility of very grave abuses.
– This is subjecting the co-operative organizations to s handicap.
Senator Sir HAL COLEBATCH.No, it is of great advantage to the cooperative organization as against the private buyer, because the latter has to’ make his bargain and finish it. I hav already shown that it will be of advantage to the farmer to sell to the pool at 8 lower price than is offered by the private buyer. If at a siding there are agents representing Dreyfus, Bunge, or Darling, and they are offering 2s. 9d. a bushel, whereas the pool is estimating 2s. 8d.: I .defy any one to say that a difference of Id. can be accurately finalized, or thai any one could say that 2s. 9d. or 2s. 8d. is actually right or wrong. It is quit* customary to find differences of Jd or Id.
– That is so.
Senator Sir HAL COLEBATCH.If the private buyer offers 2s. 9d. and the co-operative organization says that itf estimate is only 2s. 8d., it is to th< advantage of the grower to sell through the pool at the lower price, because in the one case he will get from the private buyer a certificate entitling him to s bounty of 3d., whereas in the other case he will get a certificate entitling him to a bounty of 4d., and he would know that in addition to the extra Id. by way of bounty his wheat was going into the pool but of which he would get the full advantage.
– What about the refunds the co-operative organizations mus make?
Senator Sir HAL COLEBATCH.Where are they to get the money? Another curious provision is contained in paragraph 3, of clause 3, which was inserted in another place last night. It seems to be contemplated that on some occasion, the co-operative pool may give to a farmer a certificate in which it will say, “ We estimate the price at 2s. 9d. That will entitle you to draw 3d. a bushel from the Commonwealth.” But later on, if it finds that the price realized is only 2s. 6d., it will give the farmer another certificate entitling him to a further 3d. a bushel from the Government. Suppose, however, that the estimated price is 2s. 6d., and the farmer is given a certificate entitling him to a bounty of 6d. If the price of wheat should rise to 3s., the farmer would not be entitled to receive any bounty. Is it contemplated that the pool will return to the Government the amount of the bounty already received by the farmer, but to which he is actually not entitled under the clause as it stands?
– That is provided for in clause 10 of the bill.
Senator Sir HAL COLEBATCH.How are the pools to get the money back from the farmers’?
SenatorO’Halloran. - Through the pools themselves, out of any further advances to be made to the farmers on account of future wheat placed in the pools.
– I think it will be found to be an extremely complicated matter to handle. Senator Pearce believes that it will cause the pools to rush their wheat forward. I do not know that it will not have an entirely contrary effect. A pool which has advanced 2s.11d. for wheat may say, “ We shall hold over this wheat, because, even if there is a drop of 5d. in the price, we shall still not be losers.” The pool has already given the farmer 2s.11d., and he has drawn a1d. a bushel from the Commonwealth. The pool itself is protected to the extent of the difference between that1d. and the full amount of the bounty, which is 6d., because, if the price falls to 2s. 6d., the farmer can be given another certificate entitling him to draw another 5d. from the Commonwealth Government. On the other hand, if the price goes up, the pool gets the full advantage of it. It is a dangerous position in which to place the pool if we protect it against any loss which may be incurred through holding wheat for a rise.
– Clause 10 deals with co-operative pools.
– There is nothing in clause 10 to compel a pool to realise on the wheat at once. It may hold on in the knowledge that, if the price drops to the extent of 5d. a bushel, it will not matter a rap, because the Commonwealth will have to bear the loss.
– But why should it be compelled to realize at once?
-I do not say that the pool should be compelled to realise on its wheat at once. What I say is that every buyer, a cooperative pool or not, should take upon itself the responsibility of deciding whether it should realize on its wheat or not. The responsibility for any loss through not realizing should fall upon it alone, whereas, under this bill, it is thrown upon the Commonwealth Government. All these troubles could have been avoided if this measure had been simply one for an advance of 6d. a bushel out of the £3,000,000 which the banks are ready to provide, the balance being obtained in the manner suggested in -this bill in respect of wheat sold for local consumption.I am saying nothing in condemnation of those who have drafted the bill, because I realize the extreme difficulty of their task ; but, if it is not possible to make the alteration I have already suggested, I trust that the measure will he so amended as to remove the dangers which I see in it.
– I agree entirely with the view expressed by Senator Colebatch and Senator Pearce, that it would have been infinitely preferable if the Government had been in a position to pay a direct bounty to the farmers on the export of wheat, and I also agree entirely that the wheat-farmers of Australia, in the circumstances in which they- find themselves to-day, are entitled to any bounty which this Parliament is in a position to offer, and that it is impossible for the great primary industries of wheat and wool to carry on, as they are doing, indefinitely at a loss. I do not suppose that one wool-grower or wheatfarmer has made any profit on his enterprise during the last eighteen months. Every wool-grower and wheat-farmer is practically carrying on at a loss to-day. But, while I agree that that is so, the whole question 13 whether, if we altered this bill and remodelled it. 011 the basis of a simple bounty, we should be doing something effective. After all, I suppose we are, in the circumstances in which we find ourselves, bound to rely on what the Government tells us. The Government has taken the responsibility of telling us that the banks will agree to no other means of finding the money for the wheatfarmers than that which is embodied in the bill.
– The Minister said that this scheme was submitted by the Premiers Conference to the banks.
– Yes; but I want to throw the definite responsibility upon the Government. It says, in clear and emphatic terms, that the banks decline to find the money for the wheat-farmers except under the scheme embodied in this bill. That being 30, I say to my colleagues in the Senate that the bill will at least ensure to the wheat-farmers of Australia 3s. a bushel, and not less, for their wheat unless wheat falls to a very low price, and the Government has to accept the responsibility of the Senate passing this measure with that knowledge.
Sitting suspended from 6.15 to 8 p.m.
– I regret that a measure like this should be rushed through both Houses of this Parliament at such short notice. »We are dealing with a bill which affects the interests of a vast number of our people who have been having a very bad time, and I am afraid that this proposal will prove a very inadequate form of assistance to them.v It has not been possible for its terms to reach many parts of Australia and to be understood by those whose interests are so vitally affected by it, and although we are quite unable, from our individual knowledge, to say how its provisions will affect the various interests throughout Australia, we are asked to pass the bill through to its final stages at this sitting, the Minister in charge of it having moved the contingent notice of motion, which permits of the suspension of the Standing Orders, to enable this to be done. The Senate should hesitate to pass the bill until a reasonable period has elapsed for its full consideration.
The more I study the measure, themore satisfied am I that, associated with it, there are certain problems which, i» practice, will be extremely difficult to handle. Consequently, 1 am convinced that the measure requires a most careful consideration before it passes this chamber. At the same time I realize that wcare on the eve of the harvest. Within a very few days now, the new season’s wheat will be starting to come into the market, and it will be practically impossible, 1 take it, for the Government to reconsider the whole basis of the measure, have further consultations with the financial institutions, and go through the whole procedure that has already been adopted in connexion with the proposal, before asking Parliament again to consider it. In the circumstances, the responsibility for the bill in its present form rests with the Government, and 1 think that, in its essence, it will have to he accepted by this Parliament.
I am satisfied that if the PremiersConference had been sitting last week, instead of a few weeks ago, when this subject was under consideration, the probability is that we should have had an entirely different bill presented for our consideration. As far as we are able to follow the genesis of the project, a:indicated in the press reports of the proceedings of the Premiers Conference, the fundamental idea upon which it wat based, was the assumption in the minds of everybody that it was impossible, within a reasonable time, to expect to se*1 wheat in the vicinity of 3s. per bushe f.o.b. Australia. That clearly was theview held by those most competent t(‘ judge the situation at the time of the recent Premiers Conference. Sterling had then not broken and, as we know, the decline in sterling materially affected the price of wheat. That was one facto? which affected the wheat situation to & material degree, and, looking into the future, I venture to suggest that two factors which may come into the equation may profoundly affect future wheat prices in Australia. One factor if British sterling. It may harden. We may see it pick up a very material proportion of the loss which has been regis- terod during the last few weeks. This would have the immediate effect of re ducing the f.o.b. price of wheat in Australia. The other factor is that, before this harvest is completely sold - indeed, before very much of it is sold at all for shipment overseas - it is conceivable that a material reduction will be reported in the present rate of exchange.
– That surely is inevitable.
– I would not say it is inevitable, because we are living in a period of such kaleidoscopic changes in the world of finance, that one hesitates to forecast what may happen.
– Would the abandonment of the gold standard in England affect the rate of exchange?
– The price of sterling would have something to do with the abandonment of the gold standard.
– Surely “ abandonment “ is too strong a term to apply to the change in Great Britain.
-“ Temporary suspension “ is what the people in England would call it. I do not say that recent changes in Great Britain are tantamount to a permanent abandonment of the gold standard ; hut the two factors which I have mentioned may conceivably - I think Senator McLachlan would say “probably” - affect the price of wheat; and, in all probability, the change will be in a downward direction.
I believe that if the Premiers Conference had been sitting last week, this bill would not have come up to the Senate in its present form. I should hesitate, too, to say the banks would have insisted upon the measure in this form, and no other form. But the Government has taken the responsibility of telling the Senate that this is the best proposal which it could get from the banks. Personally, I think that the present form of the bill is due to the way in which the proposal was submitted to the banks. Had it been put to those institutions in a different way, I think it probable that we should now be considering a different bill. There again responsibility rests upon the shoulders of the Government.
– The honorable senator knows that all the Government did was to bring under the notice of the banks the resolution of the Premiers Conference.
– What was that resolution ?
– That there should be a bounty on wheat, with a maximum price of 3s. per bushel.
– Exactly. And the banks, therefore, said : “ We will agree to a bounty of 6d. on wheat, which is the amount you ask for, provided we are not asked to find a bounty if wheat goes above 3s. per bushel.” If the Premiers Conference had submitted to the banks a proposal for a straight-out bounty of 6d. per bushel, in all probability we should have got it.
– That is a certainty.
– Again 1 say the responsibility rests upon the shoulders of this Government. I am afraid that it is too late now to re-argue the details of the scheme with the banks. I believe that in this bill the Government has to some extent endeavoured to rectify what I think was a genuine mistake. By thisI mean that it does not tie the bounty down to a price for wheat of 3s. per bushel, but has adopted an expedient which will enable it to re-argue this case with the banks. This is suggested in clause7, which reads -
The rate of bounty payable in respect of any wheat shall be the amount per bushel by which the free-on-bonrd equivalent of the price per bushel as stated in the certificate issued by licensee in respect of that wheat falls short of the prescribed price, but not exceeding in any case 6d. per bushel.
I have no doubt that the Government adopted that form in order to give it a certain amount of latitude in arguing the case anew with the banks, to see if it was not possible to have the bounty paid on a higher maximum price for wheat than that considered in the original request which the Premiers Conference submitted to the banks. This provision will undoubtedly enable the Ministry to do that. But we must be quite sure that no dispute arises later as to what is the agreed amount. It will be of no use for the Government, subsequent to the passing of this bill, to declare its intention to pay the bounty on wheat at 3s. 6d. if the banks have not agreed to that variation of the arrangement. The Government must be quite sure, if the Parliament gives it this liberty of action in clause 7, that it will not render the whole of this legislation nugatory, as other legislation has been rendered nugatory in the past, by not having a clear understanding with the people who have to find the money. Whatever the prescribed figure may be, we must be quite sure that there is no doubt about the matter with the financial institutions that have to find the money.
I wish now to say a few words about a point which the right honorable the Leader of the Opposition (Senator Pearce) and Senator Colebatch raised, namely, the possibility of collusion between the buyer and the seller, in consequence of which the grower may be paid a greater amount of bounty than would be justified according to the market price of wheat. I admit that there is a possibility of such collusion taking place. I have no doubt that it could happen; but, at the same time, I do not think that the Government would be wholly without resource in the matter. First of all, there will ha a certain amount of rivalry between the buyers. As a. matter of fact, there is very real rivalry at the present time between independent buyers and the co-operative organizations. This competition will tend to keep prices up. But it is conceivable that a.n individual seller and an individual buyer will come to an arrangement under which the seller will get a greater amount of bounty than he is entitled to receive according to the market price of wheat, and the buyer will agree to split with the seller the difference between the amount which he pays the seller and the amount which he receives for the wheat. I think everybody can see the possibility of this collusion, and although I do not know how it is to be overcome, I imagine that the Government proposes to meet such a contingency by the conditions attached to the licence to bc issued to buyers. If it were apparent that any transaction of the kind described was going on, that is to say, if it were evident that some buyers were not giving the market price for wheat, and some sellers were prepared to take less than the market price, the licensed buyer would, 1 presume, lose his licence.
– Who would decide that matter?
– I admit that the problem presents certain difficulties, but if it were abundantly evident that collusion was taking place, I think it could be dealt with.
– The honorable senator’s suggestion is an excellent one.
– The Government. I believe, could handle any attempt at collusion, although I do not say it would be possible to overcome it in every individual instance. If, however, the practice became widespread it would manifest itself, and the Government could take action along the lines I have suggested. As Senator Colebatch has said, this measure has been very ingeniously drafted, and if it were not for one class of buyer I think the operation of the aci would be a comparatively simple matter. A difficulty arises in connexion with the great co-operative organizations of primary producers, and personally, at the moment, I do not see how it will be possible entirely to overcome it. If I may be permitted to do so, I should like to mak* particular reference to certain provision? now, so that when we are dealing with them in committee, it will be quite clear that they have received that consideration which I feel their importance deserves.
– The honorable gentleman may make general observations with regard to underlying principles of the various clauses.
– I wish to refer particularly to the provisions of clause 6, in which a distinction is drawn between the ordinary private buyer, whose case is quite a simple one, and the seller of wheat through a co-operative organization. The provisions relating to the cooperative organizations are contained ii> sub-clauses 2 and 3 of clause 6; and also in clause 10. Sub-clause 2 of clause 6 enacts that a co-operative organization shall issue to the grower in respect of wheat received by it from him - a certificate in duplicate in a prescribed form specifying the quantity of wheat so received, and stating, as prescribed, the free-on-board equivalent of the price per bushel estimated bv the organization to be that at which the wheat will be sold, and specifying the bounty payable in respect of the wheat.
That would be all right, and there would be no difficulty whatever provided the organization could identify each parcel of wheat which it had in the pool, and each parcel which had been sold. But, of course, that cannot be done, because a grower may have had a half a dozen consignments of wheat in the pool. The estimated price of the wheat when he puts his first consignment into the pool, may be different from the estimated price when he puts his second, third, fourth or fifth consignment into it.
– That will not matter; for he will be paid on his certificates.
– Even if he is paid on hie certificates, difficulties will arise. Let us take the case of A, who puts his wheat into a pool controlled by a co-operative organization, at an estimated price of 2s. 8d. It is clear that he will be given a certificate at that price and on the assumption that the prescribed maximum price on which bounty is payable is 3s., the certificate will enable him to obtain a bounty payment of 4d. per. bushel. Then take the case of B, who, a fortnight later, puts his wheat into the same co-operative organization at an estimated selling price of 2s.10d. a bushel. It is clear that he will be given a certificate which will entitle him to obtain a bounty payment of 2d. per bushel. The way these co-operative organizations work ordinarily is to pay to every grower when he puts his wheat into the pool the average price which they receive for all wheat that goes into the pool. It must be quite clear, therefore, that if they proceed along those lines A will get 2d. per bushel more than B for his wheat.
– Even though the f.o.b. price of B’s wheat was higher.
– Exactly. I think this difficulty has been overcomein the bill, though I am not quite sure of it.
SenatorO’Halloran. - Does not subclause 3 of clause 6 meet that case?
– I am not quite sure of it, and it is for that reason that I am referring to the matter now.We should be quite clear by the time we reach the committee stage of the bill that this difficulty, of which every one is aware, has been surmounted.
– How can subclause 3 of clause 6 overcome the difficulty, seeing that the wheat is never identified ?
– I am coming to that point. I think that the provisions of the bill ensure that the growers will all get the same price for their wheat, butI want to make sure of it. I understand sub-clause 3 of clause 6 to provide that, in the event of the price at which the wheat is sold being greater than the price originally estimated, and on which bounty was paid to A, the duty is thrown on a co-operative organization of issuing a second certificate showing the true bounty which A should have received. I think it is contemplated, though I am not sure that it is actually provided for in the bill, that the co-operative organization, when it comes to finalize its accounts as between A and B and every other member of the pool, will work out the average price paid to the growers in the pool, and state on a second certificate the true bounty which should have been paid. It will then proceed on the final payments to its members to adjust either by deductt ion or addition to the individual accounts the inequalities in the bounty payments. That. I say, is what I think is intended; but I am not quite sure whether the bil! goes so far as to authorize a co-operative organization to take such action.
– Clause 10 looks a little like providing for it.
– That provides for a different matter. That is the provision of the bill under which co-operative bodies, if they have paid out to the growers in their organization more than the average bounty which should have been paid according to the realization price of the wheat, shall refund such amounts to the Government. In consequence of this provision it seems to me that in the handling of their accounts the co-operative organizations will have to retain sufficient funds first, to make such refunds to the Government, if the need for them arises ; and, secondly, to equalize the bounty payments as between the various growers who have put wheat into the pool.
– If that is the ease, the pools will get no wheat at all.
– I ventured to suggest, when Senator Colebatch was speaking, that the provisions of the bill would be found to somewhat handicap the co-operative organizations as against the private buyers. I must admit that, with this particular kind of organization in the wheat business, and this particular kind of bounty payment, it is almost impossible to overcome that difficulty other than in the way provided in the bill, but I am not sure that even that way is fully provided for. I am not clear whether the provisions of the bill will give the co-operative organizations power to keep back from the individual growers an amount necessary for equalizing the payments in regard to bounty. It is perfectly clear that the provisions should go this far, otherwise it would be impossible for an organization to do justice to its individual members.
– If the co-operative organization gives a certificate which enables a man to get a bigger bounty than he should, get, there may be a refund; but, if a private buyer gives such a certificate, there is no provision for a refund.
– That is so; but that is unavoidable as between the cooperative organizations and the private buyers whose operations are so fundamentally different in character. There seems to me to be no escape from that position. A grower who hands his wheat to a cooperative organization is a seller in two senses. He is a seller when he hands his wheat to the organization, and he is also a seller of f.o.b. wheat. Clearly, therefore, a different class of arrangement is necessary to meet that case and the case of the farmer who sells straight out to a private firm. 1 think the provisions of the bill have met this difficulty; but I am not sure whether they go so far as to authorize a co-operative organization to make adjustments as between its individual members in regard to bounty payments. If they do not go this far, another provision should be put into the bill for that, purpose.
– It is abundantly clear that the subject now being discussed by the honorable senator must inevitably be discussed again when the bill is at the committee stage. The influence of clause upon clause must be considered then. I therefore ask the honorable senator to do his best to keep to the larger aspects and the main principles of the bill.
– I recognized some little time ago that my remarks were of the nature referred to by you, sir. My only object in bringing these matters forward now i3 to prepare the minds of honorable senators to meet the problem.* when the bill is at the committee stage. I do this because of the anxiety of the Government to get the bill through at the earliest passible moment.
There is one other aspect of the subject in regard to co-operative organizations about, which I should like to say a word, although it lias already received some consideration from the Government. What would be the position of the cooperative organizations in the event of over-payments of bounty having been made? In the event, of the estimated price stated on the certificate issued to the seller to the pool being lower than the actual price received, it may be necessary for a co-operative organization to refund quite large amounts of money to the Government. What is to be the position of these co-operative organizations upon which this responsibility is thrust in the event of a lien being given over the wheat? In such cases, of course the whole of the proceeds received by the pool for the wheat goes to the lienee. The position then is that the co-operative organizations, even if desiring to make the equalization to which I have referred, would have nothing out of which to effect it. In the case of a lien where the whole of the proceeds of a crop are not the property of a member of the organization, it i.1quite clear that the obligation to find the money would be thrown upon the organization.
– Who would place the wheat in the pool?
– The member who places the wheat in the pool is the lienor.
SenatorDaly. - Having parted with his lien ?
– Then the cooperative company would have to pay the whole of the proceeds of the wheat to the lienee, and in the event of the Government coming down on the organization for a refund, as is provided in clause 10, the whole burden would fall practically upon the organization, which w ould not be able to recover any part.
– Would the organization pay out to any one until satisfied as to the 3s.?
– I am not a lawyer, but I should imagine that the position would be that whatever funds came into the possession of the organization as a result of the sale of that wheat belonged to the lienee.
– He would have to garnishee it.
– I am assuming that the ordinary process of law wereput into operation.
-he could garnishee only such proceedsas by law he held for the lienor.
– I am assuming a case in which the whole of the proceeds of a crop were involved. There are cases where no part of the proceeds passes into the hands of the lienor at all; every penny goes to the lienee.
– We should give the bounty to the farmer, and not to his creditors.
– The pointI am endeavouring to make is that underthe provisions of clause 10 the burden is going to fall on the farmers through their organizations; I do not see how that is to be overcome. I know that the matter is receiving consideration, and 1 hope it will receive further consideration before the bill reaches the committee stage.
SenatorRae. - Cannot the co-operative organizations keep back sufficient to make the necessary adjustments?
– The funds do not belong to them; they have no power to keep back any portion. It may be that it will be found possible to give them that power; but I do not know whether such a course is practicable.
– The Commonwealth cannot give that power.
– I do not think the Commonwealth can pass a law affecting the rights of the lienee. I suggest that that matter receive the immediate consideration of the Government.
I do not wish to take up any further time in discussing this measure. I feel, however, that it is inadequate to meet the position in which the wheat-growers find themselves. I am convinced that the form of the bill is governed by the nature of the request made to the banks. I contend that the request to the banks was wrongly framed. It would have been infinitely better for the farmers and for the country if the Government had asked the banks to raise the necessary money to enable it to pay a straight-out bounty of 6d. a bushel to the wheat-growers. I think tha Government could have got the money from the banks if a straight-out request had been made to them in that way.
– Probably it is not yet too late.
– I am afraid that it is. The harvest is almost upon us, and we do not wish to risk the possibility of another fiasco in the matter of payments to the wheat-growers. I think it better to accept the bill in this form, or subject to such amendments as the Senate thinks necessary, in order to let the farmers know at all events that out of this measure they will get something which will be of assistance to them.
– I am glad that at last the farmers are to get something; but I wish to point out some of the difficulties and injustices to which they are. being subjected under this bill. During the 30 years of federation, numerous bounties have been paid to different industries. There occur to one’s mind at once the large sums that have been given to those engaged in the iron and steel industries, and to those engaged in the production of cotton, flax and cattle for export. There has never been any difficulty in obtaining a straightout bounty on the total production or the export quantity of these commodities. “We also find that our secondary industries have been generously assisted. No difficulty has ever been found in giving those engaged in secondary production, all the protection and -assistance that they wanted and a great deal more than they needed. During this long period the primary producers, and particularly the wheat and wool growers have had to bear the brunt of the burden of tariffs and bounties. It has now become too much for the wheat-growers, who, in their present parlous state, find it impossible to carry on. For the last, two years they have been asking for assistance, but when an offer is made to them, it is on a totally different basis from that on which those engaged in other industries, which have been assisted by bounties or tariffs have had assistance. The wheat industry is the only industry to which assistance has been approved by legislation which has not received a straight-out bounty. When the Government now promises to provide 6d. a bushel on export flour, we find that a string is attached to the proposal. If the price of wheat in the markets of the world should increase - although the increased price may not bring it up to the cost of production, or provide the farmer with a living or even the basic wage - the farmer is to receive only about threefourths of the cost of production. The generous banking institutions or whoever is responsible, have now said that if the f.o.b. price of wheat reaches 3s. a bushel, no bounty shall be payable. They are saying, “ After starving you, we will give you a bone or only one-half of the cost of production.” If the price reaches 3s. » bushel f.o.b. they are not to receive anything at all. It is a monstrous proposal, and I hope that the efforts of the Government to increase this pittance to Sr. fid. a bushel will be successful. I am glad that the Government has introduced the hill in a form which will permit the payment of 3s. 6d a bushel, or a bonus of 6d. a bushel irrespective of the price of wheat, if the banks agree.
I wish now briefly to refer to the repeated disappointments which the wheat-
Senator JB. fi. .Johnston. growers have experienced during recent years, not with the object at the moment of apportioning the blame, but in order to show how the farmers’ interests have been disregarded. The first bill that, came before the Senate provided for the payment of a guaranteed price of 4s. a bushel, but that payment was to be subject to the State governments providing one-half of any loss that might accrue under the guarantee. For the first time in federal history, the States were asked to provide one-half of the bounty, and on an unequal basis owing to the variation in production and in the matter of population. The proposal was so unjust that some States refused to accept the heavy liability involved, and the bill was lost. In December of last year, a Wheat Advances Bill, under which the paltry price of 3s. a bushel f.o.b. was offered, was approved by Parliament. Although that act is now on the statute-hook, the nation has defaulted in its promise to the wheat-growers, who have not received the price promised. They have been “ welshed “ out of it, as no payment whatever has been made. After 30 years of federation, that is the only bill that has ever been placed upon the statute-book of the Commonwealth or of any of the States which has been entirely ignored.
– There is also the Tariff Board Act.
– Yes ; but if effect had been given to the measure to which I have referred, it would have had a striking effect upon the nation’s prosperity. Under this measure, the Government now proposes to repeal that act, and the legal promises it contains, to pay a guaranteed price of 3s. a bushel for last year’s harvest. This second measure was approved by the Senate, and I trust that this chamber will reject this proposal for its repeal, concurrently, with the introduction of the Fiduciary Notes Bill, the wheatgrowers were promised 4½d. a bushel on the whole of last year’s crop under a measure introduced in another place, but which was abandoned. ‘ The abandonment of the one measure and the defeat of the other were abundantly justified. This is the fourth measure that has been sent along. It provides for the payment of 6d. a bushel, with the nasty condition attached to it to which I have referred. I object, unequivocally, to the proposal that if the price of wheat in the markets of the world should reach a figure that will give the wheat-farmer 3s. a bushel f.o.b., he shall receive nothing by way of bounty. I agree with previous speakers, that a simple bounty of 6d. a bushel on all wheat produced is what is required, and that a genuine mistake was made by the recent Premiers Conference when it did not ask for that straight out.
– In the event of the price of wheat reaching 5s. a bushel, does the honorable senator say that the Government should still subsidize the wheat-farmers?
– Certainly. In view of the fact that last year they received nothing, unless the Government intends to honour in full its promise to guarantee the payment of 3s. a bushel f.o.b. under the Wheat Advances Act this 6d. a bushel should be paid whatever price may be received for the 1931-32 crop. No limitation is placed on the price that the exploiters who reeeive bounties in the cotton, flax, steel and iron, and other industries, shall charge for their products.
– Yes, it is, in every case.
– It has rarely been done. With the exception of possibly galvanized iron, the manufacturers charge what they like. That has been the case in connexion with agricultural, mining, and all other machinery in which iron is a base product.
– The honorable senator is quite wrong.
– Despite tbe denial of the honorable senator, I maintain that, except in the case of galvanized iron, industries that have been given bounties have had no limitation placed upon them except a limitation of the total bounty. In this case a limit of £3,000,000 would apply to the wheatfarmers’ bounty for next harvest. The Commonwealth has not the power to regulate the price that is charged for agricultural, and every other type of machinery. It is only when we come to the wheat-growers, who have been wrecked during the last two years on account of the non-fulfilment of: the promises of assistance that have repeatedly been made, as a result of their wonderful response to the invitation to grow more wheat, that this Parliament is asked to approve of such a limitation. Should three-quarters of the cost of production be obtained, they are not to be given any assistance. They and their families are to work under conditions approaching slavery, and are not to receive even the basic wage. If the banks are responsible for this stipulation, they must be made to realize that in the wheat districts of the Commonwealth, the determination is stiffening not to tolerate the conditions of semistarvation and hardship under which the wheat-farmers, their families, and their employees, have been working for so long.
– The honorable senator’s vote was responsible for the defeat of the bill which proposed to guarantee to the wheat-growers 4s. a bushel for last season’s crop.
– It was the Government’s refusal to relieve the States of liability which brought about the defeat of that measure. I cannot refer to the disappointments and privations of the wheat-growers but the Minister must attempt to introduce that measure of party politics which I am trying to avoid. It is the humbug of his Government that has been responsible for the position in which the wheatgrowers are placed to-day.
I wish to refer to the cost of production of wheat, with a view to showing the absolute inadequacy of the 3s. per bushel f.o.b. which has been fixed as the point at which assistance under this hill shall cease to be given. A copy of The Wheatgrower, of Western Australia, dated the 15th of this month, sets out the cost of production in that State, as ascertained by the Farmers Disability Royal Commission, which recently inquired into the question. That was an honorary royal commission, the object of which was to learn what relief could be given to the wheat-growers of that State. It supplied the following details: -
Those figures show that the cost per bushel under horse traction totals 3s. 5d. at the railway siding on a 12-bushel average. It costs a further 7d. a bushel to transport the wheat to the ship. Another table shows the cost under power traction to be 3s. 5.3d. at the railway siding on a 12-bushel average. In the light of those figures, which were ascertained on sworn evidence, taken only a few months ago, why should the banks, the Government, or any other authority, fix 3s. per bushel f.o.b. as the price at which assistance to the wheat-grower under this measure, shall cease to be given ?
– What about 3s. 6d. perbushel?
– That would not be sufficient, but it would be better than 3s. What I ask is that the Government should make a straight-out request to the banks for a bounty of 6d. per bushel on export production. If that wore granted, and the provisions of this measure relating to the charging of 6d. per bushel on that portion of the crop used for local consumption were operated, we should be doing something to help the wheat-farmer, and the assistance would he on the same unrestricted basis as that which has been given from time to time to many other Australia industries. The figures that I have quoted show clearly that the cost of production under average conditions in Western Australia, where there is cheap land and a regular rainfall, is 3s. 5d. per bushel at the rail head, or slightly over 4s. per bushel f.o.b. Yet under this measure, the farmer is to be restricted to three-quarters of the cost of his production. In connexion with other bounties, it is laid down by law that the employees in the industry shall receive the basic wage. The payment of 3s. per bushel f.o.b. will not represent to the farmer, his sons, or his assistants, even that return, let alone show him a profit on his production, interest on his capital, or any remuneration for the hardships that he is called upon to endure in the way of long hours, isolated conditions, and the absence of many “ of the every-day services, such as water supply, electric light, gas, and other conveniences, that are enjoyed by the people in the cities. I doubt whether, under this measure, he will be allowed to receive even three-quarters of the basic wage before the assistance which it professes to give will be withdrawn. I warn the Government that, the wheat-growers are desperate, and that in them are being awakened forces that it will not be easy to control unless justice is meted out to them. The following paragraph, which appears to be authentic, and to have been inspired, was published yesterday in the Melbourne Herald: -
A meeting of the representatives of the associated banks in Victoria was held to-day to consider the request of the recent interstate conference of wheat interests that the banks should finance fid. a bushel bounty on export wheat provided this did not increase the f.o.b. price above 3s. fid. per bushel. 1 hope that that is the minimum that the Government will accept, and that it will continue to negotiate until at least that small result is attained. The paragraph continues -
No finality will be reached until later in the week. The banks agreed in September to provide £3,000,000 for a bounty of Od. a bushel provided it did not take the price over 3a. per bushel.
I repeat that there can be little doubt that a genuine mistake was made by the Premiers Conference in connexion with the form in which the request for this assistance was made. It seems to me incredible that unless a mistake waa made, the Commonwealth should be restricted by the lender of the money in regard to the extent to which assistance should be given. This is a most unusual condition, particularly when we consider the amount of money which the wheat-growers owe to the trading banks. In many districts the mortgages held by tho banks are so heavy that they are virtually the owners of those districts. The decline that has taken place in the prices of products and the value of land is so great that the owners have little equity in their holdings, and are really only managers for the banks. In those circumstances, the banks would not only assist in the rehabilitation of this nation, and in carrying out the desires of the economists who drew up the Premiers’ plan, but also would be conserving their own interests very considerably, if they allowed the wheat-farmers the extra amount which would enable them to meet some of their obligations. A great deal of the money would percolate back to the banks, and relieve their creditors in many other directions. Even from that point of view one would anticipate that the banks would much prefer having the Government as their creditors for th, £3,000,000 rather than that the farmers should be denied overdrafts which would furnish them with money for working expenses, as they will be if this bounty is restricted to wheat at 3s. a bushel f.o.b. The Herald article continues -
The Prime Minister (Mr. Scullin) conveyed the decision of the conference to the chairman of the Commonwealth Bank (Sir Robert Gibson) yesterday. Sir Robert immediately forwarded it to the chairman of the Associated Banks in Victoria (Mr. G. Ti). Healy) and to the representatives of banks with headquarters in other States. Since the original proposition was made, wheat has increased, until to-day the f.o.b. price is approaching 3s. a bushel. Wheat-growers und Ministers for Agriculture who attended the interstate conference last week pointed out that unless the guarantee price was increased the bounty would be of very little use.
Bankers in Victoria are divided on the advisability of grunting the request for an increase. They do not agree with the contention of the Minister for Markets (Mr. Parker Moloney) however, that when the original decision was made the question of a guarantee price was merely incidental to the main consideration of the advance of £3.000,000.
According to this press statement the Minister for Markets, who conducted the negotiations, evidently contends that the main consideration of the banks was that the advance should be confined to £8,000,000, and that the guaranteed price of wheat was merely an incidental matter. And to me it seems perfectly reasonable that such should be the case. That being so there is, undoubtedly, a distinct obligation upon the banks to find the whole of the £3,000,000, and on the Government to pay the bounty of 6d. a bushel on all wheat exported without restriction as to what, the price may be at the time the advance is made.
– “Will the honorable senator say how that can be done without the consent of the banks?
– I take it that the Government will approach the banks. The form in which the bill has been submitted makes it clear that even now the negotiations with the banks are not completed; even now the bankers have not given any reply to the request the Government put before them at the instance of the conference of the Minister for Markets with the State Ministers for Agriculture, held in Melbourne on the 16th of this month.
I think that a mistake was made by the Premiers Conference in regard to the form of the request put to the banks, and I have no doubt that these institutions would give the £3,000,000 unconditionally if the Government asked for it for the purpose of paying a wheat bounty. We do not know that they have been actually asked to do so. Senator Daly said that the request was made for the advance with the restriction which! appears in the bill. That might easily have been the case five or six weeks ago, when the price of wheat was about 2s. 2d. a bushel f.o.b., but to-day it is almost 3s. a bushel f.o.b. I contend that the provisions of this bill did not enter into the consideration of the trading banks. I do not know that those banks were even acquainted with them. The memorandum read by Senator Dooley this afternoon bore no suggestion that the terms of the Commonwealth Bank had been referred to or approved by the trading banks. If this bill, therefore, is not the response of the Government to the request of the trading banks, I hope that the request put forward by the conference of Ministers of Agriculture will be submitted to the Commonwealth Bank and the trading banks, in a form quite different from that in which, according to Senator Daly, it was previously put before the banks.
The following telegram which reached me this evening from Mr. J. D. Seyfort, secretary of the Wheat-growers Union in Western Australia, shows the feeling in Western Australia in regard to this bill, and the disappointment it has caused among organized wheat-growers there : - .
Please urge on Western Australian senators to put the bounty price limit up to 3s. 6d. f.o.b. in bill before the Senate. Wheat at present is over 3s. per bushel in Fremantle and bounty therefore docs not operate at all.
I endorse the request made in the telegram. If it is acceded to the country will be saved the risk of exploitation. Much greater justice will be done to the wheat-farmers if no price limit is fixed and the Government and the banks approve of the bounty being paid up to at least 3s. 6d. f.o.b. for all wheat in the coming harvest. I again contend that the 6d. a bushel bounty should be paid on the whole harvest irrespective of the f.o.b. price.
This bill is inequitable in its incidence. So far as Western Australia is concerned, it makes no provision for the fact that the f.o.b. price for wheat at Fremantle is generally l£d. or 2d. per bushel higher than the f.o.b. price in eastern ports. This is due mostly to the lower freight from Fremantle to Great Britain and, in some degree, to the very high quality of Western Australian wheat. Being grown in a dry climate it is eminently suitable for milling purposes. But as a result of getting this higher price the Western Australian farmers will receive 1-Jd. or 2d. a bushel less by way of bounty than the eastern wheat-growers if the payment of the bounty is to he limited to wheat at 3s. a bushel f.o.b. . I am sure that it is not the intention to discriminate between States. The difficulty would be overcome and greater justice done by the payment of a straight-out bounty of 6d. a bushel on all wheat, wherever produced, in the Commonwealth. We would then get the benefit of the higher value and quality of our wheat f.o.b. In fairness, I should point out that the consuming public of Western Australia will enjoy an advantage under this bill because of their smaller contribution to the local consumption price. But that advantage will be of no satisfaction to the Western Australian wheat-grower, who will he deprived of the advantage he derives from growing his wheat closer to the world’s markets than the wheatgrowers in the eastern States.
Promises have repeatedly been made to the farmers - in fact a law was enacted to provide for it - that they would be paid 3s. a bushel f.o.b. on last year’s crop ; but nothing has been done to carry out those promises. I support the bill now under discussion in the hope that the whole of the £3,000,000 promised by the banks will be paid to the wheat-growers on the basis of3s. a bushel for the export crop. We are discussing a machinery measure, which is to some extent unsatisfactory inasmuch as we do not know what the farmers are to receive. We do not know even now whether they are to receive any bounty at all. The whole scheme is dependent on an unascertained amount, and that is the f.o.b. price of wheat, whioh varies from day to day from one end of Australia to the other. In each port it is different on the same day. It varies in regard to different consignments of wheat forwarded to the same port on the same day. If the f.o.b. price of wheat ranges anywhere within 6d; of the prim at which the bounty operates the scheme in the bill will certainly lend itself to Exploitation of the Government. For instance, in Adelaide yesterday, the f.o.b. price of wheat was 2s. 6½d., whereas at Manilla, a country town in New South Wales, the priceon the f.o.b. basis was 2s.11½d. and in other country districts it was 2s. 8d. In Melbourne it was 2s. 10d. and, as Mr. Seyfort informs me in his telegram, it is 3s. in Fremantle to-day. It will be seen, therefore, that greatconfusion will arise. This measure will be very difficult to administer. It would have been far more preferable if a bounty of 6d. a bushel had been paid on exported wheat irrespective of the world’s price. In those circumstances we could beassured that the whole of the bounty would go to the producer, but under the shandygaff scheme contained in this bill, ifthe price ranges about3s. per bushel f.o.b. there is a distinct danger of half ofthe bounty not reaching the pockets ofthe wheat-growers at all. This bill will be a wheat merchants’ benefit bill if the price of wheat ranges any when? about 3s. a. bushel. TheGovernment will be paying outand the f armer will not be receiving the whole of theamountsso paid.
I arn distressed and amazed to find that forsome reason, whichhas neverbeen explained by the Minister,theGovernment desires in this bill to repeal the Wheat Advances Act 1930, which provided for the payment of 3s.a bushel f.o.b. on last season’s crop. This bill deals with next season’s crop.
– This measure would repeal the other in any case. The two could not stand together; the latter would end the former.
– If the honorable and learned senator would study the measure he would find that the Wheat Advances Act applied only to last season’s crop and no other. At the proper time, I shall ask the Chair to declare whether the clause to repeal the 1930 act is not out of order. If it is not, it ia certainly one that has no right to be considered by this Parliament.
– How could the act be operated, now that the wheat has all been disposed of?
– Records have been kept. We know what the farmers got for their wheat and the exact amounts that should have been paid by the Commonwealth Government to honour the Wheat Advances Act 1930. I hope that the scandalous act of repudiation contemplated by this bill-
– Itake exception to the honorable senator’s description of this bill as a scandalous act of repudiation, and I ask that the words be withdrawn.
– The honorable senator must withdraw the words.
– I withdraw them. The actof political perfidy contemplated by this bill-
– The honorable senator is adding to his offence.
– It is a little difficult tosay exactly what I want to say. The actioncontemplated in this bill, adopted from the Lang plan, should not be approved by this Senate. The Wheat Advances Act 1930, is the only measurepassed in 30 yearsof federation, whichhasnot been observed or honoured. No attemptwas made by the CommonwealthGovernment to pay the 3s. a bushel. I have the file of the correspondence between the Government and the Commonwealth Bank in regand to the (payment of that advance.I assume thattheGovernment laid onthe table a completefileofthe correspondence,and thatthefile is not mutilated. The bill was passedon the17thDecember, 1930,andon the18th December,the Acting Prime Minister(Mr. Fenton) sent a letter the chairman of directors of the Commonwealth Bank, asking him to make the necessary arrangements. A copy of that letter was also sent to the Governor of the bank in Sydney. Then follows complete silence. Nothing happened for several weeks. According to the file, neither Sir Robert Gibson nor the Governor of the bank had the courtesy even to acknowledge receipt of the letters. There is nothing on the file to show even that it was received by the Governor of the bank, or that the Acting Prime Minister was given an acknowledgement of its receipt. There was, as I have said, a complete silence from the 18th December, 1980, until the 19th January, 1931.
– Read the summary of the conference.
– We are entitled to assume that, if the Government had really desired to pay our wheatfarmers 3s. per bushel under that legislation, it would have inquired of the Commonwealth Bank why there had not been an acknowledgement of the letter from the Acting Prime Minister. As I have said, nothing happened until the Prime Minister returned from England. The file records the holding of a conference on the 19th January, 1931, between thu Prime Minister (Mr. Scullin), Mr. Forde, and Sir Robert Gibson. The following is the summary of the proceedings : -
On the 19th January, 1931, the matter was discussed at a conference held in Melbourne between the Prime Minister (Et. Hon. J. H. Scullin), the Acting Minister for Markets (Mr. Forde), and the Chairman of the Commonwealth Bank Board (Sir Robert Gibson). The Secretary of the Department of Markets (Mr. E. J. Mulvaney), and the Acting Solicitor-General (Mr. G. S- Knowles) were also present.
Because of a legal doubt, the Government, which led the people to believe that it was so anxious to help our wheatfarmers, turned round and said that it regretted that the act was not operative No effort was made to overcome the legal doubt, or even to refer it to the Crown Law Department. Contrast the Government’s attitude towards our wheatgrowers with its treatment of the Wiluna Gold Mines Limited. When it ascertained that it was unable to provide a certain guarantee for that mining company, it requested the State Government to do so, and undertook to indemnify it. But, because of the legal doubt as to the constitutionality of the bank’s position with regard to the payment of 33. per bushel for wheat, the Government promptly and illegally dropped the measure. The summary goes on to state -
At that conference the Chairman of the Commonwealth Bank Board intimated that the board was unable to see its way to ad-‘ vance upon wheat any amount exceeding a sum which might reasonably be computed to represent the realizable export value of f.a.q wheat, and that the bank’s legal advisers had raised serious doubt as to the ability of the Government to safeguard the bank against any losses under the guarantee proposed by the Wheat Advances Act; furthermore, that the Bank Board was faced under an act of Parliament with the responsibility of conducting the business of the bank, and was under obligation to adopt any measure which might be deemed necessary to protect the bank against loss.
If the Government had asked Parliament for the necessary authority, as in the case of the Wiluna Gold Mines Limited, Parliament would have passed an indemnifying bill, and the objections of Sir Robert Gibson would have been met. The summary continues -
In the circumstances the Acting Minister for Markets intimated in the press that, as Mie Government was unable to obtain the necessary finance from the Commonwealth Bank to give effect to the Wheat Advances Act, by providing a guaranteed price on the basis of 3s. per bushel f.o.b. for f.a.q. wheat, wheatgrowers should, in view of the decision of thu Commonwealth Bank Board, proceed with their marketing operations in the ordinary way as though the act did not exist.
This summary discloses a scandalous’ disregard on the part of t.hi3 Government for the interests of our wheat-growers. What right had the Minister for Markets to tell the wheat-growers of Australia that they could carry on with the marketing of their wheat as though the act had not been passed? And what right had thic Government to set aside the will of Parliament, merely because of an objection raised by some undisclosed legal authority?
– I have given the honorable gentleman a great deal of latitude in discussing what is, after all, a minor detail of the bill, and not one of its underlying principles. As the honorable senator will inevitably repeat his arguments when certain clauses are under discussion in committee, I trust that he will now direct his remarks to the general principles of the bill.
– With all due respect, Mr. President, I am amazed to hear you say that the matter which I am discussing is a minor one. In my judgment, it is most important, because it relates to what is equivalent to the deliberate robbery of £6,250,000 from our wheat-growers.
– In my opinion it i3 not the most important aspect of the bill.
– May I be permitted to mention the loss which the Government’s inaction has entailed upon our wheat-growers?
– I think the honorable gentleman has done that already. I therefore hope that he will conclude his observations upon what I maintain is a minor point in the bill.
– I am afraid that our wheat-growers do not share that opinion. Let us consider the amount of the wheat involved. The production figures for the season 1930-31 were as follows : -
According to Professor Giblin, “the amount that would be required to pay a minimum price f.o.b. of 3s. per bushel, can be approximated at 8d. per bushel, or a sum’ of £6,221,000 “ distributed as fol lows : -
It will be seen that of that amount the farmers of Western Australia would receive just about a quarter, amounting to £1,587,000. I submit that the Government is legally and morally bound to make this payment to the wheatgrowers, and I hope that the Senate will not approve of the repeal of the measure which authorized the payment of it. If the Government cannot find this money it might at least remember that another government may assume office which would enjoy greater credit and be able to raise the money. Before the Wheat Advances Act is repealed, the Government should explore every possible avenue of raising this sum of money. I have an important suggestion to put forward in this connexion.
– The honorable senator could put it forward in committee.
– I do not desire to disobey the Chair, but I have waited for many weeks to make this suggestion.
– The honorable gentleman has already made it and reiterated it.
– I assure you, sir, that I have not made the suggestion that I am now about to make. I had intended to submit my proposal by way of motion, but an honorable senator with greater experience in federal politics than I have had, advised me to wait until this bill was under discussion, when, he said, 1 would be able to make it most effectively. I suggest that if the Government cannot find cash to make payments to the wheat-growers in pursuance of the provisions of the Wheat Advances Act, it should make the payment by way of negotiable bonds. It will be remembered that the former Prime Minister (Mr. Hughes.) paid the war gratuity to soldiers by bonds; and the farmers could be paid in the same way. A bill could be introduced to provide for the issuing of negotiable bonds, and so the will of Parliament could be carried out.
I shall support this bill, but I hope that the Government will include in it a provision that a bounty of 6d. a bushel shall be paid on the whole of the wheat exported, irrespective of the f.o.b. price! The principle of paying a flat rate has been adopted in connexion with all the bounty bills which this Parliament has previously passed. I urge the adoption of that course in this case with all the more force because it is likely that the f.o.b. price will reach 3s., in which event no bounty whatever will be payable. I am 3’iijre that with a little negotiation the banks would make £3,000;000 available for the assistance of the wheat-growers and tot place any restriction upon the expenditure of it. I urge the Government to adopt my suggestion. To take any other course will not only jeopardize the utility of this bill, but also jeopardize the very life of the Government. Why pass a measure Under which with a small-improvement in the world’s price for wheat the farmer will again get nothing? 1 submit that our farmers are entitled to a living wage, and should not be put off with something that is less than the cost of production. I regret that the Government desires, to push this bill through without allowing proper time for its consideration. The’ measure tra* introduced into the other House only yesterday, and we did not see it until a few hours ago. We have not had time to consider properly its numerous and intricate provisions!
I had intended to refer to certain other” points, but iri- compliance with your fJshes, Mr. President, I shall not do so until the committee stage of the bill is reached. It is two years since the farmers were first promised a bounty on wheat, and it is high time that something at least should be paid to them.
– My first duty is to congratulate the Government upon having introduced this bill, though even while I offer my congratulations, I am conscious of a villainous sort of second thought that 1 should examine thyself to see whether 1 kuri really justified in offering any sort nf congratulations to it. But I atn pleased that aft*” a period of splendid pretence and masterly inactivity’ in respect to the wheat-growers, the Govern^ ment bag at long last decided to do something. The wheatgrowers are the last people iri the wide world who, in the ord- -nary course, would’ even think of asking any one to help them. The 30 years’ history of this’ Parliament justifies the making of such a remark, for this is the” fs rsl trine that the wheat-growers of Australia have ever appeared1 in the’ role df -supplicants for a measure of natural jus tice. They have generously helped other industries and Australia throughout this long period^ but have had very meagre acknowledgements of their efforts. It is only because of the special. and most unfortunate circumstances of this industry, that they arenow seeking assistance.
While I have congratulated the Government, I must also remind it now that it is sitting on the stool of repentance) that it is more” than twelve months since it very definitely promised to help the farmers. If the assistance now so tardily proposed to be given had been given then, many farmers would still be living on the countryside, whereas now they have joined the throngs of city dwellers who are living on the dole.’ Unfortunately, the Government kept promising the farmers assistance and sympathizing with them, but it is only at this eleventh hour that it has rushed thi* bill before Parliament. The best that can be said, therefore, is that this is belated sympathy. I realize that under existing circumstances, it is a big undertaking to provide £3,000,000 for the payment of a bounty on wheat. From information placed before us to-night, it appears almost certain that not one penny of that amount will go to the farmers of Western Australia. And if the price but barely equalled the cost of production, I sincerely hope that this will be so for the simple reason that 1 should like to see the wheat-farmers of the State which I represent retain their independence, so that they may not be charged in the future with coming like beggarmen to seek help from the Commonwealth, as tlie captains of other induS; tries hav’e been doing for many years. J have been studying the tariff recently, and J have been struck by the fact thai duties have been provided in the tarin* schedule which, in many cases, far exceed the manufacturing costs, duties far it) excess of what some manufacturer* wanted. It cannot be said that the bounty now proposed to be paid will bring the price of wheal up to anything like the cost of production, for the point at which the bounty will disappear is 3s. per bushel f.o.b.- It is’ manifestly impossible profitably fo produce, wheat in this’ country at that price. Any one who suggests that it can bo done, shows gross ignorance of the whole subject.
– We should not be able to offer even 3s. per bushel if it were not for the tariff.
– The farmers are only willing to accept this help, because they are in dire distress. I do not intend to say very much in criticism of the Government, for I do not desire to hurt any one’s feelings; but if any government supporter suggests that 3s. covers the cost of producing a bushel of wheat, I can only say that he will display a splendid ignorance.
– Did not Mr. Gibbons promise that 6s. a bushel would be paid for wheat?
– I believe that some such promise was made; but like many other promises to the farmers, it was not fulfilled. The promises made to the wheatgrowers of Australia have been broken with remarkable regularity. In this regard, we have had an exhibition of the most systematic breaking of promises that I have ever experienced. But now the poor farmers are to be given a few crumbs from some one’s table. The farmers - and I challenge contradiction of this statement - have been the foundation of the prosperity of Australia for many a long day. When the first citizen of this Commonwealth, the Prime Minister, sent out an S.O.S. from his sinking ship some time ago, did he appeal to his own supporters? Of course not. He singled out the wheat-growers as the only section of the community who could give substantial help to the country in its time of need; and the farmers manfully rose to the occasion and planted more wheat than they should have planted, and landed themselves deep in debt as a consequence. And they have been left in the soup! It is now proposed to give them some grains of consolation and comfort. I again repeat, however, that 3s. per bushel does not represent the cost of producing wheat in Australia. Professor Perkins, who comes from the same State as Senator Daly, and has no axe to grind, puts the cost of producing wheat in South Australia at 4s. or over per bushel; and South Australia is where our best wheat-farmers are to be found. I say that, although I am a representative of Western Australia. The price of producing wheat in New South Wales is also high. At a recent conference convened by a Labour government at Bathurst the cost of producing wheat was put down, not at 4s., 4s. 6d., or even 5s., hut at 5s. 6d. per bushel. I think it is too high. Senator E. B. Johnston has told us something about the cost of producing wheat in Western Australia, and I know from my own experience in this industry that wheat cannot be produced for 3s. per bushel. Although the collective wisdom of the representatives of the wheat industry of New South Wales put down the cost of production as 5s. 6d. per bushel, the farmers are now being offered 3s. per bushel.
Notwithstanding this, I accept the bill and am pleased that the Government is coming to the rescue of the farmers at least to this extent. I do not intend to say any hard words about the banks for not making more money available, for I realize that they have had a tough job to maintain the credit of Australia, and to keep our industries still going. Some people in this country have said that the banks are withholding money from circulation, but I do not believe such statements. An examination of the banking returns from time to time, which are published at the end of every month, will show quite clearly that money which is taken at one end of the bank counter, is passed out at the other end, and so is kept circulating throughout the community. The banks cannot extend credit without having the foundation for doing so. They are circulating among the people the money entrusted to their care. They have no philosopher’s stone which enables them to turn wood into gold. I am quite sure that the provision of this £3,000,000 will strain their resources almost to breaking point.
SenatorRae. - Not a bit of it.
– My friend, Senator Rae, has been knocking about this country as long as I have, and he knows very well that the banking smash of the ‘nineties was caused through the banks extending credit beyond the point of safety.
Because that was done, thousands of people in Australia are still lamenting.
There were only three ways in which the Government could have raised the £3,000,000 necessary to pay this bounty. It could have been obtained first, by means of a loan ; secondly, by general taxation on the whole people; and thirdly - and this is the course which any government with an atom of political courage would have adopted - by a tax upon flour.If such a tax had been imposed the farmers of Australia would have been helped, and the general public would have been brought to realize how dependent they are upon our wheat-growers. Every man who goes into virgin country to hew down trees with the object of bringing land into cultivation, has to pay a heavy tax on the axe which he uses.From the moment when he puts his axe into the first tree on his block until he has marketed his lust bag of wheat, every tool which he employs in successive operations is subjected to a tax imposed by the Commonwealth Government. But when the same farmer asks that a levy shall be placed upon the flour consumed in this country in order that he may receive some slight return of the taxation he himself has paid, to assist him in meeting his obligations, an overwhelming section of the community rise in their wrath and say, “ But consider how it will affect the cost of living.” The poor unfortunate farmer is taxed upon his axe, hia implements, his cornsacks, his food and drink, and clothing, and practically everything under the sun ; but when it is suggested that a tax should be placed upon flour in order to give him some slight return, the people who have benefited at his expense immediately become highly indignant.
I now come to the maimer in which the £3,000,000 mentioned in the bill is to be provided. I am rather sorry that the banks have fixed such a low limit, and atn pleased to find that the Government realise the justice of the claim of increasing the f.o.b. price to 3s. 6d. if that is practicable. But even that figure will not allow the farmer to even up his position. In essence, it will at least enable him to slightly reduce his indebtedness. I am rather grateful to the banks for what can be regarded as a patriotic act. Perhaps the thought is dictated by the dire circumstances of the occasion. Further credit, if it may be so termed, must be employed in other directions. The banks realize that other calls will be made upon their resources, and that is why they cannot willingly increase the amount to 3s. 6d. a bushel f.o.b., at least for the present. But it is ray most earnest wish that they will raise the limit to 3s. 6d.
In the matter of this bountyI realize that there is a choice between two alternatives.We can have uniformity or resort to what I may term non-uniformity. If we were to spread the whole £3,000,000 over the wheat marketed portion, there would be no trouble at all. It is true that if that were done no advantage could be taken of a rise in price which might occur is the meantime. The price of wheat in hardening, and the £3,000,000 to be provided is intended to fill the void between the price realized by the farmer and that prescribed by the Government. The Government is endeavouring to get a declared price of 3s. or 3s.6d. a bushel f.o.b. It is endeavouring to use the £3,000,000 to bridge the gap between what the farmer will get under present conditions, and the amount the Government proposes to fix after consultation with the banks. After doing that, it may be found that the £3,000,000 is more than sufficient or that it is far short of what is required. Two arbitrary conditions are imposed. There is the rigid limit of £3,000,000 as to the amount te be advanced, and a suggested rigid limit of 3s. or 3s. 6d. a bushel in regard to price. The first rigid limit of £3,000,000 presents certain difficulties. If the total export of wheat next season is more than 120,000,000 bushels, £3,000,000 will be quite insufficient to provide a bounty of 6d. a bushel. If, again, the price of wheat should drop to 2s. a bushel, £3,000,000 will be totally inadequate. For instance, if the price is 3s. a bushel, and something should occur to cause it to drop to 2s. a bushel, there will be a difference of1s. between the two extreme points. The sum of £3,000,000 would not provide anything approaching a bounty of 6d. a bushel. on the total production. If the market moves downwards, £3,000,000 will not do the job, and if it goes up the full amount may not be required.
I direct the attention of honorable senators to the provision relating to the private buyers of wheat. This measure throws upon private buyers the responsibility of issuing certificates to growers, stating the f.o.b. equivalent of the price per bushel paid or to be paid for the wheat. How is the difficulty to be overcome in the case of private buyers, who will be called upon to fix a price for wheat which may be sold from three, six or nine months afterwards? How can a private buyer of wheat issue a satisfactory certificate in the case of a commodity which may be marketed months after it is purchased? He will certainly secure himself by estimating a low final figure. The point is covered in the case of organizations or corporations, but no similar provision is made with respect to private individuals.
Sub-clause 5 of clause 6 deals with “ dockage.” Any person who sells inferior wheat should not enjoy the same advantage as one who sells f.a.q. wheat. A person who does not look after his business and produce wheat of fair average quality should bear the penalty. The two additional charges for which provision is made require a good deal of explanation, as an f.o.b. price is a recognized figure in every part of Australia. 1 welcome this bill, nevertheless, as an earnest endeavour on. the part of the Government to do something in the interests of the wheatgrowers. I am sorry that the occasion has arisen for the wheat producers of Australia to make this appeal to the Government. Had they been left to their own initiative, they would never have been compelled to seek assistance in this form. Neither would it have been necessary for my colleagues or myself to put the case for them. They would rather be the donors than the receivers of any benefits. They have been forced into this position owing to an unfortunate combination of circumstances. They are now asking for assistance which in comparison with that afforded by them to other industries is imperceptible. My earnest hope is that the occasion will not arise for the wheat-growers to approach the federal authorities in future. This bill will at least afford them some relief to which they are entitled, and I earnestly hope that their just claims will speedily be met.
– In the first place 1 should like to reply to the pleasantries of the genial Minister in charge of this measure, who dealt with this important subject from what I shall term a political viewpoint. If he desires me to review the action of the Government of which he is a member in connexion with the wheat industry, and the effect of its action prior to and subsequent to the last general election, I may inform him that as a result of promises made by it not only on the hustings, but in subsequent legislation, a loss of millions of pounds sterling has resulted to the farmers of this country. When the wheat-growers were promised «by a representative of Labour 6s. 6d. a bushel what was their outlook? What view did they take of the position? They imagined that there wa6 some substance in what eventually proved to be empty promises. As they had been promised 6s. 6d. a bushel, they held on to their wheat on a falling market, and. subsequently when a guaranteed price of 4s. a bushel was promised they were again induced to hold their product. Eventually, when the market dropped, they suffered a considerable loss. Again when 3s. a bushel was guaranteed the same thing transpired. I regret exceedingly that the Minister should have dealt, with this subject from a political aspect, because the time will soon arrive when we shall have to justify our actions before those who sent us here. Honorable senators on this side of the chamber will then have ah opportunity to expound their views on the utter ineptitude of the Government in dealing with the wheat question. We have now another proposal before us concerning which I wish to make a few observations. It embodies a proposal submitted by the Leader of the Opposition (Senator Pearce) when the Government first proposed to pay a guaranteed price of 4s. a bushel, and to establish a compulsory wheat pool. The members of the Opposition were then prepared to give the wheat-farmers a bounty of 6d. a bushel as is provided in this measure.-* It seems to me that when this Government sets out to do the simplest thing in the matter of taxing the people or in the making of a grant to the wheat-farmers, it has the habit of obscuring to the greatest possible degree the object which it has in view. This measure, which I have only had a short time to peruse, brings my mind into a state of utter dislocation, and leaves me utterly incompetent to grapple with what it is intended to accomplish. I fail to understand why the Government should persist with a bill of this nature when there is so little difference, in the matter of the cost to the taxpayer, between doing something in a definite and concrete form and in a way which it could be easily administered and doing it in this complicated way. Probably the complexity has arisen through a lack of understanding of the wheat business. A consideration of the provisions of this bill involves an understanding not only of wheat-growing, but also of wheat-marketing. It is quite obvious that if something had been done in the direction first indicated of providing an export bounty on wheat the complexities with which we are now confronted would not have arisen. Senator Greene and Senator Colebatch referred to the difficulties that must be associated with the effective administration of such a measure as this. Knowing as I do what happened in relation to the wheat pools that were in operation during the period of the war, I can see what opportunities there are for fraud in connexion with the administration of this measure. It is my intention a little later to ask leave to continue my remarks, in order that we may have an opportunity to study this measure more closely so that we may endeavour to formulate amendments that will simplify it and eliminate those objectionable features to which I have referred. Before doing so, however, I wish to recapitulate for the guidance of the Minister, some of the difficulties with which I am faced. In the first place, I direct his attention to the absence of any provision with respect to stored wheat. I understand that not only do the merchants buy wheat, but they also receive tremendous quantities for storage, the growers retaining control over it for all time, and being able to dispose of it or hold it as they think fit. At one time the smaller voluntary pools received wheat in exactly the same way; they had the sheds and other facilities necessary for storage, and accepted it for that purpose. No provision is made in this measure for the man who elects to hold his wheat in that way to receive any assistance by way of a bounty, or to be given a certificate by any authority. The wheat covered by this bill is that which has been sold or delivered for sale to a licensee. But let us examine- the position that exists between prescribed co-operative organizations and the merchants who buy wheat. Discussing this matter with other honorable senators, I have learned that their state of mental fog is as great as mine. Lel us assume that on a given date, say the 1st November next, the price of f.a.q. wheat is 2s. 6d. per bushel. A private firm buys at that figure, and gives to the grower a certificate upon which he proceeds to draw from the Commonwealth Bank the bounty of 6d. per bushel in respect of every bushel that he has put in. A pool acquires on the same date a similar quantity of wheat at the sam* price, giving its certificate to the grower, who proceeds to cash it. Ten days later the price of wheat has risen to 3s. per bushel. What happens? The buyer of the wheat receives 6d. per bushel, but the pool has to refund that amount to the Government. There can be only one result: the whole of the wheat will be placed in the hands of those who are prepared to buy it; there will be an out and out sale, and the outcome must be that a number of pools will go out of existence. I believe in the maintenance of voluntary pools, just as one believes in the operation of the totalisator in competition with the bookmaker. With pools in existence, the farmers can elect either to hand over their wheat, or to sell it outright. Some may choose to adopt both courses - send half of their crop to the pool, and dispose of the other half; or they may divide it into three parts, storing one, selling another, and leaving the third with the pool.
Some extraordinary difficulties are presented by the provisions of clause 6. If the position, as those who are skilled in wheat marketing see it, were placed before the banks, upon whom the Government has to rely to find the money for this bounty, I believe that they would say, “ We will accept a proposal in the nature of a straight out bounty, for which we will find the money, and you oan. apply the provisions of those clauses which relate to the obtaining of an increased price for the wheat that is consumed locally.” That would be a much simpler way of handling the matter. It would work less unjustly to everybody concerned, and keep in existence the voluntary pools, which are such a useful adjunctto the wheat-grower.
The whole of clause 6 will have to he considerably clarified beforeI shall be able to accept any responsibility for this measure.I cannot adopt the view expressed by Senator Greene, that we should throw on the Government the responsibility for the bill. I realize the difficulties in which the Government has been placed. This legislation is the outcome of the Premiers Conference, and there is a partial connexion between it and the plan of financial rehabilitation. There has been some negotiation concerning it; but sufficienttime has elapsed since the communication ofthe bank was received by the Government on the 7 th October for a much longer period to have been allowed to this and another place for its consideration. A very close examination of it is necessary, because some of the difficulties that present themselves appear to be insuperable,I have discussed with other honorable senators the likelihood of pools making a much lower advance, hut I have been informed that they advance only up to about 80 per cent. of the amount received, and that that will probably enable them to make the refunds provided for in: the; measure.
The bill makes provision for the payment of a bounty: It is true that that is within the scope of the authority of this Parliament. Other provisions,however lay it down that the bounty is to be absolutely free, and shall not be liable as part of the assets of the person who receives it. I doubt whether that provision is within the competently of this
Parliament to enact After all, it is the grower whom we desire to assist, and the probability is that that provision was inserted by the Government with a view to assisting him. My unconsidered view, however, is that it will be utterly futile, and that all the remedies provided by State law will be available to the creditors of the wheat-growers.
There is another aspeet that evidently has had scant consideration from those who have been responsible for the drafting of this legislation. I refer to the position that will arise in connexion with a person who holds a bill of sale or a lieu upon the wheat of any grower. He would not be entitled to be given the certificate that has to be issued upon delivery of the wheat, because the bounty must go to the grower. Yet he has property te the wheat. It is by no means certain what redress the co-operative pooling society would have against the person who received the bounty.
Even at the risk of detaining members of another place, the Government would be well-advised te endeavour to recast this measure. It can be made so elastic as to be easily handled. If the complexities of the situation, which are apparent to the practical men who are accustomed to dealing with these matters, were placed before Mr. Riddle and Dr. Drummond, and they realized the effect that this measure was likely to have on the pooling system, I feel sure that they would agree to provision being made for the payment of an export bounty not exceeding in the aggregate a certain amount, rather than countenance what must lead to irritation. corruption and even worse results. I ask leave to continue my remarks.
Leave granted ; debate adjourned.
Senator Sir HAL COLEBATCH (Western Australia) [10.15]. - I move -
That thebill be now read a second time.
The purpose of this- measure is to restore to the Senate a right that was intended to be preserved to it under the Constitution - that of equal power with the House of Representatives in regard to the passing of any law. But, asI understand that it is the desire of the Govern ment to proceed with other business before 10.30 o’clock, the latest hour at which fresh business can be taken, I ask leave to continue my remarks at a future date.
Leave granted; debate adjourned.
Motion (by Senator Barnes) proposed -
That the Senate do now adjourn.
Senator Sir GEORGE PEARCE (Western Australia) [10.18]. - I should like to know if the Government has had brought under its notice a press report that, at a meeting of the seamen held in Sydney to-day to receive the report of the delegates who attended the conciliation conference in Melbourne, over the trouble to which I made reference yesterday, a resolution was carried calling out the crews on all ships engaged in the interstate trade. If the Government has had an opportunity to see that report, I should like to know whether it has given consideration to it, and whether it is contemplating any action to protect the trade and commerce of this country.
– I have not had the opportunity to see the report of what the Leader of the Opposition (Senator Pearce) says the seamen have done, and I can only give the Senate the assurance that the Government, so that the trade and commerce of the country may not he embarrassed, is watching very carefully all moves that are being made. At this stage of the proceedings I am not able to give the Senate any further information.
Question resolved in the affirmative.
Senate adjourned at 10.20 p.m.
Cite as: Australia, Senate, Debates, 22 October 1931, viewed 22 October 2017, <http://historichansard.net/senate/1931/19311022_senate_12_132/>.