3 March 1932

13th Parliament · 1st Session

The President (Senator the Hon. W. Kingsmill), took the chair at 3 p.m., and read prayers.

page 535



– I have to inform honorable senators that I have received from Mrs. J. E. Ogden, Mrs. J. Earle, and Miss M. A. Poster, letters of appreciation and thanks for the resolutions of sympathy and condolence passed by the Senate on the occasion of the death of Senator the Hon. J. E. Ogden, the Hon. John Earle, and the Hon. R. W. Poster respectively.

page 535



Senator DUNN:

– I should like to know if the Minister in control of development has seen in the Sydney Morn ingHerald, that Australian petrol produced on the Newnes shale oil field, is now ready forsale? The statement to which I refer is as follows: -

The first consignment of petrol from the Newnes oil shale field will be on the market to-day. Altogether, 3,000 gallons will be available. This petrol will first bo blended with imported spirit, and will be retailed to motorists at1s. 10d. a gallon. It was stated last night by the distributing agents that analytical tests had shown that the Australian spirit was superior to the first-grade imported petrol.

As a result of the Federal Government’s desire that theNewnes field should be controlled by private enterprise, the Shale Oil Development Committee is prepared to consider proposals for relinquishing control of Newnes to bona fide private organizations. Already several schemes have been placed before the committee by companies which are anxious to develop the field. Before any finality is reached, the committee wants to be convinced that the enterprise taking over Newnes will have sufficient financial backing to develop the field, and that exploitation of the field will benefit the nation.

Senator McLACHLAN:
Minister in charge of Development and Scientific and Industrial Research · SOUTH AUSTRALIA · UAP

– So far as I can judge the press statement is accurate. There is no doubt about the quality of the product. But pending negotiations are not within my particular province. They concern the committee appointed by the previous Government. That body will make recommendations to me, which I shall either accept or reject. I do not think that it is advisable to discuss proposals for the sale, because delicate communications are passing between the board of directors and the persons negotiating the purchase.

page 535



Senator LYNCH:

– I must repeat a question I asked a little time ago, namely, what action the Government proposes to take in the matter of the price of fertilizers ?


– In accordance with my promise to the honorable senator that I would bring the matter under the notice of the Prime Minister, I wrote a letter to the Prime Minister, and have received the followingreply : -

My dear Minister for Defence,

I desire to acknowledge the receipt of your letter of the 20th February, forwarding a copy of a question asked by Senator Lynch in regard to the reduction of the cost of fertilizers and to thank you for your suggestion that an inquiry be instituted in this regard.

In response to your suggestion, arrangements have been made for the Development Branch to conduct an inquiry into -

The extent and availability of supplies:

Production costs;

Marketing costs;

Methods of distribution and any proposals which would involve an improvement of such methods; and

Means by which prices to the consumers might be reduced.

page 535



Senator FOLL:

asked the Minister representing the Minister for Trade and Customs, upon notice -

Is it the intention of the Government to suspend the new duty on tobacco, and to revert to the old duty until at least the present crop is harvested?

Senator GREENE:

– No.

page 535



Senator DUNN:

asked the Minister representing the Minister for Markets, upon notice -

  1. What were the total values in pounds sterling to Australia of trade and commerce between Russia and Australia during the years 1925, 1926, 1927, 1928, 1929, 1930, and 1931?
  2. What were the chief products of trade as between Australia and Russia during the years named above?
  3. What governments were in control of the Commonwealth during the above-named years?
  4. What are the names of the Prime Ministers and their Treasurers during the years named above?
Senator McLACHLAN:

– The answers to the honorable senator’s questions are as follow : -

  1. The values in pounds sterling of trade between Russia and Australia during the financial years 1924-25 to 1930-31 were as follows : -
  1. During the years shown above the principal articles imported into Australia from Russia were fish, furs (dressed), hair and fibre, timber, hides and skins. Wool (greasy and scoured) accounted for the bulk of the values of exports from Australia to Russia. The large increase in the exports to Russia during 1927-28 is accounted for by the fact that prior to that year the main Russian purchases of Australian wool were made on the London market.
  2. The Bruce-Page Government was in office during the financial years 1924-25, 1925-26, 1926-27, 1927-28, 1928-29, and from 1st July, 1929, to 22nd October, 1929. The Scullin Government was in office from 22nd October. 1929, to 5th January, 1932.
  3. During the period 1st July, 1924, to 22nd October, 1929, the Right Honorable S. M. Bruce was Prime Minister of Australia and from the 22nd October, 1929, to the 5th January, 1932, the Right Honorable J. H. Scullin occupied that position. The Treasurership was held from the 1st July, 1924, to the 22nd October, 1929, by the Right Honorable Earle Page; from the 22nd October, 1929, to the 9th July, 1930, by the HonorableE. G. Theodore; from the 9th July, 1930, to the 29th January, 1931, by the Right Honorable J. H. Scullin, and from the 29th January, 1931, to the 5th January, 1932, by the HonorableE. G. Theodore.

page 536



Senator DUNN:

asked the Minister representing the Prime Minister, upon notice -

  1. Will the replacing of the Australian

High Commissioner in London by an Australian Minister in London have the effect of transferring to the Imperial capital the Commonwealth’s overseas political machinery?

  1. Will there not thus be occasioned grave danger of Imperial interest dominating our overseas policy ?
  2. Will not the Australian Minister in London have immensely greater powers than the High Commissioner, in that the Minister will not be under orders?
  3. To what extent will the Australian Minister in London have powers to originate and to close matters of policy vital to the well-being of Australia?
  4. Will the Australian Minister in London be in fact a plenipotentiary in the Imperial capital, competent to act without referring anything to the Commonwealth Government or Federal Parliament?
  5. Is it not a fact that whether the Australian Cabinet intends matters to be referred back by the Australian Minister in London or not, the only restrictions upon the powers of the Australian Minister in London to commit the people of the Commonwealth by secret diplomacy or open compulsion will rest in his own conscience, his own personality, and his own conception of what Lord Clive described as his own moderation (as a dictator) ?
  6. Will not the precedent of the Imperial Parliament being bound by the secret and individual undertaking of the British Foreign Minister (Sir Edward Grey) to support France if the latter would declare war on. Germany in 1914 apply to compel Australian support of every instrument, overt or covert, authorized or unauthorized, to which the Australian Minister in London shall attach his signature?
  7. If there is protection for the Australian people against any or all of these possible abuses, will the Minister state definitely what these safeguards are, and name the clauses of the Constitution which will disable a Minister in London from overstepping his powers?
  8. For what reason is the Australian Government establishing a Minister in London?

Senator Sir GEORGE PEARCE.The answers are

  1. No.
  2. See answer to 1.
  3. No.
  4. The Government in Australia will continue to decide all matters of policy, in accordance with constitutional practice.
  5. No.
  6. No.
  7. No.
  8. See answers to the foregoing questions.
  9. I refer the honorable senator to the statement made by me in the Senate on the 17th February.

page 536



Senator DUNN:

asked the Minister representing the Minister for Markets, upon notice -

In view of the war conditions prevailing in the far East and the loss occasioned to the Australian wheat trade, will the Minister con- cerned consider the question of bringing down a bill to provide for the granting to the wheat-farmers of all States in Australia a bonus of 4s. a bushel for all stocks of silo and stacked wheat, including new crops; if not, why not?

Senator McLACHLAN:

– Any such bonus would be a matter of government policy, about which announcements are not made in answer to questions.

page 537



Revenue and Expenditure

Senator RAE:

asked the Minister representing the Minister for Home Affairs, upon notice -

  1. What has been the cost of administering the Federal Capital Territory (including repairs, alterations, and additions, &c, to Canberra public buildings), during each of the three years ended on the 30 th June, 1931 ?
  2. What has been the amount of revenue received from the Federal Capital Territory during the same period?

– Replies to the honorable senator’s questions will be furnished as soon as possible.

page 537



Senator FOLL:

asked the Minister representing the Minister for Trade and Customs, upon notice -

  1. Is he aware whether the alteration to the duty on cotton yarns has struck a serious blow to the cotton-growing industry of Australia?
  2. In view of the desirability of keeping as many men on the land as possible at the present time, will the Government revert to the old duty on cotton yarns?
Senator GREENE:

– The answers are -

  1. The Tariff Board held a public inquiry into th is matter, after the date of the imposition of the fixed rate of duty. The board reported against the fixed rate, and the Government has adopted the report, believing that no injury will be caused to the cottongrowing industry.
  2. See answer to No. 1.

page 537


The following papers were presented : -

Conference of Commonwealth and State Ministers, held at Melbourne, 28th January to5th February,1932 - Proceedings and Decisions of Conference; together with Appendices.

Northern Territory Acceptance Act and Northern Territory (Administration) Act-

Crown Lands Ordinance -Reasons for resumption of reserve at Darwin, together with plan showing area, resumed.

Science and Industry Research Act - Fifth Annual Report of the Council for Scientific and Industrial Research, for the year ended 30th June, 1931.

Navigation Act - Regulations amended - Statutory Rules 1932, No. 14- No. 20.

page 537


Motion (by Senator Foll) agreed to -

That one month’s leave of absence be granted to Senator Guthrie on the ground of ill health.

page 537




Debate resumed from the 2nd March (vide page 462), on motion by Senator Ducan-hughes -

That the following Address-in-Reply be agreed to: -

To HisExcellencythe Governor-General -

May it please Your Excellency:

We, the Senate of the Commonwealth of Australia, in Parliament assembled, desire to express our loyalty to our Most Gracious Sovereign, and to thank Your Excellency for the Speech which you have been pleased to address to Parliament.

Senator Sir HAL COLEBATCH (Western Australia) [3.14]. - The general election that was forced upon the country so hurriedly, carried out so quickly, and resulted so dramatically, was fought, at allevents, in Western Australia, and to a greater or lesser extent in the other States, on three main issues, namely, the maintenance of the Australian currency, the preservation of the federal system as against unification, and a drastic revision of the tariff in the interests of the exporting industries. In the brief time at my disposal this afternoon, I intend to refer to the Speech of His Excellency the Governor-General from those three viewpoints. First of all we are asked to deal with legislation to interpret and enforce the Financial Agreement. I direct the attention of Ministers in particular and honorable senators generally to a little book recently published by Sir Edward Mitchell, entitled What Every Australian Ought to Know. I intend to refer briefly to two short passages in the preface. On page 5

Sir Edward Mitchell refers to section 105 a of the Constitution - the Financial Agreement - in this way -

The provisions of that sub-section 5 are probably unique in the whole legal history of all English speaking communities with parliamentary institutions, and have the effect of putting both the existing financial agreements on a higher plane as regards enforcing its obligations, than the Commonwealth Constitution, hitherto described as the supreme law of Australia.

On. page 1 he makes reference to a statement of the law as laid down by the Judicial Committee of the Privy Council in these words - ‘

It is the duty of the Crown and of every branch of the executive to abide by and obey the law. If there is any difficulty in ascertaining it, the courts are open to the Crown to sue and it is the duty of the executive in cases of doubt, to ascertain the law, in order to obey, not to disregard it.

I do not propose to discuss the particular measures introduced in another place except to say that I do not think that any emergency can justify the invasion, or the attempted invasion, of the constitutional rights of the States. Nor do I think that any emergency could justify this Government in inviting Parliament to usurp in any degree whatever the judicial powers vested by the Constitution in the High Court. If, when those measures come before this chamber, I think that they offend in either of these particulars, I shall have no hesitation in opposing them. I appeal to the Government to take a long view in this matter and not merely to strive for the mastery of the moment. It should remember that, as illustrated by extraordinary changes of public opinion., seen during the last three years, the Opposition of to-day is the Government of to-morrow, and that quite conceivably in what is a very short time in the history of the nation we may have in control of both Houses of the Commonwealth Parliament, a party that, if given these extra powers, which this Government thinks might safely be entrusted to it, would in a very short time reduce the whole of Australia to the pitiful condition in which New South Wales finds itself at present.

We have heard from time to time of the unification proposals of the Labour party. Personally I have never feared those proposals. They are put up can- didly and honestly. The public, knowing exactly what they mean, has invariably turned them down and may be trusted to reject them in the future. But I fear, very desperately, the proposals coming from the other side - from the opponents of unification - which in their effect are steadily driving Australia into unification. The antiLabour party has been responsible for practically every step that has been taken by Australia towards unification. First we had the contravention, by what I do not hesitate to describe as a subterfuge, of a provision in the Constitution under which surplus revenues have to be returned to the States. That section of the Constitution is mandatory; it provides that surplus revenue shall be returned to the States. But by a subterfuge the surplus revenue was transferred to a trust account - I do not care for what purpose it was used - and that was the first step towards bringing about the most dangerous form of unification, financial unification. The second step was the abolition of the per capita payments. The third was the Financial Agreement, which destroyed at once the financial power and responsibility of the States. It was forced upon the States because the per capita payments having been abolished, they had to accept whatever was offered to them.

Each of those steps having been taken by anti-Labour parties while they were in power in this Commonwealth, I hope that the Senate, representing as it does the States, will see to it that the present emergency is not held to justify a further step in the direction of unification, a step from which it might be impossible for us to retreat. The Premiers plan has been described by its real framers, the Under-Treasurers, aided by a number of highly competent economists, as being distinctly favorable to the Commonwealth and disadvantageous to the States. Those experts, when submitting the plan, advanced the plea that they had had insufficient time in which completely to mature it. Take, for example, the effect of the Interest Reduction Act. It was almost entirely favorable to the Commonwealth. The two big States, New South Wales and Victoria, certainly obtained a good deal of relief from it; but the smaller States, particularly Western Australia, nearly all of -whose debts were in London, obtained from it practically no relief.

If we propose to pass extreme legislation giving to the Commonwealth extraordinary powers over any State that does not meet its obligations under the Financial Agreement or the Premiers plan, we have to bear in mind that certainly not more than two States can pay their way without assist- .ance from the Commonwealth. Whereas it may be quite fair to say that the assertion of Mr. Lang is “I will not pay my interest,” it undoubtedly must prove to be the case that, without assistance from the Commonwealth, other States will be compelled to say, “ We cannot pay our interest “. Bearing in mind that the framers of the Premiers plan have laid it down so clearly that that plan is favorable to the Commonwealth and unfavorable to the States, it appears to me that the matter requires a good deal of further investigation.

A telegram has been sent by the Prime Minister (Mr. Lyons) to the Premier of South Australia, Mr. Hill, informing him that it would never be proposed to apply this particular enforcement legislation except against a State that had wilfully defaulted. We have to remember, however, that the time may come when this extraordinary instrument which we are now fashioning may be in the hands of Mr. Lang himself, or of some one else who is bent upon effecting a complete unification of the States and the Commonwealth. We have to remember, also, that altogether apart from Mr. Lang and New South Wales, the Commonwealth is a long way from the balancing of its budgets. The total shortage this year will be something like £18,000,000. It is between two and a half and three years since it became impossible for Australia to raise money on reasonable terms on the London market. That, however, does not signify that we have ceased borrowing. During that period we have established an unfunded indebtedness which, at the end of June next, will amount to £85,000,000. In other words, although we have been prevented from borrowing, we have been spending money that we have been per mitted to owe; or, if it be preferred that the matter should be stated in another form, we have been inflating our currency in many directions. Consequently, we have to remember that it is not alone Mr. Lang’s default which has got us into our present trouble. I appeal to the Government to be very careful lest it place the immediate political issue before’ the permanent economic issue.

I do not think that, while we are spending a considerable amount of time in the consideration of enforcement, insurance, and other legislation, all is being done that might be done concerning the study of the economic position and the preparation of something that will have to take the- place of the Premiers plan; because we shall very soon be embarking upon a new financial year, the prospects of which are certainly very little if any brighter than those of this year, which will shortly draw to a close. There sat in Sydney recently a conference of experts which investigated matters connected with the railway systems of Australia. I congratulate the Government upon the, to my mind, exceedingly wise choice that it made when selecting the chairman of that conference. I break no confidence when I say that the conference has not had adequate time in which to do its work. The Premiers plan, so far as it went, was framed by Tinder-Treasurers, with the assistance of economists, who admitted its defects. One of the most serious of those defects was that it met the case of the Commonwealth, but not that of the States. Personally, I consider that it would be well if those Under- Treasurers, together with Professors Giblin, Melville, Shann and Copland - and others, if necessary - were at work now; because it cannot be long before the Premiers and the Loan Council will have to be called together again, to consider not only how the difficulties encountered during the current financial year shall be faced, but also to undertake the longer and larger job of deciding how we are to get through the next financial year. The present Commonwealth Government must have more regard than any previous Commonwealth Government has had, for the financial needs of the States ; because, after all is said and done, it is the States rather than the Commonwealth on which the people have to depend for all of those things which enable them to develop the resources of the Commonwealth.

I am about to refer to a very small point, and do so only in order to illustrate the razor-like keenness of the Commonwealth in effecting economies at the expense of the States. It was published as something in the nature of a great economic achievement, that the Commonwealth had saved £400 by withdrawing free railway passes from senators-elect. That £400 has been saved at the expense of the States, because payment for these passes is made to the States. Therefore it is not a saving. Apart from that aspect, however, the action of the Government seems to me to be rather paltry. I have had the experience of being elected to the Senate eight months prior to the time when I could take my seat in this chamber. Fortunately, I was busily employed at the time, and that fact did not worry me. But I do think that a gentleman who has been elected in November or December, and on account of the extraordinary system under which Senate elections are held has to cool his heels for over six months, should be given every facility to fit himself for the work he is about to undertake, so that he may better serve his constituents as well as Australia as a whole. There is no way in which he could be better employed than in travelling about this country and gaining knowledge concerning it. Generally speaking we are all lamentably ignorant of the affairs of States other than our own.

I trust that the honorable senator who has been sent to us by the Parliament of New South “Wales will understand that there is no coolness in my welcome when I say that I am at a loss to know why Mr. Charles Hardy is not with us at the present time; because I can find no constitutional .warrant or authority for a State Parliament to elect a member to fill a vacancy in the Senate except, for the period between the occurrence of the vacancy and the next general election. The Constitution is absolutely clear on that point.

I propose to discuss for a few moments the paragraph in the Governor-General’s Speech relating to the tariff, as its meaning is illustrated by the schedule which has recently been presented in another place. That paragraph contains these words -

It is considered that with industry in its present depressed condition changes in duty should be made with caution and only after full inquiry and consideration.

It would be well for Australia if no piece of legislation was presented without caution, without full inquiry and consideration. What has happened in connexion with the tariff? We now have to deal with the consequences of numerous schedules that were presented by a government which threw caution entirely to the winds; a government that had no regard whatever for the reports of the board, except to violate them completely. There was no suggestion of caution. There was a negation of inquiry, because the late Government did exactly the opposite of what inquiry had determined was right and also denied any possibility of consideration to the only authority that has any right to consider such matters at all - the two Houses of this Parliament.

It seems to me that the action of the present Government, as outlined in the paragraph of the Speech which I have just read, indicates much greater solicitude for those industries that have been advantaged by this hasty, ill-considered and incautions tariff legislation of the previous Government than for those industries that have been penalized by it. I warn the Ministry that it is in danger of straining, to the breaking point, the loyalty and support of a large section of the community throughout Australia, without whose help it could never have been placed in its present position. The revision of the tariff was one of the three main issues of the election. I venture to say that in Western Australia it was the main and pressing issue. Butwhat happened? Immediately prior to the appeal to the people we had Mr. Lyons and Mr. Latham visiting Sydney in order to achieve unity among the forces opposed to Labour. And how did they achieve that unity? Is it not on record that it was brought about by the drafting of an election policy, the central feature of which was the revision of the tariff in the interests of our exporting industries? Has this been done? The first public announcement made by the Chamber of Manufactures of New South Wales clearly indicated the intention of that body to support the Scullin Government; but as the election proceeded those very astute gentlemen realizing that they were backingthe wrong horse, hedged and gave their support to the Lyons-Latham party. In New South Wales during the week prior to polling day - I was not there, but I have been informed of this on what I regard as unimpeachable authority - word went around amongst all Nationalist supporters that they must not say anything about the tariff. In Victoria that well-known organ of high protection, the Melbourne Age, attacked most vindictively Senator Brennan and, in its selection, wiped him off the list and put some one else in his place as first choice of the Nationalists.

One day last week we had a quiet and unostentatious visit to Canberra from certain influential people in Sydney whose purpose, apparently, was to discover which parties could be persuaded to support or, at any rate, to offer no resistance to a suggested bill for the amendment of the Constitution having as its object the transference to the Commonwealth of complete power to fix the minimum wages and maximum hours of labour in industry throughout Australia. This proposal was dictated by the political difficulties of the moment in New South Wales, and it is significant - if I have been wrongly informed I hope those who know better will correct me - that although the move was obviously directed against the New South Wales Parliament, the Lang party in this Parliament gave it their unqualified approval. So did the Scullin party. Apparently members of both parties were wise enough to see that the time would come when such an instrument, placed in the hands of a Labour government having full power in Canberra, could use it just as effectively over the whole of the Commonwealth as Mr. Lang uses his power in the State of New South Wales at the present time. In fact it could be used much more effectively by a Labour government in respect of the whole Commonwealth because, in certain directions, Mr. Lang is checked and perhaps will be further checked by Federal legislation. Vested with this power, a Commonwealth Labour Government would be absolutely supreme.

Senator Sir HAL COLEBATCH.Last week. The honorable senator was away, I think. The Prime Minister (Mr. Lyons), after the election, indicated that he was in favour of some such policy, but I hope there are among his Ministers a sufficient number holding the contrary view so as to prevent him from attempting to give effect to this policy.

Has it ever struck honorable senators as curious that this world-wide depression first manifested itself in its most severe form in the Commonwealth? If they care -to read the many reviews that have been written by economists all over the world- the last one I read was from the pen of a German economist - they will find that all are agreed that it first manifested itself in a severe form in Australia. There must be some reason for this, ‘because, generally speaking, one would think that a country like Australia, whose resources, in proportion to its population are greater than those of any other country, would be the last instead of the first to feel, in its most severe form, the consequences of this world-wide depression. There must be a reason. The world war was the fundamental cause of the depression; but the chief reason for the extraordinary, world-wide trouble, and its continuance for so long a period is the disparity in price between the products of the free industries and those of the manipulated industries. Australia would not feel the drop in the price of wool and wheat so much as it does if that drop had been accompanied by a similar fall in the prices of other commodities. The -trouble is that Australia has gone further than other countries in the manipulation of industry. It has gone further in regard to tariffs, Arbitration Court awards, and arrangements between employers and employees to fix fictitious prices for the products of a number of industries. Australia had, and still has, a greater disparity between the free and the manipulated industries than exists elsewhere in the world. That is one of the chief reasons why the worst effects of the depression were manifested in Australia sooner than they became apparent in other countries. I suggest that unless we take some determined step towards removing that disparity, and restoring the equilibrium between the prices of the products of the manipulated and the free industries, the depression will continue in Australia longer than elsewhere, notwithstanding that our resources in comparison to our people suggest that we ought to get out of our difficulties more quickly than other countries can.

I desire to make special reference to certain aspects of the tariff. First, I shall mention the heavy duties on galvanized iron. About a fortnight ago I paid a visit to Newcastle, and what I saw there confirmed the opinion I had previously held, that there is nothing wrong with the efficiency of the works or the quality of the labour there. As honorable senators know, the raw material for the manufacture of galvanized iron is obtained close at hand. There is no question that the iron and steel industries are well suited to Australia, and ought to be built up on a thoroughly satisfactory basis. During the recent election campaign, or just before it, Senator Greene, now Assistant Minister, wrote a very interesting letter to the Sydney Morning Herald. I quote the honorable senator’s remarks because he has never posed as anything but a high protectionist. In his letter, Senator Greene said that the right course of action ‘for the Government and Parliament to take was to disallow every tariff increase that had not been recommended by the Tariff Board. He took his stand firmly on that. What did the Tariff Board recommend in connexion with galvanized iron? Was it not that the duty should be abolished altogether until the price had been reduced to £25 per ton? That has not yet been done, although the price has been reduced from £28 10s. per ton to £27 10s. per ton. One wonders whether that reduction was an inducement to the Government to allow the duty to stand. I suggest that the real reason was that the manufacturers found that imported galvanized iron was being sold in Australia in competition with their goods, notwithstanding a duty of £5 10s. per ton, freight charges amounting to £2 10s. per ton, primage duty at the rate of £1 6s. 6d. per ton, and exchange £3 16s. 3d. per ton - a total handicap of £13 2s. 9d. per ton.

Let me turn now to another old friend - sugar. Honorable senators have no doubt seen the latest report of the Auditor-General on this subject, in which he drew attention to the burdensome character of the industry. We know that shares in the Colonial Sugar Refining Company have soared again to £44 each. We are told that the Prime Minister (Mr. Lyons) intends to negotiate with the sugar interests. Apparently, the agreement entered into with them, and made under no other authority than that of a majority report of a committee which met irregularly, took no evidence on oath, and whose report discloses either a lack of impartiality or little knowledge of the subject, is to be regarded as . sacred, no matter what is done with other agreements. I propose to deal with the subject of sugar from a new aspect.

I suppose in the next week or two we shall hear a great deal about tobacco. I approve of the Government’s decision to follow the recommendations of the Tariff Board, and, therefore, I have nothing to say at the moment on the tobacco duties, except to express my personal view that what we need is cheaper tobacco, because it is a necessity, particularly for poor people. “We want cheaper tobacco and smaller profits on the part of the big tobacco companies, and we do not want to encourage the building up of another industry on an utterly false basis until it becomes a big incubus like the sugar industry.

Senator Sir HAL COLEBATCH.I have said that I am with the Government in doing, as a first step, what the Tariff Board has recommended.

I notice also that the extraordinary imposition of the previous Government on the importation of buttons Fas been removed - possibly wisely; but in this instance, it is a case of attacking a little industry, one that has not achieved sufficient strength to put up a fight. Probably it is just as well to wipe it out before it is able to put up a fight, but there does not seem to be much hesitation about knocking out the little chap.

I found it very hard to digest certain figures which” I happened to read some time ago when I was travelling in the south-western portion of “Western Australia, and hearing many complaints from struggling settlers about- the cost of tobacco. The figures I refer to showed that the profit of the British-Australasian Tobacco Company had dwindled from £1,000,000 a year to only £736,000, and that the shareholders, accustomed to receiving dividends of 50 per cent., had to be satisfied with a beggarly 35 per cent. ! That again is one of the matters we should look- into.

I put it to the Senate that such things as galvanized iron, sugar and tobacco are among the essentials for the development of this country, and that the high prices charged for them are checking development in every direction. Senator Dooley -said that we should get rid of unemployment by carrying out big public works. But is it not a fact that we have set up such a condition of affairs in Australia that no public work can be carried out, except at a cost at which no one could make it pay? The honorable senator referred to irrigation and particularly to the Murray irrigation works. Nature has not been as generous to Australia as she might have been in regard to water supply. Irrigation, therefore, should be our trump card. But the Murray works, estimated to cost £4,000,000, have now had something like £16,000,000 spent upon them, and still they are incomplete. Developmental works on that scale are impossible. The further we go the worse it will bc. “With reference to the duty on confectionery I draw attention to the candid statement of the manager of a confectionery factory that the industry does not want prohibition, and that his .only anxiety in the manner of the reduction of duty is that his competitors will not be bled by the sugar interests as he is being bled. “ In the recent debates in Great Britain on the tariff proposals of the British Government a Conservative member of the House of Commons drew attention to the 10 per cent, duty on lead and zinc, which he said would increase prices to British manufacturers, and that they would be likely to lose foreign trade. These instances will keep on cropping up, and whether the British people believe that they are doing right or wrong in altering their fiscal system we shall find thatsome one is hit. Indeed, I shall be entirely surprised if the new departure leads to any satisfactory results.

I do not propose to follow Senator Elliott into his. exhaustive references to the forthcoming Ottawa conference, but if it leads to freer trade between Australia and any other country, it will have good results; if it leads to freer trade between Australia and a great many other countries, it will have better results ; and if it leads to freer trade between Australia and all other countries it will have the best results. I fear, however, that it will have none of those results, or at all events, to a very small extent only.

A number of prohibitions have been removed, but of what use is it to remove a prohibition and leave in its place a prohibitive duty? On dry cells and dry batteries the prohibition has been removed, but the preferential duty imposed by the previous Government, contrary to the recommendation of the Tariff Board, and not removed by the present Government, amounts with exchange and other charges to from 85 per cent, to 100 per cent.

Another item to which, I think, the Government should give more generous consideration is the duty on books. Already the sales of books have dropped by something like one-third. It was inevitable that this decrease should come about. The revenue obtained is about £120,000 a year over a large range, not more than half of it applying to books. I put it to the Government that by encouraging the importation and the sale of books it will not lose the whole of that revenue. If it were easier for the people to obtain books it would be all to the good of the country. I refer particularly to educational books, the present cost of which is altogether too high, and is having the effect of stultifying State expenditure upon education. It is becoming increasingly difficult for children to get books. This is one matter which should be very carefully considered.

In regard to the tariff I urge the Government to exercise every precaution it likes to employ; let it have full inquiry; let it give matters all consideration; but above all I ask it not to delay. And whatever decision it may come to, I ask it not to follow the example set, not only by the Scullin Government, but also by its predecessors, by denying Parliament the right to review the duties. We may have a tariff board whose task it is to inquire and advise, and a Government whose obligation it is to interpret the recommendations of that board; but the one and only authority which has any right to impose this or any other form of taxation on the people is the Parliament. In Australia we have got away from that principle. We are the only country that has done so. I hope that before very long we shall get back to it once more.

There is one other tariff matter to which I wish to draw attention. On crude oil engines which are very extensively used for mining and for plants for the generating of power or light, the duty is 55 per cent. British, 65 per cent, intermediate and 75 per cent, general. There is one firm in Australia making these engines under licence from an English firm. It imports the pistons, cylinder covers complete with valves, cams, cylinder liners, crankshafts, vibration damper, air compressors, fuel pumps, and lubricators. The rest of the engine is made in Australia. It imports all these parts duty free and they represent 35 per cent, of the English value of the engine. The 55 per cent, duty and exchange, primage and other charges represent fully 100 per cent, protection against the completed engine as imported. Yet the local manufacturer cannot compete. Recently a quotation was asked for a marine engine. ‘ The firm in a covering letter submitting its quotation, said in effect “ If you can take delivery of this engine outside Australia we can supply it at less than half the Australian price.” Two other cases have ‘ been brought under my notice in connexion with stationary engines. An English company got the tender at a lower price than the Australian manufacturer, although it had to add to the English price practically 100 per cent, duty, and although the Australian manufacturer was importing 35 per cent, of the engine duty free.

The tragedy of the whole business, which I should like to impress upon honorable senators representing the Labour party, is that in the majority of installations in which these engines are required the engines represent only about 20 per cent, of the total cost, the other 80 per cent, being almost exclusively Australian labour. But, because of the excessive price of these engines, installations have been postponed or abandoned with the result that the sale of the other 80 per cent, of

Australian material is prevented. This isnot isolated. It is a characteristic instance of the direction in which unwise protection, so far from keeping up the standard of living in Australia, is depressing it and throwing people out of employment. 1 congratulate the Government on the abolition of the Parliamentary Standing Committee on Public Works and the Joint Committee of Accounts. I suggested something of the sort when bills were submitted to this chamber for the purpose of reducing the membership of those committees. I now suggest that the recommendations made by the Senate Select Committee on Standing Committees should be adopted so that not only matters such as the Government seems to have in mind, but also bills submitted to the chamber may be referred to select committees more conveniently than is possible now under the existing Standing Orders.

I also compliment the Government on its decision not to send a delegate to the sixteenth conference of the International Labour Office at Geneva. I hope that it will not stop at that point. I hope that it will also voice a full-mouthed protest against the monstrous extravagance that is going on in connexion with that Labour Office. It has a total budget of £300,000 a year; a staff of 400 persons representing 40 nationalities; a director at £3,600 a year and £1,200 entertaining allowance; a deputy director at £2,400 a year and £500 entertaining allowance; a small army of officers drawing from £1,350 a year upwards. It has cost in ten years £3,000,000, with, I venture to say, no practical result. It is astounding to me that supporters of the Labour party, men who in this Parliament represent people who find it extremely difficult to obtain for themselves and for their families the common comforts, let alone the luxuries of life, can view without indignation and disgust the spending of money in this direction. The whole subject of league finance should be carefully considered. The labourer is worthy of his hire. Any person attending that conference in a representative capacity must be paid, but I have it on the authority of many who have attended such gatherings in representative and other capacities, that the way in which money is thrown about is appalling. A previous representative of the Commonwealth Government, Sir Joseph Cook, a wise and frugal man, has often told me that the lavish expenditure of money at Geneva disgusted him.

I appeal to the Government that in all its economic proposals it should have full regard for the responsibilities of the States. If we cripple the States we shall cripple the development of Australia. Nothing else can happen. Unless the States have a sufficient measure of both economic and financial independence to enable them to work out their own salvation, all that the Commonwealth can do will never lift us out of our present difficulties. The Commonwealth Government says that the problem of unemployment is the responsibility of the States. Quite so. Let the Commonwealth recognize the responsibilities of the States, and see that in all its financial programmes the needs and the responsibilities of the States are fully provided for. It should cut out every federal activity for which there is no constitutional warrant. That is the first step. Over and over again I have said that there never was any constitutional justification for the establishment of a Commonwealth Health Department. I agree that all we can possibly spend in protecting public health should be spent, but will any one deny that the States have not always spent as much on health matters as their people can afford? We find, however, that the Commonwealth Government has established a Health Department, costing something like £250,000 a year, and at the same time is taxing the requirements of the State hospitals, thereby making it more difficult for the States to attend to their own people. There is no constitutional warrant for the establishment of a Commonwealth Health Department, or a Commonwealth Forestry Department, and I maintain that this Government, faced as it is with difficulties which I do not think are yet fully recognized, should not expend money in this way. To my mind, we shall have to face one of two things: Either a very drastic reduction in public expenditure, which will lead, and the sooner the better, to a reduction in taxation in the interests of industry, or, if we continue, as at present, we snail have to face a further and very drastic drop in the value of the Australian pound. Where that will lead us I do not know.

In addition to dispensing with all these activities, for which there is no constitutional warrant, the Government should examine every one of those activities that have to be carried on by the federation and the States to see if big economies cannot be effected. In doing so, the Government should not take the federal officers’ view. It should keep in mind that the States have to do these things. The Government should also remember that it is more convenient for the Commonwealth to work through the States than for the States to work through the Commonwealth. There was a time when Commonwealth public works were carried out by State departments, and that was economical and sound. To-day, however, we have an expensive Commonwealth Works Department in every State. This is a good time to get rid of such departments, and to initiate a new principle. The States must have their departments; why should not the Commonwealth work through them? I think it has been proved to the satisfaction of every one that the transfer of federal taxation to the State Taxation Department was a sound move. That policy has been adopted in every State with the exception of Western Australia, and the Western Australian Government was unhappily caught by a promise which the federal authority broke. The Federal Government promised to carry out the work for a certain sum, but two or three years later trebled the amount without any justification whatever. There is evidence that some of the activities’ I have mentioned can be carried out more economically by the States than by the Commonwealth.

I appeal also to the Government to restore as quickly as possible the powers of Parliament in regard to regulations, customs tariffs, and prohibitions. I introduced, with that object in view, two measures which were favorably received by a majority of the Senate. I do not wish to be compelled to submit them again as a private member, and I trust, particularly in view of a remark made a day or two ago, that the Government will take this matter in hand.

Before resuming my seat, I propose to read a short newspaper extract which I think is not without interest. It is reprinted from Harper’s Weekly, New York. I invite honorable members to follow it -

It is a gloomy moment in history. Not for many years - not in the lifetime of most men who read this paper - has there been so much grave and deep apprehension; never has the future seemed so incalculable as at this time. In our own country there is universal commercial prostration and panic, and thousands of our poorest fellow-citizens are turned out against the approaching winter without employment and without the prospect of it.

In France, the political cauldron seethes and bubbles with uncertainty; Russia hangs, as usual, like a cloud, dark and silent, upon the horizon of Europe; while all the energies, resources and influences of the British Empire are sorely tried, and are yet to be tried more sorely, in coping with the vast and deadly Indian insurrection, and with its disturbed relations in China.

It is a solemn moment, and no man ran feel, an indifference (which, happily, no man pretends to feel) in the issue of events.

Of our own troubles no man can see ‘he end. They are fortunately, as yet, mainly commercial; and if we are only to lose money, and by painful poverty to be taught wisdom - the wisdom of honour, of faith, of sympathy and of charity - no man need seriously to despair. And yet the very haste to be rich, which is the’ occasion of this widespread calamity, has also tended to destroy the moral forces with which we are to resist and subdue the calamity.

That was published in the newspaper mentioned on the 10th October, 1857 - 75 years ago. It describes almost in exact detail the position of affairs to-day. It continues -

Timid souls were low in spirit 74 years ago when this article was written, but men of courage and common sense were strong in their confidence that things would grow better. Only timid souls are fearful to-day of the future.

I think only timid souls are fearful of the ultimate result of the depression we are facing to-day.

Senator MOONEY:
New South Wales

– I have paid a great deal of attention to the debate in this chamber on the motion for the adoption of the Address-in-Reply to His Excellency the Governor-General’s Speech at the opening of Parliament, and have observed that, :h chief argument advanced by the members of the United Australia party is that Australia’s recovery is dependent upon an increase in world prices. I am at a loss to reconcile this view with the policy of that party as enunciated at the recent by-election for East Sydney, when we were told again and again that we must get rid of Mr. Lang as Premier of New South Wales before we can expect a return to prosperity in this country. What, may I ask, has the Premier of New South Wales to do with world prices? We are told also, that we must balance our budget iu accordance Avith the fall in world prices. Tt is difficult to understand exactly what is meant by this reference to the word “ balance “, and I invite honorable senators opposite to say plainly how this is to be done. I listen in vain for a reply to my inquiry. We have nothing hut “ shrieks of silence “. The only conclusion I can come to is that what is aimed at is the adoption of the Niemeyer plan, which this Government is prepared to put into operation to the full. I regret that this policy was put into operation to a large extent by the Scullin Administration, styled a Labour Government, and I must say, at once, that that policy is not the policy of the Labour party as it is known throughout Australia.

Let us see what has happened in those countries where the Niemeyer plan has been given effect, since I am convinced that its application here would be attended with the same results. In Germany, where it is in full force, wealth is being produced as freely as water, because of the application of science to industry, the use of the most up-to-date machinery, and the policy of mass production. Yet in that country there are 6,000,000 unemployed and a vast quantity of machinery is lying idle. Germany’s exports for the year 1930 were only £131,000 in excess of her imports. Moreover, in that home of education, there are 50,000 university graduates unemployed, and, according to New York Current History, that number will be increased to 130,000 by the end of 1932. I realize that the policy of this Government is on all fours with that in operation in Germany to-day. Largely, I suppose, as a result of the war, tuberculosis is rampant in Germany, and at present only 1 per cent, of those suffering from this terrible disease have a bed to themselves.

It may well be claimed that Great Britain is the home of the Niemeyer policy. One of the first acts of the Nationalist Government which was returned to power in Great Britain towards the close of last year was to reduce by 10 per cent, the Government allowance, notwithstanding that a large proportion of its adult population had been practically starved into submission. At present no fewer than 2,509,921 persons are unemployed in Great Britain, and some time ago it was proved, after medical examination, that 92 per cent, of the adult male population of that country were medically unfit for service in the police force, and 85 per cent, medically unfit for service in either the navy or the army. Since Christmas, the number of unemployed has increased by 140,000. The high percentage of medically unfit adults is due to mal-nutrition and unsatisfactory housing conditions.

Senator Duncan-Hughes:

– The housing conditions have been greatly improved.

Senator MOONEY:

– Unfortunately, the physique of the people has not improved.

Sir Otto Niemeyer went to Austria and laid stress on the necessity for the rehabilitation of industry in that country. I have read with a good deal of amusement a work entitled Austria and Its Industries. The principal industries of Austria are wine and tobacco; and after the policy of this gentleman had been in force in that country for a little over two years, those industries were completely handed over to the Bank of England.

In the Balkan States and in the States of South America the conditions of the people are worse. What are we to believe ? Is it contended that if this policy were put into operation there would be a different result in Australia? I venture to assert that the opposite would be the case.

Probably the most burning question agitating the minds of every government in Australia at the present time is that of unemployment. I do not say that the task of dealing with the problem is an easy one; if it were, the great money power of the world would see to it that there was no unemployed. The United States of America hold the largest proportion of the world’s gold supply, and yet have 8,000,000 unemployed. Therefore, the Government has my sympathy in its efforts to deal with the problem. The position will not be alleviated either legislatively or administratively. Not until we have at the head of the Federal Government a man who is thoroughly imbued with the Australian sentiment, and who has the courage and the backbone to grapple with the problem in the only way that will lead to success, will a solution be applied. There must be control by the nation of the banking institutions.

At the outbreak of the last war the Commonwealth public debt amounted to £19,182,333, and that of all the States to £322,894,110. On the 31st March, 1931, the Commonwealth debt stood at £389,036,752. No less than £282,390,000 of the amount by which the Commonwealth debt increased was directly due to the war, and Only £71,400,000 was utilized for works and other purposes, including the establishment of the seat of government atCanberra. The war to date has cost Australia an aggregate of £744,162,409. If we analyse these figures we shall find that a formidable task confronts us in dealing with unemployment. No government can function without finance; and until the Commonwealth Government is prepared to tackle that question this country will not emerge from the depressed state in which it is placed to-day. Just before I entered this chamber I heard the United Australia party candidate in East Sydney, and his supporters, make the claim that Australia had turned the corner, and was on the road to prosperity. It appears to me that the corner is a. very long one.

Another factor, and I regard it as the most important, is that of interest. The Australian interest bill has increased from £12,313,599 in 1914 to £57,412,450 in 1931. On a per capita basis the prewar interest bill amounted to £2 10s. 4d., while that of to-day amounts to £8 17s.

Last year the taxation collected by the federal authorities soared to £58,187,000, equal to £91s. 5d. per head of the population. The total Commonwealth and State taxation levied in 1914 was £22,892,000, or £4 13s. 9d. per head of the population; while in 1930 the returns showa total of £91,964,000, or £14 6s. 9d. per head of the population. Analysing the figures, we find that no less than £57,412,000, or approximately 63 per cent. goes to pay our interest bill overseas. Does any honorable senator contend that the debts which Australia owes can ever be paid? I do not think that I shall live to see them liquidated.

A gentleman, who is held in very high esteem, in the person of Mr. Lloyd George, recently made a statement on the subject of war debts. It is contained in the following newspaper paragraph : -

London, 7th January.

Mr. Lloyd George, who returned yesterday from a health trip to Ceylon, was interviewed at Launceston to-day. “ The only way to ensure prosperity,” he said, “ is by the cancellation of all war debts and reparations, but the present year will not see the end of the trouble.”

That gentleman is an authority of whom we must take notice. The following quotation also is interesting : -

page 549


British Commerce Leaders Say World Crisis Will Increase if Steps Not Taken.

London, Tuesday

An early conference of the powers to effect a lasting settlement of reparations and war debts, which are a perennial causa of the disturbance of world economy, is urged by the British National Committee of the International Chamber of Commerce.

This committee declares that, unless adequate measures are speedily taken, the present world economic crisis will increase, involving the closing of more markets and a continued fall in gold prices, followed by individual and national defaults, repudiations, and bankruptcies, in which creditor countries will lose all.

The committee emphasizes the belief that the British tariffs will cause highly protected countries to reconsider their policy.

One of the most burning questions today is that of arbitration, and I was pleased to hear it mentioned by the honorable senator, who has just resumed his seat. The system of arbitration is labouring to-day under severe disabilities, and the employing class are looking for palliatives from their representatives in this Parliament. I have extremely sad recollections of the passage of the Arbitration Bill through the Legislative Council of New South Wales, and am reluctantly compelled to admit that the members of the National party in that chamber acted true to their colours. Those who stand loyally by the people whom they represent, excite in me a certain amount of admiration. It is unfortunate that other members of the council, who owed their appointment to a Labour government, ware not so greatly concerned about preserving the interests of those who were responsible for placing them there. I speak with a good deal of feeling. I am fresh from industry, and know that the wages which are paid to-day are only just sufficient to allow of a mere existence. I do not know whether honorable senators opposite regard that wage as adequate, but I certainly do not, and 1 suggest that the time has come when those who have fattened and battened on the wage-earners of this country should do something in the interests of the class to which I belong. The majority of honorable senators opposite, I believe, favour the abolition of arbitration, and endeavour to persuade the people that that is the one means by which Australia may be restored to a condition of prosperity. The abolition of arbitration would mean, inevitably, a reduction in wages, and the lengthening of the hours in industry, a return by employees to the system of bargaining for the right to live. I hope that we shall never revert to those conditions in industry, because under them the employing class took full advantage of the economic necessities of the wage-earners and forced them to conform to a lower standard of living. Thanks to the strength of the Labour movement in Australia, we have arbitration working in its best form. I must, however, qualify this statement by observing that the system will not be entirely satisfactory until we have, as a corollary of compulsory arbitration, compulsory unionism. But in its present form, this can be said in its favour : It is the only legal protection afforded to the employee for his wages. Although, unfortunately, its underlying principles have been misconstrued from time to time, nevertheless it is some satisfaction to us to know that Australia is the only white man’s country that has adopted compulsory arbitration. We are endeavouring to improve the system in the interests of the working classes, who represent’ S7 per cent, of the population.

Mention has been made during the debate of railways and tramways deficits as being largely responsible for the drift in governmental finance, and it has been urged that the high wage standard in those branches of State government services is mainly accountable for the shortage in the accounts. I can speak with some authority on tramway matters. In my view, it would be unreasonable to expect the tramway system of New South Wales, for example, to balance its accounts, and, at the same time, meet the heavy interest burden on capital expenditure. To meet the depression, which was felt severely in the New South Wales railway and tramway services the government of the day resorted to a system of rationing, under which men were required to work only one week in six, with the result that the average wage was reduced to £3 18s. lOd. a week, but when Mr. Lang came into office, he did away entirely with the rationing proposal, and so abolished that pernicious system of wage reduction.

Senator MOONEY:

– The former Premier, Mr. Bavin, was well aware of the difficulties to be overcome iii any attempt to put the railway and tramway finances in order, and was not courageous enough to tackle the problem of transport. The Labour party realized fully that an extension of unemployment was inevitable, but since the problem was so pressing, no other course was open to the Premier, and it might be as well to remind Mr. Lang’s critics that, if the transport services of New South Wales had not been co-ordinated, the people of that State would have been called upon to pay additional taxation for the upkeep of its railways and tramway services.

Senator Reid:

– What additional railway revenue has been received?

Senator MOONEY:

– I have not the figures, so I cannot tell the honorable senator. For several years the works policy of the New South Wales Government involved the expenditure of millions of pounds for the construction and maintenance of roads carrying transport services in active competition with the railways. I agree that the reforms instituted by the Lang Government have given rise to a number of grievances. When I was in the Hume district during the election campaign, some complaints with regard to the Transport Act were brought under my notice. If the railway system is loaded with a number of non-paying lines the blame must be attached to earlier administrations. In the Hume district, for example, during the regime of the Government in which Mr. G. R. Hall was Minister for Railways, deputations from country districts brought pressure to bear upon the Ministry to construct a number of country railways, one of which is the branch line from Wagga through Tarcutta. Those people who now complain cannot have it both ways. They must accept some blame for the present unsatisfactory condition of railway finances. On some sections the interest charge is equal to one-third of the earnings, and in some cases it is more than 200 per cent, in excess of the cost of maintenance. Clearly drastic action had to be taken by the Government to check the drift in railway finance.

Senator FOLL:

– The honorable senator’s comments are a strong condemnation of State instrumentalities.

Senator MOONEY:

– That is a matter of opinion.

About eighteen months ago those interested in the pastoral industry made a successful application to the Arbitration Court for a revision of the shearers’ award. The effect of this reduction was revealed in some interesting figures quoted by Mr. W. A. Holman, now a member of another place, in an address at the Unitarian Church, Liverpool-street, Sydney, prior to the last State election. The figures were, I believe, prepared by the Nationalist party, the members of which are, of course, more conversant with the conditions in the pastoral industry than I am, so I shall not challenge them. They indicate clearly to what extent the reduced wages in that industry have helped towards the rehabilitation of Australia. Shearers’ wages were reduced by no less than 25 per cent. - from 40s. per 100 to 32s. per 100. Assuming that a shearer shears, on the average, 100 sheep a day, and that the average weight of a fleece is 8 lb., the daily production of wool will be 800 lb. At the present price of wool the wage reduction represents a saving to the wool-grower of id. per lb.

This Government is urging an increase of production in order to get Australia out of its present difficulties. In nearly all industries mass production methods now prevail. Not until the primary producer realizes that fact and replaces his little machine with a bigger one will he be able to compete in the markets of the world with the products of other countries. It is essential also that his rent and interest charges be reduced; otherwise he will have to go out of business. The policy of the Government is making it impossible for the farmer to sell his produce. Our troubles are troubles not of production, but of distribution. Throughout the world there is no shortage of the commodities needed by man. God, or nature, has provided more than sufficient for our needs; but the policy which calls for more sacrifice on the part of the workers has made them so poor that they cannot purchase those things which are produced in abundance. Fancy any man taking the public platform and appealing to the workers of Australia to make greater sacrifices than they are already making ! Throughout the world men, women and children are hungry, not because there is no food for them to eat, but because of the capitalistic system which makes such things possible. Hundreds of thousands of people are illclad in the world to-day, notwithstanding that the warehouses are full of clothes and materials from which clothes could be made. Little children go ill-shod, or without boots and shoes, not because of any lack of materials, but because such things are inevitable under our present system. The time is not far distant when the people of this country will realize that there is only one policy which can save Australia. I cannot see how the interests of the people of Australia can be protected in these days if we are “to look first to the interests of bondholders overseas.

During the election campaign, candidates representing the party now in office gave the people to understand that they were imbued with the Australian spirit. It- is unfortunate that the electors were so easily hoodwinked. In the Hume electorate the only policy of the Country party was the “ red “ bogey. The policy of the United Australia party was first enunciated by the Prime Minister (Mr. Lyons) in a speech delivered at the Millions Club, Sydney, after the election. That policy can be summed up in three words : “ rent, interest, profits.” That it is not a humanitarian policy is evidenced by the Government’s treatment of the workless in Canberra, to whom it has deliberately refused rations. Every day, you, sir, open the proceedings of the Senate by reading prayers. It is remarkable that their reading has had so little effect on honorable senators opposite. Some of the men affected by the Government’s callous decision are of fine physique, ready and willing to work, if only they could obtain it. The Premier of New South “Wales (Mr. Lang) has come in for a good deal of criticism in this chamber, but at least it can be said of him that he will feed the workless to whom the National Government of Australia refuses food. Any person who places the claims of humanity before the payment of interest to bondholders is branded as a repudiationist. If to stand first for humanity is to be a repudiationist, then I am proud to be one.

Senator Lynch had a good deal to say regarding the “ red “ menace in Australia, but as the honorable senator is not now in the chamber, I shall leave the subject until another occasion. The honorable senator also made reference to my presence in this chamber. I accept his remarks in the spirit in which they were uttered. I claim to represent the people of New South “Wales. Although not of long duration, my membership of the Senate has been a happy experience. I trust that my remarks1 -this afternoon will not fall on deaf ears, but that something will be done by the Government for the unfortunate men not many hundred yards from this building. I followed closely the remarks of the last speaker. It is to” his credit that when he referred to Mr. Lang, the Premier of New South Wales, he spoke in respectful terms. Mr. Lang has a difficult task in dealing with the unemployed problem in his State. He is doing his best to supply the workless with food, although it costs New South Wales about £7,000,000 per annum to do so. Were Mr. Lang to subscribe to the policy of the United Australia party, and discard his principles regarding the basic wage, child endowment, and widows’ pensions, he would be acclaimed by his present political enemies as one of the greatest statesmen in the world. Twenty years ago an Australian of independent thought predicted that when the time arrived that A public man attempted to put the financial policy of the Labour party into operation, he would have the financial magnates of the world up against him. To-day that prediction is being fulfilled. One man in Australia is endeavouring to put that policy into operation ; and we know the odds against which he has to fight. Mr. Lang is an Australian who puts Australia first. The only way to prevent such a man from advancing is to shoot him.

Senator FOLL:

.- At the outset of my remarks I desire, as other honorable senators have done, to congratulate the mover and seconder of the motion for the adoption of the Address-in-Reply on the excellent speeches they delivered. I also offer my sincere congratulations to the United Australia party which now occupies the Government benches in the Federal Parliament, and my personal congratulations to the three Ministers in the Senate. I regretthat there is no Country party representation in the Ministry. There would have been more security in the government of the country had the Country party section in this Parliament agreed to accept its share of responsibility for the administration of its affairs. The people of Australia at the last election called upon the Country party equally with the United Australia party to assume control of the administration of affairs, and it seems to me a pity that when so much is being made of the cry for national unity, and after Mr. Lyons on every platform had put forward the plea to follow England and have a truly National Parliament, the Country party should not be represented in the Federal Cabinet. I understand that Mr. Lyons urged Dr. Earle Page to accept at least three portfolios for his party, so that the Country party might take its share of the burden of responsibility. Apparently, because of some small difference - too small in my opinion to divide two sections both opposed to Labour - the leaders of the respective parties could not get together.

Senator Sir George Pearce:

– What was the small difference?

SenatorFOLL. - I may be wrong in calling it a small difference; but it was one to which the Prime Minister would naturally object. He certainly declined to be dictated to by a member outside his own party in the matter of the allocation of portfolios.

Senator Sir George Pearce:

– He objected to the insistence of the Country party that it should have the portfolio of Minister for Trade and Customs.

SenatorFOLL. - It certainly placed the Prime Minister in a difficult position when Dr. Earle Page foolishly stipulated the portfolio he would have if he were chosen as Minister.

Senator Dunn:

– Was not Senator Foll reported in the SydneyMorning Herald as having said that Mr. Lyons could form a ministry without the assistance of the Country party?

Senator FOLL:

– I have no recollection of making that statement when the question of the formation of the Ministry still remained undecided. If I did make it, and I could have had no reason for making it, it must have been after the members of the Country party had refused to accept their share of responsibility in the Cabinet. I think that the time will come when all sections of this Parliament who stand for sound administration will be compelled by force of circumstances to come together to form a joint government. It is desirable that when a country is passing through a difficult time, and when Ministers are called upon to deal with important questions such as those with which the present Ministers are now dealing, there should be no limitation upon the source from which those entrusted with the responsibility of administering the affairs of the nation are drawn.

Although I think that Dr. Earle Page was foolish to make the stipulation he did, possibly it would have been advisable to give him the portfolio of Trade and Customs. From one end of Australia to the other he promised that he would bring about certain fiscal reforms that would give relief to country districts, and would do a great deal towards the rehabilitation of Australia. Possibly it would have been wise to afford him an opportunity to give effect to his policy.

I hope that the Country party will not take up the attitude of being in opposition. I trust that it will continue to be allied with the Nationalist party, because it is of the greatest importance to Nationalists in Queensland that the utmost harmony should exist between them and the Country party. Members of both parties are endorsed by the same executive. They go on the same platform. They have one president and one general organizing secretary. The Moore Government is composed of an equal number of members of the Nationalist party and the Country party. A close association between the parties has meant all the difference between having a socialist government and the type of government now in power in Queensland. I am looking forward to a continuance of this close union.

Senator Daly:

– It was not too successful in Queensland in the recent election.

Senator FOLL:

– I am grateful to the honorable senator for his interjection, because I had almost forgotten to express my sincere regret that our good friends from Queenslandwho have been with us for so many years will not be with us after the 30th June next. It is a most regrettable feature of our democratic system that men who have rendered such service to their country, as Senator Glasgow, Senator Thompson, and Senator Cooper have done, should be cast out of public life by a wave such as that which swept over Queensland, but which had nothing whatever to do with federal politics. I believe that there is general regret in Queensland to-day that the services of these able honorable senators will not be available to Australia for some little time after the end of June next. I remind Senator Daly that these honorable senators were defeated because there is in power in Queensland to-day, as there is in South Australia, a government that has had the unpleasant task of putting the finances of the State right.

Senator Dooley:

– The Scullin Government also had that experience.

Senator FOLL:

– The Scullin Government had to put the finances of the country right,but its defeat was due to the fact that it made no attempt to do so during the early part of its career. For the first eighteen months of its regime it allowed the country to drift. It did not take drastic measures to rehabilitate Australia financially until near the end of its career. The fact that it had to do these unpleasant things at the end of its career did not result in its feeing scattered to the four winds. Its defeat was brought about because in the early part of its career it made no attempt to govern the country, but simply allowed the finances to drift.

In Queensland the same old tactics that have been employed for years were again followed by members of the Labour party. They went from one end of the State to the other deploring the fact that the Moore Government had been compelled to retrench in the railways and Public Service. The fullest possible use was made of matters of minor importance to the national welfare of the country.For instance, the people were told that unless Labour was returned the sugar industry would be ruined ; that other industries dear to Queensland and of considerable importance to the welfare of the electors of that State would be utterly destroyed. The voters were promised a restoration of the State basic wage and a 44-hours working week. All these promises were given so lavishly that the electors began to believe that they could get salvation merely by putting into power one of the contesting parties.

Senator Mooney dealt with the activities of Mr. Lang, that financial redeemer, of whom he is such an ardent disciple. I do not intend to spend much time discussing Mr. Lang, who has been given more prominence than he deserves. It is remarkable that he should be held up by some members of this chamber and of another place, as a financial genius and the only person in Australia capable of showing the way to financial rehabilitation. When the trumpets have ceased to blare and he is asked what his financial policy really is, his reply, in effect, is that he does not believe in paying his debts. That is not a new policy. There are hundreds of people, who, when they find it inconvenient to pay their way, say that they do not intend to do so. That is the policy of a crook or a tap-room spieler, and not of a financial genius. Within a week or two the Sydney Harbour bridge, one of the world’s greatest engineering achievements, is to be officially opened by the Premier of New South Wales. Extensive preparations are being made for the forthcoming ceremony, but the most astounding feature of the whole proceedings is that interest on some of the money used in the construction of the bridge is not to be paid.

Senator Rae:

– The Premier of New South Wales never made such a statement.

SenatorFOLL. - The bridge was built under contract, but it appears that interest on money used for the purchase of material is not to be paid, and that some of the conditions of the contract are not to be fulfilled. This great financial wizard, whose policy Senator Mooney supports, has adopted an unusual course for any self-respecting government. Prom time to time he has appealed to the people of Great Britain and of the United States of America to contribute to the loans raised on behalf of New South Wales. As the result of his appeals many thrifty persons of small means invested their savings in what they regarded as a sound investment, and now find that the Government which raised these loans does not intend to pay them their interest. It is a new form of finance to deny those who have invested money in New South Wales stock the interest to which they are entitled! Australian Government stocks have always been regarded as good security in the overseas market. Money raised by the Government of New South Wales has been used in the construction of the North Shore bridge; in railways and a concrete road between Sydney and Newcastle, which is competing with the existing railway. But now that the money has been spent, men provided with employment, and the works completed, the interest is not to be paid. That is not the policy of a financial genius, but of a “ welsher “. Any person who borrows money should repay it as soon as he is able to do so.

Senator Mooney:

– I am glad the honorable senator qualified that by saying As soon as he is able to do so “.

Senator FOLL:

– Does the honorable senator think that Australia has reached the stage when it is unable to meet its obligations in the matter of overseas interest? Does he suggest that Australia’s assets are not worth the £1,100,000,000 borrowed ?

Senator Daly:

– No.

Senator FOLL:

– I am glad to have that admission from the honorable senator. The time has arrived to arrange for the conversion of our overseas loans at lower rates of interest. In the absence of default by one State that would have been practicable. During the last eight or nine months Australian stocks have shown a considerable improvement on the London market. I do not think it would be a. difficult matter, if Commonwealth and State Governments honoured their obligations, to convert our overseas indebtedness on terms similar to those adopted in connexion with the recent internal conversion loan. When Senator R. D. Elliott and I were in Great Britain, the year before last, we found that there was no antagonism by the people of the Motherland toward Australia; but that it was their desire to assist in placing her on the right road. We cannot expect our overseas creditors to give us further financial accommodation when one State is deliberately repudiating it3 liabilities.

Senator Mooney rejoiced in the fact that, as a result of the passage of the New South Wales Transport Co-ordination Act, tramway employees who had been rationed to the extent of one week in six had now been placed on full time. But the honorable senator conveniently overlooked the point that over 3,000 unionists engaged in another - form of transport had been thrown out of employment. While some men have been placed in full work hundreds of thousands have no employment at all. Honorable senators opposite speak of the brotherhood of man, but is such a policy in accordance with the doctrine which they enunciate? ‘ There are thousands of men in New South Wales who would be glad to have one week’s work in six. It is a lamentable fact that in New South Wales, where this financial genius, Mr. Lang, reigns supreme, there are almost as many unemployed as in all the other States combined. That is a startling commentary on the Government which Senator Mooney has’ been eulogizing. The New South WalesGovernment, instead of endeavouring to< introduce some revolutionary financial policy, should be attempting to provide employment. Senator Mooney further said that men who could not obtain rations in the Federal Capital Territory are able to obtain food from the New South Wales Government. A vast majority of our unemployed are looking not for dole tickets but for work. Many men in New South Wales are out of employment as a result of the deliberate action of the Lang Government. During its period of office it has introduced such obnoxious legislation that industry is being retarded instead of being developed. Hundreds of thousands of men have been thrown out of work as a result of the application of the policy which Senator Mooney supports. Present conditions will continue while Mr. Lang occupies the position of Premier of New South Wales.

Senator Mooney:

– He will occupy that position for years.

Senator FOLL:

– I doubt it; but God help the country if he does. Does Senator Mooney realize that as the result of the Lang policy huge sums of money which would have been spent on industry in New South. Wales have been invested in Victoria and the other States? Industry in New South Wales cannot carry the present burden very much longer. Senator Daly referred to the election results in Queensland. I am not complaining, because the people have a right to decide who shall represent them. During the period that the Moore Government has been in office unemployment has been 50 per cent, lower than in New South Wales. I remind Senator Rae that the two. Lang candidates lost their deposits.

Senator Daly:

– Has the honorable senator overlooked the assistance the late Government gave to Queensland in the form of flax, and cotton bounties and a renewal of the . protection .afforded to the sugar industry? . ;

Senator FOLL:

– The primary industries of ‘Queensland, have been responsible for keeping unemployment in that State at a lower level than in any other Slate of the Commonwealth. “We have been fortunate in having such important assets as the great sugar industry. On former occasions Senator Daly has shown a friendly interest towards that industry. I hope that, having changed his seat in this chamber, he will not change his attitude towards the sugar embargo.

Senator Daly:

– There will be no misunderstanding as to where I stand.

Senator FOLL:

– I am glad to have the honorable senator’s assurance. One of the principal reasons why unemployment has never reached, in Queensland, the proportions to which it has attained in other parts of Australia, quite apart from the benefits bestowed by our protected primary industries, is that nearly three years ago a government in which the people had confidence was returned to power and as a result finance, which is the life-blood of industry, was not driven from that State as it was from other States. Unfortunately, however, the finances of Queensland are in a very disastrous condition at the present time; but a favorable circumstance is that the Government of the State has not yet had to apply to the Commonwealth Government for treasury-bills, and that it still has a credit balance in London.

Senator Daly:

– It inherited a big surplus from its Labour predecessors.

Senator FOLL:

– A certain amount of loan money, was in the Treasury when the previous Government vacated office. Those funds were carefully conserved, and the new Government early in its career reduced public expenditure, and in other ways placed its financial house in order.

Senator Rae:

– “Why did the Assistant Treasurer (Mr. Bruce) say that Queensland was in the most hopeless condition of all the States?

Senator FOLL:

– I do not think that that was the tenor of his remarks. The statement made at the Loan Council wai that the finances of Queensland were in a very serious condition. I admit that they are. The principal reason is that the revenue of the State is derived almost entirely from primary industries, which have been hit harder than any other form of industry in this country. About 38 per cent, of the total amount received by way of direct taxation is derived from the pastoral industry, which has been most severely hit.

Senator Thompson:

– And heavy exchange payments have had to be made.

Senator FOLL:

– The present Treasurer of Queensland has pointed out that but- for the abnormally heavy exchange’ the budget for the financial year ended the 30th June, 1931, would have been balanced. Unfortunately, the revenue of the State has fallen to a deplorable extent during the last eight or nine- months, du.s to the fact that little or no income tax has been received, and that there are no other sources of revenue, such as those States which have huge secondary industries possess.

Senator E B Johnston:

– Has the honorable senator read the report of the Auditor-General in regard to the sugar industry?

Senator FOLL:

– Yes. The AuditorGeneral should mind his own business. It is his function to audit the accounts of the Commonwealth, not to probe into matters with which he has no concern. His statement in relation to the sugar industry shows how woefully ill-informed he is on the subject.

Senator Dunn:

– What about the gold bounty?

Senator FOLL:

– I do not know whether the gold bounty is a subject which the Auditor-General could discuss in his report. Our friends from Western Australia will probably wait on the Treasurer and point out that, in view of the very serious condition of the finances of the Commonwealth, and the high price that is being paid for gold, they will willingly sacrifice that bounty.

Senator Sir Hal Colebatch:

– Along with all the others.

Senator FOLL:

– I believe that Senator Colebatch will lead such a deputation. I have a deep admiration for the high stand that he takes on these questions, and regret that he has not maintained his reputation by having already offered, on behalf of “Western Australia, to restore to the Federal Treasury the amount received under this bounty.

Reference is made in the GovernorGeneral’s Speech to the proposed disarmament conference. I hope that that conference will he attended with success. I am sure that the Attorney-General (Mr. Latham) will worthily uphold Australia’s prestige at it. So far, Australia has led the world in regard to disarmament.

Senator Thompson:

– Does the honorable senator mean that no country is as defenceless as Australia?

Senator FOLL:

– The provision for defence has been cut to the bone in every budget that has been presented within recent years, until at the present time there is little more than the nucleus of an army and a navy. If it is possible to reduce armaments still further, I hope that action along those lines will be taken. I trust, however, that we shall not witness the spectacle which followed the termination of the last disarmament conference at Washington, of 20,000-ton cruisers -being scrapped and others of 19,999 tons being built in their place. In my opinion, very little has been done in the direction of naval disarmament; and so long as nations continue to wrangle and utter threats, there is very little likelihood of a really drastic curtailment of armaments.

Senator Duncan-Hughes, in moving the motion which we are now discussing, referred ably to the picture that confronts the world at the present time. Reading our newspapers each morning, we might .almost imagine that we were back in the years 1914-1918. We read of battalions having been landed, of flanking movements having taken place, of intense bombarding operations, and of many of the other accompaniments of a first-class conflict. That is what is actually raging in China between two of the great eastern powers, while the delegates of the different nations of the world have been sitting in conference, and sending notes, first to this power and then to that, suggesting the establishment of a neutral zone, or something else that is utterly inadequate to the needs of the situation. No real step has been taken by the League of Nations to terminate the conflict. Only the other day the statement was made by the leaders of different governments, whose countries occupy an important place in the Council of the League of Nations, that they could not institute a boycott of this or that country because they recognized that it would mean a big trade disad vantage to them, and because it might cause complications in their relations with other nations. One country which is vitally interested in the position that exists in the East, the United States of America, has all along refused to become a member of the League, or to take any part in its deliberations. China, which is making frantic appeals to the League, has never paid her subscription to it.

Senator Colebatch has referred to the extraordinary and wicked waste of money in connexion with the Labour Secretariat at Geneva. I presume that his remarks applied to the machinery of the League, and to the commissions that exist at Geneva generally. Last year I saw huge buildings that were erected there, and t’he tremendous ‘amount of governmental machinery that had been set up. So little has been achieved by the League that I am inclined to think it is rapidly developing into an excuse for a picnic, so that the different delegates might have a pleasant trip to Geneva, pat each other on the back, and return to their respective countries without accomplishing any tiling. The fact that the trouble in the East has been allowed to go unchecked, under the very nose of the League, shows how utterly impotent a body of that character is in dealing with a crisis of first-class magnitude. I hope that the proposed conference will make it possible for the League to function. We want it so to function as to do away with world conflict for all time.

A question of vital importance to Australia at the present time is that of Empire trade preference, which we hope will be brought about as a result of the Ottawa Conference. I confess frankly that I am sorry that a greater gesture of friendliness in the direction of. trade reciprocity with Great Britain was not made when the latest tariff schedule was presented to Parliament only a few days ago.

Senator Elliott:

– Was not the preference reduced on 24 items?

Senator FOLL:

– Many of the reductions were fractional. Of what benefit is it to a country which desires to trade with us, to say that as a gesture of friendliness we will reduce to 55 per cent, a duty that stands at 65 per cent., when the exchange rate means the addition of 25 per cent?

The most important reduction in the new tariff schedule is in respect of an item which will not affect Great Britain in any way, because the bulk of the imported tobacco, if the new duties operate as the growers seem to think they will, will enable foreign-grown tobacco to flood the Australian market and cause a glut which will be disastrous to Australian growers. It was really unfortunate that the Scullin Government so heavily increased the duty on tobacco, thus encouraging a large number of growers to give their attention to the industry, if now the benefits of that protection are to be snatched from them in the middle of the business of harvesting the crop. The high duties imposed by the Scullin Government benefited mainly people who were already in the industry. They realized huge profits from a small acreage and low production due largely to the ravages of blue mould. Those growers who more recently gave their attention to the industry did so on the security of the tariff imposed by the Scullin Government. I, therefore, contend that the new schedule should not be operative immediately; that the old duties should be allowed to stand until the present crop is harvested. The Government might intimate that the lower duties will become operative in respect of next season’s crop, so that those who cultivate their land for tobacco will do so with their eyes open.

Senator Thompson:

– Did not Mr. Forde intimate that the duties which he imposed would have to be revised?

Senator FOLL:

– I believe he did ; but, as my honorable friend knows, Mr. Forde makes so many and such varied statements’ and promises that sometimes it is difficult, to know precisely what he means.

If the Government had been sincerely desirous of showing friendliness to Great Britain, it could have given its attention to many other items in the schedule, because, as I have stated, the new tobacco duties will not benefit Great Britain in any way. The Government had a good opportunity to make a friendly gesture to Great Britain, because its tariff schedule was introduced in another place only a few days after the British Govern ment had brought down proposals which exempted a considerable number of dominion products. As a matter of fact, we are now enjoying a substantial preference in the British market for nearly all our exportable primary products. I, therefore, contend that, instead of waiting for the conference at Ottawa where, I presume, this Government will barter for tariff concessions with Britain and other Dominion Governments, it would have been wiser to reduce the duties on many items in the Scullin schedule, because tariff revision along those lines would have benefited Great Britain and would have been regarded as some return for the genuine and spontaneous concessions given to Australia by the Mother Country.

Senator Lynch:

– Would not ;t be possible to make a better bargain with a high tariff wall?

Senator FOLL:

– I hope that we shall never reach that stage when we will endeavour to drive a hard bargain with the Motherland. Bather should we be ready to reciprocate in tariff matters in return for the generous treatment which Britain has given to all the dominions in the Tariff Act. If this Government had made a genuine offer to Great Britain, prior to the Ottawa Conference, its action would have been greatly appreciated by the Mother Country.

It is unfortunate that the activities chiefly affected by the new tariff schedule are our primary industries. I make no apology for what may be regarded as inconsistency in fiscal faith in the consideration of the tariff, because I am firmly convinced that if there is one section of the community that deserve.-: the fullest protection and assistance it is our primary producers - the men who, when this country . is in difficulties, continue production, and provide an exportable surplus for the payment of our overseas obligations. As every one knows, the great majority of our farmers have been struggling against extraordinary difficulties for many years. I doubt that many of them have earned the net basic wage in recent years, although they work anything from 80 to 100 hours a week. Consequently, even if I do appear inconsistent with regard to the tariff, I offer no apology. In a time of national diffi- culty like the present, I feel quite justified in urging that every consideration he shown to our primary producers.

Senator Daly:

– Including the man who grows onions?

Senator FOLL:

– Certainly, because the man who grows onions is doing his part equally with the man who grows sugar. There is no better way of solving the unemployment problem than by making more attractive the lot of the man on the land. I agree with one of the previous speakers, who emphasized that our cities ave now so overcrowded that the overhead is too great for our primary producers to carry under existing conditions. I believe that truly sums up the position. Consequently, I shall, at all times, do everything that lies within my power to see that a man on the land is encouraged, by tariff protection, to stay there, and that others who may desire to go on the land have an opportunity to do so.

The building industry has been severely hit by the present depression. For manyyears the expenditure of loan money upon roads, railways, bridges, the erection of new offices and business premises provided a great deal of employment in our cities and larger centres of population, but owing to the financial stringency such works have’ ceased and I see no prospect of a revival in the building trade for a eonnsiderable time. I therefore regret that the Government, notwithstanding its declaration that it would be guided by the recommendations of the Tariff Board, has not done so with regard to the timber industry. High duties on imported softwoods have been responsible for a slowing down in the building trade.

Senator Sir Hal Colebatch:

– Australian timber is protected to the extent of 700 per cent, against imported timber.

Senator FOLL:

– The committee which inquired into the importation of softwoods into Australia dealt fully with the Australian industry, and the Tariff Board recommended a reduction of 5s. per hundred cubic feet in the duty on imported oregon, with a view to stimulating the local hardwood industry because Australian hardwoods are largely used in conjunction with softwoods for building purposes. The Government did not adopt that recommendation.

Senator Colebatch referred to the duty on galvanized iron. My mind carries me back to speeches delivered in this chamber and in another place, on that subject. I well remember the impassioned appeals made, in some cases, by members of the present Ministry in another place on behalf of our primary producers who, it was argued, were large users of galvanized iron, and would be penalized by the high duties, and I cannot help feeling astonished that this Government, which is supposed to have the interests of the primary producers at heart, has deprived the tobacco-growers of the protection given to them by the Scullin Government, and at the same time is apparently satisfied with the reduction of £1 a ton in the price of galvanized iron. I see no reference in the schedule to lower duties on wire netting, fencing wire, barbed Wire, which also are largely used by our farmers. When we were in Opposition we criticized the Scullin Government for its attitude towards our primary producers. I hope that the Ministry will take up the attitude which I have adopted and, in its. tariff policy, will offer every possible assistance to our farmers, who are entitled to the fullest protection and should be able’ to purchase their requirements at the lowest possible cost.

Senator Lynch:

– There is a rumour that the Government intends to reduce the price of sugar!

Senator FOLL:

Senator Lynch has the embarrassing habit of introducing contentious matters at the wrong moment. J Just now he is attempting to be facetious. I recall an eloquent and forceful speech, delivered by the honorable gentleman not long ago, when we were discussing the sugar agreement. On that occasion he asserted that he would never expect any man to work in the cane-fields of the tropical north for less than a fair living wage, and went on to declare that the labourer was worthy of his hire, and so on. Then after making a most impassioned appeal on behalf of the sugar industry, and’ leading me and my colleagues from Queensland to believe that, at last, we had secured another convert from Western Australia to assist what may rightly be regarded as the greatest Australian primary industry, when the division bells .rang be remained in his place. It therefore ill becomes the honorable senator to make any reference to the sugar industry. Henceforth he should for ever hold his peace, on that topic at all events.

One further reference to the tobacco industry. A year or two ago a very complete investigation was made by a select committee of this Parliament. In its report the Committee emphasized that, one of the reasons why the revenue was not likely to be seriously affected by the new proposals of the Government was that the excise on cut tobacco was low, while the rate on manufactured cigarettes was high. The excise on cut tobacco was, ] believe, 2s. 4d. per lb. compared with 7s. 6d. per lb. on manufactured cigarettes. If the Scullin Government had made the excise duty on cigarette tobacco ls. or ls. 6d. a lb. less than the duty cm manufactured cigarettes more revenue would have been obtained. That is the altitude which the Government should adopt with regard to all revenue duties. The duties on some commodities are so high that they put the commodity out of the reach of the average consumer. Some of the excise duties have resulted in a loss instead of an increase of revenue.

Hundreds of -thousands of pounds of revenue are being lost annually by the Telephone Department, because the Government has not seen fit to reduce the charges for telephones. When the present Prime Minister (Mr. Lyons) was Postmaster-General in a previous government the rentals for telephones were increased, at a time when the people were looking for relief from the then existing rates. The result was that thousands of subscribers had their telephones disconnected. Were the Government to make a substantial reduction in the rental charges for telephones, I feel confident that the number of new subscribers would more than compensate for any loss of revenue occasioned thereby. If the rates were made so low that every house in every street would be connected with a telephone exchange it would pay the department better than if only one or two houses in each street had telephones. It would also be an advantage to have a flat rate for telephones rather than the present toll system. Unlike the manual system, it matters little with automatic telephones whether a subscriber makes few or many calls each day. Instead of seeking additional revenue by increasing charges, the Government would do well to consider the advisability of reducing charges in different directions. I realize that many difficulties confront the Government, and I submit these suggestions in the hope that many of these difficulties will’ soon disappear. There is a general desire on the part of the people that the Government should go ahead with its scheme of rehabilitation. Only by doing so will it justify the confidence which the people have reposed in it.

Question resolved in the affirmative.

page 560


Motion (by Senator Sib George Pearce) agreed to - ,

That the Address-in-Reply be presented to His Excellency the Governor-General by the President and such honorable senators as may desire to accompany him.

The PRESIDENT (Senator the Hon W Kingsmill:

– The Address will be presented at a time convenient, to His Excellency.

Sitting suspended from 6.10 to 8 p.m.

Private business taking precedence after 8 p.m.,

page 560


Service Outside the Commonwealth.

Senator DUNN:
New South Wales

.- I move-

That no naval or military units of the Australian Defence Forces be permitted to engage in active service outside the shores of the Commonwealth of Australia.

I wish to support this motion by quoting from the platform of the Australian Labour Party the following : -

Amendment of the Defence Act to secure no raising of forces for service outside the Commonwealth, or participation or promise of participation in any future overseas war except hy a decision of the people.

The leading statesmen of the world who assembled at Versailles at the conclusion of the Great War, made it known that the future policy of all the civilized races was to be a cessation of war, and the creation of a better feeling among the various peoples. Yet to-day, within 24 days’ steam of some of our northern ports, the drums of war are sounding, and the roar of cannons is heard. To-day’s issue of the Sydney Morning Herald contains the following: -

page 561


Fires Over Enormous Area

Chinese Retreat in Disorder. alarminforeignsettlement.

An intense bombardment of Chapei by the Japanese yesterday morning resulted in the Chinese defenders retreating in disorder.

The shells started many fires which spread over an enormous area around the North Station and practically destroyed the remaining portion of Chapei.

A general retirement of the Chinese from Nantao and Chapei is now proceeding.

Fearing land mines, which are reported to have been laid, the Japanese have not yet advanced into the evacuated territory.

It is anticipated, that unless there is a rally by the Chinese, the Japanese will completely occupy Chapei.

The Labor Daily, the official organ of the Labour party of New South Wales, publishes the following: -

page 561


United States will go full speed ahead if Japan continues to violate Treaties.

The fleets of the powers are gathering at Shanghai. Squadrons of aeroplanes are dropping bombs, endangering the lives of not only Chinese, but also men, women and children in the foreign settlement at Shanghai. It is possible that Australia may be drawn into this conflict. We, in this chamber who represent the Australian Labour Party in the State of New South Wales, declare that we shall use every constitutional means in our power to prevent it. If our homes were in danger from an invading force, we should do our best to defend them, but we would never consent to the participation of this country in what is nothing more than a sordid trade war. That Imperial Japan has invaded Manchuria to advance its commerce is proved by statements put forward by eminent delegates at the

League of Nations Assembly. We in Australia desire to live in peace. We have already proved ourselves in war, and now we are trying to live up to the spirit of the decision arrived at by the statesmen of the nations at Versailles.

It is interesting to quote the views of eminent churchmen. A leading minister of the Methodist Church is reported to have been loud in his denouncing of war at the Methodist conference now sitting in Sydney. The press report is as follows: -

page 561


Denouncedby Church Leader

Greater Curse Than War Itself

Sydney, Wednesday

Relations between the church and international problems was referred to by the retiring president of the New South Wales Methodist Conference (Rev. J. W. Burton), addressing the conference to-night. “ Can we wonder that the church has lost moral leadership in world leadership? She will never regain it until by sincere word and heroic actions she denounces war as ungodly lust and un-Christlike spirit,” said Mr. Burton. “ Science, commerce, transport and communication have, by many and subtle means, made the world one great neighbourhood. It is for Christianity to make it neighbourly.”

Mr. Burton declared that a greater curse even than actual war was the perpetuation of the war spirit. “ Armaments, it has been demonstrated, are not protective, but are provocative, and therein lies the greatest single danger to civilization,” he continued.

Within a few days we shall be observing, with homage, the anniversary of the crucifixionof the Pounder of Christianity. Our Saviour gave His life for the peace of mankind. Yet to-day the war spirit is still firmly established among some of the nations. It is true that many of them are discussing the possibility of disarmament. To their credit, let it be said, that the statesmen of our Motherland are doing all that lies in their power to bring about complete disarmament. Yet it is within the bounds of possibility that we may at any moment be launched into another world conflict.

I shall deal now with the sacrifice that Australia made during the late war. I quote from page 198 of Staniforth

Smith’s Australian Campaign in the Great War, the following table : -

that table shows the sacrifices made by Australia’s manhood during the great war, and I am sure that no hororable senator or any other intelligent member of the community ever wishes this country to again be engaged in such a conflict. Speaking personally I say that I do not wish to see mothers shedding tears, as my mother now does on Anzac Day, beca use of the loss of their sons in fighting the nation’s battles.

I have a good deal which I could quote in support of this motion, but as my time is limited I shall direct attention to only a few important utterances which have been made on the subject of international disputes. The policy of the British Labour party is given in the following paragraphs : -

The Council of the Trades Union Congress and the Parliamentary Labour party have issued a manifesto declaring that the Japanese are violating treaty obligations, and disregarding pledges, and also the League’s powers.

They have established a virtual protectorate in Manchuria. The manifesto goes on to say that a state of war exists between China and Japan, for which Japan is responsible, though she could have obtained satisfaction through the Covenant. China, on the other hand, had put the case in the hands of the League of Nations throughout. Japan can ensure prosperity only by friendly co-operation with China, instead of force.

If the nations of the world, adds the manifesto, fail to uphold the Covenant, they will destroy the collective system of world law, increase international insecurity, and cause other wars.

The council, therefore, asks the League to consider the making of a request to member nations to withdraw their ambassadors from Tokio. If Japan defies world opinion the British Government must propose to the League such measures of financial and economic restraint as will restore peace.

General Sir Ian Hamilton, who took a very important part in the Gallipoli campaign, expresses the opinion that -

Great Britain should not interfere in the Far East, and says that he is surprised that Japan should have selected as her battleground a crowded city, in which the value of leadership, discipline, and marksmanship are lost, and the struggle becomes one between two blind mobs.

The foreign consuls in Shanghai have again protested against shells falling in the Settlement. The Chinese disclaim responsibility, alleging that the Japanese are using the Settlement as a base of operations.

If foreign nations engage in deadly conflict and ruthlessly murder men, women and children, it is impossible to say when Great Britain may be involved and Australian troops asked to assist. According to press reports no fewer than 240 fighting ships of the United States’ fleet are now assembled in the Pacific. I also quote the following paragraph from Smith’s Weekly: -

The great war devastated thousands of square miles in the theatres of hostilities. Its financial legacy, twelve or thirteen years after the termination of military operations, has laid waste industry and trade in a hundred countries, put millions of men out of employment, thrown the world’s monetary machinery out of gear, and upset international financial relations of half a century’s standing. The western world, having first insisted on the payment of huge sums by the vanquished to the victors, and by some victors to others, and having subsequently refused to accept’ payin the only currency in which enormous amounts can be paid - in merchandise - has reached the position of deadlock which, sooner or later, was inevitable.

If Australia became involved in an international struggle, she soon would be in a worse position than she occupies to-day. I trust that a majority of honorable members will support the motion which I have submitted in the interests of the Australian people.

Minister for Defence · Western Australia · UAP

[8.21]. - I am sorry that this motion appears on the notice-paper of the Senate at a time when most of the civilized nations of the world are trying their best to bring two nations now engaged in deadly conflict to a realization of the necessity and desirableness of peace. “While the utterances made during this debate may not go beyond Australia, there is always a danger that in the discussion of a motion of this nature something may be said which is capable of a construction that was never intended.

The present Government is absolutely sincere in its desire for universal and continued peace, and will never be a party to an act of aggression against any other country. As a member of the British Empire it will use all its influence in the direction of securing and maintaining peace. It will use all its efforts through the League of Nations, or through international conferences, to bring about disarmament to the utmost possible extent, so that the means of making war shall be lessened. It does not believe in war as an instrument of international diplomacy. I direct the attention of honorable senators to the fact that the motion provides that “ No naval or military units of the Australian Defence Forces should be permitted to engage in active service outside the shores of the Commonwealth of Australia “. Technically, the shores of Australia extend to the three-mile limit. I would remind the honorable senator who moved the motion that it takes two to make a quarrel. It is not that two individuals or two nations agree to fight. One individual or one nation may be aggressive and quarrelsome while the other individual or nation may be absolutely peaceful, desirous of avoiding conflict, and objecting to fight. Yet such an individual or nation may have a war forced upon it, by a quarrelsome, combative, and aggressive individual or nation. The honorable senator’s motion is submitted on the assumption that two nations are seeking war. This nation is not aggressive or quarrelsome. We do not desire to invade or interfere with any other country; but another country may desire to invade our country or interfere with us. If it should it will not consult us; it will not defer to our wishes in the matter. If it should desire to make war against us our consent will not he sought any more than consent is sought by an aggressive person who holds up another in the street and trounces him. The fact that we are peaceful, non- aggressive, non-combative, and disarmed, as we practically are, does not dispose of the risk of war. While there are combative and ‘ aggressive nations, there will be a danger of war regardless of how peaceful, non-aggressive or noncombative other nations may be. Let us assume that some nation sees fit to attack Australia. The motion provides that “ no naval unit shall serve outside the shores of Australia.” Such a unit must not proceed beyond the three miles limit while the naval units of other nations can come up to that limit and raid our commerce and sink our ships.

Senator Sir Hal Colebatch:

– And bombard our cities.


– Yes, as they could readily do from a distance of 30 miles. While that was being done our ships would have to remain within the three mile limit and see Australian ships sunk, and Australian sailors murdered, as they would be, without firing a shot.

Senator Dunn:

– The Minister is splitting straws.


– That is what would happen under the terms of the motion. I am not using extravagant language or misconstruing the motion. The present Government, and, we believe, the British Government, is most anxious to see the present trouble in China settled by peaceful means. It is using its utmost endeavours to obtain that end. The British Government, with the full consent and support of the dominions, is doing everything possible to bring about a peaceful settlement of the present trouble. If a war were forced upon the British Empire by an aggressive and combative nation, this motion would mean that in such an event we should invite the enemy to fight the war in our territory.

Senator Sampson:

– That is the last place where wc should want it.

Senator Sir GEORGE PEARCE.Yes. I have seen the effects of war after hostilities have terminated; and I never want to see a war - if, unfortunately, Australia is ever forced into a war by the act of an aggressor - fought in Australia. Having seen the devastation of war in France and Belgium, I hope that if we ever have to fight for our own protection, the fight will not he in Australia.

Senator Lynch:

– The freedom of Belgium was fought for outside the boundaries of that country.


– Both inside and outside of it. I have no desire to enter into a general debate on this subject, and am sorry that it has been introduced at a time like the present. “When a terrible war is raging, and every civilized nation outside the combatants is doing its best to bring it to an end, the less said about the matter, the better.

Motion (by Senator Foll) put -

That the Senate do now divide.

The Senate divided. (President - Senator Hon. W. Kingsmill.)

AYES: 16


Majority . . . . 8



Question so resolved in the affirmative.

The PRESIDENT (Senator the Hon. W. Kingsmill) . - No, the Senate will now divide on the main question.

Question - That the motion (Senator Dunn’s) be agreed to - put. The Senate divided. (President - Senator Hon. W. Kingsmill.)


NOES: 18

Majority . . . . 11



Question so resolved in the negative.

page 564


Second Reading

Senator McLACHLAN:
Acting Attorney-General · South Aus tralia · UAP

– I move -

That the bill be now read a second time.

Although this measure appears to be a formidable one, I can assure honorable senators that the majority of its clauses relate to matters of administration, and are non-controversial. The bill is one for consideration at the committee stage, and I do not now propose to go into details as to the various minor amendments contained therein. I direct the attention of honorable senators to the more important clauses, which I shall explain at some length.

From time to time, amendments to the act have been proposed by representative bodies, and interested parties; but, apart from some pressing amendments that have been necessitated by judgments of the High Court, no general amendments have been made to the act since its commencement. The experience gained in the past three years, and the decisions of the Federal Judge in Bankruptcy, have shown that the time is now ripe to amend the act generally.

Prior to the Commonwealth act coming into operation, each State had its own bankruptcy or insolvency law. The Commonwealth act, adapted to Australian conditions from the Imperial Bankruptcy Act and Deeds of Arrangement Act, superseded the State acts. Certain provisions were also taken from the acts of the States. Part XII. of the act relating to compositions and assignments without sequestration was adopted from the acts of South Australia and Western Australia. This method has not found favour in the more populous States, which have indicated a decided preference for deeds of arrangement under Part XII., which was taken from the Imperial Deeds of Arrangement Act. It will thus be seen that there are two methods of winding up estates under deeds of assignment; and this has led to a certain amount of confusion. As the Imperial Deeds of Arrangement Act is distinct from the Imperial Bankruptcy Act, many of the decisions under the English acts are inapplicable in the Commonwealth, where the provisions are incorporated in the one act. This did not become apparent until the federal court had decided certain cases.

Recently, for the benefit of the trading community, certain parties approached the court, by a friendly proceeding, to seek a declaration as to the effect of section 199 of Part XII. of the Bankruptcy Act on a deed of arrangement made thereunder. The point at issue was, whether a deed of arrangement under Part XII. could be drawn so as to subordinate, override and neutralize certain statutory provisions of the act that are either contained or incorporated by reference in Part XII. Owing to the unfortunate position of many traders in country districts, it has been the practice for suppliers of goods to permit small traders, when in financial difficulties, to carry on in the hope of a recovery, rather than to make them bankrupt. In the case in question, a deed of inspectorship was executed, and ‘goods were supplied thereunder. The business did not prosper, and a deed of arrangement was executed for the benefit of “his creditors generally”. The trustees under the two deeds were the same, and acting under a clause in the Second deed they exercised the discretion conferred thereby, and paid certain debts in full. It was on that preference, and in view of the proportionately unequal payments and the disregard of other possible claims under the act, that the proceedings were based. The trustees maintained that the second deed, by a special clause, authorized them to pay certain creditors in priority to others, notwithstanding the provisions of the act that all debts shall he paid pari passu. His Honour Judge Lukin went into the matter very fully, and held that a deed cannot override section 199, which provides, inter aiia, that the provisions of the act as to the priority of payment of certain debts, and the respective rights of secured and unsecured creditors shall apply to every deed of arrangement under Part XII. as fully and effectively as if a sequestration order had been made against the debtor. His Honour pointed out in his judgment that the Bankruptcy Act was the creation of the Federal Parliament, not merely in the interests of private persons, but in the interest of the community generally. As indicating the court’s view on the necessity of paying due regard to the interests of the community, and as to the necessity of regulating schemes of arrangement and compositions, His Honour quoted largely from English decisions.

There is a general principle in bankruptcy known as equality of treatment of creditors. In the common shipwreck, equality among the creditors, and justice and humanity to the debtor, if he gives up all his property for equal distribution among the creditors. To enforce’ this principle, section 95 of the act absolutely forbids any undue preference. If this principle were strictly observed in the existing abnormal conditions, creditors would hesitate to supply goods on credit to persons whom they knew to be in financial difficulties. These persons would then be forced to sequestrate their estates, and all hope of their financial rehabilitation would be lost.

The departure from the established bankruptcy principle in clause 19 c can only be justified on these grounds. The clause contains sufficient safeguards to preserve the interests of all parties, and prevent abuse, and should meet all reasonable requirements so far as bankruptcy practice will permit.

The next important amendments to which I wish to refer are clauses 46 and 54, relating to property divisible among creditors. At the present time policies of life assurance are protected under section 91 in the case of a sequestration, but are not so protected in proceedings under Parts XL and XII. of the act. The proposed amendments will have the effect of protecting life assurance policies in all cases of winding up of insolvent debtors tinder the act.

Clause 33 of the bill relates to the remuneration of trustees. At the present time the act contains separate provisions prescribing different methods of remuneration of trustees under the three methods of winding up estates. The absence of uniformity has resulted in misunderstanding and uncertainty as to the amount which a trustee may retain for his services in any specific case. The present restriction limiting the amount that may be received to 5 per cent, on the amount realized by the trustee without regard to the work involved in the realization has operated unfairly to trustees in the case of small estates. It is now proposed to include the provisions relating to trustees’ remuneration in one comprehensive section which is sufficiently elastic to provide for all cases, as it will enable the trustee to apply for an increase and the creditors or debtor to apply for a reduction, and the court may decide in all such cases what is a fair remuneration in view of all the circumstances of the case.

Another matter to which the attention of honorable senators is directed is that contained in clause 20, which proposes to insert a new section SSa in the act. The amendment is designed to protect, the trustee under a deed of arrangement who, in order to carry on a business under the deed, has entered into necessary contracts and performed other duties before receiving notice that the estate was about to be sequestrated.

The bill contains several minor amendments, other than those already referred to as making for uniformity of procedure, to Part XI. - Compositions and assignments without sequestration. Of these amendments, clause 20, amending section 157, will ensure that a debtor obtains proper legal advice before committing himself to bankruptcy proceedings. At the present time an interested person may induce him to enter into the proceedings for the purpose of obtaining fees, without regard to the interests of debtor or creditors.

The other amendments to this part are designed to ensure that the fullest information is given to the creditors and placed on record in the court. At present the court and the public have no knowledge of the nature of some of the arrangements entered into under this part.

The remaining amendments are designed to promote the smooth and economical working of the act. I may add that the Government is indebted to the federal judge in bankruptcy, Judge Lukin, for his valuable assistance and suggestions. Judge Lukin has made many valuable recommendations on administrative matters whilst refraining from, expressing any views on matters of policy.

Debate (on motion by Senator Barnes) adjourned.

page 566


Communism in Europe - Trade with Russia - Russia’s Attitude to Disarmament - League of Nations - Unemployment Relies1.

Motion (by Senator Sir George Pearce) proposed -

That the Senate do now adjourn.

Senator RAE:
New South Wales

– I desire to enter an emphatic protest against the way in which honorable senators on this side were treated a few minutes ago. It seems to me that the purpose of private members’ night is to give members an opportunity to discuss matters of importance, which may net come within the scope of the Government’s legislative programme, and I eontend that it was most unfair - I should like to use a harsher term-

Senator Sir George Pearce:

– I rise to a point of order. Senator Rae apparently is about to reflect on a vote of the Senate which has just b’een taken. I direct your attention, Mr. President, to Standing Order 413 which reads -

No senator shall allude to any debate of thi” same session upon a question or bill not being then under discussion, nor to any speech in committee except by the indulgence, of the Senate for personal explanations.

The question which the honorable senator was proceeding to debate has been disposed of by the Senate and cannot be a subject for further discussion. Standing Order 415 provides -

No senator shall reflect upon any vote of the Senate, except for the purpose of moving that such vote he rescinded.

Senator Rae asserted that the proceedings of the Senate in respect of a vote taken a few minutes ago were unfair. I submit that, in doing so, he contravened Standing Order 415. I also ask for your ruling as to his position under Standing Order 413.

The PRESIDENT (Senator the Hon W Kingsmill:

– Since there is no doubt that the honorable senator was contravening Standing Order 415, it is not necessary to give a ruling concerning his remarks under Standing Order 413.

Senator RAE:

Mr. President-


– Does the honorable senator wish to make a personal explanation ?

Senator RAE:

– No; I wish to speak on the motion for the adjournment.


– It would be well if the honorable senator withdrew his comment about the unfairness of the proceedings of the Senate.

Senator RAE:

– Am I compelled to do that? Nobody has asked me to do so.


– I now ask the honorable senator to withdraw the remark.

Senator RAE:

– Very well. I withdraw it, but most reluctantly.

I desire now to allude to a matter which was discussed on the motion for the adjournment last night. After Senator Poll had spoken of communism in Australia, I had something to say on the general subject, and in the discussion which followed, Senator Duncan-Hughes attributed to me statements which I did not make, or. at all events he entirely failed to grasp the point which I did make. I do not imply that he intentionally misrepresented me, nor do I suggest that he was incompetent to deal with the subject, but it appears to me that the bias of some honorable senators is so pronounced that, perhaps unconsciously, they misrepresent those with whom they disagree. In any case my point was not materially affected by the figures which Senator DuncanHughes quoted. I had referred to the strength of the Communist parties in the Parliaments ofFrance and Germany.

Whether or not I over-rated their strength is beside the point. Senator Foil, it will be remembered, had urged this Government to take immediate and drastic action against Communists in the Commonwealth, and I claimed that organizations which Senator Foll would have declared illegal in Australia, exist and return representatives to the Parliaments of the countries mentioned. Obviously, in France and Germany, it must be perfectly legal for Communists to promulgate their doctrines and to conduct election campaigns in furtherance of their views, otherwise their representatives would not hold seats in the Parliaments of those countries. I was twitted and gibed at by Senator Pearce for not having given the number of Communists in Russia. But that, also, would not have affected my argument, because the Soviet Government is admittedly communistic. My sole purpose last night was to show that even in countries where the dominant parties are reactionary in outlook, the governments have not attempted to stifle the free expression of public opinion to the extent of preventing Communists from contesting parliamentary seats and advocating the adoption of their doctrines. Furthermore, Senator Duncan-Hughes attempted to prove that I contradicted myself, when I said that the New Testament conveyed lessons of a communistic character, which I had attributed to the Founder of Christianity, while at the same time I claimed that those who chose to advocate irreligious doctrines had a perfect right to do so. Surely that was not a contradiction. I did not say that the Founder of Christianity was the founder of communism, but that the record of His utterances in the Scriptures clearly conveyed the idea of the application of communistic principles.

Senator Lynch:

– The honorable senator referred to Him as the “ alleged “ founder of Christianity - a remark that was not very becoming.

Senator RAE:

– That is a matter of opinion, and does not materially affect my argument which was that the New Testament contains many references and many statements which are clearly of a communistic character. As I have not. the exact words here I shall not attempt to give them, for I should probably be accused of misquoting the Scripture. Any one who has read the Scripture even as much as I have must be aware of the truth of my statement. I do not say that the doctrine of communism was preached by the Founder of Christianity; but that communistic principles are embodied in His teachings.

Senator Foll:

– The Scripture says, “ Render unto Caesar the things that are Caesar’s.”

Senator RAE:

– As an interjection that quotation is meaningless, because the injunction to render unto Caesar the things that are Caesar’s does not specify what things are his.

Senator Foll:

– It means that we should pay our interest bill.

Senator RAE:

– It means nothing of the kind. When the Pharisees of old attempted to trap Jesus Christ into making a statement on which they could impugn His loyalty, He cleverly gave them an answer from which they could get nothing. He did not define the things that belonged to Caesar. I repeat that I am unalterably opposed to the idea of stifling the utterances of any section of the community by making any association an illegal one. I go further, and say, as a citizen of this country, that if the party to which I belong ever again attains power, we shall make it our business to treat those who now act tyrannously to a dose of their own medicine multiplied a hundredfold. I point out that two can play at the game of deporting citizens for expressing their opinions. If the party to which I belong attains a majority, and again assumes the reins of office, then for every one who is deported by the party now in power, we shall deport ten ; and we shall not be greatly concerned whether they are foreign-born or natives of this country. If those now in power apply measures of brutality to legislation by stifling freedom of utterance, and deporting all who disagree with their political views, or should they introduce the boycott, or other barbarous punishments worthy only of the dark ages, I repeat that two can play at that game, and that those who start it may yet be sorry that they did so.

I wish now to refer to the answers given by the Minister representing the

Minister for Markets to some questions asked by my colleague (Senator Dunn). The honorable senator asked a number of questions concerning Australia’s trade with Russia. The answers supplied by the Minister show that during the seven years covered by the questions - from 1924 to 1931 - the total imports from Russia to Australia were valued at £620,000, whereas during the same period Australia exported to Russia goods valued at £4,126,000, leaving a balance of trade in favour of Australia amounting to £3,506,000. The Minister’s statement also mentioned that the large exports from Australia to Russia during 1927-28 were due to the fact that in that year Australian wool was exported directly to Russia, whereas previously it had been sent through London. It would appear, therefore, that the balance of trade in favour of Australia was much greater in previous years than the official figures indicate. I mention this subject in order to show that those who would make it appear that the dumping of Russian wheat was calculated to ruin British industry and Australian prices, quite ignore, in their hatred and bias, that in the matter of trade between Russia and Australia, the balance is in Australia’s favour. Whenever I rise to speak some honorable senators appear to think it in- cumbent on them to refer to Russia and communism. I remind them that only within the last few days the Russian Foreign Minister, Litvinoff, who was attending the assembly of the League of Nations at Geneva, proposed the only real and genuine method of disarmament that the representative of any nation has yet brought forward when he advocated a complete and total disarmament. Some years ago, when the Russian representative was invited to Geneva, he made a similar proposal. He said then that Russia was prepared to join with the other great powers in an immediate total disarmament. He told the assembled representatives that if his proposal were agreed to he would go back to Russia and see that her naval, military and air forces were disarmed, and her munitions of war destroyed, provided, of course, that the other nations took similar action. His pro- posal was not even considered; the other delegates refused to take it seriously. At a subsequent meeting the Russian representative suggested that if the other nations were not prepared for immediate disarmament they might accept a plan by which complete disarmament would be brought about within a period of four years. Again the League refused to discuss the proposal; it was rejected without debate, in the same way that other proposals have been rejected in this Senate without debate. At the sittings of the League now taking place a similar proposal has been made. On the last occasion a vote was taken, but only one or two of those present supported the Russian proposal. A government which is willing to disarm its army, navy and air forces, to destroy its munitions of war, gives an evidence of its sincerity, which is absent from the other proposals which have been put forward from time to time. I have no faith whatever in the League of Nations. It has shown that it is incapable of dealing with any major issue. Even so long ago as the trouble between Italy and Greece, when Italian warships fired shells upon defenceless people in a convent on the Island of Corfu, and killed innocent women and children, the League of Nations gave a verdict against the victims instead of against the offenders, and compelled those who suffered to make reparation to Italy. So long as the League of Nations is composed of the same statesmen, who exercise their talents to promote armaments, and the causes which lead to war, so long will its existence be an expensive farce. I consider that the time and money spent in sending a representative to Geneva is time and money wasted. I agree with the Government’s decision not to send a representative to the Labour Convention. Beyond the compilation of statistics, which may have some slight value, very little is done at those assemblies; and what is done is out of all proportion to the cost. Seldom do the nations ratify the conventions of the International Labour Office. The constitution of that body is not such as -to make for any marked progress.

Senator Foll:

– Have any of its recommendations been carried out?

Senator RAE:

– One or two of them have been ratified; but, generally, when the representatives of the nations do express concurrence with the decisions arrived at, they notify the others that they are willing to ratify them if the other nations do the same. All the delegates say the same thing; but nothing is done. Even the decisions relating to the white slave traffic, and the suppression of the traffic in opium have failed to materialize in any conclusive manner. One article in the Covenant of the League of Nations provides that, in certain circumstances, such as that of one nation acting aggressively in defiance of the League, an economic boycott of that nation shall be set up. Let us consider what that means. I agree with the Leader of the Government (Senator Pearce) that, in relation to the present trouble in the East, we should be careful not to say or do anything which might lead the nations to believe that we are taking sides in the matter. But supposing that we agree that one of those nations has broken its compact as a member of the League of Nations, what is the position? In order to enforce the decision of the League of Nations, it would be necessary for every Australian wool-grower to refuse to sell his wool to that country, even if it should happen to be the second largest buyer of our wool. It would also be necessary for trade and commerce between the other members of the League and the erring nation to cease at once. The enormous losses which would be incurred, and the dislocation of trade which would follow would be so costly and complex that the remedy for any breach of the Covenant referred to is impossible of application. I believe that our commercial system must inevitably lead to further warfare. The most pious utterances of’ Methodist clergymen, or others, will not prevent war. The only thing that will prevent war is for those who are concerned in preserving their own lives and liberties - the great working classes of the nations - to set their faces against taking part in any war other than against a war of invasion. It is as clear as crystal that if every community pledged itself to take no part in any war other than a war of invasion, and kept its pledge, there would be no war at all.

Senator Foll:

– Have we reached that state yet?

Senator RAE:

– If honorable senators were not so biased against socialism they would realize that the growth of socialistic principles is all that can weld together the working classes of the different nations in a determination not to fight one another.

Senator Foll:

– Then why has Russia such a huge standing army?

Senator RAE:

– Because the other nations are menacing her very existence.

Senator Foll:

– Why does not Russia set an example to the other nations?

Senator RAE:

– When I reflect on the ferocious utterances even of honorable senators in this chamber, I am forced to the conclusion that for Russia to attempt to set an example to the rest of the world at this stage would be equivalent to inviting other nations to come and cut the throats of her people while they lie on the ground. I repeat that Russia’s sincerity is shown in that on at least three occasions she has proposed that the nations should completely disarm their naval, military and air forces, and has signified her willingness to do so, and to destroy her munitions of war. What greater test of a nation’s sincerity could we have? But the honorable senator, I am sure, will admit that if it would be suicidal for Great Britain to sink its fleet and disband all its army until the other nations on the Continent had done likewise, it would be altruistic madness for Russia to do so, hemmed in as it is by other nations avowedly hostile to it, and certainly hostile to its form of government. There are many who contend that the principles under which Russia is governed cannot exist side by side with contrary principles under which the rest of the world is governed.

Senator Foll:

– The other nations were not hostile until Russia tried to foist its principles on them.

Senator RAE:

– I do not know that it has attempted to do so. The other nations are hostile to Russia in the sense that they proceed on entirely different principles. That is to say, if the new principles involved in the Russian form of government, and Russians present social system, attract the attention and approval of the people of other nations, it manifestly weakens the whole of the governing classes in their respective communities. There must necessarily be feelings of deep hostility between systems on such entirely different bases. It would, therefore, be utter madness for Russia to lay down all its arms until the other nations signified that they were prepared to do the same.

But leaving Russia alone, we have the example of Germany. At Versailles all sorts of penalties were inflicted on Germany in the shape of reparation payments. Among other things, Germany had to limit the size of its army, its air forces, and its navy, and abolish conscription ; but the other nations promised to follow suit. Indeed, that the other nations have done nothing to carry out their promise in that respect has ever since been a matter for constant reproach. At any rate, the majority of them have not done so. England has abolished conscription, but in most of the other countries conscription laws are still in force. I read only the other day that the seven largest powers, including the United States of America and Japan, are annually spending over £14,000,000 more on armaments than they were spending the year before the Great War broke out. Although it was declared to be a war to end war, to make democracy safe, and bring about universal peace, the great nations to-day are better armed than ever before in the history of the world. It is, therefore, quite clear that no large nation can afford to lay down its arms until the others are prepared to do likewise.

When honorable senators on this side give utterance to sentiments that may be entirely hostile to the views expressed or held by other honorable senators, the least the others can do is not to misrepresent us. I do not care how much abuse or vilification I am subjected to, hut I do object to my words being twisted to mean something which I did not say. Yesterday’s discussion hinged on the fact that many of the nations of Europe, even those controlled by the most tory or reactionary governments, have not taken steps to exclude Communists from the right to contest parliamentary seats.

Senator Barnes:

– That has not been done here.

Senator RAE:

– But it is proposed that communism shall be declared an illegal organization. Senator Pearce says that in the other countries the Communists have a milder programme; that they do not advocate extreme measures which would upset the prevailing systems of government if carried into effect. At any rate, I understand from the right honorable senator in conversation that the extreme measures which are said to he proposed by Communists in Australia, are not part of the programme of Continental socialists who are permitted to be candidates for Parliament. The other day I read a translation of a speech delivered by a German Communist in the Reichstag. He was openly advocating the immediate establishment of socialism by the expropriation of the private banks, factories and large businesses of Germany. If that is not contrary to what honorable senators think should be allowed here, I should like to know what it is.

SenatorFoll. - We heard Senator Mooney this afternoon advocating something like that.

Senator RAE:

– I do not wish to go into that subject at this stage beyond saying that I am not one of those who believe that you could stop at taking the private banks. That step alone would not establish socialism. It would be merely a first and very valuable step towards that end; you would have to go a great deal further and institute an organized system to make it effective. But, as I have always contended, it is not a question of whether socialism shall be brought in by peaceful means or by violent means. The question is whether what may, for the sake of convenience, be termed the possessing classes, people who have vested interests in the existing system, will allow it to be brought in by legislative or peaceful means. Judging by the efforts made to suppress freedom of speech even in Australia, I venture to say that the privileged classes will not be prepared to obey any law which vitally affects their material interests. Consequently we have to ask them, if they are not prepared to obey laws which are obnoxious to them, whether they will be prepared to allow a peaceful transition from the present social system to a saner or more human one. Eventually economic circumstances - not any predetermined plan or plot hatched in underground passages, or anything of that sort, nothing of the melodramatic character, but simply economic circumstances - will inevitably force a change. While no one can say exactly how it will come about, clearly world events are rapidly working that way. Just as the snowball gains in momentum as it increases in size, so the evils and inherent contradictions of the present capitalistic system are working up to a climax.

Senator Thompson:

– How can the honorable senator say that such a change will be an improvement?

Senator RAE:

– I am not saying whether it will be an improvement or not; but it seems to me beyond question that it will be. The present system is so unutterably bad, and so unutterably condemned to become worse, that almost any change, provided it is an orderly change will be for the better. I would not hurt an animal or a worm needlessly ; but if a plan or organized system of replacing the existing system is not adopted with the concurrence of those who may be opposed to it, inevitably the trend of circumstances will lead to its adoption by force. It is, therefore, not a question of what we advocate. It is a question of setting out the trend of human events, and the course of social history. Events are manifesting themselves in such a direction that a climax must be reached, when the inherent contradictions of the capitalistic system that cause conflicts between rival groups of imperialistic nations will inevitably reach the point at which civilization will collapse. No one realizes better than I do the value of the great advance civilization has made. But its splendid achievements are in danger of ending in chaos and universal ruin unless the social system is changed from its very basis. Mere production for profit leads to rapacity and the desire to annex each other’s territory ; it leads to all the causes of friction which ultimately bring about warfare. Unless we. are prepared to adopt a system which will prevent the world from going to eternal smash, chaos must result from an obstinate refusal to face the facts. Nothing is to be gained by any of us showing prejudice based on “self-interest. We must be prepared to examine facts and theories in the light cast by writers and speakers upon these problems, and I venture to say that those who do so will agree that even now we are in a state of transition. We are in what I may term a revolutionary era, and on the sound judgment and broadmindedness of the majority of the people will depend whether these changes shall he effected peacefully or whether they shall be inaugurated in ruin and bloodshed.

Senator DUNN:
New South Wales

– I wish to record in Hansard my appreciation of the assistance which was rendered to me to-night by Senator Colebatch. The honorable senator is a remarkable man. During the course of the last two and a half years since I have been an elected member of the Senate for the State of New South Wales-


– T rise to a point of order. I suggest that the honorable senator is transgressing Standing Order 413, which reads as follows : -

No senator shall allude to any debate of the same session upon a question or bill not being then under discussion, nor to any speech made in committee, except by the indulgence of the Senate for personal explanations.

The honorable senator is alluding to. the fact that Senator Colebatch supported him to-night on the motion, “ That the Senate do now divide “, and I submit that he is now alluding to the debate on the question which was then before the Senate.


– Is Senator Dunn alluding to that debate?

Senator DUNN:

– Not in a spirit of impertinence to you, Mr. President, hut as the elected custodian of the Standing Orders of the Senate-


– The honorable senator will please answer my question.

Senator DUNN:

– I have said nothing in relation to that question. I am merely giving Senator Colebatch a character.


– The question I am asking is whether the honorable senator is making an allusion to the debate to which Senator Pearce has referred.

Senator DUNN:

– I am not going to tell a lie. My answer is “ Yes “.


– Then, the honorable senator is out of order.

Senator DUNN:

– I cannot tell a lie: The standing order quoted by the Leader of the Government prevents me from saying what I intended. Our

Standing Orders should go into the political dry dock for overhaul. An honorable senator, having gone to the troubleto prepare matter in support of a motion, such as I submitted this evening, should have at least one hour iu which to state his case.

I wish now to refer to the subject of unemployment relief. When the Scullin Government was in office it made £1,000,000 available at the end of 1930,. and a further £250,000 at the end of 1931, to afford a small measure of Christmas relief to the unfortunate unemployed. These amounts, which I endeavoured to increase, were paid to the State Governments, who distributed them among local governing bodies who used them in providing work. A few days ago I asked the Leader of the Government in the Senate if he would ask Cabinet to make available the sum of £500,000 in order to afford relief at Easter time; but, apparently, nothing will be done. To-day there are no fewer than 500,000 persons out of work in Australia, and; according to the Statistician’s figures, the position is not likely to improve. The Government and its supporters should realize that under the present capitalistic system it will not be long before world finances are in a state of chaos. When an appeal was made to the electors a few months ago, the Government now in office was returned with a -majority in both Houses in the belief that confidence and prosperity would be restored and budgets would be balanced by it. Confidence has not yet been restored, and the only way in which budgets will be balanced by it is by a complete reorganization of public departments, and a further cut in the salaries of public servants. It would appear that the only way in which Britain’s difficulties can he overcome is by a complete change in the present monetary system. That change is likely to occur much sooner than some honorable senators expect. Notwithstanding the belief held by some people in Great Britain that prosperity would be restored if a National Government were returned, the unemployment figures in that country have now reached the staggering total of 3,000,000. In these circumstances it is unreasonable to assume that Great Britain can assist Australia. In travelling through the country one sees flourishing cereal and . fruit crops, well-fed cattle, but starving human beings. The previous Government, in its endeavour to assist the unemployed in the Federal Capital Territory, established what is known as the No. 4 camp. [Quorum formed.’] Some of the men accommodated in that camp had tramped long distances in search of wort. When they reported themselves each week they were supplied with rations by the last Government. To-day they are being sent about their business. The Minister for Home Affairs (Mr. Parkhill) stated in another place that the Government had decided that there was to bc no further issue of rations to the 35 men who vere resting in No. 4 camp. What is the result? Many of these young men, the flower of the manhood of Australia, through no fault of their .own, but as a consequence of a tura of the economic wheel, are forced to tramp the highways and byways in an endeavour to sell all that they possess, their labour.

We have listened in this chamber to quite a number of speeches castigating the Premier of New South “Wales. Only a few hours ago Senator Foll referred to that gentleman as a spieler and a crook, and applied to him many other opprobrious terms. Yet that honorable senator is a resident of Manly, a suburb of Sydney, which is only five or six miles from the chambers in which the Premier of the State conducts the affairs of his government.

Attention called to the state of the Senate. There being no quorum,

The President adjourned the Senate at 0.50 p.m.

Cite as: Australia, Senate, Debates, 3 March 1932, viewed 22 October 2017, <>.