Senate
15 June 1933

13th Parliament · 1st Session

  1. Senate
  2. 13th Parliament
  3. 1933

The President (Senator the Hon. P. J.Lynch) took the chair at 11 a.m., and read prayers.

page 2338

SENATOR THE HON. SIR WALTER MASSY GREENE

Senator Sir GEORGE PEARCE:
Minister for Defence · Western Australia · UAP

[11.1]. - by leave - On this, the first occasion on which the Assistant Treasurer, Senator the Honorable Sir Walter Massy Greene, has taken his place in the Senate since the honour of knighthood was conferred upon him by His Majesty the King, I am sure that I shall be speaking the mind of all honorable senator’s when I tender to Lady Massy Greene and the honorable senator our very hearty congratulations. The honour is a well-deserved recognition of a long period of sterling public service. We trust that both Lady Greene and the honorable senator himself, may long live to enjoy the honour which His Majesty has been pleased to confer upon them.

Senator Sir WALTER GREENE:
Assistant Minister (Treasury) · NEW SOUTH WALES · NAT

[11.8]. - by leave - I thank the Leader of the Government (Senator Pearce) for the manner in which he has referred to the honour which has been conferred on me, and also for his gracious reference to Lady Massy Greene.

Senator DUNN:
New South Wales

– I desire the leave of the Senate to make a statement.

Senator Sir George Pearce:

– It is the usual custom for an honorable senator who seeks leave to make a statement to intimate, as I did a few minutes ago, the subject with which he desires to deal.

The PRESIDENT:

– That is the usual custom.

Senator DUNN:

– by leave - I wish to refer to the conferring of a knighthood upon Senator Sir Walter Massy Greene. In view of the remarks made by the Leader of the Government (Senator Sir George Pearce) it might be thought that I, and my colleague, Senator Rae, approve of the granting of this knighthood. While we bear no personal animosity to Senator Sir Walter Massy Greene, we take this opportunity of expressing our agreement with the opinion of the Labour party of Australia that titles should not be conferred in this manner. We wish it to be understood that we do not attach any value to such title as that which Sir Walter Massy Greene has had conferred upon him.

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QUESTION

WORLD ECONOMIC CONFERENCE

Senator DUNN:

– I ask the Leader of the Government in the Senate whether the Government is prepared, in the name of the people of Australia, to send the following cable to Mr. Ramsay MacDonald, Prime Minister of Great Britain, and Chairman of the World’s Economic Conference, now sitting in London: -

Recognizing the increasing gravity of the unemployment crisis throughout the world and Australia, and in view of the fact that the problem of unemployment cannot be solved under the present monetary system of private banking and credit, we, the Federal Government of Australia, call upon the delegates now in session at the World’s Economic Conference, to fight for the adoption of new economic, financial, and political measures that will help to alleviate the position of the unemployed workers, and that will aim at providing more security of employment to those who are working in industry, and in view of the continuance of the present depression, with the sufferings it involves to the working class, it must be admitted that palliatives are insufficient, and that if the suffering caused by the world’s economic depression and its consequent mass unemployment is to be mitigated, the causes of the depression must be directly attacked.

Senator Sir GEORGE PEARCE:

– As we wish the peoples of the world to have some regard for the sanity of the Australian Government, the answer to the honorable senator’s question is, No.

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QUESTION

QUESTIONS

The PRESIDENT:

– I point out to honorable senators that while they are entitled to ask questions to elicit information on certain subjects, it is undesirable that the notice-paper should be cluttered up with a mass of literary matter. I ask Senator Dunn to condense his questions as much as possible, so that he will not encroach on the rights of other honorable senators in this connexion.

Senator DUNN:

– I shall try to follow your advice, Mr. President. The question which I have just asked related to a cablegram which I desired sent to the World Economic Conference.

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QUESTION

PROTECTION OF NORTH AUSTRALIA WATERS

Senator DUNN:

– I ask the Leader of the Government whether his attention has been drawn to the following press report which appeared in the Sydney Morning Herald of the 14th June: -

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JAPANESE VESSELS

DARWIN, Tuesday. - Allegations are being made that Japanese poachers are using Buchanan Island, near Melville Island, as a resort for evil practices.

It is declared that they are holding aboriginal women, and the police have discovered caches of pearl shell and kerosene on the island. They have been unable to do anything owing to want of time and the absence of a swift patrol launch.

A Darwin trepanger, when fishing off Melville Island, saw a large white lugger inshore. When ho sailed in to make an investigation the strange lugger departed at top speed due north, and refused to answer any signals.

It is impossible to check poaching or slavery until swift patrols have been established in these waters.

Does the Minister intend to take any action in the matter?

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QUESTION

WESTERN AUSTRALIA

Subsidence of Coastline

Senator DUNN:

– I ask the Leader of the Government -

  1. Whether he has read the alarming news of the gradual sinking of the coast line of Western Australia already amounting to over 20 inches?
  2. Whether the causes of this land-slide have been traced to the enormous migration of black swans from all . over the State to the headquarters of the Dominion League, where the vast deposits of their eggs, coupled with the continuous singing of the National Anthem, has disturbed the earth’s equilibrium by the vibrations emanating from that centre?
  3. What steps does the Government intend to take in order to dissolve this Nazi stronghold of political derelicts and boneheads-
Senator E B Johnston:

– I rise to a point of order. Is the honorable senator entitled to. ridicule the National Anthem as he. has done ?

The PRESIDENT:

- Senator Dunn must be aware that his question is quite frivolous and, therefore, out of order.

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STATES GRANTS COMMISSION

Formal Motion for Adjournment

The PRESIDENT (Senator the Hon. P. J. Lynch). - I have received from Senator Johnston an intimation that he desires to move the adjournment of the Senate for the purpose of discussing a definite matter of urgent public importance, namely, “ the appointments made by the Government to the States Grants Commission, and particularly the appointment as chairman of Mr. F. W. Eggleston, of. Melbourne, who had expressed views of a very hostile nature against the finances and administration of the State of Western Australia, and, to quote his words, ‘ the alleged grievances ‘ of that State under federation “.

Four honorable senators having risen in support of the motion,

Senator E B JOHNSTON:
Western Australia

– I move -

That the Senate, at its rising, adjourn till to-morrow at 10 a.m.

The appointment of Mr. F. W. Eggleston as chairman of the States Grants Commission has caused widespread concern in Western Australia. The other gentlemen appointed to the commission are Professor Giblin and Mr. J. Wallace Sandford. The Premier of South Australia,

Mr. Butler, announced some time ago that he intended to suggest at the Premiers Conference in Melbourne that the Premiers of South Australia, Western Australia and Tasmania, and perhaps the other Premiers also, should be consulted before any appointments were made to this commission; but the Commonwealth Government forestalled such action by making the appointments before the Premiers Conference met. I do not. wish adversely to oriticize the appointment of Professor Giblin, who is a highly qualified economist. Professor Giblin knows the case for Tasmania intimately, although I must say that he has prepared a formula for the making of grants-in-aid to the States which does not meet the special conditions of Western Australia. Professor Giblin was a member of the Tasmanian Parliament, and at that time a supporter of Mr. Lyons. He prepared “ the case for Tasmania”, which was submitted to the Public Accounts Committee in 1930 in connexion with an application for financial assistance that was then made by that State to the Commonwealth Government. Mr. Wallace Sandford is a South Australian and, no doubt, the Government has satisfied itself that he is qualified to fill the position to which he is appointed. I assume that he has a full knowledge of the circumstances of South Australia. I think that both Professor Giblin and Mr. Sandford would be fair to the other States. The third appointment, and perhaps the most important, is that of Mr. F. W. Eggleston, of Victoria, as chairman of the commission. During the last six months Mr. Eggleston has been a harsh and hostile critic of the finances and administration of Western Australia. It was said by the Prime Minister (Mr. Lyons) that the Government intended to set up an impartial tribunal - I emphasize the words “ impartial tribunal “ - to consider the grants to be given to the weaker States; but the Government opposed suggestions made, both in this chamber and in another place, that the States concerned should be represented on the commission. Now that the appointments have been made, we find that a South Australian, and an advocate of Tasmania, who is an ex-member of the Parliament of that State, have been selected. No “Western Australian has been chosen ; but a harsh and hostile critic of the financial operations of “Western Australia has been appointed to the position of chairman. “Why is it that Western Australia is always overlooked or ignored, or treated differently from other States that are intimately concerned in matters of this kind ? Omissions such as this convince the majority of Western Australians that their State is the Cinderella of the federal family, and will never receive a fair deal from any federal government.

I have an .article before me that was written by Mr. Eggleston, and published in the Perth Daily News of the 14th December last. It severely criticizes the finances and administration of Western Australia. As my time is limited by the Standing Orders, I should be glad to have the permission of the Senate to have the whole of the article printed in Hansard.

The PRESIDENT:

– What is the extent of the article?

Senator E B JOHNSTON:

– It occupies about one and a half columns of the newspaper. [Leave not granted.) As I am not permitted to put the whole article into Hansard unread, and have not time to read it all, I shall make some extracts from it. In the course of the article, Mr. Eggleston states -

Western Australia is chronically unable to handle her financial problems.

Western Australians have never been able to admit that their financial difficulties are. due in any degree to their own fault.

Much capital has been imported for development of these agricultural areas, yet the current finance was still disordered. The Western Australian will then curse the Commonwealth, and say that it has ruined Western Australia, but, from the point .of view of administrative expense, the federal service mint bear more lightly on huge territory where the taxation is levied according to population, and the flat rates for posts and telegraphs must be a big advantage. When one refines these arguments they all centre in the tariff, and one finds that Western Australia pint’s for more secondary industries protected by its own tariff. It is difficult to be patient with this argument; a tariff in a large area is probably justified, but with 400,000 people, with a lot of development to do, it would be a devastating luxury, and that is what it was before federation. The financial incidence of the tariff failure represented by customs revenue may be unjust to Western Australia, but as her grievances have been cashed by extracting special large grants from the Commonwealth which total £4,500,000, the net burden here can be very little.

It is interesting to note that the Leader of the Senate told us that Western Australia had received only £2,972,890 inspecial grants during the last ten years. Mr. Eggleston’s article continues -

The truth is that a person with a sense of grievance is always a bad financier, and the alleged grievances of Western Australia have led to their toleration of financial methods which cannot be excused. Not only have these methods caused far more loss to Western Australia in the past than the grievances themselves, but they will be a clog in future development.

In referring to the disabilities of Western Australia under federation, which at least three federal tribunals have admitted are greater than those of other States, he calls them “ alleged grievances “. The article, which is biased and untruthful, proceeds -

So Western Australia, instead of joining . the movement to reduce burdens, under the plea of compensation, is always increasing them. Hence the gold bonus which even the doughty Colebatch is unable to refuse.

The truth is that Western Australia has a burden of unliquidated losses dating from the socialistic regime when shipping lines and meatworks, mining batteries and trading enterprises of various kinds, were started, and speedily demonstrated the bankruptcy of the socialistic idea. A great many of these are closed, so dead that they cannot be kept open, but the lost capital still appears in the loan schedule, or in the trust funds, and is not being written off as dead capital should.

The Industries Assistance Board was originally created for the purpose of assisting in an informal way those deserving projects so dear to the politician, but for some years it has become the refuge of bad accounts, and where the dead and no longer profitable hopes of the politician are buried.

I repeat, there is no hope for Western Australia until these things are all cleared up. Nor is there any excuse, for Western Australia has great opportunities, and with all her grievances, has the lightest taxation of all the States.

The real weakness of Western Australian finance is her unreformed loan accounts. I am afraid to make an estimate of the loan capital which has been lost, but it is possibly half. Interest on her loans is £3,208,000, and when sinking fund and exchange are added, the deficiency in earnings is £1,524,964. The schedule is full of items such as “ Mining Development,” “Public Buildings,” “Other” and “ Miscellaneous “ work which should have been debited to income. It is in the Western Australian loan details that the priceless item occurs, “ Entertainment of visiting journalists.” The “ ascertained loss “ on State trading concerns is £1,029,030, and their co*t is £4,583,152. There is no doubt of the solvency of Western Australia. It has as many undeveloped assets as, say, Queensland. But the sense of grievance has led to a toleration of unsound finance which is disturbing, and so far as I can see, there is no resistance to this feeling, not even in the Perth business man.

Senator Foll:

– That article shows that the writer has a good knowledge of the position.

Senator E B JOHNSTON:

– I contend that it conclusively demonstrates his bias against Western Australia. He has pre-judged the State, and now he is put in a position in which he will have to consider its case. The appointment of this biased writer, who has already prejudged the matter of the disabilities of Western Australia under federation, has aroused a storm of protest. I have received from Melbourne a telegram from the Premier of Western Australia, dated the 13th instant, as follows: -

I cannot believe that Commonwealth Government aware that Eggleston had recently expressed such definite and hostile opinions concerning Western Australian difficulties under federation. Such attitude of mind must inevitably prevent his giving impartial consideration to case for our State. Western Australia strongly protests against question being submitted to one who lias already given decision on matter to be investigated by commission - Collier, Premier.

Mr. Collier has the right to speak for Western Australia, and he does so when he says that the people of that State object to the matter being now submitted to one who has already given a decision on the matter to be investigated. Mr. Collier has put our whole objection to Mr. Eggleston in a nutshell, with the wisdom that he always shows when the vital interests of Western Australia are at stake. An extract from the Sun, of the 10th June, contains the following statement by Mr. Latham, the Leader of the Opposition in the Western Australian Parliament : -

The appointment of Mr. F. W. Eggleston, whose public utterances had been hostile to the State, appeared to indicate a Commonwealth policy of antagonizing Western Australia.

I know that the opinion expressed by Mr. Latham is widely held in Western Australia, and there is nobody to blame for it except the Prime Minister himself, because, on the 4th April last, the follow ing statement by the Prime Minister appeared in the West Australian: -

It should be clearly understood that while the Commonwealth Government is prepared to treat with Western Australia, as part of the Commonwealth, and to discuss such ‘matters us a convention and a means of fixing State grants, an entirely different position would arise if there were a vote in favour of secession, and any government or parliament of Western Australia should take any steps to put such a decision into effect. If, unfortunately, such a position should arise, all questions affecting Western Australia would have to be considered from a new point of view, and it would not be possible to treat the State on the same footing as those which continue to recognize their duties to one another and the Commonwealth.

This statement, made on the eve of the secession referendum, is of the nature of a threat, and it speaks for itself.

Socrates said that four qualities belonged to a judge : he should hear courteously, answer wisely, consider soberly, and decide impartially; but we find that Mr. Eggleston did not wait to hear the claim of Western Australia for compensation on account of its disabilities under federation. On his own initiative, he has inquired into that matter, and he has already decided the case against that State. He said that our alleged disabilities are not due to federation, but are our own fault. We have already been judged, and found guilty at his hands. It is clear that the views expressed by Mr. Eggleston do not qualify him to retain the important position of chairman of this commission.

I believe that it was the wish of the Prime Minister (Mr. Lyons) and the Leader of the Senate (Senator Pearce) that this important commission, whose work will be so vital to the interests of the smaller States, should be absolutely impartial, and I have no doubt that the Government was not aware that Mr. Eggleston had expressed these views when they appointed him to the position. Yet, holding that opinion, I say that it is the responsibility of the Government, now that it knows of Mr. Eggleston’s past attitude, to see that we get an impartial commission, as was promised by the Prime Minister. I am sure that the Government did not know that Mr. Eggleston had been a harsh and reckless critic of Western Australian finances and administration; but, in Mie light of the facts that 1 have presented, the appoint ment is shown to be an offensive one to the Government and the people of my State. If Mr. Eggleston accepted his high semi-judicial position without disclosing to the Federal Government the views that he had already expressed in condemnation of “Western Australian finances, such action was indecent and improper, and it should disqualify him from retention of the office. “Western Australia has been denied the impartial representation on the commission which has been afforded to South Australia and Tasmania, and, in lieu of that, we have been given a biased chairman who has pre-judged our case, and cannot approach the subject-matter of the investigation with an open mind. It is for the Government to see that this new federal disability to which Western Australia alone, of the six States, is subject, is removed. The Government should see that its promise to appoint an impartial States Grants Commission, with a chairman who would enjoy -the confidence of all the States concerned, is carried into effect. The protest I have made is endorsed by the Premier and Government of Western Australia, by all political parties and all sections of public opinion in that State, and demands suitable action from the Commonwealth Government.

I have here many other protests against the appointment. I have read those of the Premier and the Leader of the Opposition; now I propose to quote that of Mr. Keenan, K.C., Leader of the Nationalist party in Western Australia -

Mr. N. Keenan said that it seemed somewhat out of place to appoint a gentleman on the commission who had expressed such decided views regarding one of the States chiefly concerned with the effects of federation. Mr. Eggleston, in his published utterances and his public remarks, had placed Western Australia as a mendicant State. The description was quite wrong. Western Australia had been placed in its unfortunate position as a member of the federation by the policy adopted by the more populous and industrialized members. A policy had been enforced which eminently suited these members to the very great detriment of Western Australia, and it was as a protest against this policy and as a claimant for due rights that Western Australia demanded some amelioration.

The Country party of Western Australia telegraphed to me as follows: -

Because Mr. F. W. Eggleston’s published utterance concerning Western Australia dis close so many misconceptions, and are so markedly unfriendly to this State, members of the Country party of Western Australia desire to register the strongest possible protest against that gentleman’s appointment as a member of the recently created State Grants Commission.

The Chamber of Commerce of Western Australia, in a lengthy letter, endorsed the protest in detail, and the Lord Mayor of Perth, Mr. J. T. Franklin, on the 6th of this month, also protested against the inclusion of Mr. Eggleston in the commission. In the Sydney Morning Herald there is published the following protest from Senator Lynch against the appointment : -

Senator Lynch said that Mr. Doney had directed attention to Mr. Eggleston’s published utterances regarding Western Australia. In these utterances, it was thought that he left no doubt as to his unfriendly bearing towards that State. Senator Lynch added that he had forwarded the protest to the Prime Minister, with the comment that if Mr. Eggleston’s published opinion referred to the referendum vote just taken in Western Australia he had clearly rendered himself ineligible for the position of chairman of the commission. No person could do justice to any given cause submitted to him nor to himself if he set out to search for the truth with a lurking prejudice in his mind.

Senator Sir George Pearce:

– Apropos of the protest from Senator Lynch, did Mr. Eggleston comment on the referendum in Western Australia?

Senator E B JOHNSTON:

– No ; but he did something more adverse to Western Australia. He commented on the cause that was to be placed before the commission of which he is now a member. The Sunday Times newspaper states -

States Grants Commission will be a farce if only due to the membership of F. W. Eggleston who visited the west last December, and exhibited bias against this State and its administration, and also the secession movement.

The chairman of the Dominion League of Western Australia, Mr. H. K. Watson, suggested that the Collier Government should boycott the States Grants Commission so long as Mr. Eggleston remained a member of it. He stated -

Mr. Eggleston will be remembered as the gentleman who paid Western Australia the doubtful compliment of a visit in December, and indulged in a vitriolic attack on this State and its administration.

I have here an article by Sir James Mitchell, which fully answers the misstatements of Mr. Eggleston, but I have not time to read it now.

Senator Elliott:

– Are all those protests unsolicited?

Senator E B JOHNSTON:

– Yes. They are all from the public press, with the exception of two telegrams, one of which is from Mr. Collier. The West Australian newspaper, in a leading article, states -

Evidently the Commonwealth Government has not yet realized the sensitiveness of Western Australian opinion towards the federally created disabilities from which this State suffers. The latest evidence of tactlessness, amounting to stupidity, is to be found in the personnel of the Commonwealth Grants Commission . . . Undoubtedly, the Federal Government has blundered, and no doubt there will be a difference of opinion as to whether that blunder reflects a lack of appreciation of Western Australian feeling or lack of regard for it. Whichever it is, the Government has done nothing to mollify the secessionists, and something that will offend many of those who voted on principle for preserving the federation.

It is quite clear that the most important protest of all is that of the Premier of Western Australia, who speaks in the name of that State on behalf of the people.

Senator Collings:

– What are his politics?

Senator E B JOHNSTON:

– He is a member of the Australian Labour Party. Nothing short of the appoint ment of another and impartial chairman will appease this storm of righteous indignation, which will continue to be directed against the Commonwealth Government, so long as it persists in the appointment of this gentleman, to the States Grants Commission.

Senator Sir GEORGE PEARCE (Western Australia) [11.38]. - I do not know exactly what is the object of Senator Johnston in moving this motion. I wonder how many of those whose protest has been organized against this appointment have actually read the article referred to.

Senator E B Johnston:

– Mr. Collier certainly has, because he told me so.

Senator Sir GEORGE PEARCE:

– I am quite certain that some of them did not read the article before making their protest. First of all, the telegram from the president is based, apparently, on his belief that Mr. Eggleston had commented in his article on the recent referendum on secession, whereas the article was written before the referendum was taken. I am also certain that Mr. Keenan had not read the article. I have a copy of the article here, and from beginning to end there is no mention in it of Western Australia as a “mendicant State”, which Mr. Keenan alleges against Mr. Eggleston. Obviously, therefore, some of those who have published their protest did not read the article against which they were protesting. Had they done so, they would possibly have discovered that Mr. Eggleston’s criticism of Western Australian finance was not entirely condemnatory. He gave both praise and blame. Senator Johnston, when quoting from the article, did not read this passage, for instance -

I do not believe that the Western Australian Public Service establishment can stand much cutting down, but the only real reduction in current expenses is in the railways, which has cut from £3,100,000 to £2,100,000, m magnificent achievement for which the management must be congratulated.

Senator E B Johnston:

– No ; because I had not time to read it all.

Senator Sir GEORGE PEARCE:

– What are the facts? Mr. Eggleston is a legal gentleman living in Victoria, who was at one time in the Victorian Parliament, and a Minister in a Victorian Government. After his defeat as a member of the State Parliament, he still retained his interest in public affairs, and he has been a vigorous and searching critic of government finance throughout Australia. One would think to listen to Senator Johnston that Mr.. Eggleston devoted his criticism entirely to Western Australia. That is not so. He has criticized the budget of every government in turn, and, as I shall show presently, his criticism of the Commonwealth Government has been more severe than his criticism of any other government in Australia.

Senator MacDonald:

– Probably with more reason.

Senator Sir GEORGE PEARCE:

-Perhaps so. I do not associate myself with Mr. Eggleston’s criticism, but I have read all the articles he has published on this subject. They have appeared in the chain of evening papers associated with the Melbourne Herald. One might imagine, listening to Senator Johnston, that this was a gratuitous attack on Western Australia as being the only culpable State. The fact is that this gentleman, from a sense of public duty, has been criticizing public budgets and the financial positions of the States quite impartially. I have here an article written by him analysing Commonwealth and State expenditure. Here is an extract from it -

The above figures show that it will be difficult for the States to get back to the 1923-24 level, because their increase is almost entirely accounted for by increases in fixed charges and losses on public services. But the increase in interest paid by the Commonwealth is only £2,500,000, while the total increase in Commonwealth expenditure is £15,000,000: The scope for economy here is, therefore, enormous. Thus the major share of the responsibility lies on the Commonwealth Treasurer. We hear interested rumours from Canberra to the effect that the revenue is so buoyant that it will be hard to justify economies!

That is from the pen of the gentleman who is supposed to be an enemy of the small States, but in that article he places the main responsibility on the Commonwealth, and not on the States. The following quotation is from an article on the Commonwealth budget : -

It will be seen that there has been no real economy or financial reform at all. The real burden of the budget, and the real pressure on State finance, is shown by the fact that direct taxation, apart from customs revenue, has increased from £15,000,000 to £25,000,000, the real burden on the people being far greater owing to the reduced capacity to pay.

Again, he says -

It follows then, that the administrative expenditure of the service is, as a whole, taking one department with another, maintained at the strength which it reached at the height of the boom, and that in strict parlance there has been no real economy at all apart from blue pencil cuts and adventitious savings in war interest.

Further on he states -

The main point, however, is that there is no attempt in this budget at a reduction of administrative expenditure, and this is what tha people are entitled to get, and the Government are under a duty to give.

This is the gentleman whom Senator Johnston regards as a friend of the larger States, and an opponent of the smaller States. I am not associating myself with the criticisms of Mr. Eggleston, but am bringing them forward to show that he has criticized the administration of the finances, not only of Western Australia, but also of the Commonwealth and of the other States. Here is an extract regarding Tasmania which appeared in a series of articles which I read at the time, and from some of which 1 strongly dissented, although I admitted that it was very pungent criticism. I direct the attention of the Senate to Mr. Eggleston’s references to Tasmania, in order to show whether this gentleman is likely to give the smaller States a fair deal. In dealing with the Tasmanian budget, he said -

In the plight of the small States in varying degrees for Tasmania, Western Australia, and South Australia we see the true bearing of the Commonwealth policy. The outward and visible sign or error is that the three States have to receive grants from the Commonwealth. They are rich in resources, and could pay their way with ease if they could adjust their economic structure. But the Commonwealth fiscal and industrial policy, including the Navigation Act, which inflicts a maximum amount of damage with a minimum of fruit, imposes such a burden on the smaller States that the taxpayers of the Commonwealth, who benefit very little at all from the offending policy, have to make up in part for the special disabilities which are inflicted on the marginal and pioneering States. To the extent that Commonwealth policy, by its fiscal and industrial policy, dislocates the economies of these areas, and by its financial extravagance burdens them with taxation out of scale with their capacity, it is inflicting the same damage on the pioneering and marginal industries in the larger States, and thereby in the whole Commonwealth.

A little later he says -

It is small wonder that the representatives of the small States despair of influencing Commonwealth policy and advocate secession.

This is the gentleman whom Senator Johnston regards as an enemy of the less populous States ! I am sorry that Senator J Johnston did not read these articles before he spoke of the subject this morning. They appeared in all the leading newspapers. I do not know whether they were published in the Daily News of Western Australia, but that portion relating to Western Australia was. I know that other articles appeared in the Melbourne Herald, .before the secession campaign in Western Australia was embarked upon. This is what Mr. Eggleston says concerning the Queensland budget -

The chronic nature of Queensland’s financial unsoundness is shown by the fact that, since 1915-16, there have been only five years showing a surplus, none of these over £30,000, and the total accumulated deficit is £7,400,000, of which £3,040,000 is unfunded. The progress of the late deficits is interesting: - In 1929-30, £723,185: 1930-31, £842,044; 1931-32, £2,075,180, and estimated 1932-33, £3,490,000. Nothing could show more clearly that Queensland is simply bowing her head to the financial hurricane, allowing the whole burden to show as a deficit.

Then we come to the South Australian budget, in connexion with which Mr, Eggleston says -

Being a marginal State, South Australia thus suffers more even than Tasmania from Commonwealth fiscal and industrial policy. It may be definitely affirmed that, owing to the cost of the tariff and wages, the possible settlement area of South Australia is diminished by hundreds of thousands of square miles. Every addition to the fiscal burden prescribed by the Commonwealth Parliament, every addition to the basic wage, puts an end to the hopes of some struggling settler, and drives him to the cities to receive unemployment benefits.

Those are the expressions of a gentleman whom Senator Johnston terms a harsh and prejudiced critic. All I can say on that point is that, if, as Senator Johnston says, he is a harsh and prejudiced critic, he certainly distributes his favours, and has not selected Western Australia for particular attention. I read an article written by Mr. Eggleston on Western Australia’s finances, which is mild in comparison with that which he has written on the Commonwealth finances. According to this article, Western Australia should be held up as a paragon of virtue as compared with the Commonwealth.

Senator E B Johnston:

– The right honorable gentleman would not be in favour of AIr. Eggleston conducting an inquiry into the finances of the Commonwealth.

Senator Sir GEORGE PEARCE:

– At the time these articles were written, Mr. Eggleston regarded the subject from the view-point of a critic- He had not the faintest idea that a commission was to be appointed to inquire into the finances of certain States. Mr. Eggleston is a gentleman of judicial temperament, and with a legal training. There is one thing that we can say about a member of the legal profession, and it is that he possesses judicial temperament associated with legal training, and, if he is a man of character - Mr. Eggleston is a man of very high character - we can depend upon him to apply his legal training in deciding a case upon the evidence which comes before him. I am quite sure that Mr. Eggleston will not decide questions which come before the commission on the basis of any preconceived opinions he may have’ formed in the course of his study of Commonwealth and State budgets, which are embodied in the articles he has written from time to time. If the statements he has made in his article on Western Australian finances are incorrect, and cannot be supported by evidence, his legal training and temperament will lead him to reject such preconceived opinions. If Western Australia or any other State which comes to the Commonwealth for assistance can support its case with evidence which will stand investigation, it will get as fair a deal from Mr. Eggleston as from any other member of the commission. The suggestion of Senator Johnston this morning was that there should not be a judicial investigation at all; that there should not be a fair and impartial investigation, but that there should be a packed jury.

Senator E B Johnston:

– Nothing of the kind.

Senator Sir GEORGE PEARCE:

-What is the suggestion? That the appointments to the commission should be condemned because Western Australia has not a direct representative on the commission. He suggests .that the question of grants to certain States should be decided by a commission consisting of one representative of each of the States concerned. Does the honorable senator think that the recommendations made by such a commission should be accepted, and that no one should dare to challenge them? There is nothing to show that the members of this commission are prejudiced against the smaller States. Two members of this commission have throughout their lives been closely associated with the business and economic life of the smaller States. The chairman has shown capacity as a financial critic, and as he has had legal training and possesses a judicial temperament, the commission should be well balanced.

I resent the suggestion of Senator Johnston that this Government is unmindful of the interests of Western Australia. I throw that suggestion back in his teeth. As a representative of Western Australia in this Parliament, I have always fought for a fair deal for the people of Western Australia. As a member of the various governments with which I have been associated, I have done my best for that State, but I have not made that public as a means of gaining votes at election time. There ate some advantages which Western Australia has obtained from the federation, particularly in years gone by, which have been of tremendous value to that State. For instance, there is the transcontinental railway. Certain gentlemen have claimed that they were instrumental in authorizing the construction of that line. I was a member of the Government that took the decisive step for the construction of that railway; but I have never stated so from a political platform in Western Australia in order to secure votes. I was also a member of the government responsible for the appointment of the first royal commission which inquired into the disabilities of Western. Australia, and gave effect, to some of its recommendations. I have never sought votes on those grounds; but I have seen others do so when appealing to the passions and prejudices of the electors. Every one knows that a strong feeling was aroused in Western Australia by the secession referendum and the campaign which preceded it. Of course, it is popular to say that this is an attack upon Western Australia; but where is the proof of it? As I have said, at least two members of the commission have been associated with the interests of the smaller States. One member of the commission, Professor Giblin, has been actively associated in the preparation of a report asking for assistance from the Commonwealth. If there is any ground for an attack upon the Commonwealth Government, I should say that it is because sufficient consideration has not been given to the interests of the larger States, and that the commission consists of a jury in which the smaller States have a preponderance of influence. However, we have sufficient confidence in the integrity, capacity, and character of the two gentlemen who represent the interests of the smaller States to believe that they will decide the claims of the States on the evidence brought before them. The Government does not regard Mr. Wallace Sandford as a representative of South Australia or Professor Giblin as a representative of Tasmania. These two gentlemen have been selected because of their merits - because we believe they will hold the scales fairly between the Commonwealth and the States. I repel the suggestion that anything the Government has done will be injurious to any State. On this question, the States will get even-handed justice. No State has a right to ask for more. If it does, it will be a mendicant State. I refuse to have that term applied to the State which I have the honour to assist in representing in this chamber. I refuse to look upon Western Australia as a mendicant. Western Australia is not coming to the Commonwealth as a mendicant; it asks for justice, and for no more. If it asked for more than justice, it would be a mendicant State. I believe that from a commission such as has been appointed we shall receive justice.

Senator DUNN:
New South Wales

– My colleague, Senator Rae and T rose in support of the motion moved by Senator Johnston, to whom we are politically opposed, because we believe in free speech. It appears that Senator Johnston has a grievance; but, from the remarks of the Leader of the Senate (Senator Pearce), who also represents Western Australia, the honorable senator has a political axe to grind. I do not know whether Comrade Eggleston is a member of the United Australia party, the United Country party, the Australian Labour party, or the Communist party; but certain politicians in Western Australia, tories and others, object to the appointment of Comrade Eggleston as chairman of the States Grants Commission. This i3 the first time during the four years I have been a member of this chamber that I have known Senator Pearce to become so heated over criticism levelled against the Government of which he is a member. I object to the action of ti*s political go-getters and tory politicises cf

Western Australia in using every known method of trickery and chicanery to bolster up the secession movement in that State. Senator Brennan has called Senator Johnston a rebel, but he is worse than that, because although he is a secessionist, at the meetings held in connexion with the secession movement in Western Australia, he joined with others in singing the National Anthem. The high priests of the secession movement - and Senator Johnston is one of them - spoke in the interests of the editor of the Perth Sunday Times. The honorable senator said that according to Socrates, a judge should be sober, but does he think that, if Western Australia were given control of its own customs affairs, beer would taste better coming up than it does going down ? The suggestion of Senator J Johnston that the appointment of Mr. Eggleston as chairman of the Commonwealth Grants Commission is inadvisable is neither more nor less than a vote-catching stunt in the interests of the so-called patriotic politicians of Western Australia. I strongly object to the underground methods adopted by Senator Johnston and his colleagues. Why does not that honorable senator act honestly and tell the people of Western Australia that even if they were granted secession from the Commonwealth, they would still be unable to overcome their economic difficulties? I object to this political dope, which is being used day after day with reference to the sufferings of Western Australia under federation. The disabilities of that State are not common to it alone; they are suffered to a greater or less degree by every other State. I am not much concerned with the secession issue because, in the final analysis, everything depends upon the bread and butter issue. Our main problem is to find employment for our people. Will this country be any better off because of the appointment of this commission? To blazes with the secession movement ! Let us have unification and so place this country upon a sound basis. When Mr. Lang was Premier of New South Wales, and fighting in the interests of the great mass of the people of that State, he did not squeal. He was prepared to fight to the bitter end, and we were prepared to fight with him.

But Senator Johnston and his colleagues in this chamber, and Mr. Gregory and Mr. Prowse in the House of Representatives, have done nothing but squeal about the sufferings of Western Australia. The World Economic Conference is now sitting in London, and we have no knowledge at all of what the Australian delegation is likely to do. Let us get on with the job of unification, and dispense with all the political trickery and chicanery which is being resorted to by Senator Johnston and his colleagues.

Senator Sir HARRY LAWSON (Victoria) [12.8]. - After the avalanche of words that we have heard, it is somewhat difficult to discover the real points in this discussion. We are not called upon to decide the question of the disabilities of the smaller States, or to discuss the question of secession. This Parliament has made a gesture of goodwill to Western Australia in particular, and to the smaller States in general by appointing a States Grants Commission to investigate their case and to report to the Government as to what is justly due to them. The appointment of the chairman of that commission has been questioned, and Senator Johnston has moved the adjournment of the Senate in order to state that, in the opinion of himself and others representing the views of Western Australia, the appointment is inadvisable, and that the appointee, Mr. Eggleston, has pre-judged the case. As one who has had close personal and political association with Mr. Eggleston, I wish to say a few words as to what ! know about that gentleman, and his qualifications for this particular appointment. The Ministry is to be congratulated upon the fact that he has been willing to undertake this arduous task. The remuneration attached to the office is not attractive, and, therefore, has not been the motive which has impelled Mr. Eggleston to accept this obligation. He has accepted it absolutely in a spirit of public service, and because he feels that the work which it entails is along the lines of his own inquiry and research for several years past. He was a member of the Victorian Parliament, and represented the constituency of St. Kilda. He quickly brought himself under the notice of the Legislative Assembly, and finally became Minister in a Government which I had the honour to lead. During my association with him in the Victorian Parliament, and particularly as a colleague, I had peculiar opportunities to judge his capacity and judicial temperament. He is a man who has been trained as a lawyer, was a Supreme Court prizeman, and won academic distinction at his university. He became Assistant Treasurer, and, subsequently, in a later Government, was Attorney-General, Minister of Railways, and Minister in charge of electric undertakings. He was also a member of the Cabinet subcommittee which investigated finance and the administration of all Victorian Government departments. That committee presented a report containing a searching analysis of the financial operations of those departments, and I think it was that which give him his penchant and flair for public finance. He has written a book on the life of the Honorable George Swinburne which, in addition to being a biographical sketch of that great public man, is, in a way, a history of Victorian politics for the whole period during which George Swinburne was a member of the Legislative Assembly. Mr. Eggleston has also written another book entitled State Socialism in Victoria which has - whether honorable senators will agree with his conclusions or not - won for him high praise from leading economists who have pronounced judgment on the value of his work. The book contains a judicial and searching analysis of the operations of State undertakings and government departments in Victoria, and if honorable senators will take the trouble toread it, they will soon ascertain that the author, while he is not afraid to express his opinions no matter whom he may offend, is a man of intelligent mind and judicial outlook who endeavours to make his findings on the facts and evidence as presented to him. I assure Senator Johnston that, in spite of the article to which he has referred - and it is on that article alone that his judgment has been pronounced - Mr. Eggleston is of such quality of character, and of such integrity and public spirit, that there is no doubt in my mind that he will find according to the evidence presented to him. He will not pre-judge the case. We have known of men who have been appointed as arbitrators who, before their their appointment, held certain views, but after their appointment, dismissed those views from their consideration. Once a man assumes the role of judge, he, like jurymen, dismisses from his mind any preconceived notions which he has gained from reading the press, or from what he has heard of the subject upon which he is called upon to give judgment. In this case we have a man of high attainments and great literary gifts, with a legal training and a judicial outlook, who is charged with the onerous public duty of making this investigation and presenting to the Government a report according to the evidence. It is most unfortunate that this attack should have been made, and that certain sections in Western Australia should have prejudged the matter.

Senator E B Johnston:

– Mycharge is based on the fact that Mr. Eggleston has done the pre-judging.

Senator Sir HARRY LAWSON:

– It is obvious to me that Senator Johnston does not know the calibre of Mr. Eggleston, or his qualifications for this particular investigation.

Senator E B Johnston:

– I have never seen him, but I have read his writings on the subject.

Senator Sir HARRY LAWSON.Without having any interest to serve, I may tell Senator Johnston something of what I know of the man and his work, his quality and character. I ask the honorable senator to satisfy himself that here is a man with a sound and independent judgment, and then to tell his electors in the West that, after all, these criticisms have been based on imperfect information and a partial statement of the facts. Now that the full knowledge of the man’s life work and judicial temperament have become known to him, I hope that the honorable senator will take the responsibility of saying, “There has been a mistake. I now find that we have got a man of outstanding ability, animated by an outstanding public spirit, who possesses all of the essential qualifications for research and an investigation of this kind “.

Although there may be differences of opinion as to the method employed, and whether commissions are fruitful of any good results, it is generally agreed that the appointment of the States Grants Commission is a gesture of goodwill from this Parliament to certain States, in particular, Western Australia. They are asked to accept it as such, and as an indication of the desire of this Parliament to have the case for the States decided according to the facts, and of its endeavour to find out what are the radical and principal causes of the disabilities under which those States suffer, and to arrive at the proper remedy. It is unfortunate that, at the outset of such an investigation, an attack should have been made upon the man who has been appointed to guide the commission in its deliberations, one who is well qualified for the work, and from whom all sections can expect a fair deal, and justice according to the evidence submitted.

Senator O’HALLORAN:
South Australia

– I have listened to the argument that was propounded by Senator Johnston in support of his charge that there is a fear that the Chairman of the States Grants Commission, Mr. Eggleston, will not view in a strictly impartial spirit the claims of Western Australia for assistance. I have also listened to the defence of the Government’s action by the Leader of the Government in the Senate (Senator Pearce), and to the personal defence of Mr. Eggleston that has been made by his ex-colleague, SenatorLawson. I confess that I do not think that Senator Johnston has made out a strong case in support of the charges which he levelled against Mr. Eggleston. Personally, 1 know nothing of this gentleman other than what I have read in the press since this controversy has begun, and what I have heard in this chamber to-day. As no complaint has been lodged by the Government of South Australia, I presume that Mr. Eggleston’s appointment is giving satisfaction to the Premier of the State which I represent, and which, by the way, will have its. ease adjudged by this tribunal in the same way as will Western Australia.

At the same time, I desire to register some objections to the action of the Government, based on entirely different premises from thoseused by Senator Johnston. In handling this matter the Government has displayed the vacillating attitude that has characterized its actions in connexion with every other important matter with which it has been entrusted, with the result that much criticism has been levelled against it. The desirability of the appointment of a permanent body to inquire into the disabilities of the smaller States was exhaustively investigated by the Commonwealth Public Accounts Committee, of which I was a member during the period that that body inquired into the disabilities of Tasmania and South Australia under federation. That committee was also charged with an investigation into the disabilities suffered by Western Australia, but circumstances intervened which prevented the inquiry being made. After giving the problem mature consideration the Public Accounts Committee came to the conclusion that, while federation exists in its present form, there is a strong probability that the Commonwealth will have to grant assistance to certain States, and that difficulties will continually arise in assessing the amount of that relief unless a permanent and impartial tribunal is created to investigate these disabilities and assess the amount to which the State concerned is reasonably entitled to receive from Commonwealth revenues.

In its report on the disabilities of Tasmania the committee strongly recommended the creation of such a body, and it repeated that recommendation when reporting on the position of South Australia. This Government professes to be strongly in favour of accepting the advice of the advisory bodies which it appoints, such as the Tariff Board, and it was expected that on this occasion it would stick to the colours that it has nailed to the mast. I am surprised, therefore, that it has not taken the advice that was tendered to it by a responsible body such as the Public Accounts Committee. Had it done so, it would have obviated the criticism that is now levelled at it in connexion with the appointment of Mr. Eggleston.

After strongly recommending the appointment of a permanent body for the purpose, the Public Accounts Committee gave consideration to the wisdom of advising the Government as to the personnel of such a body, and came to the conclusion that, because of the peculiar circumstances in which it was placed as the investigator of the case from the point of view of the Commonwealth and the State concerned, it was justified in suggesting to the Government how the permanent body which it recommended should be constituted. It stated its opinion in these words -

The committee is of opinion that the permanent body suggested should be composed of a representative of the Commonwealth Treasury with a close knowledge of Commonwealth and State finance, the Director of Development, and a qualified economist, who should be attached to the office of the Commonwealth Statistician.

Two of those gentlemen were at the time employed in the Commonwealth Service. The Director of Development, as is well known, is Mr. J. Gunn, who has had a most extensive experience in the State Parliament of South Australia, filling, among other positions, those of Premier and Treasurer of that State. Mr. Gunn has also had a comprehensive experience in connexion with the developmental activities of Australia, acquired first as a member of the Development and Migration Commission, and then as the Commonwealth Director of Development. Another matter which influenced the committee in making its recommendation was that efficiency could be secured at a minimum cost to the taxpayer. “When suggesting a trained economist, the committee had in mind the very gentleman whom this Government has appointed, Professor Giblin, for, of all the economists and other learned gentlemen who gave evidence before it, he was the outstanding personality, and I am quite prepared to trust the destiny of my State to his judgment. However, because it did not wish to embarrass the learned professor, the committee did not mention his name. The following is also taken from its report : -

The committee also holds the strong view that, in the investigation of any State’s claim for financial assistance, a treasury officer from the State concerned should be temporarily attached to the proposed body during the course of the proposed inquiry.

That would have been a desirable action for the Government to take, for it would have given the State concerned an opportunity ensuring, inexpensively, that its case was being properly considered by the investigating body. It would also have created a feeling of satisfaction among the smaller States, which are vitally concerned, and have done much to break down the anti-federal spirit which is being fostered in the smaller States for political purposes. I have no sympathy with those in this Parliament or in any State legislature who foster that antifederal spirit for political purposes. It cannot be beneficial to the Australian nation, however much it might help to keep those concerned in Parliament.

Senator E B Johnston:

– What does the honorable senator think of the view of Mr. Collier on the subject?

Senator O’HALLORAN:

– My opinion is not tempered by the calibre of the person whom I am criticizing. In Western Australia the bigger issues which should be determined at election time - the question of which policy is right or wrong to bring about the development of the State in the interests of the majority of its people - is being clouded by the discordant propaganda that has been introduced by Senator Johnston and his colleagues for political purposes, and which, in some respects, members of my party have not been strong enough to resist. I do claim that, to a considerable extent, the Labour party in Western Australia has resisted this political propaganda, and has shown a sanity which is strongly absent from the incursions into the matter of Senator Johnston and those who are associated with him in the western State.

Earlier in my speech, I said that the Government has been guilty of a vacillating attitude in connexion with this and other matters. Instead of acting on the specific recommendation of a competent advisory body, which had investigated the problems of the needy States, the Government introduced a bill to create a commission of five members. When, however, that measure was subjected to hostile criticism in another place, the Prime Minister (Mr. Lyons) agreed to reduce the number of members to three. Evidently the Government had not a firm mind on the subject. I wonder what will happen when the commission’s report is presented to the Government; for the Government has said that it will have the final say in this matter, irrespective of any recommendation which the commission may make. That is not right, if the commission is an impartial body - and we have the testimony of Senator Pearce and Senator Lawson regarding the calibre of the chairman of the commission - its report should be valuable, and it should be followed by the Government. Why is the Government afraid to say that it will accept the recommendations of the commission? Should it veto those recommendations, it will probably cause further dissatisfaction in the States concerned.

The quotations from some remarks of Mr. Eggleston concerning the conditions of certain States, which the Leader of the Government (Senator Pearce) presented to the Senate this morning, raised some doubt in my mind regarding the qualifications of Mr. Eggleston for the position of chairman of this commission. Mr. Eggleston’s criticisms of the budgets of South Australia, Tasmania, Western Australia, and the Com”monwealth, and of conditions generally in South Australia and Tasmania, contain a number of allusions to wages and conditions in industry, as well as to Australia’s fiscal and industrial policy, and the effect of the Navigation Act.

The PRESIDENT:

– The honorable senator has exhausted his time.

Senator ELLIOTT:
Victoria

– As I listened with interest to the remarks of Senator E. B. Johnston, when moving the motion now before the Senate, I was forced to the conclusion that Western Australia must have an extremely weak case if it is so essential for the commission to have an unbiased chairman.

Senator Sampson:

– Does he want a biased chairman?

Senator ELLIOTT:

– The honorable senator indicated that he was perfectly satisfied with the outlook of the other two members of the commission, but doubted the fitness of Mr. Eggleston for the position of chairman, because that gentleman had dared to suggest that something was wrong with Western Australia. I found it difficult also to reconcile the protests read by the honorable senator with his answer to an interjection inquiring whether those protests were unsolicited.

Senator E B Johnston:

– Most of them were press comments.

Senator ELLIOTT:

– I know Mr. Eggleston. ; at various times I have acted with him on a number of committees, and I should like to associate myself with the remarks of the Leader of the Senate (Senator Pearce) and Senator Lawson regarding his fitness for the position of chairman of a commission such as that now under discussion. His appointment will add strength to the commission and weight to its conclusions, and the Commonwealth is to be congratulated on having such a man as chairman of the commission.

Senator RAE:
New South Wales

– I listened with a great deal of interest, and some astonishment, to the heated reply by the Leader of the Senate (Senator Pearce) to the criticism of the Government for having appointed Mr. Eggleston as chairman of the commission which is to inquire into the disabilities of the States. I was also astonished at Senator Lawson’s statement that Mr. Eggleston is a political paragon, who approaches more nearly to perfection than any other politician of whom I have heard. What a pity that he is not the Premier of that much afflicted State from which Senator Lawson comes !

Although the subject of secession is not now before the Senate, it has been mentioned by the Prime Minister himself in connexion with the appointment of this commission. The Prime Minister said that, in the event of the referendum vote favouring secession, Western Australia would be treated on an entirely different basis from what would otherwise be the case. That most unjustified threat detracted from the value of the proposed commission. What can be the value of such a body if, before its appointment, the Prime Minister has announced that the case for Western Australia will be dealt with on an entirely different basis from that of the other necessitous States?

Senator Sir George Pearce:

– The honorable senator is reading into the Prime Minister’s statement something which is not there.

SenatorRAE. - The West Australian of the 4th April, 1933. contains a report of a meeting held at Adelaide, the previous evening at which Mr. Lyons is reported to have said -

It should be clearly understood that, while the Commonwealth Government is prepared to treat with Western Australia as part of the Commonwealth, and to discuss such matters as a convention as a means offixing State grants, an entirely different position would arise if they were to vote in favour of secession, and any government or parliament of Western Australia should take any steps to put such a decision into effect. If, unfortunately, such a position should arise, all questions affecting Western Australia would have to be considered from a new point of view, and it would not be possible to treat the State on the same footing as those which continued to recognize their duties to one another and the Commonwealth.

Senator Sir George Pearce:

– That was a threat only in the event of the Parliament or the Government of Western Australia acting on the vote.

Senator E B Johnston:

– Mr. Collier, the Premier of Western Australia, has announced that he will act on the vote.

SenatorRAE. - Had the Prime Minister said to Western Australia : “ If you vote for secession and intend to put the vote into effect, the Commonwealth will not treat with you at all “, he would have been more logical.

Senator Sir George Pearce:

– He did not say that.

Senator RAE:
NEW SOUTH WALES · ALP; LANG LAB from 1931

– No; but that is what he ought to have said. The Government should have adopted the attitude which nations adopt when they are deeply offended - it should have severed diplomatic relations with Western Australia. If the Government regarded a vote in favour of secession as something equivalent to treason to the Commonwealth, the logical thing would have been to refuse any longer to have dealings with that State. The only right footing is an impartial investigation. There was a veiled -threat that Western Australia would not receive impartial treatment if the people of that State dared to carry the secession vote.

Senator Sir George Pearce:

– The Prime Minister did not say that.

SenatorRAE. - That is the only inferencewhich can be drawn from the right honorable gentleman’s statement.

Senator Sir George Pearce:

– The Prime Minister said that certain things would be different if the Parliament and the Government of Western Australia attempted to give effect to an affirmative vote.

Senator E B Johnston:

– He said that things would be different if steps were taken to give effect to the decision.

SenatorRAE.- The Premier of Western Australia has stated that he intends to take steps to give effect to the decision.

Senator Sampson:

– I think he said. “Don’t wake the dead”.

SenatorRAE. - The fact remains that the method which the State Premier proposes to adopt is perfectly legal.

Senator McLachlan:

– What method?

SenatorRAE. - He means to appeal to the Imperial Government. I am not greatly concerned with questions of loyalty or of constitutionality, from a merely technical point of view; but, technically, there is nothing treasonable in Western Australia desiring to dissolve partnership with the rest of the Commonwealth. That State does not propose to use armed force, or to resort to violence, or even passive resistance or the boycott; it intends to appeal to the Imperial Government. The very act which constituted the federation is an act of the Imperial Parliament.

Sitting suspended from 12.45 to 2.15 p.m.

SenatorRAE. - It is quite illogical to argue that the attitude of the Commonwealth Government to the Government of Western Australia would be influenced adversely if the State Government attempted to give effect to the recent vote in favour of secession. If the State is entitled to absolutely impartial treatment, theway should still be open for conciliation. Under no circumstances whatever should it receive more or less than justice from the Commonwealth Government; because to be more than just to one means that the Commonwealth must, to that extent, be unjust to some other State.

I am not one of those who attach very great importance to the secession movement in Western Australia. I happened to be a member of the New South Wales Parliament when the first draft of the constitution convention was under consideration, and I then openly stated that

I did not believe in an indissoluble compact, believing that the best guarantee for solidarity in Australia was the absolute freedom of the several colonies, as they were then called, to adopt the course which, in their opinion, would be the best in their own interests. I venture now to predict that if “Western Australia does actually secede, it will not be very many years before she will make overtures to the Commonwealth to return to the federal union. This freedom of action is the best guarantee we could have that the several States will remain in the federation. I object to compulsion whenever it can be avoided, and, therefore, would offer no opposition to the movement for secession provided the seceding State was prepared to accept its share of any obligations incurred while it was within the federation. Our geographical position requires the several States to be linked by natural ties in a federation. No man-made ties can last for ever.

Senator Johnston has a perfect right to complain of the bias which is implied, at all events, in that portion of Mr. Eggleston’s article which he read, and it is not fair to accuse him of having selected only certain parts; because time did not permit him to read the whole of it. On the other hand, Senator Johnston deserved the rebuke of the Leader of the Senate that he is making a political stunt out of this movement for secession. Whatever may be the disabilities of Western Australia under federation, to simply excite the people generally about them is an unworthy exercise of political power. So, to my mind, is the continued exploitation of the sentiment of so-called loyalty. This morning, my colleague, Senator Dunn, was told that his references to a certain matter, in the course of which he questioned the propriety of the National Anthem, were objectionable, and could not be allowed. Is it not more objectionable for people simply to exploit the sentiment of loyalty, to indulge in Empire flag waving, and the singing of the National Anthem merely for political purposes? Senator Johnston himself cannot be absolved of this charge, because yesterday morning he was at pains to tell the Senate than an organization to which he belongs is so loyal that its members sing the

National Anthem at least once at every meeting.

Senator E B Johnston:

– I alluded to that fact merely to rebut the charge of disloyalty made against me by one honorable senator.

Senator RAE:

– I am well aware that the honorable senator wished to disprove the charge that, because he had taken a prominent part in the movement for secession, he was a rebel. Nevertheless, it appears to me that mere lip service and the singing of the National Anthem, or the practice of flag waving on every conceivable opportunity, does not necessarily denote loyalty, if there is such a thing. Loyalty has been defined as “ faithfulness to a principle.” If any person is faithful to a principle, and is prepared to accept the consequences of his faithfulness, whether or not I agree with the principle itself I freely acknowledge that the person holding fast to such a principle is absolutely loyal, though, in the eyes of other people, he may be neither hero nor saint. Consequently, it is fudge and nonsense to declare that the singing of the National Anthem or the waving of the nation’s flag is proof of the virtue of patriotism.

I merely wish to add, as regards this matter, that the observation of the Queen of Denmark, “ The lady doth protest too much, methinks,” might well be applied to those who are always talking about their loyalty. During the war we had many evidences of the lip-service loyalty of those who took very good care not to expose themselves to danger, but made tons of money out of the sacrifices of other people. They brought this loyalty business down to such a level as to merit the condemnation of all decent citizens; so the less I hear of it in the speeches of public men the more respect I have for those who keep reference to it out of their public utterances.

It is most unfortunate that Mr. Eggleston should have expressed his views concerning certain of the States so forcibly, thereby laying himself open to the charge of being biased, even though he has not so offended since the passage of the bill under which he has received his appointment. I cannot help thinking that the Government has done something to merit criticism by refusing the very reasonable proposal made by some of its own supporters, Senator Duncan-Hughes among the number, that each of the States should be represented on the commission, with an independent chairman, representing the Commonwealth, to preside over their deliberations. Had that course been adopted, while it might not have saved the commission from the charge of being biased, it would, at all events, have been true to say that it was a well-balanced body, and that any bias in favour of the small States which it might show would be counteracted, to some extent, by the detached judgment of the Commonwealth representative. However, the Government decided otherwise, and it seems to me that the probable effect will be that when the first report of the commission is presented, unless it is particularly favorable to the small States, those people who now criticize the commission will point to its conclusions as ample proof of their belief that the small States could expect nothing better. The worst thing that can happen to any commission of a judicial or semi-judicial character is for its impartiality to be questioned before it begins its work. Whatever its finding may be, it will be more or less prejudiced by antecedent criticism. L, therefore, regret the necessity for introducing this subject in the Senate, and think that it would be a good idea if the gentleman whose impartiality has been challenged, voluntarily retired from the position to which he has been appointed rather than allow any report which may emanate from the commission over which he presides to be discounted by charges that have been levelled against him.

Senator CARROLL:
Western Australia

– My contribution to this debate will be brief, and, I hope, temperate. I very much regret the warmth that ha3 been imported into the discussion, and regret also that extraneous matters have been introduced in a very loose manner. I accept, without the least hesitation, the statements that have been made about Mr. Eggleston’s character and attainments, and I have no desire to impute to him anything to his disadvantage; but I am sorry that, prior to his appointment to the commission, he took upon himself, rightly or wrongly, the role of critic of the expenditures of State

Governments, for I noticed throughout the whole of his criticism, evidence of a pedantic and schoolmasterly touch, the implication being that the whole regiment was out of step, “ except my boy, Johnny.” I do not resent his criticism of the financial administration of the several States - as a private citizen of the Commonwealth he is entitled to express his opinion - but it will be difficult for him to reconcile the views of E. W. Eggleston, the private citizen, with the views of E. W. Eggleston, chairman of the States Grants Commission. If he had simply criticized the expenditure of all State governments I should have found no fault with him; but he went further, and stated definitely that the position of Western Australia was due to its own faulty finance administration. Had he left out that portion of the written statement I would say that he was entitled to his opinion.

Senator Foll:

– But is the statement correct?

Senator CARROLL:

– The honorable senator is one of those very innocent persons that one meets about once only in a lifetime! Every authority that has investigated the position of the smaller States has admitted, with the utmost frankness, that some, at least, of their disabilities are due to the federal policy that has had the approval of the majority of the people of Australia. No unbiased critic will deny that federal policy has benefited some States to the disadvantage of other States. No sane person will affirm that any government in Australia, or, for that matter, any government in the world has not, at times, done foolish things, and has wasted public money on uneconomic ventures. It can, however, be said for Australian governments that there was some excuse for their misguided policy. Every one knows that no government can retain office without the support of a certain number of members of Parliament. Also that it is customary for members to rise in their places and condemn a government for what they term its extravagance and wasteful expenditure of public money, declaring that economy must be the watchword, and subsequently to appeal to Ministers, with crocodile tears running down their cheeks, telling him that he must spend a bit more money in their constituency, or they will be “ shot “ at the next election. Behind these members are their constituents who say, in so many words, “ This’ dud ‘ representative of ours is not getting a pound out of the Government for expenditure in our constituency, and Brown, the fellow representing our neighbouring district, is getting thousands of pounds. We must ‘ out ‘ our man at the next election.” All honorable senators know that what I am saying is not an exaggeration of the situation of Ministers and members. Practically every government in Australia, to avoid defeat in Parliament or in the constituencies, has been compelled to spend money which it knew should not be spent, and that, subsequently, its supporters would condemn it for having spent that money. I appreciate the fine eulogy of Mr. Eggleston that has been voiced by Senator Lawson. It is rather pleasing to hear one public man speak well of another with whom he has been associated over a long period. The practice of “ tearing one another to pieces “ is far too common. But, I do not hold the view that a man who has expressed opinions in a given direction can divest himself of them, and, as it were, divide himself into watertight compartments, entirely forgetting, as a royal commissioner, what he has said as a private citizen. There is probably not one legal gentleman in this chamber, and few outside it, who have not objected to a particular judge trying a case, on the ground that he had previously expressed opinions which, in their view, indicated the existence of bias. That has occurred over and over again. Only last week such a case was reported fromSydney. I have even known judges, without being requested by the bar, to make the public statement that, because of previous circumstances, they wished to be relieved of the duty of trying certain cases. Therefore, the request that this principle should apply in the present case does not involve the suggestion of anything dishonest or dishonorable in Mr. Eggleston. That gentleman hasfreely expressed his opinion; he has definitely stated that the Western Australian Government has muddled its own finances, and has fallen back on the excuse that their condition is due entirely to Commonwealth aggression.

In reply to Senator Foll, I say quite frankly that Western Australia is not a greater sinner in that respect than any other State. It cannot be denied that unbiased commissions and committees, as well as the Tariff Board, have stated that disabilities exist in Western Australia, and that they are due to federal policy.

Senator Sir George Pearce:

– That statement was made by Mr. Eggleston in his article on the Commonwealth.

Senator CARROLL:

– I was not aware of the existence of these articles until I read them yesterday, nor did I know, until the Leader of the Government (Senator Pearce) informed the Senate of the fact this morning, that the article on Western Australia is one of a general series. That, however, to my mind, rather strengthens the case that Senator Johnston has attempted to make, because it establishes beyond doubt what I have already contended, that Mr. Eggleston is a self-appointed general critic of governments throughout Australia. According to the evidence that he has adduced, they have done very little that is right, and a great deal that is wrong. I honestly hold the view that, having expressed such decided opinions, it would be extremely difficult for him to divest himself of preconceived ideas, and to give an unbiased judgment. No matter in what position a person may be placed, it is always difficult to prevent his political views from obtruding themselves when a favorable occasion arises. Although I do not believe that there is anything venomous in Mr. Eggleston’s attacks on Western Australia, in view of the evidence that he has been a very strong critic of State government finance, and would, therefore, experience extreme difficulty in giving a calm and judicial finding, I support the motion moved by Senator Johnston.

Senator DOOLEY:
New South Wales

– I should not have risen but for the conflicting evidence that has been submitted by the two parties to this controversy. I agree with the Leader of the Government in the Senate (Senator Pearce) that Senator Johnston had not read the articles which the right honorable gentleman quoted, giving the opinions of Mr. Eggleston concerning the fiscal and industrial policy that should be followed. They would have influenced the honorable senator in a different direction, because, according to my interpretation, the views expressed by Mr. Eggleston are in conformity with the policy of the Country party. He holds the view that what is wrong with the smaller States is that in them the wages paid aTe too high, and the burdens placed on industry are too great, because of Arbitration Court awards, workmen’s compensation, other industrial legislation, and the fiscal policy of the Commonwealth Government. There is no question that he applies that to Western Australia. I should welcome the appointment of Mr. Eggleston if it were in accordance with the principles enunciated by Senator Lawson. The honorable senator has an open mind, and honestly believes that the appointment was made without any consideration of what the ultimate result might be. I feel, however, that I can predict the decision of the commission. It will decide that the barriers to which I have referred should be removed, so that industries in the smaller States may have an opportunity to work out their own destiny in their own way. I hold , that, if the conditions of the workers and the primary producers are to be dealt with, they are at least entitled to representation on the commission. I am afraid that some persons have a one-track mind on this matter. If my prediction should prove correct, the result will accord with the ideas of Senator Johnston. But if, on the other hand, the appointment has been made for some other purpose, I am at a loss to know what ground he has for complaint, except that of the case being prejudged. I claim that it is prejudged in an entirely different direction; that the mind of Mr. Eggleston travels along the track of reduction, of making it possible for industry to pay, by lifting the burdens to which I have referred. If he has been appointed merely because his views coincide with those of the Government, we shall get nowhere. The chairman of a board of this character must have an open mind. Yesterday, Senator Brennan would not accept an authority quoted by Senator Collings, because he is an avowed socialist.

Senator Brennan:

– I did not say that.

Senator DOOLEY:

– The honorable senator’s words conveyed no other mean ing to me. I should be sorry to think that the honorable senator has such a narrow mind. But there are in the community many persons who are not prepared to decide questions on their merits. My hope is that the conditions of the people will be bettered, rather than lowered still further. I have no personal knowledge of Mr. Eggleston. I have read some of his statements, and agree that they are sound and logical ; but his viewpoint is different from mine. If the Government has appointed him because of his political beliefs, no blame can attach to a future Labour Government if it places in responsible positions men of its own faith.

Senator Brennan:

– It has done so.

Senator DOOLEY:

– It has not. The reverse has been the case. Labour Governments have appointed men without taint.

Senator Sir George Pearce:

– Professor Giblin was a Labour member in Tasmania.

Senator DOOLEY:

– He may have been. The right honorable gentleman, and Senator Reid who sits behind him, also were Labour members at one time. I challenge Government supporters to point to any case in which an appointment has been made of an avowedly out-and-out Labourite. I could mention the names of able men who are associated, with the great Australian Workers Union in South Australia and Western Australia, who are perhaps just as capable as a member of the legal profession of dealing with this question. They have a perfect right to be considered when appointments of this character are to be made, because living conditions have to be taken into account in arriving at a determination.

Senator BRENNAN:
Victoria

– The logical conclusion of the arguments advanced against the appointment of Mr. Eggleston is that the Government should have searched Australia for a man with a blank mind. I venture to submit that it would be very hard to find a man who, at the same time, had a blank mind and was capable of the sound leadership of this commission. I do not often find myself in agreement with Senator Collings; but I agree with him that the mere fact that Mr. Eggleston lias shown an interest in these matters ought not to be a disqualification, but ought rather to be a mark of his qualifications for the position. There is one aspect that I desire to put as a member of the legal profession. I premise it by stating that I do not claim any special virtues for the legal profession, but that profession, like every other, has its own traditions. One tradition in which every member of the legal profession grows up - because every member of it has his eye on the Lord Chancellorship, or its equivalent in this country - is that he must distinguish between his private views and matters of fact which have to be decided on evidence. Here is a matter which has to be decided, not according to the private views of the members of the commission, but by their capacity to sift the evidence that is put before the commission.

Many years ago I remember that the question arose in Melbourne whether one of the learned judges of the High Court, who now occupies the most exalted position in this country, should sit to hear a case that involved the validity of an act which lie himself had piloted through the Parliament while he was AttorneyGeneral. When it was intimated thai, that question would be raised by one of the parties, it was brought before the learned judge in advance, and he said that he felt himself quite capable of deciding the matter which the court would have to decide without paying the slightest regard to the views which he might have previously expressed in the Parliament. Those who raised the point accepted the undertaking of the judge that he would shut out from his mind anything that he had previously said or thought about the matter, and decide ii according to the arguments submitted to him, and withdrew their opposition to his participation in the case. There is no member of the legal profession who believes that that learned judge did other than decide the matter quite free from bias.

I have listened with interest to the high eulogy of Mr. Eggleston by Senator Lawson, and I endorse what he said. Mr. Eggleston would not have accepted thi3 position had he felt himself incapable of judicially deciding the matters that would be brought before him. Those who are cavilling at this appointment should bear that in mind.

Senator Rae:

– There is also the question of the confidence of others in hi? judgment.

Senator BRENNAN:

– That is a consideration that is not without weight. It has been said that a principle which is accepted in relation to courts is that it is not enough that a person is, in fact, above suspicion; he must also be thought to be above suspicion. But when we are dealing with a case of this sort, which has to be decided ultimately by such learned bodies of persons as are to be found in the various parliaments throughout Australia, I do not think that that consideration need be given the same weight.

There is one other point to be remembered. If some other person were chosen as chairman of this commission in place of Mr. Eggleston, it might not be possible to unearth any contributions that he had made to the newspaper press which revealed his views on the subjects to be dealt with ; but he might hold views even stronger than those which Mr. Eggleston is alleged to have expressed. I have known Mr. Eggleston for a long while. His reputation is above reproach. I have the utmost confidence that he will discharge any duty that he undertakes to discharge in a way that a citizen of his eminence in the community should discharge it.

Senator E B JOHNSTON:
Western Australia

.- This debate has served a very useful purpose, if only to show how futile protests from Western Australia are likely to be in affecting the mind of any member of the Government in this chamber. If such a prejudiced and one-sided appointment had been made by the Scullin Labour Government, Senator Pearce would almost have torn the place down in his righteous indignation, just as he nearly tore it down in protesting against the Seullin Government’s tariff. The right honorable gentleman referred to organized opposition to Mr. Eggleston’s appointment. So far as I know, there has been no organized opposition to it. The views which I put before the Senate were mostly culled from the eastern press. Newspapers published in Western Australia after the appointment was announced arid arriving to-day had not been perused by me before I spoke this morning. It is true that I read a telegram from the Premier of Western Australia, and another from the Secretary of the Country party; but the views that I expressed as being those of the Leader of the Opposition, the Leader of the Nationalist party, and the Western Australian Chamber of Manufactures, I gathered from newspaper reports, and were in no way organized, as stated by the Leader of the Senate. The three political parties of Western Australia, as well as many important public bodies, and public men, are united in their protests against this prejudiced judge. It is felt that this appointment is not fair to Western Australia. A person who has so strongly criticized our finances should not have been appointed chairman of this commission. It has been said that he has also criticized the Commonwealth finances, but that statement, like the flowers that bloom in the spring, has “ nothing to do with the case.” Anyhow, the Government has taken good care to place this gentleman in a position from which he can no longer criticize Commonwealth finance.

Western Australia has an unanswerable case. I do not know that this is the place to enlarge upon that aspect of the subject, which certainly is not the point at issue. The point is that we want a just and honorable commission in which we shall have confidence. I have seen the case for Western Australia summarized briefly on the following lines: Western Australia claims that her relatively undeveloped condition calls for the stimulation of agriculture by borrowing abroad ; that the cost of development has been raised all through the Commonwealth by the federal tariff policy; and that this burden has been disproportionately severe in Western Australia because our development is the most backward. We also claim that federal policy has forced Western Australia to pay a yearly tribute amounting to several millions to industries in the eastern States, where this tribute has gone into circulation, and has been taxable by federal and eastern State Governments, principally Victorian, New South Wales, and Queensland. Our claim against the federation is not a claim for charity, but for just compensation for the tribute we are being forced to pay directly as citizens to Western Australia, and, indirectly, to the federal and some of the State Governments. And we are being denied an impartial tribunal before whom to place these facts.

I must say that I was surprised at the attitude of Senator Pearce to my motion. I said that I believed that the right honorable senator had done his best for Western Australia in this matter, but in return for that remark, he made the unwarranted charge against me that I was vote-catching. It is easy to make such a charge, but if the right honorable gentleman thinks that by doing so he will prevent me from doing what I believe to be my duty to the State and people I represent as a member of the Senate, he is making a great mistake. Senator Pearce and I stood upon the same platform at the last election, and also at the preceding election and, of course, accepted the same fiscal policy. My views have not changed. In 1925, when I was a member of the State Parliament, and again at the last election, I gave a month of hard work and travelled the State from one end to the other at my own expense, in order to catch votes, not for myself, for I was not a candidate, but for Senator Pearce and the Senate team of which he was a member. Senator Pearce is the last man in Australia who should talk about vote-catching, because, in my opinion, he is the champion vote-catcher of the Commonwealth. When Western Australia had a Labour majority in the State electorate, Senator Pearce had a policy to catch the Labour vote. When the gold-fields declined, and the State became more Nationalist in sentiment, Senator Pearce still had a policy to catch the majority vote. I have assisted the right honorable gentleman in every election in which he has stood with a Country party candidate. When the agreement was made with the Country party, the retirement from the Senate was necessitated of an honorable gentleman who has since been elevated to the high position of a judge. That gentleman’s retirement enabled Senator Pearce to go vote-catching, and to catch the Country party vote. . The speech which he has delivered in the Senate to-day, in so offensive a manner to myself, was a vote-catching speech, for he asked the people of Western Australia to remember his services to them in respect of the construction of the transAustralian railway. I admit that the right honorable gentleman did good work in that regard; but, in my opinion, the greatest fighter that Western Australia ever had was the late Lord Forrest, and he, more than any other man, was responsible for the construction of that great work. It ill becomes a colleague, whom I have always tried to help on the hustings, to charge me with vote-catching, because I have honorably tried to place before the Senate an important grievance of the State which I represent. I shall go a little further in discussing the right honorable gentleman’s vote-catching ability, and predict that, when consideration is being given in Cabinet to the appointment of a new High Commissioner for Australia, this great Australian vote-catcher will catch more votes than any other candidate. The right honorable gentleman was entirely unjustified in attacking me because I expressed the opinion that an impartial tribunal should be set up.

Senator Sampson:

– -But the honorable senator does not want an impartial tribunal !

Senator E B JOHNSTON:

– That is incorrect. The objections of Mr. Collier and others to the appointment of Mr. Eggleston were made immediately the appointment was announced. I have made these remarks about Senator Pearce more in sorrow than in anger, because I think that a right honorable gentleman whom I have known for 30 years should not have thrown such an unwarranted charge across the chamber at me. Senator Pearce, on vote-catching, is an instance of Satan reproving sin.

In my speech this morning, I did not have the opportunity of referring to the comment of Sir James Mitchell on Mr. Eggleston’s article. I therefore now quote the following paragraph from the Daily News, which appeared on the15th December - the day following the publication of Mr. Eggleston’s article : -

It is difficult to understand why Mr. Eggleston should indulge in this somewhat vitriolic outburst against the administration of the finances of this State, unless it is that, being a member of a highly protected State, he feels it necessary to try to withdraw attention from the criticism of the federal policy of protection, which was indulged in during the debates on the SecessionReferendum Bill.

Whatever his object is, however, he has made so many mis-statements that it is necessary to reply to him, even though many of his criticisms are not deserving of comment.

A long article follows refuting Mr. Eggleston’s charges seriatim.

After hearing the Government’s defence of this appointment, I can come to only one conclusion, and it is different -from the opinion which I held when I submitted this motion. I think that, in selecting Mr. Eggleston as the chairman of the commission, the Government knew his views with regard to Western Australia, as is shown by the article that I have quoted, but did not know that the people of Western Australia were aware of them. Owing to the attitude that the Government has adopted, and as a protest against the appointment, I do not ask that the motion be withdrawn.

Question - That the motion be agreed to - put. The Senate divided. (President - Senator the Hon. P. J. Lynch.)

AYES: 3

NOES: 26

Majority . . . . 23

AYES

NOES

Question so resolved in the negative.

page 2360

QUESTION

WAR DEBTS

Senator DUNN:

asked the Leader of the Government in the Senate, upon notice -

  1. Has his attention been drawn to a cabled report in the Canberra Times, dated London,

Tuesday, 13th June, that Britain has defaulted in her payment of war debts to the United States of America?

  1. Is it a fact that Australia’s war debt commitments overseas amount to £5,584,000 annually ?
  2. If it is a fact that Great Britain has defaulted, or is about to default, in payment of war debts, in co-operation with many European countries, will the present Australian Federal Government default in relation to its overseas commitments of£ 5,584,000? If not, why not?
Senator Sir GEORGE PEARCE:

– The information is being obtained, and will be furnished as soon as possible.

page 2361

QUESTION

WORLD ECONOMIC CONFERENCE

Senator DOOLEY:

asked the Minister representing the Prime Minister, upon notice -

Will he assure this Senate that, at the World Economic Conference now sitting in London, the Resident Minister in London will not enter into any commitments binding upon the Australian Government before any proposals emanating from such conference have been approved of by the Parliament of the Commonwealth ?

Senator Sir GEORGE PEARCE.The Minister without Portfolio in London will not enter into any commitments at the Economic Conference without the approval of the Government. If, and when, any proposals are submitted for the approval of the Commonwealth Government, the Government will give consideration to the question as to whether, in view of the nature of the proposal, it is necessary or advisable also to obtain the approval of Parliament.

page 2361

QUESTION

FILM DISTRIBUTORS’ CHARGES

Senator BROWN:
QUEENSLAND

asked the VicePresident of the Executive Council, upon notice -

  1. Has the attention of the Government been drawn to the report that the film distributors are threatening the exhibitors of films with additional charges over and above the present contract commitments, because of the increased duty upon imported foreign films?
  2. If the report is correct, will the Government inquire into the legality of this procedure and also take steps to protect exhibitors?
Senator McLACHLAN:
UAP

– The replyto the honorable senator’s question is as follows : - 1 and 2. This matter was brought under the notice of the Prime Minister by telegram yesterday, and is receiving consideration.

page 2361

CUSTOMS TARIFF 1933

Second Reading

Debate resumed from the 14th June (vide page 2337), on motion by Senator McLachlan-

That the bill be now read a second time.

Senator SAMPSON:
Tasmania

– Some honorable senators have expressed the opinion that it is rather futile to discuss the tariff, but, on that matter, I join issue with my honorable friend, that ardent Empire crusader and disciple of Lord Beaverbrook, Senator Elliott, who read the Senate a lecture yesterday by saying that this debate was so much waste of time, and that we should get on with our job. I must admire the temerity of the honorable senator, and I wish that I had as much “ front “ as he displayed on that occasion, because I think that it ill became him to lecture the Senate in that way. I say nothing as to his attendance record in this chamber, but his remarks were certainly rather” thick “.In my opinion, this debate is of some value, and it is interesting to hear the views of honorable senators from the various States regarding the tariff. A tariff is an extraordinarily complex thing. Whether freetraders or protectionists, I think that we are all more or less influenced by geographical considerations in our attitude to certain phases and items of the tariff.Senator Collings has shown, to his own satisfaction, at least, that he is capable of solving all tariff problems, whether they occur in this or any other country. In quite a friendly way, and with great respect, I suggest that the honorable senator should not take things for granted. Both in peace and war, it is dangerous to do that. I was struck by a friendly remark that he made to’ me, when he said that it was all very well for me to sit back with a smile on my face, looking prosperous, well fed, and happy. For Senator Collings’ information, I may say that I am certainly not prosperous, and I am afraid I am not particularly happy. As to being well fed, I point out that I receive the same scale of rations as the rest of the troop, and if I put that food inside a good skin, that is not my fault.

One of the chief criticisms levelled against the Ottawa Conference and the policy of this Government is that the Tariff Board is given new responsibilities and functions. Under the Ottawa agreement, the board is to make a review of the tariff, and this Parliament is to be invited to make any necessary changes in import duties consequent upon reports of the board. It is further provided in the agreement that no new duties, or increases of present duties, on goods from the United Kingdom may be made without investigation by the board. I am in entire accord with that principle. Mr. Scullin, the Leader of the Opposition in another place, claimed that had such fetters been imposed upon his Government in 1930, action to correct the trade balance could not have been taken. This assumes that the imposition of import duties and prohibitions was, in fact, the instrument by which the trade balance was rectified, and that no other methods were available to the Government. I submit that both those assumptions are unsound. No doubt, tariffs have some effect upon imports, but my difficulty is in reconciling Mr. Scullin’s view with the fact that there was little difference between the decline in imports subject to duty, and those free from duty.

Senator Sir George Pearce:

– A similar decline in imports took place in New Zealand, and that country did not impose prohibitions.

Senator SAMPSON:

– Quite so; I am grateful for that interjection. In any case, the trade balance is soon adjusted in a free exchange market. There is no doubt that tariffs have some effect in restricting imports ; but is it in the public interest that so vital a thing as the tariff should be adjusted haphazardly ? Does not Parliament require some expert guidance on the many technical problems involved ? Does not the opportunity for pressure from sectional interests suggest that an ordinary member of Parliament should welcome an extension of the authority and guidance of the Tariff Board? Most of the critics of the Tariff Board have not, I feel sure, read the reports presented from time to time by that body, and they have possibly no knowledge of the principles upon which the board works. The reports are most voluminous, and, in many instances, highly technical. For my own part, I find it extremely difficult to keep abreast of current thought. Most of my time is taken up in an endeavour to read and assimilate the large amount of printed matter, reports, &c., that comes our way, as well as the literature dealing with current affairs which the Library places at our disposal. This is a complex, fastmoving age, and it is not easy to keep up with things.

The Tariff Board is of the utmost value and importance to us in this Parliament. The impression I have gained from reading the Tariff Board’s reports is that the board is anxious to assist the establishment of efficient Australian industries, and to increase the employment of Australian labour in the manufacture of products from local or imported raw materials. The board, however, recognizes that local costs of production cannot be raised beyond a certain point without causing loss of employment in other industries to a greater amount than the direct employment given in the highlyprotected industries producing at high cost. During the Scullin Government’s regime, the tariff was increased for the ostensible purpose of reducing imports, and giving employment to those engaged in Australian industries.We all remember the grandiloquent statements made from time to time by the then Acting Minister for Trade and Customs (Mr. Forde). In fact, before very long, those statements had become nauseating. They came pouring forth from the Acting Minister’s place in the House, and were broadcast in the press. They informed the public that certain duties, which were absolutely prohibitive, would result in new industries springing up here, there, and everywhere. One week we would be told that a new industry would provide employment for 20,000 persons; next week it might be 50,000, and, I believe, it even went as high as 100,000. Of course, we all know that, instead of increasing employment by 20,000, the new duties had the result of throwing that number and more out of employment.

Senator Duncan-Hughes:

– The results were in inverse ratio to the promises.

Senator SAMPSON:

– They were; and only now is the country beginning to recover from the dreadful condition into which we were thrown at that time. The last general report of the Tariff Board contains this significant paragraph -

During the year under review the board, after due consideration, recommended in the majority of cases against the retention of the increased duties that have been imposed by the tariff resolutions since November, 1929.

This is a severe condemnation of indiscriminate tariff-making. I suggest that we should give the Tariff Board a recognized place in our tariff scheme, in accordance with those much talked of articles, 9 to 12, of the Ottawa agreement. The principles on which the Tariff Board works are eminently sound. The board first asks whether the local product sells at a price reasonably close to that of the imported article, landed in Australia duty free. It then inquires whether there are reasonable prospects of the local industry getting command of the Australian market, and whether that market, is sufficiently extensive to allow of large-scale production. That is a most important point. It next inquires whether the local industry is efficient, whether it is using the latest plant and production methods, and whether it is maintaining reasonably efficient management. Again, the board inquires whether the raw material used is of local origin, and whether the development of the industry will give indirect employment to a large amount of labour supplying the raw material.We can have industries at any old price if we are prepared to pay it. It would be possible, if we wanted to do it, to go down to the South Pole and grow grapes, or to breed polar bears at the equator, but no one would pretend that those would be sound economic undertakings. I regret that, since the war, we have, in many instances, tried to do things almost as foolish, and with disastrous results.

Another question asked by the Tariff Board is whether there are at the present time, or whether there is likely to be in the near future, over-capacity in an industry if it is given a high protective duty. This is another important consideration, because over-capacity increases overhead charges, and renders the duty, whatever it may be, less effective. There are many examples in Australian industry to-day of over-capacity. In my own small State I know of more than one industry in which I am interested that could turn out in 30 days the whole of Australian’s requirements in its particular line.

Senator Dunn:

– Is that not the way all the world over?

Senator SAMPSON:

– To some extent, yes. The Tariff Board must give consideration to that matter when considering whether to increase or decrease the amount of protection afforded a certain industry. Another thing to consider is whether the freedom from overseas competition which some industries enjoy has encouraged too many producers to enter the field, and too much plant to be laid out. So far as I have been able to observe, the board has always approached these questions in a reasonable and efficient manner.Without its assistance I fail to see how we in this Parliament could possibly arrive at a just appreciation of the problems before us, when we have to deal with a tariff comprising hundreds of items. Without the guidance of this investigating body, we could not possibly arrive at a just and reasonable decision regarding the duties which ought to be imposed.

For those reasons I welcome the activity and advice of this expert body. I believe that it would be a good thing if the board periodically made a systematic review of the major industries in Australia, with a view to checking any undesirable development. Why there should be any objection to the proposal that the Tariff Board should be given increased authority - and that seems to be what is sticking in the minds of many honorable senators - and why Parliament should not bind itself to pay more heed to the recommendations of the board, I cannot understand. The history of the board shows conclusively that the policy of protection has never suffered, and never will suffer, at its hands. I believe that statement to be absolutely true. On the contrary, the review of our industries by the Tariff Board will be, I think and hope, a check upon the activities of impetuous, headstrong and, perhaps, young and enthusiastic Ministers for Trade and Customs. We’ have had such gentlemen filling the position before, and, no doubt, will have again. Control by the Tariff Board is, I submit, the only means by which protection in this country can be kept respectable. When I say “ respectable,” I mean exactly what I say. Things have happened in the past in connexion with tariff-mongering which were far from respectable ; I submit that the existence of the Tariff Board is a check upon governments in the making of tariffs. I do not care very much what are the views held by honorable senators generally in connexion with the Ottawa agreement; but I consider that its provisions with respect to the Tariff Board are in the best interests of Australia’s secondary industries. Tariffs always have been, and always will be, highly contentious. The records of the governments of European and of other countries since the years from 1914-18 contain no law or regulation passed with the object of fostering or encouraging international trade. After the signing of the Treaty of Versailles, tariff barriers were erected i n every country ; even in countries which only then began to have a separate nationality. That has been continuing ever since, so that to-day international trade is almost impossible. That is one of the reasons why things in this old world are in such a dreadful mess, and why there are millions of tons of British and other shipping lying idle. It has slowed down the whole “ show.” Practically every country has tried, as a result of tariffs, embargoes, and other obstacles to trade, to become self-sufficient, to make itself an autarchy. Yet we read a lot of cheap stuff about internationalism, the brotherhood of man, and war being a thing of the past. It is that spirit of fervid nationalism that has built up these barriers to trade; but the world has to retrace its steps. The action taken at the Ottawa Conference may not have very beneficial results, but it. is a step in the right direction. The British Empire has to give a lead, and the conference at Ottawa was a beginning. What will result from the World Economic Conference now sitting no one can say. Personally, I am not very hopeful. In 1919, after the termination of the Great War, I resided in Paris for several months, when the Peace Conference was in session. I had work to do there at the time, and I know of the antagonism that then existed .between certain European countries. This antagonism is age-old; its roots are in the dim past; it is based on traditions which are hard to break down. These tariff barriers breed anger, hatred, and war. The worst feature of the present tariff systems is that they have no organic relationship to general policy - national or international. For the most part, they have been framed under sectional pressure. We know what that- is. The tariff policy of creditor nations is not influenced by the fundamental fact that they need to be paid what they are owed, which, in the long run, can be paid only by goods and services. Changes in policy are made without consultation with other countries, without any warning whatever, although every import shut out is a foreigner’s export. Until we can get away from this foolish policy - the idea that in this modern world, with its wonderful methods of transportation and of communication

Ave are to be self-contained, or to be sellers only, and not buyers - there will be no hope for our boasted civilization. It cannot be done.

I think it was Senator Collings who said that we were the second best customer of the Old Land. Great Britain, however, is our best customer. I am not one of those who can be charged with beating the drum, or waving the flag. There is nothing in that. We saw a lot of that, long ago when we went away to undertake a big . job. We also remember those very dear ladies who distributed white feathers very impartially. I do not look upon patriotism in that way. That is a shoddy way, and not worth anything. In framing a tariff in this young Commonwealth, it is up to us to remember that Britain has granted, and still safeguards, the liberties and privileges we enjoy. The British navy and the British army preserve us from interference by foreigners who are biding their time to invade our shores. It is the British public which has financed our industries, and made possible our standards of living. The future prosperity and the security of Australia depend upon the maintenance of Britain’s place in the political and commercial world. The mo3t pressing obligation upon us is to fortify and develop the country, which guarantees our freedom, and, up to a point, our prosperity.

It is with the Empire, in other words, Britain - may God bless and keep her - with which our freedom and well-being are indissolubly bound. In framing our tariff, we should always remember that fact.

Senator BRENNAN:
Victoria

– There are great disadvantages in speaking at the close of a long debate such as this, which is really a continuation of another debate, in that one has heard’ all his good things said by some one else, and one by one, has to shed them. In this connexion, I include the concluding remarks in the speech just delivered by Senator Sampson. I shall not try to elaborate anything that has been dealt with by other speakers, although it may be necessary, since one likes to get what he has to say in some order, at least to mention them, and in some instances to elaborate upon them. This discussion has roughly, two main lines of argument. An attack has been made upon the policy of the Government along these two main lines, and a curious thing, as I think I mentioned before, is that the attack has been directed at the Government for diametrically opposite reasons. This recalls to me a cartoon that appeared very many years ago in a well-known weekly paper, in which an outback farmer was represented as driving a team consisting of a badly-stricken horse and his own wife. According to the letterpress, the farmer was saying, “ Come over here. What a time I am having between the two of you.” I think the Minister in charge of the bill (Senator McLachlan) feels inclined to say, “ What a time I am having between the two of you. What a difficulty I will have in reconciling the two views.” Although there are these diametrically opposing lines of attack, he may have the consolation of knowing that in every emergency, he will be saved. These two main lines of attack were launched by the Leader of the Opposition (Senator Barnes), and by Senator Hardy, who, at any rate, was the next speaker who opposed the Government. Senator Hardy’s opinion is that the party to which he belongs has, as he expressed it, “ been sold a pup “. His main complaint was, I think, that the spirit of the Ottawa agreement is not being observed. On the other hand, the Leader of the Opposition is an advocate of prohibition of imports, He may protest against it being put in that plain form, but the fact remains that the logical outcome of the speech he made, and of those supporting him, is the prohibition of imports. Take, for instance, the words of the honorable senator himself, that he would keep in this country every shilling’s worth of work that could be done in it, and every shilling. His grievance is voiced by Mr. Kitchen, the president of the Chamber of Manufactures of Victoria, who spoke of the shadow of Ottawa hanging over the manufacturing industries of Australia. Senator Dooley said that he would prevent anything and everything from coming into this country that could be manufactured here, and he believed that that would be good for Australia. Senator Collings would not resort to ordinary tariffs at all. He would make it a criminal offence to bring into this country anything which could be manufactured here. As Senator Sampson has pointed out, anything could be manufactured here.

Senator Collings:

– I did not say that anything could be manufactured here.

Senator BRENNAN:

– Then I shall leave the honorable senator out of the count, and shall take the opinions expressed by Senator Dooley and Senator Barnes. What do they mean when they say that we should keep out of this country anything that can be manufactured here? I take it that those honorable senators do not mean anything, in the sense that Senator Sampson used the word; but that they mean anything that can be reasonably and economically manufactured here.

Senator Collings:

– They did not say that.

Senator Duncan-Hughes:

– That was the view taken until the Pratten tariff, when the question was whether anything could be “ commercially “ manufactured in Australia.

SenatorBRENNAN. - We have to define our terms, and no one can say what the word “ commercially “ in that connexion means. If the question is whether an article can be “ economically “ manufactured here, there should be no disagreement between the parties. Honorable senators on this side of the chamber are willing to give Australian manufacturers, not only prefer ence, but also substantial preference, and the one question is, how far we can go in that direction? Are we to increase duties each time a rate is saidnot to be sufficient? Whenever manufacturers ask Parliament for higher duties, are we, under pain of being branded freetraders and wreckers of industry, to gape and swallow? That seems to be the contention of honorable members on the other side of this chamber. We are divided into opposing parties, each with, we must assume, honest, though diametrically opposite, views on this question. Let us project our minds a little into the future. What is going to happen when an appeal is made to the people upon this question? Those who, in the press and on the platform, support honorable senators opposite, will not give us credit for being honest fools. They will, in effect, brand us as dishonest knaves, as conscious and wilful wreckers of industry, because we have tried to contribute, within the limits of our intelligence, whatever we can to the truth of this complicated matter. Admittedly, this is an extremely complicated matter, about which honest differences of opinion may be entertained. I showed, when speaking one day last week,that those of us who advocate lower duties canat least cite the best thought of the world as supporting us. I gave certain illustrations, and said that my friends opposite could not point to one single economist of note in the world who took the opposite view - the view that what this or any other country was suffering from was the lack of sufficiently high duties. What is the answer of Senator Collings? He cited a remark of Mr. J. A. Hobson which has no more to do with this particular question than the man in the moon. The illustrations that I gave were supplemented yesterday in the admirable speech from Senator DuncanHughes. He added certain other wellknown authorities, and I shall refer to only one of them, and that is the Committee of Economists of Australia, which, while quite sympathetic with protectionist aspirations and claims, reported that any further increase of the tariff would endanger the Australian standard of living. I propose to cite one or two further examples, even at the risk of wearying honorable senators. Sir Walter Layton, an eminent economist, standing in the first rank in Great Britain, speaking at Oxford at the end of last year, said -

The tide had turned. The movement of prices has flattened and it will be only a question of time before it turns upwards. The British Government recognizes the appalling damage tariffs are causing throughout the world, but the dominions are not fully alive to it.

Dr. Mauldon, Senior Lecturer on Economics at the Melbourne University, has stated -

I may be unpopular for saying this in Australia, but it is essential that economists should go on hammering that it is ultimately a bad thing for the world to build upmore and more tariff barriers. We have to arrest this tendency to economic nationalism somehow, and we in Australia must, with other countries, contribute to the releasing of national trade.

How nice it is to be a professor instead of a politician, and thus be able to say things which are unpopular! We know that the United States of America has been ruled by protectionist presidents for a long time, but President Hoover, when about to retire from office, issued a Christmas message, in respect of which the London Daily Telegraph states -

In it President Hoover is shown as being completely cured of the delusion that his country is able to stand on its own feet and to live in happy detachment from the troubles of the rest of the world.

Senator Collings would erect a tariff wall round this country, so that we might live entirely to ourselves, like the people of Tibet. Sir Walter Layton, on the eve of the assembly of the World Economic Conference, now sitting, said -

The choice before the world in the conference is nationalism versus co-operation. The omens are not at present favorable, but needs must when the devil drives, and if the delegates shrink from the courageous road and continue their national self-sufficiency, they might as well go home immediately. No makeshift of pious resolutions will rescue the world from the present economic barbarism.

Senator MacDonald:

asked, in effect, what do these economists know of the subject?

Senator MacDonald:

– Not the tame economists we have in Australia.

Senator BRENNAN:

– That is one of those easy charges of corruption and venality which are thrown about by honorable senators from the other side of the chamber. The insinuation is, apparently, that men like Dr. Mauldon, Professor Copland, and others, speak to order, and not according to the opinions that they hold. Apparently, Senator MacDonald’s view is - let us have not the wisdom of the expert, but the opinion of mere numbers - vox populi, vox Dei.

Senator MacDonald:

– “We want men who have been through the mill, and not men of theory.

Senator BRENNAN:

– I have no doubt that the honorable senator himself has been through the mill.

Senator MacDonald:

– Yes, and I have a fair amount of theory with it.

Senator BRENNAN:

– In effect, the honorable senator says that he is better able to diagnose the evils of the world and to prescribe for them than are those who have devoted their lives to making a study of those ills.

Senator Sir Walter Kingsmill:

– In his view, the patient should know more than the doctor.

Senator BRENNAN:

– What has happened under the government of men who have been through the mill - common ordinary men? The United States of America recently made its appeal to the men who have been through the mill. After long years of high protectionist governments, an election took place last November for President and both Houses of Congress. The result was that the first freetrade President for many years was elected to office, and both Houses of Congress were returned with an overwhelming pledge to some policy of tariff reduction. Following upon that fact, and after President Roosevelt had established his ministry, Mr. Roper, the Secretary for Commerce of the United States of America, in a public statement at Washington, advocated “ a tariff policy of common sense and -common decency to every nation.” He said -

There were honest differences of opinion about tariff policies, but he believed that an overwhelming majority of the American people had shown unmistakably that they were tired of a policy that had antagonized every other nation.

Is not that exactly the position of Australia? Have we not pursued a policy which has antagonized, at any rate, a great many nations, including - and Sena tor Greene, who has just returned from New Zealand, will be able to speak on this subject at the proper time - our neighbouring dominion? We are separated from the people of New Zealand by scarcely a thousand miles, and have no points of dissimilarity at all. Yet we have erected tariff barriers against that and other countries, which have retaliated against us to the grave detriment of our rural producing interests. That is one of the evils which high tariffs bring in their train. Let us not forget that when the people of the United States of America - the” common people who had been through the mill - had the opportunity to vote at the last election, Mr. Smoot, who was either the father or the mother of the Smoot-Hawley tariff, was swept ‘ into oblivion with many other persons of his own way of thinking. This honest difference of opinion, with which Mr. Secretary Roper deals, brings me to the point that was raised by Senator Sampson in his admirable speech. It is a matter upon which there may be honest differences of opinion, and, if our criticism were restricted to it, no one would complain. But, as there are honest differences of opinion on the subject, it follows that, in order to determine what is the correct opinion, there must be an examination of witnesses, and, when witnesses have been heard, there must be a weighing of the evidence that they” have given. Is the Commonwealth Parliament a body suited for that? I venture to say that it is not. And it does not undertake to do it. It undertakes to settle this tariff, I regret to say, by parliamentary candidates going upon the hustings, and making extravagant appeals to the community, based not upon truth, but appeals to the passions, and sometimes, I am afraid, the ignorance of the electors. By ignorance, I mean in this connexion nothing more than want of knowledge. The tariff being such a vastly complicated thing, the want of knowledge of its percussions and repercussions must be extensive.

Therefore, it seems to me that there are two things open to this Parliament in connexion with a subject of this kind. One is that we should have a really national parliament, and a national government, which will not be faced by an opposition who thinks it its duty merely to oppose, and takes advantage of every conceivable chance to discredit the party in power when an election is imminent. I am not confining that criticism to the honorable senators who are at present in opposition, who, I hope, will for many years grace the Opposition benches. I am afraid that such opposition as I deprecate is a weakness inherent in every Parliament. While the party to which honorable senators opposite belong is organized upon the present basis, it is impossible that we can have anything in the nature of a national parliament.

Senator Foll:

– During the life of the last Parliament, the then Opposition put most of their major measures through.

Senator BRENNAN:

– That is so. They demonstrated that, when the country was faced with a crisis, they could act in a national spirit, even although the country had not then a national government.

The other point appears to be that which was elaborated by Senator Sampson, that we should, in fact and not merely in theory, by putting something on the statute-book which we disregard, establish the practice that a tariff board, however constituted, should examine these matters in detail, and arrive at a conclusion upon them. Parliament should make it the invariable practice not to act in these matters except upon the report of the Tariff Board. That would clear the atmosphere, and take one of the most contentious subjects from the arena of party politics.

Senator Payne:

– That is the law at present.

Senator BRENNAN:

– But it is a law “more honoured in the breach than in observance “. It has been urged by honorable senators opposite that we have already gone far enough in that direction ; that, by surrendering our powers to the Tariff Board, as Senator Collings put it, we are making the creature greater than the creator. That is not so. The highest exercise of power is often to delegate certain authority to other bodies. By- doing so, a parliament loses none of its rights of selfgovernment, and does nothing derogatory of its dignity. With us, ‘the case is the same as it is with the law courts. We are not fitted to make these inquiries. A board of some sort is better fitted than a parliament to deal with the tariff, and therefore we should delegate the necessary authority to it.

I take it that honorable senators of the Labour party are all believers in the ‘ Arbitration Court, and would not support the abolition of the principle of arbitration. The principle of wage fixing is entirely complementary to the fixing of duties by the tariff, which is supposed to be a finance measure. Technically and nominally, it is still a finance measure, but, in the main, the greater part of it has no connexion with finance. A tariff is not meant primarily for the raising of revenue, but for the regulation of industry. Many years ago, it was thought that since it was provided that the manufacturers should have a proper field of endeavour, it was only right that the worker should share in the profits that were made. We know the new protection legislation, and what happened to it. Still, we have a Federal Arbitration Court, which fixes wages. As to the surrender of powers, do honorable senators realize that this Parliament could not alter a single provision in a wages award that had been made by the Arbitration Court? Is it not therefore quite in accordance with reason and practice that we should delegate the thorny and complicated tariff question to a board, and be guided by its decisions?

Senator Barnes:

– This Government did alter an award promulgated by an arbitration tribunal.

Senator BRENNAN:

– Not one that was promulgated under the Arbitration Act. Naturally, this Parliament has complete powers over the Commonwealth Public Service, and the alteration to which the honorable senator referred was made in connexion with an award by the Public Service Arbitrator.

Senator Barnes:

– It is the same thing.

Senator BRENNAN:

– It is a totally different thing. The fact- remains that this Parliament cannot alter a single provision of a wages award fixed by the Commonwealth Arbitration Court.

I pass on to the criticisms that have been levelled against the Government for the supposed destruction of industries that it is contemplating. In determining whether the- criticism is genuine, let us remember that the present tariff is the highest that has ever existed in Australia, with the solitary exception, perhaps, of certain features of the Scullin tariff, which really never became a tariff, because it was not passed by the Parliament. This is the highest tariff in the English-speaking world. Certainly it is as high as that of the United States of America, and far higher than that of Canada. Recently, when the manufacturers of New Zealand were putting their case before the Tariff Board that has been newly appointed in that dominion, in pursuance of the terms of the Ottawa agreement, they said that theywould require a duty of at least 30 per cent. to enable them to compete with the outside world. The position is as was stated by Senator Johnston, that every tariff that has been passed since theFederal Parliament came into existence, has had an upward tendency. I doubt whether there has been even a slight exception. As the honorable senator has also shown, with every increase of the tariff there has been an increase in unemployment. So that one of the things that faces every honorable senator who criticizes the Government is the evil that the tariff wreaks upon industry.

Senator Foll:

– What becomes of the argument that protection is needed only to start an industry?

Senator BRENNAN:

– That argument was abandoned before my honorable friend was born. It certainly did duty for 20 or 30 years, and lay moribund for another 20 or 30 years, but I do not think that anybody regards it seriously now. The “ infant industry “ was a joke in my boyhood, and we used to laugh at the term in Victoria, for such industries, even after having been established for 30 years, still howl for the bottle.

Senator Sampson:

– They never grow up.

Senator BRENNAN:

– Some endeavour has been made to prove that employment increased under the Scullin tariff, and, strangely enough, increased the moment that that tariff became operative, while it decreased the moment that this Government came into power. Let us see whether that can be borne out by statistics. The Scullin Go vernment came into power at the end of 1929, and made its graceful exit at the end of 1931. From the first quarter of 1929, before unemployment had become acute, the percentage of unemployed unionists was 10.8, andby the end of 1932, the year after this Government had assumed office, it stood at 29 per cent. But if the quarterly statistics are taken, it will be found that the highest point of unemployment was reached during the quarter after the Scullin Government went out of power, after a reign of over two years. It cannot be expected that appreciable results would be noticeable immediately after a government came into office, therefore as the Scullin Government went out of power at the end of 1931, and statistics compiled for the first quarter of 1932 indicate that there was then a considerable increase in unemployment, it is reasonable to assume that the increase is attributable to the Scullin Government. However, I do not altogether claim that; I merely meet the argument that the tariff of the Scullin Government produced employment, while that of this Government has produced unemployment. As I have said, unemployment reached its peak during the second quarter of 1932. Since then there has been a slight drop; it was 29.6 per cent. and 28.1 per cent. respectively in the two following quarters, and 26.5 per cent. in the first quarter of this year.

Senator Elliott:

– Has the honorable senator noticed that there are now 40,000 fewer registered unionists?

Senator BRENNAN:

– I have not, noticed that. It has been said that the Ottawa agreement is one-sided. I am aware that we are not now dealing with that agreement; but as it is supposed to underlie the tariff, some reference to it appears necessary. The first four articles of the Ottawa agreement are entirely one-sided - they provide for concessions being made to Australia by Britain. The next two articles may be regarded as neutral. That brings us to articles8 to 12, the last four of which have been subjected to much criticism, most of it illinformed. Were it not for articles 9 to 12, the agreement would, indeed, have been one-sided; it would have provided for concessions by Britain to Australia with no corresponding concessions by

Australia. Not one article of the agreement violates any principle underlying the protective policy of Australia as it was understood when initiated, and as it is continued to be understood, in spite of variations under the Pratten tariff. Article 9 reads -

His Majesty’s Government in the Commonwealth of Australia undertake that protection by tariff shall be afforded only to those industries which are reasonably assured of sound opportunities for success.

That .principle has been accepted all along, even in the absence of an agreement with the Mother Country. Article 10 provides -

His Majesty’s Government in the Commonwealth of Australia undertake that during the currency of this agreement the tariff shall be based on the principle that protective duties shall not exceed such a level as will give United Kingdom producers full opportunity Of reasonable competition on the basis of the relative cost of economical and efficient production, provided that in the application of such principle special consideration may be given to the case of industries not fully established.

Are we to say that we will not give British producers a chance of reasonable competition in the Australian market? Can we claim to be a part of the British Empire and refuse them that opportunity? Does that article violate the protective policy of this country? I am particularly consoled by article 11 -

His Majesty’s Government in the Commonwealth of Australia undertake that a review shall be made as soon as practicable by the Australian Tariff Board of existing protective duties in accordance with the principles, laid down in article 10 hereof, and that after the receipt of the report and recommendation of the Tariff Board the Commonwealth Parliament shall be invited to vary, whereever necessary, the tariff on goods of United Kingdom origin in such manner as to give effect to such principles.

During the currency of the agreement the Tariff Board must consider duties in accordance with article 10 and, if necessary, recommend a reduction of duty. The agreement was originally made out for a term of five years, during which the Tariff Board may - and I hope will - furnish reports, so that we may have something in the nature of a fairly constant operation of this provision.

I pas3 on to refer to some criticism of my attitude towards the amendment moved by Senator Johnston. Senator

Hardy expressed the hope that I would explain my attitude, and I express my regret that he is not present to hear my explanation. Towards the end of my address on the first reading I mentioned the influences which might determine my vote. I said that I would not vote to embarrass the Government, if nothing was to be gained by so doing. I had it in mind particularly that there might be a combination of parties in this chamber whose only desire would be to embarrass the Government, and I wanted to make it clear that, if that was the purpose of the amendment, I would not be a party to it. I doubted the right of the Senate to do what Senator Johnston invited it to do. I am aware that there is a standing order which provides that, in dealing with bills which the Senate may not. amend, the Senate may make requests at certain stages, and that the first reading is one of such stages. In considering any request from the Senate, the House of Representatives would not have regard to the Standing Orders of the Senate; it would examine the Constitution to see what powers were conferred on the Senate in that connexion. Section 53 of the Constitution provides, inter alia -

The Senate may at any stage return to the House of Representatives any proposed law which the Senate may not amend, requesting, by message, the omission or amendment of any items or provisions therein. And the House of Representatives may, if it thinks fit, make any of such omissions or amendments, with or without modifications.

It is true that that section contains the words “ at any stage.” I can understand that circumstances might arise in which a bill would be returned with a request at the first-reading stage; but those circumstances did not arise in connexion with this bill. Since the section of the Constitution referred to deals with money bills, and because the framers of the Constitution had in mind the amendment of such items as a tariff schedule, the sending back of a bill with such a message as that drafted by Senator Johnston was not contemplated. The amendment really meant that the Senate would not pass the first reading of this bill, but was prepared to consider an entirely new bill. Whether or not that would be within the power of the Senate under the Constitu tion we need not now stop to consider.

Whatever the position, I submit that nothing that could be devised would be more likely to have a negative result than the amendment moved by Senator Johnston. The honorable senator knew, because it was pointed out to him, that the subject-matter of his amendment had been fully discussed in the House of Representatives. It was, therefore, not a matter of something done unthinkingly, and without due consideration, but one on which there had been a special debate, carried even to the taking of a division. AsSenator Pearce reminded us, the carrying of Senator Johnston’s amendment would have meant calling the members of another place together, and the inviting of a rebuff. When there are two ways of doing the same thing, no question of principle is involved if one is chosen in preference to the other. Senator Johnston’s amendment was designed to affect the whole schedule, regardless of the fact that it would eventually come before a committee of the Senate item by item, and that, in regard to every one of those items a vote would be taken. If the amendment could have been carried, it follows that amendments of items in the schedule could also be carried in committee. And if the House of Representatives were requested to accept those amendments, it might happen that some of them would be accepted, and others rejected. What Senator Johnston sought to accomplish in his amendment could as well be accomplished in committee as the items came before it seriatim. The honorable senator, and those who supported his amendment, must have known that nothing but confusion could have come from carrying it. I am told that Senator Elliott rose impatiently in his place, and delivered a whirlwind address, in which he said that it would be a waste of time to debate the bill any further, because the matter was settled in the vote taken the previous week. The honorable senator did not mention me by name, but in a description, which was as accurate as I would except the honorable senator to be, he clearly indicated me. I know that the honorable senator’s time is precious.

Senator Elliott:

– My remark about wasting time had no reference to the honorable senator.

Senator BRENNAN:
VICTORIA · UAP

– Although Senator Elliott disguised his language, there was no doubt regarding his meaning. He said that my vote had helped to settle the question. It did not. He went on to say that it was now impossible to do anything, since we had failed to take the proper action the previous week. Had Senator Johnston chosen the other course, and waited until the several items came before the Senate, he would have had me with him on every occasion. But an amendment which would have carried the matter no further made no appeal to me. Moreover, since it might have embarrassed the Government, and antagonized another place, and as no principle was involved, I decided to vote against it. Should any honorable senator desire any further explanation of my vote, 1 shall endeavour to give it; but at present I can think of nothing further to say in this connexion. Every item covered by the comprehensive amendment is in the schedule, and may be brought before us and voted upon. And every item will be voted upon by me if it is brought before the committee, in a way that may, perhaps, seem to be in conflict with myvote against the amendment.

I turn now to offer a few general comments upon observations made by some honorable senators who preceded me.I shall not refer to what Senator O’Halloran said, because his remarks have already been dealt with by Senator Sampson, and the Leader of the Senate (Senator Pearce) by way of interjection. The claim that the Scullin Government rectified the adverse trade balance has been exposed over and over again. That Government did a number of things, and, doubtless, it deserved credit for being honest in its desire to improve the financial and economic position of the Commonwealth. But actually, it only anticipated by a little what took place in both New Zealand and the Argentine, and, since the decline in the importation of non-dutiable goods has been as great as the drop in the importation of dutiable goods, I cannot understand why this claim is constantly being repeated.

I come now to some observations made by Senator Collings, who last night was described in some excellent verses which

Senator Sampson and some other conspirator, whose name has not been mentioned, seemed to have evolved between them. I must, however, say that to me, the proper simile to apply to the honorable gentleman seemed to be, not that of a man “ who snorted like a buffalo “, or “ whose words like lava used toflow “, but the situation described in Robert Southey’s lines-

How does the Water come down at Lodore? which I shall not recite, for the very best of reasons - I do not know them, although I have read them on many occasions. Senator Collings told us last night that he had no hope of anything good coming out of the Ottawa Conference; that he had no illusions about that gathering, and, further, that he could not look for good results to flow from the World Conference now sitting in London. Although the honorable gentleman did not say so, the inference to be drawn from his remarks was that, because he had not been consulted, and apparently had not been asked to attend the conference, it was not likely to achieve any good results. He proceeded to sneer at the general idea underlying the proposal for such a conference, repeating what he had said on several occasions, that it was bound to fail, one reason for this belief being that the delegates were not allowed to smoke ! He directed the attention of honorable members to the cabled report in the Sydney Morning Herald in which, so he told us, we should find this complaint, and repeated his warning as to the probable outcome of the conference as though it could really be regarded as serious criticism of the memorable gathering which is now meeting at the heart of the Empire. Let me remind the honorable gentleman that he was inaccurate at the outset.The reported complaints did not appear in the Sydney Morning Herald at all, and that, I suggest, makes some difference. The Sydney Morning Herald is a grave, and, may I add, stately paper, maintaining the old traditions of journalism. It is not one of those papers which picks out the high spots in a gathering and prints them in a black type on its front page where, Senator Collings said, he had read this complaint. It follows, therefore, that the honorable senator’s remarkscon veyed a totally wrong impression to his hearers. Then, as he went on to read from a book written by Lieutenant-Commander J. M. Kenworthy, I was rebuked by Senator Dooley when I interjected that the writer of the book in question was a well known socialist.From that Senator Collings deduced that I was prepared to discount any opinions which might be expressed by Lieutenant-Commander Kenworthy. That was not the case at all. I merely suggested that the value to be attached to the opinion expressed by the author of the book might be influenced by the knowledge that he was a socialist and a socialist writer.

Senator Collings:

– Then what a man may say does not matter so much as whathe is!

Senator BRENNAN:

– Yes. In this country, at all events, the estimation of a man’s views is influenced considerably by his political activities. It is quite natural to assume that much more weight would attach to remarks made by Lieutenant-Commander Kenworthy of the British Navy, if it were known that he was-

Senator Collings:

– A conservative?

Senator BRENNAN:

– Possibly. In that event his views would find more acceptance than if it were known that he was a writer with strong socialistic leanings.

Senator Duncan-Hughes:

– As a matter of fact I think that LieutenantCommander Kenworthy was a Liberal who went across to Labour.

Senator Collings:

– -That is so, and I suppose we may infer that while he was a Liberal his views were sound; but since he has joined the ranks of Labour they are not worth considering.

Senator BRENNAN:

– I do not know. When the honorable gentleman told us that he was quoting from a book by Lieutenant-Commander Kenworthy, I was anxious to ascertain the date of publication, asI considered that it might have an important bearing on the views expressed.

Senator Collings:

– I did not say I was quoting from Lieutenant-Commander Kenworthy’s book. What I said was that I was reading extracts from a speech made by Lieutenant-Commander Kenworthy.

Senator BRENNAN:

– That may he true, but no one can doubt that if the honorable senator meant to convey the impression that he was quoting from the book, he was unhappy in the expressions which he used.

Senator Collings:

– I also read extracts from speeches made by Mr. Hoover and Mr. Ramsay MacDonald.

Senator BRENNAN:

– So far as I recall the honorable senator’s remarks, he kept repeating that he was reading from the book written by LieutenantCommander Kenworthy.

Senator Collings:

– I said nothing of the kind.

Senator BRENNAN:

– Then that ends the matter. I accept the honorable senator’s assurance, and admit that the mistake was entirely my own. I would, however, remind him that, in an interjection, I asked if the references in the extracts were not to the previous Government led by Mr. Ramsay MacDonald, and he asserted that they were not. As a fact, they were, because it is three years since the book was published. This did not appear to be important to the honorable senator, who a little later, said that wonderful things had happened in the last three years. That is true. One of the most astonishing things that has happened in the political world in that period is the annihilation of the British Government which was supported by a party analogous to the one to which the honorable gentleman belongs. Honorable senators will, no doubt, recall that, at about that time, there were grave doubts about the safety of the British Empire, and when an appeal was made to the people of Great Britain, they responded in a way that never before had happened in the history of the British Parliament.

Senator Duncan-Hughes:

– I think Kenworthy went out also.

Senator BRENNAN:

– I am sorry that I do not remember the details, but I am pretty certain that LieutenantCommander Kenworthy was numbered among the candidates defeated at that election.

I am not quite certain what are Senator Collings’ methods for the regeneration of the world, since he has not taken us into his confidence except to the extent of advising us to read the policy of the Labour party, which, he suggests, will put everything right if it is adopted.

Senator Badman:

– Is it not a fact that the Ramsay MacDonald Ministry was a freetrade government?

Senator BRENNAN:

– It was; but the issue upon which the last election was fought in Great Britain had nothing to do with protection or freetrade. It is true that people feared that if the MacDonald-Baldwin combination were returned to power, some liberties might be taken with the freetrade policy of Great Britain, and that possibility was canvassed to a considerable extent from the public platform; but people would not listen to warnings as to the future of freetrade or protectionist faiths. They were too much concerned about the safety of the nation, and believed that, to ward off disaster, there must be unity in government. And unity there was in a manner which reflected the great historic characteristics of the British people.

Senator Collings:

– Where has it got them ?

Senator BRENNAN:

– The questionto ask is, not where has it got them, but where did it prevent them from going?

Senator Collings:

– Now there are millions of unemployed in Great Britain.

Senator BRENNAN:

– Among the many claims which the honorable senator makes to recognition is, I believe, his advocacy of the fostering of the spirit of the brotherhood of man. May I remind him of what Samuel Lover wrote of his countrymen? -

Fighting like divils for conciliation,

And hating each other for the love of God.

The honorable gentleman’s mission is to establish the brotherhood of man, but in his fierce advocacy of this cause, he has not hesitated to insult and stigmatize as liars, knaves, and “batteners” on the people - I am quite unable to summon to my aid all the adjectives which the honorable senator has at his command - those men - he will not admit that they are his superiors - who in public and private life have been carrying on the work of developing this country.

Senator Collings:

– I rise to a point of order. The honorable senator is accusing me of using language which I never employed. I have never in my life, in this chamber or elsewhere, referred to men as liars or knaves.

Senator BRENNAN:

– I accept the honorable senator’s assurance, and I am sorry if I have made observations that were hurtful to him.

Senator Collings:

– They do not hurt or annoy me; they are untrue. My inferiors cannot insult me; my superiors will not.

Senator BRENNAN:

– Nevertheless, I notice that the honorable gentleman was very prompt in asking for the protection of the Chair. If I erred, it was because I had heard the honorable gentleman make two speeches, and was under the impression that he had used all the words in our vocabulary. [Extension of time granted.)

I thank honorable senators for their - courtesy, and I shall draw my observations to a close with a story. It relate? to the fiction, that the lion, in its natural state, is such a noble creature that, having once pounced upon its intended victim, and failed, it will not make a second attempt. A traveller on one occasion went out seeking to kill a lion which had been causing considerable damage in .the district. When suddenly he came face to face with it, the animal sprang at him, missed, and then uttering a roar of disgust, disappeared. The following morning the traveller again went to meet the lion, and, espying the animal in a secluded spot, watched it in surprise, because it appeared to be practising short jumps. If to-morrow in any of the fastnesses that distinguish this Federal Capital city, any of my honorable friends discover me acting in some strange fashion, I ask them not to be disturbed. I shall be merely practising short speeches.

Senator HOARE:
South Australia

– At the outset, I wish to reply to some of Senator Sampson’s statements. “The honorable senator appears to think that the Scullin Administration was guilty of tariff rigging, through the agency of the Tariff Board. He said that the Tariff Board had been, and always would be, in favour of protection, and that protection had nothing to fear from it. That, I contend, would depend on the personal opinions in regard to freetrade and protection of the members of the board. It would be quite easy for a Tariff Board to either wreck or make protection. 1 a3k leave to continue my remarks at a later hour.

Leave granted; debate adjourned.

page 2374

QUESTION

WAR DEBTS

Senator Sir WALTER GREENE:
Assistant Minister (Treasury) · NEW SOUTH WALES · NAT

[4.47]. - -by leave - The following is a summary of the note presented to the United States Government by ‘ His Majesty’s Ambassador at Washington yesterday : -

After recalling the general view expressed by His Majesty’s Government in the United Kingdom on the war debts question in correspondence last November and. December and the exceptional nature of the procedure then adopted, in view of the peculiar position of the then United States Administration, and referring to the subsequent negotiations and discussions between the Prime Minister and the President of tlie United States in Washington, the note emphasizes the urgent need for a speedy conclusion, especially with a view to the success of the World Conference. Tt then states that the conclusion at which His Majesty’s Government in the United Kingdom have arrived is that payment of the June instalment could not be made at this juncture without gravely imperilling the success of the conference and involving widespread political consequences of the most serious character. In their view, the instalment should be considered and discussed as part of the genera) subject of war debts upon which they are anxious to resume conversations as soon as they can bc arranged. In the meantime, in order > to make it perfectly clear that they do not regard the suspension of tlie June payment as in any way prejudicing ultimate settlement, His Majesty’s Government propose to make an immediate payment of 10,000,000 dollars as an acknowledgment of the debt pending a final settlement. If, as they trust, the Government of the United States is thereafter prepared to enter upon formal negotiations for the ultimate settlement of the whole war debts question, His Majesty’s Government would be glad to be informed of the time and place at which the United State Government would desire such negotiations to be begun.

The statement in reply by the President of the United States of America reads as follows: -

The payment of 10,000,000 dollars now being made does not in any sense prejudice the freeing of either Government in any subsequent discussion of the entire debts question, which will take account of this and other debt payments. President refers to his discussions with His Majesty’s ambassador and with the Prime Minister but states that the time and circumstances would not permit any definite conclusion, because both governments were vitally concerned in the preparations for the Monetary and Economic Conference. It seems the part of fairness and wisdom to postpone formal representation until the summer or autumn. Meanwhile the World Conference is beginning under the most favorable auspices, and it is vitally necessary that during the opening days of the conference difficult and possibly protracted discussion of debts be avoided. In a spirit of co-operation the President has, as the Executive, noted the representations of His Majesty’s Government with respect to payment of the 15th June instalment, in as much as the payment made is accompanied by a clear acknowledgment oi the debt itself. In view of those representations, and of the payment, he has no personal hesitation in saying that he does not characterize the resultant situation as a default. Beyond this the law and constitution do not permit him to go. Under his constitutional powers and in accordance with the terms of policy set forth he can. entertain the representations of His Majesty’s Government concerning entire debts settlement, and His Majesty’s Government have requested that such opportunity be afforded. The Economic Conference does not include ‘any consideration of the debts to the United States of America in its programme, and the United States delegates have been instructed not to discuss the debts with the representatives of any debtor government. This is in accordance with the further principle which’ the President lias felt important - that the debts be considered on their merits and separately from other international economic questions.

page 2375

QUESTION

CUSTOMS TARIFF 1933

Second Reading

Debate resumed from page 2374.

Senator HOARE:

– I cannot conceive the possibility of any government submitting to the will of the Tariff Board. I know of no reason why a government should adopt the findings of that body without applying to the matter its own judgment and discretion. After all, an administration governs solely at the will of the people, and may be considered to have a mandate from” the people. If the Labour party were entrusted with the administration of the affairs of this country, it could justifiably assume that the people were in favour of protection, irrespective of whatever might, be the findings of the Tariff Board. Senator Sampson appeared to be somewhat concerned about- the tariff walls that enclose the different nations to-day The reason why every nation is endeavouring to protect itself by means of a tariff wall is that we have nation against nation, people against people, and individual against individual. What does it matter to one nation what happens to others, so long as it is pre-eminent? That is the basic principle which governs the commercial world in every country. One individual fights for another’s job, because he fears the possibility of want and misery. Senator Sampson, presumably in reply to Senator Collings, referred to the brotherhood of man. That has been destroyed by what one may term the advance of civilization, under which have been built up tariff and other walls that have created divisions between man and man,” people and people. If we wish to restore the brotherhood of man along the lines of socialism, a new world must be borne. Reform measures can only follow the education of the masses. Education is knowledge; knowledge is power; power ensures victory; victory means progress; and progress involves the destruction of whatever imprisons the souls and the lives of mankind. Knowledge is the axis upon which the universe must revolve, and it is the duty of all right-thinking men to seek knowledge, and make it available to their fellows.

The other day, when I referred to the harvesters manufactured by the Hugh V. McKay Harvester Company, Senator Elliott interjected that he had not discussed that company’s operations. At the time, I was not .quite sure of my ground;’ but I am now, because I have since made inquiries into the matter. The harvesters manufactured by H. V. McKay Proprietary Limited are landed in all the capital cities of the Commonwealth freight paid, and should not cost more in Perth or Adelaide than in Melbourne.

Senator Badman:

– Does that also apply to the Massey-Harris machinery manufactured in the McKay works?

Senator HOARE:

– I was given to understand that the rule applied to all the agricultural implements made there. I knew that it was so two or three years ago, and I ascertained last week that it is still so.

Senator E B Johnston:

– It may be so in the other States, but it is not so in Western Australia.

Senator HOARE:

– A McKay harvester costs £5 more in Perth or Fremantle than in Adelaide; but who has the advantage of the £5? It must be the agent, for it is not the manufacturer. We have been told by honorable senators who believe in low tariffs, that if the duties were removed from all agricultural implements the price of them would be reduced. Experience, however, does not bear this out. The effect of removing all duties from farming machinery would be to place primary producers at the mercy of the importers. The importers are not philanthropists. In the Argentine, and in parts of South Africa, where freetrade applies, the cost of farming implements is higher than in Australia, where protection applies. This shows that the primary producers are not benefited when they are left at the mercy of the importers or their agents.

Senator Duncan-Hughes:

– Are the importers less philanthropic than other people ?

Senator HOARE:

– In my opinion they are.

Senator Sampson:

– Are the Australian m anuf acturers philanthropists ?

Senator Duncan-Hughes:

– Some are.

Senator HOARE:

– Some may be; I believe that our farmers are likely to get a better deal from local manufacturers than from importers.

Senator Foll:

– Can a man who made £2,000,000 in the manufacture of agricultural implements be regarded as a philanthropist ?

Senator HOARE:

– I should say that a man who made that amount of money from the manufacture of agricultural implements was charging too much for his goods. It is the duty of this and every other Government to protect the people of Australia from unscrupulous traders.

Senator Foll:

– What would happen to the wharf labourers of Port Adelaide if all imports ceased?

Senator HOARE:

– If imports ceased, more manufacturing would be done in Australia, and so the wharf labourers who lost their work on the wharfs would find work elsewhere. It has been said that if we desire other nations to trade with us. we must trade with them. One honorable senator was dogmatic enough to say that other nations would not trade with us unless we trade with them.I remind him that during the regime of the Scullin Government, when the tariff reached its highest point, the Japanese bought more wool from Australia than they had ever bought previously. According to some honorable senators, when the duties on Japanese goods were increased, the Japanese should have said: “If you increase your duties on Japanese goods, we will not buy any more wool from you “. But it suited J apan to buy Australian wool because it was the best wool in the world, and could be had at a satisfactory price. Japan, as a matter of fact, forced the British wool buyers to pay more for Australian wool than they desired to pay. I believe that if the nations of the world want our goods, they will buy them if the price is right, even though we may prohibit the importation of foreign goods. It has been said that we should give a greater preference to British goods, but Britain has not shown much preference for Australian goods.

Senator Sampson:

– Oh yes she has ; she has treated us more than generously.

Senator HOARE:

– I think that we have been more than generous to England. We know that Great Britain gives a preference to butter from Holland, and to beef from the Argentine. The reason for the preference to Argentine beef is well known. Millions of pounds of British capital are invested in the Argentine.

Senator Elliott:

– British investments in the Argentine total £435,000,000, but the present value of them is only a little over £200,000,000.

Senator HOARE:

– Most of the British money invested in the Argentine has gone in the development of the cattle industry.

Senator Elliott:

– That is not so; for £271,000,000 has been invested in railways and tramways, £59,000,000 in Government securities, and £105,000,000 in miscellaneous undertakings.

Senator O’Halloran:

– There has been no depreciation of British capital invested in Australia.

Senator HOARE:

– A large amount of British capital has been spent in developing the cattle industry of the Argentine, and it is only reasonable to expect that the British investors will do their best, to protect their investments. Every one. knows that Vestey Brothers have a big pull in the Argentine. If honorable* senators knew who Vestey Brothers really are, they might be very much surprised. It is probable that many of the largest shareholders in Vestey Brothers hold prominent public positions in England. Naturally, these shareholders will do everything they can to protect their investments. In my opinion, Australia and the other British dominions are entitled to a larger preference from Great Britain than the Argentine, or any other country outside of the Empire, but they do not get it. Although many other countries receive a greater preference than Australia, we are expected to break down our tariff walls so that British manufactured goods may be imported to the detriment of our own industries and our own workers.

In my opinion, primary and secondary production should be developed simultaneously. If one is depressed to the advantage of the other, economic difficulties will undoubtedly occur. Who can draw a line of demarcation between primary and secondary industries? Some honorable senators would like freetrade for secondary industries, and protection for primary industries; but such a policy would be destructive to Australia. I should be quite prepared to sweep away all tariff barriers to-morrow if the standard of living and the wage conditions of all countries were equal, for I should know that the workers of Australia would be able to hold their own against the workers of the world. But as we know, equality in these matters is not practicable at present; we must protect our own people. If equal conditions could be provided for all nations, irrespective of colour, freetrade could be allowed. But even if we became a freetrade nation, honorable senators opposite would complain, because we should then have to raise our revenue by placing a tax on the land. The adoption of the single tax, however, would place a huge load on land-holders. With a single1 tax, and a freetrade policy, the wealthy property-owners of our capital cities would, in the main; carry the burden. We have not yet reached that stage. Those engaged in secondary and primary industries should endeavour to work hand in hand, instead of trying to score off one another. I am a protectionist through and through. While I believe that the secondary industries should be protected, I also favour the protection of the primary industries. I have always endeavoured, by voice, and vote, to assist both. The following figures show the value of production in Australia during 1930-31, which was not a particularly favorable year: -

Those figures, which total £319,701,000, indicate the effect of the policy that has been followed in Australia during the last 30 years.

Many of the industries that we have established have given very fine returns. Take, for example, the tanning and leather industry. The raw materials used by that industry in 1930-31 had a value of £2,132,000. In the same year the value of the raw material used in the manufacture of boots and shoes amounted to £3,148,000; in fellmongering and wool scouring to £3,349,000; in soap and candle-making to £1,448,000; in saw-mill3 to £2,995,000; in agricultural implement-making to £596,000; in engineering to £2,386,000; in the smelting, refining and rolling of iron to £6,133,000; in jam and fruit preserving to £2,354,000; in sugar confectionery to £2,590,000; and in woollen and tweed mills to £3,756,000. It will thus be seen that some of our main industries depend very largely upon primary products, and provide a very considerable home market for the consumption of Australian goods. Taking the value of primary industries and secondary industries on an employment basis, we find that, since 1911, the population of Australia has increased by nearly 2,000,000, or about 40 per cent. The value of production of primary industries has increased in that period by £154,000,000, or 135 per cent., and the number of employees engaged in primary production has decreased by 44,000, or 9 per cent., although the lesser number cultivates 9,000,000 more acres of land and produces an additional 200,000,000 lb. of wool. f On the other hand, the value of production from secondary industries has increased during the same period by £287,000,000, or 215 per cent., and the number of employees engaged in secondary industries has increased by 138,000, or 44 per cent. Those figures are for a normal year, 1928-29.

Senator Duncan-Hughes:

– The honorable senator should take the export figures.

Senator HOARE:

– Those that I have quoted support my argument, and prove that the.interests of both the primary and the secondary industries are so interwoven that injury to the one would inevitably do harm to the other. If the protection given to secondary industries were to be reduced, it would be but fair to reduce the protection granted to the primary industries. The following figures show the amount of protection accorded, and other interesting information relating to primary production for the year. 1929-30 : -

If Australia suddenly adopted a policy of partial freetrade, and removed the protection now given with regard to maize, the returned soldiers who grow maize in Queensland would go to the wall. The dairy and poultry industries of the Commonwealth return, in round figures, £43,000,000 a year, and one can imagine the consternation that would be caused if the tariff were suddenly altered so that Chinese eggs could be imported into Australia, as they were before we had a tariff in operation. Senator J. B. Hayes would have us reduce the duties on the products of secondary industries; but how would he like it if, to equalize matters, we reduced the duty of £8 a ton on onions to £1 a ton, and allowed the Australian market to be flooded with New Zealand onions? The people of Australia pay some millions of pounds annually to give the dairying industry the benefit of a duty of 6d. per lb. on butter. If we reduced the duty on butter to 2d. per lb. our dairymen would be threatened with ruin, because many thousands of pounds worth of butter would immediately be imported from New Zealand, against whose dairymen the

Australian producers cannot compete. 1 helped to place the present duty on butter, because I know from personal experience of the dairying industry that the producers of that commodity are engaged in an industry in which the conditions of work approximate slavery. The unfair part of it is that Senator J. B. Hayes and others claim that we shouldallow the duties to remain on primary products, but they complain against those on manufactured goods. Because of the duties imposed on primary products entering Australia, the people are paying millions of pounds more for the primary products they buy, the purpose of it all being to help the man on the land. The exchange rate also operates to help the primary producer. I do not know the amount we pay in this way each year, but probably it would be £7,000,000 or £8,000,000,and that has to be made up by the taxpayer. Is that not a large measure of assistance for those engaged in the exporting industries? Of course it is. That being so, those who believe in building up secondary industries in Australia have a right to demand similar protection for those industries.

Senator Duncan-Hughes:

– But they are getting the benefit of the tariff and the exchange as -well.

Senator HOARE:

– Perhaps they are, but the community is paying for it. No doubt the primary producers are deserving of the assistance they receive from the exchange, but, for my part, I should prefer, instead of an exchange rate of 25 per cent., to pay the primary producers an equivalent bounty if it were necessary. The man on the land who buys an imported agricultural implement, for instance, has to pay 25 per cent, more for it because of the exchange. This exchange rate has a boomerang effect which a bounty would not have. If we protect primary industries without protecting the secondary industries we shall destroy the local market for the things we grow. After all, the home market is the best market for any country. The figures I have quoted prove the value of the secondary industries as providing a market. What is the use of offering a man a ha; for 2s. 6d. if he has only 2s. with which to buy? The only way to develop the home market is to develop our secondary industries side by side with the primary industries. We shall then get our population back to work, and restore to them their lost purchasing power. It is of no use plastering hoardings throughout the country with slogans calling on the people to buy Australian-made goods if we rob the people of the power to buy them. Therefore, let us protect both the primary and secondary industries, because they both deserve it. I have here an extract relating to the consumption of dairy products within Australia. It is as follows : -

The Australian butter producers are, in effect, receiving from the consumers of Australia a bounty of between £3,000,000 and £4,000,000 a year. Some of the primary products wl dell receive protection are - milk, butter, cheese, sugar, tobacco, dried fruits, bacon, hams, pork, lard, wax, poultry, eggs, live-stock- and pigs. In 1929-30 Australia produced £49,389,000 worth of these foodstuffs. Tlie value of such goods consumed in Australia was £40,819,000, while exports were valued at £8,579,000.

That is the point I have been trying to emphasize. Is it not better to consume in Australia all the products we can, and thus provide employment for our own people, than to send the stuff overseas? The Australian price for butter is higher than that offering abroad. If we were to build up our secondary industries sufficiently, we should be able to provide a market in Australia for all the butter we produce, and the dairymen would get something approaching the full value of their labour.

Some people seem to believe that primary industries are more important than any others. Discussing this attitude, Professor Copland has stated -

The belief that primary production ]S more important to a country than manufacturing come.-: down to us from the discussions that took place at the end of the eighteenth century among a group of French economists (the Physiocrats), who held that all wealth (-alius from the soil, and that other forms of labour were unproductive. It is, perhaps, natural that this belief should survive in a country like Australia, where primary production supplies the bulk of the exports. But it is a mistaken view, and it has led to much misunderstanding concerning the contribution made by manufacturing industries to the national income and the economic prosperity of the country. There is, in any case, some secondary production in the exports from primary industries. For instance, flour is manufactured in Australia for export. All butter produced goes through a process of manufacture, metals - have to be refilled, and meat has to be slaughtered and frozen. The “processing” of these exports is not different from the manufacturing of other products, whether these products are exported or sold in the domestic market. Any operation that produces a commodity at a marketable price is productive, and secondary industries are just as much engaged in producing wealth as primary industries. They add to the national income, enabling the “country to support a greater population. How vital this has been to Australia since the war is shown by the fact that the majority of Australian workers now find employment in the secondary industries.

Surely Parliament can find a way of assisting both primary and secondary industries without giving one an advantage over the other. Speaking at Tamworth ou one occasion, Senator Hardy said that Australia would never become a manufacturing country, because the production of wool, wheat, butter, &c, were our main industries. That opinion is dissented from by the committee of economists appointed by the Bruce-Page Government to inquire into our economic position. These men, Professors Brigden,

Copland, Giblin, and Mr. Dyason, prepared and presented a report from which the following is an extract -

Because of the large proportion of primary production in Australia, Australian income is subject to greater fluctuations than are experienced with its manufacturing production. We should have suffered more from world disturbances had we depended more upon export industries. Before the war, the agricultural and pastoral production also showed progress, but with falls as well as rises. In the years 1908-1913, agricultural production (in million pounds) was 37, 41, 39, 38, 45, 40; and pastoral production 40, 51, 56, 52,63; while manufacturing production was 33, 30, 42, 47, 53, 57. It is clear from these figures that a larger proportion of manufacturing industry for home production gives greater stability to the national income, and, insofar as the tariff increases the ratio of manufacturing production to total production, it encourages greater stability, and reduces the dependence of Australian industry upon the vagaries of foreign markets.

In addition to the economists’ example as quoted above, the following figures make a comparison from another view-point equally effective: -

In 1911, the agricultural, pastoral, dairying, and mining industries value of output is set flown in the Year-Book statistics at £132,096,000.

The output of value of the manufacturing industry £133,090,000 being nearly equal to the other.

In 1929-30, the first-named industries advanced to £229,015,000, or an increase on the 1911 figures of approximately 74 per cent.

The value of the manufacturing industry for 1929-30 amounted to £390,912,000, equivalent to an increase on the 1911 figures by approximately 193 per cent., as against 74 per cent.

That was written by men from whom we have a right to expect a sane and considered judgment, and it should carry conviction. For my part, I desire both primary and secondary industries to expand. I want to see primary industries become even more important than they have been in the past. Our secondary industries should become an important factor, as they were until recently, in the economic life of the country. I cannot understand objections being raised concerning the price of galvanized iron manufactured in Australia. Probably the average Australian farmer does not purchase more than a few sheets in ten or twelve years. If any one has any reason to complain about the prices charged for that commodity, it is those who used it extensively in the construc tion of homes at a time when prices of all building commodities were highest. At that time home builders were robbed,’ fleeced, and cheated by the importers of galvanized iron, and not by the Australian manufacturers: Working men and returned soldiers who were building homes made a strong plea to the Government in power at that time to come to their aid, but no assistance was given. Large importing firms, such as Harris, Scarfe and Company, of Adelaide, and other importers, should have been told to reduce their prices or the Government would become an importer. Some honorable senators claim that they are protectingthe interests of the primary producer by squealing about the price of galvanized iron; but they are blaming the wrong persons. They should protect those who are compelled to use galvanized iron in large quantities.

Senator Carroll:

– Of what year is the honorable senator speaking?

Senator HOARE:

– I do not know the year, but it was during the period when the Gunn Government was in power in South Australia, when, and for some time previously, an enormous price was charged.

Senator Sampson:

– Was the locallymanufactured galvanized iron as expensive as the imported article?

Senator HOARE:

– No. At the time of which I am speaking, galvanized iron was imported at from £18 to £20 a ton, held in stock, and sold at from £82 to £100 a ton to returned soldiers and others who were building homes. It should be illegal for manufacturers to charge exorbitant prices for their goods. Surely this Parliament has the power to attack these exploiters. Some contend that it cannot be done; but if it cannot be done by this Parliament, we should make room for one with the ability to do it. In some instances when the duty of certain imported goods was raised, prices were also raised; but it is only fair to say that some manufacturers did not take advantage of the higher duties. Some Australian-made goods can be purchased to-day at less than one-half the price of the imported article, and those who are using the local product claim that its quality is as good as that of the imported. An enormous quantity of motor machinery is now being manufactured in Australia which was previously imported, and I am informed that a good deal of it is being sold at one-half the price previously charged for machinery manufactured in America. Industries which can produce at -lower rates are worthy of protection, but I suppose if they can maunfacture at one-half the price of their overseas competitors, they do not need high protection. Manufacturers should recognize that it is their duty to give the people a fair deal. Complaints are heard because some manufacturers are making more than a fair profit; I believe that there is a good deal in that. Manufacturers who are doing so should recognize that if they continue the practice there is a danger of their businesses being destroyed. The Government should tell these people that they are charging too much, and that they should expect only a fair margin of profit. It should be able to tell them that it is ille’gal to make excessive profits. [Extension of time granted.] Some time ago, in company with other members of this Parliament, I visited Tasmania, when we were invited to inspect the carbide industry. We listened most attentively to the manager, who said that if he could get the industry properly established and receive adequate protection, he would have a monopoly of the Australian trade. The Scullin Government gave the protection sought, and I suppose that industry is prospering; I hope that it is. I submit that if a government was right in protecting that industry, it would be equally right to protect every other secondary industry. If it is good policy to protect the hopgrowers of Tasmania to the extent of ls. per lb., it is also right to protect those engaged in secondary production. We should protect both primary and secondary production, as by doing so we shall be assisting Australia to become the great nation which she deserves to be.

Senator MCLACHLAN:
Vice-President of the Executive Council · South Australia · UAP

– There are two things upon which honorable senators have reason to congratulate themselves, namely, that they have now accomplished the feat pf listening to 22 speeches on » the second reading of this bill, . and, secondly, that under our Standing Orders, in speaking in reply,- 1 am not permitted an extension of time. Therefore, I shall have to review somewhat rapidly the various opinions expressed by the various speakers, and I shall endeavour to extract from their remarks suggestions which may be of value constructively.

The subject of exchange has been ably dealt with by the Leader of the Government in the Senate (Senator Pearce). As I indicated when moving the second reading of the bill, it must be considered apart from our tariff legislation. Honorable senators will remember that the depreciation of the German mark and Italian lira was dealt with by special legislation, and probably if anything is undertaken in the direction desired by some of the speakers, it must be by special legislation, or under the Australian Industries Preservation Act.

The attitude of honorable senators opposite towards the bill may be determined by the speeches of the Leader of the Opposition (Senator Barnes), the Deputy Leader (Senator O’Halloran), and Senator Collings, the last-mentioned being most pronounced in the expression of his opinions. Those honorable senators believe in a policy of economic nationalism, which, on reflection, they must admit has been condemned by the world’s greatest economists. They regard economic nationalism as a remedy for the evils from which the world is suffering; but such a policy cannot be applied in a country with a population of 6,000,000 persons. It has never been effectively adopted in any country, and it has been condemned by those great economists who are making every effort to show the way to economic and financial stability. I cannot share the pleasure of Senator Collings in his forecast of the imminent failure of the World Economic Conference now sitting in London, upon the success of which the future of civilization largely depends. I view the matter in an entirely different light. While the efforts of the representatives who are attending the conference may not succeed completely, I feel that a larger economic unit than exists at present will be brought into existence. This will not be economic nationalism such as: Senator .Collings considers desirable. That would mean the breaking off of commercial relations with practically the rest of the world. In my second-reading speech, I stated that there were conflicting or distinct schools of thought i» relation to the economic affairs of the world, and I indicated the Government’s view, which, of course, is not shared by honorable senator’s opposite. They believe in a policy of economic nationalization, a policy of production for use and not for profit, and on that question we are diametrically opposed. But I see a glimmer of reason among honorable senators opposite, because one honorable senator has stated that he is in favour of a greater population in, and a heavier immigration to, Australia. That, to me, was the one redeeming feature in the otherwise hopeless attitude of Labour senators. But they have been driven to that attitude for political reasons. Because nationalization has failed, they have been forced to adopt the policy of high tariffs, which has placed, not only Australia, but also other countries, in the unfortunate position which they occupy to-day. Honorable senators opposite blame private enterprise - to which they refer as spiders which have spun their financial webs - for the position of this country to-day. That is arrant nonsense, yet those honorable senators believe that the people are. credulous enough to believe it.

Some honorable senators believe that, in respect of the Ottawa agreement, we should have reduced duties against GreatBritain, instead of increasing the duties against foreign countries; but two things stood in the way of that. One was the Ottawa agreement itself, coupled with our own tariff policy, and the other was the provision in the Tariff Board Act which makes it mandatory for a Minister to refer duties to the Tariff Board for recommendation and report before they are assented to by either the Cabinet or the Parliament. I have always considered that it is mandatory upon the Minister to refer duties to the Tariff Board, and my view has been supported by the Solicitor-General and various Attorneys-General. Section 15 of the Tariff Board Act lays down a certain procedure, which was followed in respect of the Ottawa agreement. Do Senators Payne and Duncan-Hughes object to the Tariff Board acting in accordance with principles which are laid down in the Tariff Board Act, and are embodied in the Ottawa agreement itself? Surely the Government should not be criticized for adhering to those principles. We have been charged with not giving effect to the spirit of the Ottawa agreement, but I can find that spirit only in the letter of articles 9 to 13 of the agreement, under which we must conform to the law of this country by referring duties to the Tariff Board. Great Britain itself stipulated that that should be done, and thi3 Parliament has given a statutory direction to the board to deal with the tariff in the light of the Ottawa agreement. It will be remembered that the members of the party to which I belong condemned the Scullin Government for increasing duties without the sanction of the Tariff Board, and at that time Senator Payne was one of those who clamoured for the application of section 15 of the Tariff Board Act.

Various matters of detail have been referred to by honorable senators, and I shall deal with, them at the committee stage.

Senator Foll complained that the Customs Department was not policing the industries of this country, and that the manufacturers who were enjoying tariff protection, were being permitted to exploit the public. I assure the honorable senator that the department is keeping a careful watch on the operations of the manufacturers and the prices charged by them, so as to prevent them from imposing upon the public.

Senator FOLL:
QUEENSLAND · NAT; UAP from 1931

asked why the Government, instead of increasing the duty on films, did not impose an excise duty. The position is that it is impossible to impose an excise duty on films, because in the administration of excise, discrimination cannot be exercised between Empire films and those at which we desire to strike a blow in the interests of revenue. It has also been suggested that Great Britain should reciprocate with Australia in respect of films, but that is not possible now in view of the exceedingly small number of films that we . could send to Great Britain at the present time. However, that matter is being taken up with the British authorities, and I have no doubt that if Australia produces sufficient films, reciprocity with Great Britain will ensue. Another difficulty in respect of films is that their distribution is in the hands of an American company. That has come about because of American investors gaining control of the British industry at its source. The position is being investigated, but at the present moment I do not think that the Commonwealth can interfere.

A suggestion was made by one honorable senator that there was some significance about the sale of American wheat to China, and it was enlarged upon by other honorable senators. During the past week I had an opportunity to interview a gentleman who has an intimate knowledge of that transaction, and he informed me that an enormous quantity of American wheat assessed at a certain price was handed over to the Government of China, that it is being milled in that country, and that the whole of the proceeds is being used for the purpose of carrying on no less than four different wars.

One honorable senator suggested thai the Ottawa agreement was being undermined by the action of Great Britain in entering into trade agreements with foreign countries, but I assure honorable senators that that is not so. Great Britain is preserving and respecting the Ottawa agreement. When Senator Brown was speaking the other night, he said that under the Anglo-Danish agreement, Denmark was supplying 62 per cent, of Britain’s butter imports, but he quickly corrected himself by saying that that applied only to foreign imports. Great Britain is entering into agreements with foreign countries, and I hope that before long we shall be able to submit similar agreements to this Parliament for ratification. I have no wish to enter into a controversy with Senator Crawford in respect of the cause of the unsatisfactory position of the world generally. He spoke of prices being reduced under a high tariff, but I have never heard of such a thing, and it is not likely to happen unless the tariff is carefully policed.

Items such as rabbit traps and perambulators have been mentioned, but I shall not deal with them at this stage. Senator Duncan-Hughes said that the duties on medicines were 30 per cent. British preferential, and 40 per cent, general, but those duties apply only to drugs the like of which are being manufactured in Australia, and there is no complaint about them excepting in one or two particulars. The duties on medicines n.e.i., are - free, British preferential, and 15 per cent, foreign. Whatever form the World Economic Conference may take we must play our part in it in the interests, not only of the British Empire, but also of civilization itself.

Question resolved in the affirmative.

Bill read a second time.

In committee :

Clause 1 (Short title).

Senator MCLACHLAN:
Vice-President of the Executive Council · South Australia · UAP

– Honorable senators will remember that after the Customs Tariff memorandum showing the rates of duty under items set out in groups Nos. 1 to 8, were laid on the table, the following resolution was carried by the Senate -

That, for the information of the committee, the Customs Tariff Memorandum which was laid on the table on the 1st June, 1933, be referred to the Committee of the Whole on the Customs Tariff Bill.

Progress reported.

Sitting suspended from 6.16 to 8 p.m.

page 2383

PAPERS

The following papers were presented : -

Audit Act - Regulations amended - Statutory Rules 1933, No. 68.

Financial Relief Act - Regulations - Statutory Rules 1933, No. 67.

Private business taking precedence after 8 p.m.,

page 2383

QUESTION

LIAISON OFFICER IN LONDON: PAPERS

Senator DUNN (New South Wales) [8.01.- I move-

That the file of papers, including the applications of permanent officers of the Commonwealth Service and the recommendations of the Public Service Board of Commissioners thereon, relating to the recent appointment of a liaison officer in London, be laid on the Parliamentary Library table.

To me, that motion means a great deal, for I regard myself as one of the elected custodians of the well-being of the Commonwealth Public Service, and every Minister in this chamber along with every other honorable senator is also under a moral obligation to safeguard the interests of our 30,000 public servants. In every British nation the Public Service has established for itself a reputation for zeal, honesty, and integrity, and before a recruit is accepted he must prove that he possesses certain specified educational attainments. Many intellectual persons make the Public Service their profession, and, by studying at night classes or the university, equip themselves scholastically so that they may efficiently perform any duties that may be allotted to them. As a result, there are, in the ranks of our Public Service, men who possess the highest educational and technical qualifications. Unlike that of the United States of America, our Public Service remains constant, irrespective of changes of government. It pledges its allegiance to no political faction, but discharges its duties loyally and impartially to the government of the day; so that the saying, “ The King is dead ! Long live the King ! “ may aptly be paraphrased to read, “ The Government is dead ! Long live the Public Service ! “

Throughout that loyal and highly capable body which we term the Commonwealth Public Service there now exists a state of seething discontent, for its members believe that some of them have been unfairly treated, and that, as a body, they have been slighted. The cause is the appointment by the Government of Mr. Keith Officer as liaison officer in Australia House, London. Previously that gentleman was a temporary clerk in the Service. The Government has issued the statement that no member of the permanent Public Service possesses the educational, linguistic and technical attainments which are required for the post, those attributes, apparently,’ being peculiar to Mr. Officer.

In my capacity as senator, I come in contact with many prominent members of the State and Commonwealth Public Services, and I have formed the ‘opinion that, so great is the sense of injustice under which the Service is labouring, these men and women have no intention of submitting to the affront without registering a protest, and taking appropriate action. I believe that there is even a move afoot to inform public opinion on the subject, so that the taxpayers may know how their representatives abuse their rights. This misuse of privilege has caused public servants to lose confidence in the Government that was elected through the medium of the ballotbox some eighteen months ago. They do not desire to make threats, and I” do not suppose that the Government would bo greatly concerned if threats were made, for it still has another eighteen months tenure of office. But I remind honorable senators opposite that there is an end to all life, including political life, and that, at no distant date, they will again have to go to the people, and give an account of their stewardship.

I regard the answers which Senator Pearce gave to my questions on this subject as an affront to our public servants, and say without fear of contradiction that there arc hundreds within their ranks who are excellent linguists, whose knowledge of international affairs is extensive, and whose general and technical qualifications fit them admirably for the position of liaison officer in London.

Shortly after the Senate had reassembled for this session, the Minister in Charge- of Mandated Territories (Mr. Marr) addressed a group of very fine young men who had been chosen as cadets for the New Guinea Public Service, just prior to their embarkation for the mandated territory. Impressing upon the young men the fine traditions of the service into a branch of which they were entering, Mr. Marr emphasized that they were going to New Guinea not merely as cadets, but as potential diplomats in the service of the nation. Those w-ere high sounding and courageous words, and, perhaps, the Minister was creating a precedent.

The PRESIDENT (Senator the Hon. P. J. Lynch). - What relation has this to the motion that has been moved by the honorable senator?

Senator DUNN:

– Everything, sir, because, according to Senator Pearce, the person who has to carry out the duties of liaison officer in London must be capable of rendering highly diplomatic service.

It was also stated by the Government, as propaganda, that Mr. Keith Officer had been in the service of the British Government in Nigeria. I have no personal animus against this man; in fact, I should not know him if he walked in the door; but I protest emphatically against what I firmly believe to be the unfair treatment of a highly trained and capable body of men. I, therefore, desire to have all the papers relating to this extraordinary transaction laid on the table of the Library, so that honorable senators may see for themselves what has actually occurred. It has been stated that nobody in the permanent Public Service is capable of carrying out the duties of liaison officer in London. I ask what would happen if Mr. Keith Officer fell overboard during his voyage to Great Britain, or if he were chosen for some higher office? Should we again have to go through the farcical procedure of the Public- Service Board calling for applications for the position from all who are in the Public Service, merely to have transmitted to us later the pre-determined statement that there is nobody in the service -capable of carrying out these duties ? The people of Australia do not believe that in the Federal Public Service of 30,000 officers, including many university graduates and highly-trained men, there was not one man capable of performing the duties associated with the comparatively minor position of liaison officer. .Instead of treating with scorn the government which has shown itself capable of making such an appointment, there are some in the community, and, indeed, in this chamber, who associate idealism with it. That such things should take place at the seat of government, in this national city, is a disgrace to Australia. What is behind this appointment? Is it that the present Government intends to give all the plums of office to its friends, in payment for services rendered? If that is the position, the public should’ know the truth. Only a few years ago Mr. Keith Officer was in Nigeria, in Africa, and during the time that he has been connected with the Public Service of Australia he has not held a permanent position, but has. been classed as a probationary officer. . In making this appointment, the Government has ignored the Public Service Act, and treated with contempt the Public Service Board. There is something wrong. It may be that Mr. Keith Officer has been given this position because when a youth he played marbles and “bogeyhole “ with a fellow Melburnian in the person of Mr. Stanley’ Melbourne Bruce, a former Prime Minister of Australia, wore the same kind of spats, moved in the best society circles, and occasionally perambulated along “ The Block “ in Collins-street, Melbourne. I do not know whether my assumption is correct; I am merely a political innocent seeking the truth, and endeavouring to ascertain the reasons for this appointment. The Leader of the Government in this chamber is most unwilling to supply information to honorable senators on this side of the chamber in reply to questions without notice; he prefers to give his answers through the Government Printer. Whether I am a member of this chamber for three, six, or 33 years, I shall at all times endeavour to see that the federal public servants are treated fairly. Were the whole of the circumstances associated with this appointment made public, there would probably be revealed another sordid story of political treachery to the Public Service. There is no doubt that in that Service are many men capable of filling the position to which Mr. Keith Officer has been appointed. You, Mr. President, may remember that a few months ago, when there was trouble with one of the State Governments, men who volunteered to join a Public Service “ basher gang “ were supplied with batons in order to resist a mythical “ Red “ army, headed by Mr. J. T. Lang, the then Premier of New South Wales, which was said to be marching on Canberra. But to return to the appointment of Mr. Keith Officer. On the 10th March, 1932, applications were invited in the Commonwealth Gazette, No. 20, for appointment as liaison officer, London, 3rd Division, the closing date being the 24th March. The position was advertised as being open to officers of the State and Federal Public Services, and to other persons. Suitable applicants were examined personally, and, after careful elimination, their number was reduced to. two. That was in June, 1 932. The names of those two applicants were announced by the Prime Minister, who said that a selection would be made in the. course of a few days, because, it was necessary to fill the position as soon as possible. The promised announcement was never made ; but a recent issue of the Commonwealth Gazette notified the people of Australia that Mr. Keith Officer had been chosen to fill the position. It was then announced that he would proceed to London immediately. Mr. Officer was appointed to this position from outside the Public Service. It is true that he was a probationary officer in that Service at a salary of about £6 a week, but he was not a public servant within the meaning of the Public Service Act. The other applicant to whom I have referred was a Mr. Hodgson, a permanent officer of the Commonwealth Public Service who possessed outstanding qualifications for the position. The Public Service generally has not been treated fairly in connexion with this appointment. We are told by the Government that no officer permanently employed in the Public Service was capable of doing the work which Mr. Keith Officer has been appointed to perform. I suppose that, notwithstanding his qualifications, Mr. Hodgson was not suited for the position, because he had not been sufficiently active on behalf of the United Australia party. Perhaps his political outlook was not entirely favorable to the Government. This position was reserved for a friend of a prominent Minister in the present Administration, who sits opposite Labour senators in this chamber.

The PRESIDENT:

– What have all these remarks to do with the motion fer the tabling of certain papers?

Senator DUNN:

– I want the papers tabled because I am of the opinion that this appointment has been made for political purposes in payment for services rendered. If a Labour government had made the appointment, Comrade Sir Keith Murdoch would rush to Canberra with a printing press to tell the world about it. I shall hearken to your rebuke, Mr. President, not only because you are the custodian of the Standing Orders, but because, in your exalted position, you have given every member of the Senate a fair deal.

The PRESIDENT:

– The honorable senator will realize that, if he does not confine his remarks to the motion, the debate may not be kept within reasonable limits. Therefore, for the sake of the reputation of the Senate, and in the interests of the honorable senator himself, I shall be glad if he will keep as closely as possible to the subject-matter of the motion.

Senator DUNN:

– If -the papers in connexion with this appointment are laid on the table of the Library, honorable senators outside the Ministry, and members of another place, when they reassemble, will have an opportunity to ascertain the facts. There were two applicants for the position, one being Mr. Hodgson, a permanent member of the Public Service, and the other Mr. Keith Officer, a probationary public servant, who has not been many years in the employ of the Commonwealth, and was, for some time, engaged in diplomatic work for the British Government in East Africa. As honorable senators are ‘aware, it is the function of the Public Service Board to recommend appointments to the Public Service, and in the discharge of its duties it safeguards, as far as is possible, the interests of 30,000 men and women in the employ of the Commonwealth. For the last few days Ave have been discussing the powers and functions of another board, and we have had evidence of a wide difference of opinion among even Government supporters on the subject of the tariff. Indeed, the general discussion became so heated that challenges were issued by or against certain members of the Country party in connexion with an understanding or arrangement which, it was alleged, had been made between the two parties supporting the Government. Apparently, a similar set of circumstances has now arisen having relation to the actual powers of the Public Service Board, for it has been stated that the board declared that Mr. Hodgson was a fit and proper person for appointment as the Liaison Officer in London, but the Government^ thought otherwise, and appointed Mr. Officer to the post. I~ assure honorable senators that I am quite disinterested in this matter. Both gentlemen are unknown to me personally, and I am told that some of my Labour colleagues met Mr. Keith Officer for the first time a few days ago. I certainly have no axe lo grind, my sole purpose being to see that justice is done to all members of the Public Service. I am not prepared to say that the appointment of Mr. Officer was engineered by the right honorable the Leader of the Senate or by the Assistant Treasurer (Senator “Greene) ; but, apparently, some power behind the scenes brought pressure to bear on the Government to ensure the appointment of Mr. Officer. All the circumstances clearly indicate that the answers given, by Ministers to questions on the notice-paper of the Senate with reference to this matter were merely intended to camouflage the position in the interests of some person, or, perhaps, some member of the Ministry. Let us have the truth about the whole business. It is possible, of course, that the Leader of the Senate has an answer to the charge which I have made, and, possibly, he may be able to get out of an awkward position due to the appointment of Mr. Officer, and be able to placate the 30,000 members of the Commonwealth Public Service who are so vitally concerned in this matter. But it is better to clear up all doubt, and allay all suspicion, by laying the papers on the table of the Library. I have no illusions as to the working of the Commonwealth parliamentary machine. My experience* in this chamber for the last four years has confirmed me in the belief that political intrigue “is prevalent throughout the system of government. But surely the time has arrived when politicians of every school of thought can agree no longer to tolerate existing conditions governing appointments to the Public Service. If the recommendations of the board are to be ignored in this way, if the aspirations of public servants are to be ruthlessly trampled upon as in this instance, merely because public servants have no direct representation in this Parliament, how will it be possible to maintain discipline in the service? Are we to look for the spirit of Hitlerism in ‘all future appointments? “What incentive will there be for those lads who enter the Postal Department as telegraph messengers, or for those cadets who secure appointments to other departments, if political friendships or other influences, due to the atmosphere of the late war, are so powerful as to ensure the appointment of a temporary officer to the highest post in the diplomatic service of the Commonwealth? No matter what the Leader of the Senate may say, and no matter what may be published in the newspapers by the “ heelers “ of the mechanized press of this country, under the jurisdiction of Sir Hugh Denison in New South Wales, and Sir Keith Murdoch in Melbourne, the impression of unfairness existing in the minds of 30,000 men and women in the Commonwealth Public Service, can only possibly be allayed or removed when the papers in connexion with this appointment are made available for inspection by honorable senators and members of another place.

Senator Sir GEORGE PEARCE:
Minister for Defence · Western Australia · UAP

[8.43]. - Any one listening to the honorable senator would have the impression that he found some difficulty in convincing even himself that the case which he has presented to the Senate was a good one. I ask honorable senators not to agree to his motion, and I feel sure that after they have heard what I have to say, they will admit that there is very good reason why the papers should not be laid on the table df the Library. In the first place, I would point out that Parliament has, in the Public Service Act, expressed its will as to the. procedure to be adopted in regard to the Public Service. That act gives to the Board of Public Service Commissioners full power over promotions in, or appointments to, the Public Service. This power does not rest with the Ministry at all. It is definitely given to the commissioners. The permanent heads of departments are given certain powers of control, and have to be consulted by the Public Service Board in respect to appointments. Parliament made that provision so as to remove the Public Service from political control and patronage. The Government had nothing whatever to do with this appointment, except in relation to a decision at a certain time that the position should not be filled. The appointment was made by the Public Service Board, and by it alone. Let me give the history of this case. A notification of the vacancy was published in the Commonwealth Gazette on the 10th March, 1932. At one stage of his speech, the honorable senator wanted to know why all officers in the Public Service were not allowed to apply. They were not only allowed, but were also invited to apply. Applications were invited from permanent officers of the Commonwealth Public Service. It was also stated that the position was open to officers of the State Public Services, and to other persons, and that, as amongst such applicants, preference would be given to returned soldiers and sailors possessing the necessary qualifications. The whole, of that procedure was absolutely in accordance with the Public Service Act. It was further stated that applicants must be graduates of a recognized university in arts or law, must have a good knowledge of at least one modern foreign language, preferably French, and must have had some experience of international affairs. Those requirements were stipulated because of Iiic particular nature of the duties that the officer appointed to the position would have to perform. The applications were received by the Secretary to the Department of External Affairs, who, after examining them and interviewing several of the applicants, in conjunction with the Commonwealth Public Service Inspector for Victoria, transmitted the papers to the Public Service Board. The then permanent head of the department, Mr. McLaren, in his memorandum to the Public Service Board, in which he discussed the claims of the applicants whom he regarded as most deserving of consideration - and that is one of the duties imposed on him by the Public Service Act - placed Mr. Officer as No. 1 in the order in which he recommended them for consideration by the board. I understood Senator Dunn to say that Mr. Hodgson was placed No. 1.

Senator Dunn:

– He was one of the two candidates recommended by the Public Service Board.

Senator Sir GEORGE PEARCE.My information is, that at that stage the permanent head placed Mr. Officer No. 1. While the matter was receiving the attention of the Public Service Board, it was decided by the Government that, in view of the imperative need for economy, the making of a definitive appointment be deferred pending an investigation of the position by the Minister without Port folio, who is at present in London asResident Minister. Honorable senators will remember that, at that time, Mr. Bruce had just left for London. The Government decided that it would not. make the appointment until he had examined the whole position, and could advise whether it should or should not be’ filled. I think everybody will agree that that was a wise precaution to take. In due course, the matter was further considered by the Government in the light of reports that had been received from Mr. Bruce. The conclusion arrived at was, that the system of attaching such an officer to the Foreign Office had worked admirably, that its continuance was essential, and that it was a most economical method of obtaining the information relating to foreign affairs which is so- necessary for the satisfactory conduct of the Department of External Affairs. The Public Service Board was therefore asked to make a definitive appointment to the vacancy. Meanwhile, the permanent head of the department, Mr. McLaren, had left Australia to take up the position of Secretary to the High Commissioner’s Office in London, and Mr. Starling became the permanent head. Mr. Starling was asked to make a recommendation to the Public Service Board, and he recommended the appointment of Mr. Officer, who has been appointed by the board on probation, in pursuance of the provisions of the Public Service Act and of Public Service regulation 159, which provides that a returned soldier who has passed one of certain specified examinations shall be deemed to have passed, a prescribed examination for admission to the Public Service in the third or the fourth division. That was not exceptional. In a number of cases returned soldiers who were beyond the age at which they could qualify by examination for admission to the Public Service in the ordinary way, have passed into the Service under those very provisions. I point out, therefore, that up to that stage every step had been taken in entire accord with the Public Service Act, and it cannot be said that there was anything extraordinary in the nature of the appointment.

I come now to Mr. Officer’s qualifications. By the way, the honorable senator seemed to think that Mr. Officer was not an Australian because he happens to have spent some time in Nigeria.

Senator Dunn:

– I did not say anything of the sort.

Senator Sir GEORGE PEARCE.The tenor of the honorable senator’s remarks would lead one to the conclusion that that was his belief. Mr. Officer is an Australian. He is a Bachelor of Laws of the University of Melbourne,has a good knowledge of the French language, and has had considerable experience in international affairs. He served with the Australian Imperial Forces for the whole period of the war, from 1914 to 1919, and is at present on the unattached list of the Commonwealth Military Forces, with the rank of major. From 1919 to 1923, he was political officer of the British Colonial Service in Nigeria. Since 1927, he has been continuously employed in a temporary capacity in the Department of External Affairs, upon duties complementary to those of the London Office. He has also been closely associated at this end with all the recent work upon disarmament, and if necessary will be able to take over the duties now being discharged by Mr. Shedden, an officer of the Defence Department who is at present representing the Commonwealth on the Disarmament Committees at Geneva.

Why does the Government object to laying these papers on the table of the Library? In the first place, it will be noted that we have acted in entire accord with the principle of non-political control of the Public Service. The reports submitted to the Public Service Board are absolutely confidential, and would be stripped of all value if they were not so. I should like first to deal with the report, made by Mr. Bruce. Why is that confidential? For Mr. Bruce to decide whether it was necessary to fill the position, he had to find out exactly in the Foreign Office what work was done by the Liaison Officer when the position was filled by Major Casey, what are the systems under which the Foreign Office works in connexion with foreign countries, what are the channels of communication, and how does the Australian Liaison Officer act in relation to the rest of the Foreign Office in obtaining information that is of value to Australia. I remind honorable senators that to-day Australia is very greatly interested in the reports which come from the Foreign Office, particularly on account of its position in relation to certain nations which, geographically, are not far distant from us. Is it not, therefore, of the utmost importance that we should receive as quickly as possible the most confidential reports on all matters affecting foreign policy with the nations that are in touch with Australia, particularly in the Pacific? Mr. Bruce’s report is consequently of a most confidential nature. It gives an outline of the work that this officer does, how he obtains his information, the officers with whom he comes in contact, and the kind of knowledge revealed to him. It deals with the most secret organization of the Foreign Office. I am convinced that the British Government would regard it as an absolute breach of confidence if we were to make public that report of Mr. Bruce, and I assure honorable senators that the Government cannot see its way clear to make it public. Mr. Bruce made no comment whatever upon the candidates for the position, nor did he deal in the slightest degree with that aspect of the question.

I come now to_ the reports of the two permanent heads to the Public Service Board. These are confidential to the board, because they give the personal opinion of the permanent heads in regard to officers who have worked either under them or in other departments. Honorable senators can see that, if such reports were made public, they would have no value in future. It will be realized how undesirable it would be for the permanent head of a department to have his reports discussed in Parliament, or to be pilloried because he had expressed an opinion, that we must assume is an honest opinion, concerning the qualifications of certain officers. Such reports would not be made if they were not to be regarded as confidential as between the permanent head and the Public Service Board. They would be stripped of all value as a guide to the board in considering the relative merits of different officers, if the permanent head were to be made a chopping block in Parliament, or to be discussed in the press or by Public Service associations and other bodies. I may say that this very procedurewas followed during the whole- of the time that the Scullin Government was in office, and that it has been adopted ever since the Public Service Board was appointed. During that period there have been Labour governments, but they have never altered the practice, the reason being that it is realized that the Commonwealth’ Public Service receives substantial justice, and that it is removed entirely from political influence and patronage.

Senator Dunn appeared to be under a misapprehension in regard to the cadets that were recently appointed to the New Guinea Service. They are not in the Commonwealth Public Service, and these papers have no bearing on their appointment.

In the light of the explanation that I have given, I ask the Senate to support the Government in the view that it is not in the public interest that these papers should be laid on the table of the Library.

Senator BARNES:
Victoria

– The explanation that has been given by the Leader of the Government in the Senate (Senator Pearce) sounded reasonable; but why could it not have been made earlier? Had it been, Senator Dunn might not have sought to have the papers in connexion with the case laid on the table of the Library. If, in the exercise of his privileges, an honorable senator asks a department for information, so far as I know he is entitled to receive it. He may have been wrongly advised in regard to certain matters. At times I have received information which appeared indisputable, yet, when I have had the opportunity to peruse tlie files, T have found that it was quite inaccurate. In all probability, that would have been the result in the present instance had a similar procedure been followed.

Although the explanation of the Minister was clear and, apparently, candid, I can see no reason why certain information that must be on the file should not be made available to us. ° No one wants to know anything about the channels through which information from the British Foreign Office percolates through to the Commonwealth Government. I take it that all Senator Dunn desired to know was whether the appointment had been made legitimately in accordance with the Public Service Act. If the Leader of the Senate had given us this information frankly the other day “when he was questioned on the subject, this motion would probably not have been moved. I have been informed that the recommendation of the responsible officer of the Department of External Affairs was overridden by some higher authority. If that has happened it is outrageous; but, apparently, the appointment has been made regularly. I regret that the Minis”ter did not make this clear to us the other day. Had he done so, both Senator Dunn and I would have been satisfied. I was interested in this appointment some time ago, when certain information in regard to it came to me. When I found that Senator Dunn was also interested in the subject, I passed my information on to him. The whole matter could have been disposed of very easily if the Minister had dealt more frankly with us.

Senator RAE:
New South Wales

– The suggestion of Senator Barnes that sufficient information should be supplied to us to assure us that this appointment has been made in accordance with the usual practice should commend itself to the Government. If a feeling is engendered in the Public Service that what may be called the “ plums “ of the Service are being handed out to persons who are not public servants, grievances will undoubtedly arise. If the information which Senator Pearce has given us tonight is complete’ and correct, he should have made it available without so much pressing. We should not have to drag information of this kind out of him. After all, a grievance is just as much a grievance to the person concerned whether it he rightly founded or not. It is in the best interests of the Public Service that as much frankness as possible should be exhibited in dealing with important Public Service appointments. I know that there is a feeling abroad that sometimes the forms prescribed by statute law and the regulations made thereunder are complied with in the letter but not in the spirit. If a certain stipulated procedure is overridden so that some favorite of a Minister may be given an appointment, trouble i3 bound to occur. It has been rumoured - and it is just as well for us to mention these matters - that the influence of Mr. Bruce has been brought to bear on the Public Service Board - surreptitiously, perhaps - in order to have a certain person appointed. It appears, however, from the explanation of the Leader of the Senate (Senator Pearce) that the Secretary of the Department of External Affairs examined the applications for this position, and eliminated those which he deemed thought came from unsuitable persons.

Senator Sir George Pearce:

– I do not think that he eliminated any. He examined the applications, and made certain recommendations to the Public Service Board; but the whole of the applications came before the board.

SenatorRAE. - Even if all the applications went to the board, the making of a recommendation would tie its hands to some extent.

Senator Sir George Pearce:

– The Public Service inspector and the permanent departmental head would examine all the applications.

SenatorRAE. - If that procedure is adopted, there is surely an element of political interference. Is the permanent head in no way subordinate to the Minister in a matter of this kind? If he is, there is a point of contact between the Ministry and the Public Service Board.

Senator Pearce:

– This appointment was made as all appointments of the kind are made.

SenatorRAE. - It still seems to me that there is room for pressure to be brought to bear on the board. A person who is seeking an appointment is always helped by a push from behind.

Senator DUNN:
New South Wales

– The explanation of the Leader of the Government (Senator Pearce) why the file of papers relating to this appointment cannot be laid on the Library table is not acceptable to me. If the members of the Public Service had been here to hear the explanation, I am sure that they would have given Senator Pearce a loud horse laugh, Haw, haw, haw! When I was a child, I was told that dear old Santa Clauscame to Australia on a. sleigh from some mythical Greenland. The Leader of the Senate has told us this evening that a bogy man may come to Australia from some nearby foreign country. The Sydney Morning Herald has reported that luggers from a nearby foreign country are appearing regularly along the coastline of Northern Australia. Perhapsthey bring these mysterious bogy men to Australia. The supporters of the Government may be satisfied with the fairy tale that Senator Pearce has told us about the possible danger of these bogy men learning the secrets of the foreign office if this file of papers is tabled in the Library. But it is ridiculous to suggest to sensible people that in this year of grace, 1933, some one in big boots may walk round the Library table of this Parliament and find out things that he ought not to know. This is where the Leader of the Government should be given another horse laugh!

Nothing was said by me about the war service of Mr. Keith Officer, who has been selected for this position by the Government. Who am I that I should criticize a person on this score ? I was myself a private soldier in the Australian Imperial Forces, earning 6s. a day. For five years I watched the contours of the hills and walked the valleys wherever the Australian troops were fighting. I do not know whether Mr. Keith Officer is an Australian, an Englishman, a Scotchman, an Irishman, a Swede, a Jew, a Christian, a Chinese, a Japanese or a Nazi; and I do not desire it to be stated in Sir Keith Murdoch’s tinsel press that I have attacked this man because he is not an Australian. I do not know what he is.

I support the remarks of the Leader of the Opposition (Senator Barnes). I have not suggested that the secret files of this nation should be laid on the table of the Library, so that foreign spies, of whom the Minister for Defence seems to be greatly afraid, might be able to see them. The reply of the Minister may be described as a political jig-saw puzzle. I am not aware of any overseas appointments made by the Scullin Government, but it may have acted upon the recommendation of the Public Service Board. The Leader of the Senate gave the show away when he said that theResident Minister in London (Mr. Bruce) had recommended that the position of liaison officer should be filled. The story going the rounds in the Public Service is that

Mr. Keith Officer happens to be a club pal and personal friend of Mr. Bruce. Of course, Mr. Bruce can have whom he likes as his friend; but this shows why Mr. Officer was the only man considered suitable for the position. I said that the New Guinea cadets had been spoken of as a section of the diplomatic service. Applicants for these positions were invited in the press, and they were considered by the Government of the day.

The PRESIDENT:

– That matter has no relation to the motion before the Senate.

Senator DUNN:

– With all due respect, Mr. President, I am merely replying to a criticism made by the Leader of the Government. It is evidently the intention of the Government to create a diplomatic body.

Question resolved in the negative.

page 2392

QUESTION

CUSTOMS TARIFF 1933

In committee (Consideration resumed from page 2383) :

Clauses 1 to 5 agreed to.

Clause 6 (Imposition of duties).

Senator PAYNE:
Tasmania

– I suggest that this clause be postponed. The opening words of the clause are -

Each duty of customs specified in the schedue in relation to an item contained therein, is hereby imposed in accordance with the schedule - . . .

Amendments may be requested by the committee, and I ask the Minister in charge of the bill whether it is desirable to pass this clause at the present stage.

Senator MCLACHLAN:
Vice-President of the Executive Council · South Australia · UAP

– I ..give the honorable senator an unqualified assurance that this clause relates only to the schedule as finally accepted by this committee. It does not validate the schedule as it now f rands, because that has not yet been considered by the committee.

Clause agreed to.

Clauses 7 and 8 agreed to.

Clause 9 (Application of British preferential tariff to the non-self-governing colonies).

Senator DUNN:
New South Wales

.- This clause reads- (1.) The Governor-General may, from time to time, by proclamation declare that the rates of duty set out in the column headed “British

Preferential Tariff “ in the schedule shall apply to such goods as are specified in the proclamation as are the produce or manufacture of a British non-self-governing colony specified in that proclamation in relation to those goods, and thereupon the British preferential tariff shall apply to the goods so specified as are the produce or manufacture of the colony so specified.

Certain manufacturers prefer to establish their plants in countries where cheap labour is procurable. For instance, the jute industry of Scotland has been transferred from Aberdeen to India, where millions of pounds worth of machinery has been erected. Similarly. Lancashire cotton mill-owners have gravitated to India and China, where they can get cheap labour, and where children of tender years work night and day at their machines. I wish to be sure that the British preferential tariff shall not apply to goods produced under cheap coloured labour conditions in British nonselfgoverning colonies. Being a politician, I cannot help being suspicious about the possible effect of this clause. By products of coco-nut, sugar, pineapples, bananas, and citrus fruits might be produced in such colonies to the detriment of Australian white labour.

Senator MCLACHLAN:
Vice-President of the Executive Council · South Australia · UAP

– The proclamation referred to in this clause will declare that the British preferential rates of duty shall apply to such goods as are specified in the proclamation, and are the produce or manufacture of a British non-self governing colony. This provision results from the Ottawa agreement, and leaves room for negotiations between the ‘ Government of the Commonwealth and the administration of non-self-governing colonies of- the British Empire, with a view to entering into arrangements for the application of the British preferential rates to various products. The concession could affect only one commodity, namely, bananas, which might be regarded as competitive with anything produced in Australia, and honorable senators will have an opportunity of discussing that later.

Senator RAE:
New South Wales

– Notwithstanding the explanation of the Minister, I can see a very grave danger in this” clause in its present form. The Minister admits that the purpose of the clause is to enable negotiations to be entered into with non-self-governing colonies. The clause itself says that the Governor-General may from time to time issue proclamatious declaring that British preferential rates shall apply to the non-self-governing colonies. We all know that the Governor-General means, in effect, the Government of the day. Therefore, the Government of the day may vary the duties on goods imported from these colonies to bring them under the British preferential rates without referring the matter to Parliament or to the Tariff Board.

Senator McLachlan:

– The duties may be transferred from the general column to the British preferential column.

Senator RAE:

– The alteration might be opposed to the general wish of Parliament, and might even be opposed to a recommendation of the Tariff Board.

Senator COLLINGS:
Queensland

– The objection raised by Senator Rae to this clause is important to those of us on this side of the chamber who hold strong views to the effect that the tariff should be used to protect Australian industries from the competition of goods produced in cheap-labour countries, whether those countries are styled nonselfgoverning colonies or anything else. Senator Dunn pointed out that certain manufacturers who formerly carried on in Great Britain have now transferred their operations to India in order to reap the advantage of cheap labour. If this clause is passed, it will mean tariff alteration by government proclamation without reference to any ether authority. The Executive Council is supreme, and may, by proclamation, transfer duties from one column to another. I shall need some better explanation than that givenby the Minister before I am satisfied. I understand, of course, that the Minister cannot be expected to answer on the spur of the moment, but there is no reason why the clause should not he postponed until ho has had time to investigate the matter.

Senator McLACHLAN (South Australia - Vice-President of the Executive has mistaken my meaning. In the tariff schedule contained in this bill, there are two columns, the first containing the British preferenial rate, and the second column the general rate. At the present moment, the British preferential rates apply, broadly speaking, to Britain herself. A proclamation was issued last year applying those rates to the mandated territory of Tanganyika, in return for certain concessions granted by that territory to our products. It is now contemplated to extend the proclamation to Ceylon in return for which certain concessions will be granted to Australia, particularly in respect to canned fruits. This power will be exercised only when we get in return for it a quid pro quo in the shape of special concessions for Australian products. It will certainly mean the transference of rates of duty from one column to another, and to that extent will involve a reduction of duty, but will be done only as the result of a bargain. Whatever the appropriate duty may be in the British preferential column, that duty will apply to the goods exported by the colony concerned.

Senator Barnes:

– Then the Commonwealth Government could, by proclamation, admit goods free of duty from a non-self-governing possession.

Senator McLACHLAN:

– The honorable senator has misunderstood me. Suppose the British preferential rate on a commodity is 5 per cent. and the general rate 15 per cent. At the present time, the goods of non-self-governing colonies would be assessed at 15 per cent.; but if this clause is passed, the GovernorGeneral may, by proclamation, admit those goods at the British preferential rate of 5 per cent. If no duty is imposed in the British preferential column, then, of course, the goods in question would be admitted free. It is not mandatory that this be done, but the Government would have power to do it.

Senator Collings:

– Will this bargain, which is to be made before the proclamation can be issued, be subject to ratification by Parliament?

Senator McLACHLAN:

– The proclamation will not be ratified by Parliament.

Senator Collings:

– Then any kind of bargain may be made behind the back of Parliament?

Senator McLACHLAN:

– It can be done only in regard to the nonselfgoverning colonies. If we are to encourage inter-Empire trade, there is no reason why we should not have this power. That is the spirit in which we are approaching the tariff. This provision will enable the rate of duty applying to the Motherland to be applied to the non-self-governing colonies of Great Britain. There is a good illustration of this in regard to Colombo, but I am not sure whether the proclamation has yet been gazetted. It is unfortunate that the proclamation refers only to the tariff items by their numbers, so that I cannot for the moment explain to honorable senators the nature of the goods affected. The arrangement with Colombo was entered into on the 11th May of this year, and it will be exceedingly beneficial to Australia. Were the Government not to have this power, it would be difficult to enter into arrangements between Australia and the nonselfgoverning colonies.

SenatorRAE (New South Wales) [9.42]. - I really cannot understand the value of this clause, and I can still see a danger in it. I do not know whether there is any legal constitutional interpretation of the words “nonselfgoverning”. Of course we know that in extreme cases Fiji is considered to be a self-governing colony. But what is the position in respect to India?

Senator McLachlan:

– The definition in clause 3 states that “ nonselfgoverning colony” includes British Protectorates, the Mandated Territory of Tanganyika, and so much of the Cameroons and Togoland as is governed under British mandate.

Senator RAE:

– A few years ago we should never have dreamt of Great Britain having to compete with any of its dominions or colonies in respect of cotton manufactures. At one time most of the cotton clothing was made in Lancashire, but to-day there are millions of spindles being used in India for the manufacture of goods, and, as a result, hundreds of thousands of weavers ‘in England have been thrown out of employ ment. We should be at least consistent in regard to our tariff, and I suggest that we postpone this clause or consent to an amendment providing that any duties proposed to be levied by proclamation should first be referred to the Tariff Board for consideration and report. Surely honorable senators, whether they advocate a high, low, or no tariff at all, will agree that a principle, which is applicable to the general tariff, should also apply to special cases as set out in clause 9.

Senator McLACHLAN:
Vice-President of the Executive Council · South Australia · UAP

– This clause is necessary in view of article 15 of the Ottawa agreement, which reads -

His Majesty’s Government in the Commonwealth of Australia undertake to accord to the non-self-governing colonies and protectorates, and the mandated territories of Tanganyika, the Cameroons, under British mandate, and Togoland, under British mandate, preferences on the commodities, and at the rates shown in schedule G, and also any preferences for the time being accorded to the United Kingdom, if his Majesty’s government in the United Kingdom so request.

Provided that His Majesty’s Government in the Commonwealth of Australia shall not be bound to accord any preferences to any colony or protectorate which, not being precluded by international obligations from according preferences, either (i) accords to Australia no preferences, or (ii) accords to some other part of the Empire (in the case of Northern Rhodesia, except the Union of South Africa, Southern Rhodesia, and the territories of the South African High Commission) preferences not accorded to Australia.

Senator O’Halloran:

– Do the possible preferences apply only to items under schedule G of the Ottawa agreement?

Senator McLACHLAN:

– That is the position. Schedule G contains such items as asphalt, bitumen and natural pitch, dry gums, essential oils and bananas, but. as I have informed honorable senators, the item of bananas will he discussed separately. Other items in the schedule are - cocoa, fruit juices, fruits, coco-nuts, plumbago and graphite, sago and tapioca, spirits, sponges, timber, tobacco, cigars and unground spices. Those items are not numerous, and the goods referredto, with the exception of bananas, are not produced in this country to any extent.

Senator MacDonald:

– What about rum?

Senator McLACHLAN:

– The margin of preference on rum is 5s. per gallon, when not exceeding the strength of proof, and 5s. per proof gallon when exceeding the strength of proof. This clause is necessary in order to facilitate business with other countries, and, of course, if this Government makes a bad bargain for Australia, it must be held responsible. Ceylon, which is a near neighbour of ours, offers a market for not only a number of our primary products, but also many of our secondary products. I instance biscuits. During my short sojourn in that delightful centre, except as regards climate, I noticed that the biscuits made by the Western Australian firm of Mills and Ware had quite a vogue among the residents of Colombo, while Australian apples were also being transported to Ceylon in considerable quantities. It may be said that the trade is of no great magnitude; but it is all to the good that we should have this elasticity. In any case, we are bound to give effect to these matters in accordance with the obligations into which we entered at Ottawa.

SenatorDUNN (New South Wales) [9.51].- I move-

That the House of Representatives be requested to leave out the clause.

In support of my amendment, I mention that tie first plank of the fighting platform of the Australian Labour party is “ The cultivation of an Australian sentiment and the maintenance of a White Australia.” I congratulate the Minister on the plausible story that he told, and the appealing sentimentality of his arguments. I can quite appreciate his viewpoint as the Minister in charge of the bill, but I cannot reconcile it with an unbiased interpretation of clause 9, which reads -

The Governor-General may . . .

And who is the Governor-General ? Why, the Government, of course. The clause continues - from time to time, by proclamation, declare that the rates of duty set out in the column headed “ British preferential tariff “ in the schedule shall apply to such goods as are specified in the proclamation as are the produce or manufacture of a British nonselfgoverning colony specified in that proclamation in relation to those goods, and thereupon the British preferential tariff shall apply to the goods so specified as are the produce or manufacture of the colony so specified.

Then I turn to clause 3, which clearly states that “ non-self -governing colony “ includes British protectorates, the mandated territory of Tanganyika, and so on. It is quite possible that the quantity of foreign bananas which we are importing may be increased, by agreement. Again, there are banana flour and other such commodities. When I was in Natal I saw thousands of acres of sugar-cane, cultivated by black labour, and a little while ago I read a pamphlet, entitled The British March of Trade and Commerce, which indicated that capitalism is stretching its tentacles into Tanganyika, and other places, because of the cheap labour that exists there. And capitalism does not concern itself about our ideate of a White Australia. I overheard a conversation that another place let this clause pass unchallenged. That has no significance to me, for I fear that the specious arguments advanced by the Minister in charge of the bill portend danger to our ideal of a White Australia, and to the protection of our manufacturers and workers.

Senator FOLL:
Queensland

.- Senator Dunn referred to the danger of the importation of black-grown sugar under the terms of this agreement. The embargo which is imposed under the terms of the Sugar Agreement Bill affords sufficient safeguard in that respect. But, particularly in view of the explanation of the Minister, I consider that clause 9 should have been made more specific, in order to impose a limit upon the quantity of products to be imported. Under the clause as it now reads, any British protectorate may make a trade agreement with Australia, and send us its products without any limitation such as is imposed by schedule G of the Ottawa agreement on bananas from Fiji. The question of bananas is a vexed one to Queensland and New South Wales, and it must be watched carefully. In group No. 1, item52, the duty on bananas is shown as 2s. 6d. per cental British and 8s. 4d. per cental general. I understand that previously there was only one rate for bananas. The Assistant Treasurer (Senator Greene) shakes his head. Why, then, did Fiji bananas always come in previously at the rate of 8s. 4d. per cental ?

Senator Sir WALTER GREENE:
Assistant Minister (Treasury) · NEW SOUTH WALES · NAT

– Because they came in under the foreign rate.

Senator FOLL:

– Exactly. That is why I am concerned about clause 9, and the possibility of an agreement being entered into which would permit bananas other than those now imported from Fiji entering Australia at the reduced rate.

Senator McLachlan:

– Is not the answer that schedule G of the Ottawa agreement definitely limits the quantity of bananas to be imported to 40,000 centals ?

Senator FOLL:

– That is from Fiji only; but I am unaware of any limitation regarding the total quantity of bananas to be imported from other nonselfgoverning colonies. I should like it to be specified definitely in clause 9 that no more than that quantity shall be imported per annum.

Senator BRENNAN:
Victoria

– I agree with the view expressed by Senator Foll. Two articles of the Ottawa agreement are affected. The first is article 7, which reads -

His Majesty’s Government in the United Kingdom will invite the governments of the non-self-governing colonies and protectorates to accord to Australia any preference which may for the time being be accorded to any other part of the British Empire . . . and further will invite the governments of the colonies and protectorates shown in schedule E to accord to Australia now or additional preferences on the commodities and at the rates shown therein.

The other article concerned is the first part of article 15 -

His Majesty’s Government in the Commonwealth of Australia, undertake to accord to the non-self-governing colonies . . . preferences on the commodities and at the rates shown in schedule G, and also any preferences for the time being accorded to the United Kingdom if His Majesty’s Government in the United Kingdom so request.

When we agreed to the Ottawa agreement, we agreed to the things which are specifically mentioned in schedule G. But clause 9 does not limit us in any way to what is contained in schedule G. It enables the Governor-General, by pro clamation, after treaty, no doubt, with the non-self-governing country concerned, to make a trade arrangement for the admission of articles not included in schedule G, and to make the British preferential rate apply to them. Although I am willing to trust the Government to see that no article is admitted under these terms which it would not be to the advantage of Australia to admit, I think that the view expressed by Senator Foll is the correct one. The position could be met by making it clear that clause 9 is limited to those articles which are set out in schedule G.

Senator Sir WALTER GREENE:
Assistant Minister (Treasury) · NEW SOUTH WALES · NAT

– How would the honorable senator give effect to article 15 of the Ottawa agreement if that were done?

Senator BRENNAN:

– Article 15, portion of which I have already quoted, contains the following proviso : -

Provided that His Majesty’s Government in the Commonwealth of Australia shall not be bound to accord any preferences to any colony or protectorate which, not being precluded by international obligations from according preferences, either - (i) accords to Australia no preferences or (ii) accord to some other part of the Empire . . . preferences not accorded to Australia.

Senator Sir WALTER GREENE:
Assistant Minister (Treasury) · NEW SOUTH WALES · NAT

– If it is limited to schedule G, why is the word “also” inserted?

Senator BRENNAN:

– There is something in the view expressed by Senator Foll, and I think that the position could be met by limiting the application of clause 9 to the articles set out in schedule G.

Senator O’HALLORAN:
South Australia

– Unless the Minister can give a more satisfactory explanation than he has yet given, I shall feel disposed to support Senator Dunn’s amendment. There is no limitation on clause 9. It may apply to the Ottawa agreement; but it may also apply to other agreements, and for that reason it places too great a power in the hands of the Executive. Section 9 of the tariff legislation passed in 1921 provided for preferential rates of tariff to apply to the British dominions, but on that occasion protection against the Executive was given by requiring an investigation to be undertaken by the Tariff Board. Any preferences which we are bound to give under the Ottawa agreement could not, of course, be inquired into by the Tariff Board. In the case of other preferences which we are not bound to give under the Ottawa agreement, the Government should consider the possibility of providing that they shall be the subject of inquiry and report by the Tariff Board. My reading of the proviso to article 15 is that if in the future we accord additional preferences to the United Kingdom, and the Government of the United Kingdom requests that they shall also be accorded to similar products produced in any of these British colonies, it will be out duty under article 15 to extend such preferences to those products.

Senator McLachlan:

– Does not the honorable senator think that there is some limitation implied as regards the commodities to which preference shall be granted?

Senator O’HALLORAN:

– I fail to see any limitation. Article 15 provides that Australia shall accord preferences to nonselfgoverning colonies, protectorates, and mandated territories at the rates shown in schedule G - and also any preferences for the time being accorded to the United Kingdom if His Majesty’s Government in the United Kingdom so request.

To me that seems to indicate definitely that there shall be no limitation to the preferences which may be given by Australia.

Senator McLachlan:

-I am afraid that the honorable senator has not quite grasped my meaning. The article provides that the preferences shall be “ on the commodities and at the rales shown in schedule G, and also any preferences for the time being accorded to the United Kingdom.” Would not such preferences bo at the rates shown in schedule G? I shall look at the matter a little more closely.

Senator O’HALLORAN:
SOUTH AUSTRALIA · ALP

– I confess that the provision puzzles me, and I think it would probably be wise if the Minister postponed consideration of the clause in order that he may examine it more closely.

Progress reported.

Senate adjourned at 10.16p.m.

Cite as: Australia, Senate, Debates, 15 June 1933, viewed 22 October 2017, <http://historichansard.net/senate/1933/19330615_senate_13_140/>.

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