14th Parliament · 1st Session
The President (Senator the Hon. P. J. Lynch) took the chair at 10 a.m., and read prayers.
– I ask the Leader of the Senate, if the’ Government will consider the desirabilty of attaching to the proposed contingent of 150 returned soldiers, who are to attend the coronation, the 31st Battalion (Cairns) band, the champion “ A “ grade baud of Australasia, all the members of which are militia men ?
– Numerous suggestions that members of various organizations, including bands, should be permitted to attend’ the coronation, have been referred to a subcommittee of Cabinet. I do not know whether representations have been made on behalf of the band mentioned by the honorable senator, but if so they will have been referred to the sub-committee and full consideration given to them. The Government decided that the line would have to be drawn somewhere, and consequently it has been unable to accede to all the requests made, many of which are of great merit. When further particulars are received from overseas, a statement will be made by the Prime Minister as to the exact nature of the delegation to be sent.
Leader of the Senate, upon notice -
Senator Sir GEORGE PEARCE.The answers to the honorable senator’s questions are as follows: -
asked the Minister representing the Minister for Trade and Customs, upon notice -
Senator Sir GEORGE PEARCE.The Minister for Trade and Customs has supplied the following answers to the honorable senator’s questions : -
No. 2and 3. Registration of the film was refused by the Censorship Board because it was considered that it would be used for undesirable propaganda purposes. If the importer so desires he can appeal to the Appeal Censor against the board’s decision.
asked the Minister representing the Minister for Commerce, upon notice -
– The Minister for Commerce has supplied the following answer to the honorable senator’s questions : - 1 and 2. The average price for greasy wool during the last six seasons was -
For 1935 the average price for the period July-September was 12.19d. For 1936 the average price for the period July-September was 12.46d.
Suspension ofStanding Order No 68.
Motion (by Senator Sir George Pearce) agreed to-
That Standing Order No. 68 be suspended, tor the present sitting, to enable new business to be taken after half-past ten p.m. this day.
[ 10.8]. - I move -
That the bill be now read a second time.
Representations have been made to the Government with a view to assisting the widow of the late Mr. William James Mc Williams. As honorable senators will recall, the late Mr. Mc Williams was ‘ a member of the Tasmanian Parliament for six years, and of the Commonwealth
Parliament, as the honorable member for Franklin for twenty years. Inquiries have disclosed that Mrs. McWiliiams is in necessitous circumstances, and the Government considers that the Parliament should be asked to grant to her some measure of assistance. The deceased gentleman played a prominent part in the public life of Australia, and in view of the circumstances in which his widow is placed, it is fitting that some provision should be made for her.
Question resolved in the affirmative.
Bill read a second time, and reported from committee without amendment or debate.
Standing and Sessional Orders suspended; report adopted.
Bill read a third time.
Bill received from the House of Representatives.
Standing and Sessional Orders suspended.
Bill (on motion by Senator Sir George Pearce) read a first time.
Bill received from the House of Representatives.
Standing and Sessional Orders suspended.
Bill (on motion by Senator Sir George Pearce) read a first time.
Bill received from the House of Representatives.
Standing and Sessional Orders suspended.
Bill (on motion by Senator Sir George Pearce) read a first time.
Motion (by Senator Brennan) pro posed.
That the bill be now read a third time.
– I ask the Government to make this bounty available to the apple and pear growers with the utmost expe dition. When in Tasmania at the weekend, I found that the orchardists are- in a precarious position. They must now start spraying operations and have to purchase the sprays and equipment. They also have to employ labour to keep the orchards clean and in a reproductive condition. Prompt payment of the bounty will help them to meet these costs.
– I support the appeal made by Senator Grant. Like my colleague, I was in Tasmania at the week-end and met a large number of orchardists who are interested in this appropriation. They expressed disappointment that the amount to be made available is not greater, but they are particularly anxious that this money shouldbe made available at the earliest possible moment. Seasonal operations on the orchards make the payment a matter of extreme urgency. The returns are available, and as was made plain on the second reading, the orchardists are in a difficult financial position.
Question resolved in the affirmative. Bill read a third time.
[10.19].- I move-
That the bill be now read a second time.
I suggest to you, sir, and to the Senate, that the debate on the second reading of this bill should cover also the South Australia Grant Bill and the Tasmania Grant Bill, as the three measures are inter-related
The PRESIDENT (Senator the Hon. P. J. Lynch). - It has been a long established practice in the Senate that bills of a cognate character may be discussed simultaneously, and, as was suggested by the Minister (Senator Pearce), that procedure may, with the concurrence of the Senate, be adopted in this instance.
Senator Sir GEORGE PEARCE.All honorable senators have received a copy of the report of the Commonwealth Grants Commission for this year, and if they have read it they must have formed the conclusion, even should they not agree with its conclusions, that it is a wellreasoned document. No one could say that every aspect of the question of State grants has not been covered in the report.
The grants proposed for the current year, compared with those for last year, are as follows: -
Honorable senators are no doubt aware that the special grants to be paid to the three States under notice “has been a very difficult problem for many years. The grounds upon which these special grants were originally claimed were the disabilities due to federation or the effects of Federal policy, and a number of attempts has been made by various bodies and authorities, some official and some unofficial, to assess in terms of money the effects of such disabilities on the finances of the States concerned, without, however, any permanent solution of the problem being arrived at. Anybody who has read, as 1 have read, these various reports will at any rate cease to be dogmatic on the subject and will admit that it is a most difficult problem.
– For which there is no formula.
Senator Sir GEORGE PEARCE.I invite the honorable senator to frame one.
– I admit that I cannot; neither can the commission.
Senator Sir GEORGE PEARCE.The effects of the disabilities on the finances of the States are apparent; but the solution of the problem is not apparent.
In 1933 the Commonwealth Grants Commission Act was passed by this Parliament and under that act the commission was established. It was hoped, at the time, that the commission would be able to formulate a policy which the Government could adopt, under which the grants to the States could be placed on a more stable, and possibly a more permanent, basis.
The commission has two tasks. One is to assess the amount of the grant that should be made to a State, and the other is to ascertain on what basis grants could be made more stable and possibly more permanent. Anybody who has read and studied the last three reports of the Commonwealth Grants Commission will sympathize with it in respect of its inability to complete the second task. In one year what might appear to be a fair basis and desirable to be accepted as permanent, may be reached, but in another year that basis might be found to be unfair and to require amendment.
The commission has: now submitted three reports, the last of which, as I have mentioned, was recently tabled. The recommendations of the commission for the last two years, 1934-35 and 1935-36. were adopted by the Government and grants were passed by Parliament in accordance with those recommendations. On each of those occasions the grants recommended were an appreciable increase on the grants of the preceding year. Although in two instances the grants for this year will be less than those made last year, it is proposed that tha recommendations of the commission this year should similarly be accepted. The bills now before the Senate give effect to these recommendations.
As has already been mentioned, prior to the appointment of the Grants Commission, the claims of the States were based on the grounds of “ disabilities “ and were considered from that aspect. The commission has, however, since its first report, stated that it found itself unable to assess the grants on the basis of “ disabilities “, and has consistently based its recommendations on financial “ needs “.
I invite the attention of honorable senators to its comments on this subject in the second report, and suggest that if they do not agree with the commission, they should support their disagreement by stating where its comments are either unjustified or incorrect -
The adverse effects of federation may be the cause, in whole or in part, of the inferior financial position of a State. It is, however, the relative financial .position (i.e. of any one State compared with the other States) which determines whether a grant is justified. (Paragraph 72.)
Special grants are only an extension of the normal system. The problem of recommending them is to determine how much the transfer should be for any particular State in excess of the amount provided by thu normal system. We rind that this should be the amount necessary .to enable the State Government to function at some minimum standard, and that this amount must be determined by a searching examination of the comparative financial position of the Statu.
We have found no ground for compensating the people of a Statu for disabilities due tn federation or any other causes. Disabilities due to federal policy may be the cause of the inferior position of a State’s finances, but a variety of other causes may have thu same effect. (Paragraphs 78 and 79.)
In its third report the commission has repeated its opinion that the grants payable to the States should be based only upon financial needs, as will be seen from the following extracts from paragraph 164:-
In our second report we developed the tentative principles “f the first, and concluded that the relative financial position of the States, when analysed with sufficient care and understanding, was the only basis on which special grants should hu ninda Further consideration and another year’s experience have led us to the following conclusion : -
Special grants are justified when a State through financial stress from any cause is unable efficiently to discharge its functions as a member of the federation and should be determined by the amount of help found necessary to make it possible for that State by reasonable effort to function at a standard not appreciably below that of other States.
The view is still held irc certain quarters that payment of grants to the States should, be based upon the financial effect of disabilities due to federation or federal policy. This is borne out by evidence submitted as recently as this yea.r, to the commission by the representatives of certain of the State governments concerned. On this point, it is interesting to note what the commission, in its latest report, has had to say upon that phase of the subject. The attitude of the commission has been that, in considering the effects of federation or federal policy on the accounts of the States, it is necessary to take into account not only the adverse effects, but also the benefits which a State may derive from federation or federal policy. The commission has made a genuine effort to place a .monetary value upon the net effects of federation. Let me quote from paragraphs 126 and 127 what that body has to say in this connexion lt follows, that unless the adverse, effects of federal policy on the claimant States exceed the benefits due to the allocation of Commonwealth revenue and expenditure, there are no adverse net effects of federation.
The measurement of the total net effect of federation is clearly an impossible task - . . . We can, however, make some rough approximation.
L invite those who dissent from those views to show to the Senate, by facts and figures, how they estimate the effect of federal policy, how they arrive at their conclusions, and how they justify them, and to state whether they have made any allowance, as the commission has done, for some or all of the possible benefits of federation. The commission made an attempt to ascertain the approximate effects of federation, and, after considering all the aspects of the case, which are tet out at some length in the third report, it reached the following conclusion, which is contained in paragraph 146: -
It appears then that without reckoning any benefit from exchange, benefits and burdens from federation almost balance for South Austin Iia and Western Australia, while, for’ Tasmania, there is a net benefit of nearly £] per bead, lt follows that no substantial part of the special grant received was made necessary by the effects of federation. We may conclude that these States, unfederated, would have been, at least, in the same financial difficulties as at present.
– They might have been worse.
– And they might have been much better.
– These are merely suppositions. The commission, which consists of qualified men had before it representatives of the claimant State governments, who, in turn, were buttressed by all the information, statistics and data that those States, after careful examination, could bring before it The task of the commission was to analyse, dissect, weigh and assess all those facts, and arrive at a conclusion. Its conclusion should not lightly be brushed aside. I suggest that the obligation lies on those who differ from its recommendations to build up before the Senate a case to take the place of that presented by the commission after its exhaustive examination.
Sufficient has been said, I think, to indicate the reasons why the commission bas accepted the basis of measured financial needs in arriving at its recommendations as to the ~ ants to be made.
I wish now to indicate, very briefly, the manner in which the financial needs of the States have been measured. The commission holds that special grants are justified when a State, through financial stress from any cause, is unable, efficiently to discharge its functions as a member of the federation, and that such special grants should be determined by the amount of help necessary to make it possible for that State, by reasonable effort, fo function at a standard not appreciably below that of other States. Those views are contained in paragraphs 164 and 201 of its third report. For the purpose of arriving at this standard the commission has adopted the plan of comparing the financial results of the claimant States with those of the non-claimant States, after making such adjustments as are necessary to put them on a comparable basis. In making this comparison the commission has decided that the nearest approach to an Australian standard would be obtained by taking the simple average of Victoria and Queensland, as was done in the previous year, 1935-36. I shall not go into the elaborate reasons given by the commission for choosing those States, but I invite honorable senators who have not read them, to do so, and then, if possible, to show where they are wrong, or not justified. I imagine that they would have difficulty in doing so.
– Had New South Wales been included, the standard would have been raised considerably.
– The commission gives the reasons why New South Wales was not included.
I wish particularly to bring to the notice of honorable senators the result of this method of comparison. In those cases in which the claimant States disclose less improvement than do the nonclaim ant .States, a larger grant is recommended’, whereas should the finances of the claimant States show an improvement greater than the degree of improvement revealed by the finances of the nonclaimant States, the amount of the grant is reduced. In its third report the commission bases its recommendations for the year 1936-37 on the finances of the States for the year 1934-35, for the obvious reason that they were the latest figures available at the time of its inquiry. In that year the budget results of South Australia and Western Australia revealed a degree of improvement greater than that shown by the budgets of the nonclaimant States. Accordingly, reduced grants for those two States are recommended. On the other hand, the finances of Tasmania during 1934-35, whilst better than for the preceding year, did not disclose an improvement equal to that revealed by the non-claimant States. The grant recommended in the case of Tasmania is therefore greater than that for 1935-36.
I anticipate criticism by reason of the fact that the recommendations for this year are based upon the budget figures for 1934-35, which represents a time lag of more than a year. But as the commission has pointed out in its reports, this factor is not open to very serious objection. Whilst admittedly paving the way for some degree of error, the commission points out that the error is no: cumulative. It adds that, while general conditions are deteriorating, the grant on those lines will be too small, but that on the other hand, when conditions are improving it will be too great. The differences will balance over a term of year?. As, during the last two years, condition.”5 have been improving, it will be seen that: this principle operates to the advantage of the States concerned at the present, time.
The Government makes no apology for its acceptance of the recommendations of the commission for this year, notwithstanding that the aggregate grants recommended are £320,000 less than the total grants recommended for 1935-36. The Grants Commission was appointed as an independent body to make complete and thorough investigation of Commonwealth and State financial relations insofar as Commonwealth grants to the claimant .States are affected. The commission has been confronted with an arduous and difficult, task and has carried out its responsible duties in a painstaking and thoroughly impartial manner. When the commission recommended increased grants in each pf the last two years, involving in the aggregate for the two years £890.000 more than would have been paid had the 1933-34 grants been continued, the Government accepted those recommendations without question, and obtained Parliamentary approval of them. The total grants now recommended are £320,000 less than those approved last year, and the Government sees no reason why those recommendations should not be accepted also, particularly in view of the improved conditions obtaining in each of the claimant States. I commend the bills to the favorable consideration of honorable senators.
.- The Leader of the Senate (Senator Pearce), in his usual able manner, has presented a good case from . his point of view. Evidently, he sees difficulties ahead, for usually he does not make speeches of the quality that he has made this morning unless he anticipates trouble. I recognize that he had a difficult task in presenting the case for the Government, for it is, indeed, a bad case. The right honorable gentleman did exceedingly well with the material available to him. He is a past master in the art of making an apparently good case out of a bad one. But in spite of the somewhat intimidatory remarks of the right honorable gentleman - intimidatory because he suggested that honorable senators who had not read the report should read it, in which case, he said,, they, would discover this and that, and should bs prepared to do such and such, if they wished to rebut the recommendations of the commission - I shall endeavour to show that he is not entirely right. I do not suggest that I have read every line of the commission’s report, but I have read the salient parts of it which concern us in the consideration of the bills now before the chamber. In passing; I wish to say that I am glad that the Senate has agreed to take them as one, so that we shall not have to repeat the same arguments in connexion with each meas-ure. The Leader, of the Senate said that the making of grants- to necessitous States is a difficult problem. Of course it is. It is difficult because no attempt is being made to put into operation the federal compact which I well remember was promised as a result of federation. That promise has never been fulfilled because no Government has had the courage to propose that the compact be given effect.
The Minister said a good deal about the arduous task undertaken by the Commonwealth Grants Commission. Whilst not wishing to rob that body of any credit to which it is entitled, I confess that I am somewhat tired of hearing remarks of this sort. The commission is handsomely paid for its work, and therefore I see no reason to go into ecstasies about what it has done.
– The same thing may be said of some politicians.
– That is true, and Senator Hardy and the party to which he belongs would be included amongst them. They are being paid for a job and are not doing it. On the other hand, it may be said that there are some of us who are doing the job and doing it well. I cannot, however, include Senator Hardy in that charmed circle. The Opposition stands for unification; we stand definitely for the abolition of State Parliaments, and we stand definitely for ending the farce of maintaining thirteen Houses of Parliament, six State Governors, and a Governor-General to do the job of governing a population of 6,500,000: It is a crime against the people that that state of affairs should bo allowed to continue. If a Government were in power to which the members of the- Opposition in this chamber could subscribe the so-called difficult- problem of deciding grants to offset the disabilities suffered by certain States, as a result of federation would be quite easily solved, as would also a number of other allegedly difficult problems. The Leader of .the Government suggested this morning that . at least the problems are so great that none of us ought to have the temerity to be dogmatic about them. I know the danger which some people incur when they rush in where angels fear to tread, but I shall not be diffident in expressing emphatically the view of the Australian Labour party on- this subject. The plain fact is that this very able commission in its last report has entirely shifted if* ground’. Previously, the disabilities suffered by claimant States were assessed on a basis that everybody could understand. The disabilities were: crystallized under three main headings: first, those arising through the operation of the tariff; secondly, those resulting from the Arbitration Act; and thirdly, those resulting from the operation of the Navigation Act.
– I do not think the honorable senator is correct in saying that the commission has shifted its ground.
– I shall produce evidence from the commission’s report to prove the truth of my assertion. It cannot be denied that previously the commission based its recommendations on the disabilities suffered by the claimant, States as a result of those features of federal policy.
– Those features were the basis of the claims submitted by the States.
– Nevertheless, those aspects were considered. Thecommission in its previous reports definitely assessed the value of those disabilities. Now we find that the basis is entirely altered. As one who believes in greater powers being given to the Commonwealth, which connotes lesser powers for the States, I am not displeased to find State rights invaded. . But, like all other commissions which have been set up, such as the Broadcasting Commission, about which we heard a good deal yesterday - and I propose to see that the Senate hears a good deal more about it later on - like the Tariff Board, the Commonwealth Bank Board, and a number of other authorities created by this national Parliament, the Common wealth Grants Commission has become superior to its creators. It has now invaded the budgetary -position of the various States, and it says to them, in effect, “You have spent too much on social services; you have been too extravagant; you should not have paid out so much; your budgetary position is the result of your liberality. You are now to be penalized for that liberality”. I invite the attention of honorable senators to page 99 of the latest report of the Commonwealth Grants Commission, chapter8, dealing with themeasurement of relative financial position, wherein the commission presumes to tell the State Government? of Australia what it thinks of their budgetary position, and to dictate to the claimant States how they should do their job. The commission was not appointed to do that; it was appointed to gather information concerning the position of the claimant States. Itis all very well for the Leader of the Government to say that this is a complicated matter. There is nothing complicated about it; the Commonwealth has only to say to the smaller States which are suffering from disabilities, “ Submit your evidence concerning disabilities. How much do you estimate those disabilities to be worth?”, and then to come to a reasonable conclusion as to what compensation should be awarded.
– Suppose the honorable senator tells us what the disabilities of federation are.
– As usual Senator Hardy would like to make my speech, but I shall not permit him to do so. I submit that the honorable senator never has any surplus knowledge which it would be wise for him to give away. He should reserve it for himself, because -he will have a difficult task in attempting to refute what I. have already submitted. I remind Senator Hardy that it is a point of medical etiquette that one of the first things a doctor should do when a new patient comes along is to endeavour to get the history of the case, and to find out his previous medical adviser. The doctor is naturally averse to butting in on the case of a fellow practitioner. I do not intend to take this job out of Senator Hardy’s hands. It is interesting to note what a wonderfully ardent thick-and-thin supporter of the Government he is to-day as compared with what he was a couple of years back, before he was elevated to the position of Leader of the Country party in this chamber.
The Opposition proposes to support these bills. We are always delighted to see the Government spending money in relieving anybody in difficulty, whether individuals or claimant States. I might let the Leader of the Government into a further secret. If a move is made to give back to Western Australia some of the grant which has been taken from it the Opposition will support it.
– What about South Australia?
– If the honorable senator will propose that that State be given an increased grant the Opposition will support that too.
– On political or financial grounds?
– We shall support it because, although a lot of people imagine it is difficult to get money for this or that, we do not believe anything of the sort. The great evil from which Australia is suffering to-day is that in the hands of the common people there is not sufficient purchasing power. If the Government can throw money about by way of grants to claimant States, we shall be delighted to see it done, because we hope more of it will filter through into the hands of those who need it. I am entirely opposed to the basis on which the commission has worked; it is unscientific, and, from a democratic stand-point, is wrong. The claimant States have a right to have their disabilities assessed on a perfectly plain and understandable scientific ‘basis. There is no complication about that. We should say to the States, “ You are suffering certain disabilities. What is their cash equivalent?” Yet the commission has altered its ground, and with coldsteel effrontery has said to the State governments, “ You will get less this time because your budgetary position does not please us “. That is merely allowing political bias to cloud the issue, and no commission, no matter how wonderfully constituted, is entirely free from political bias.
– Is the honorable senator without political bias ?
– I am not, but in contradistinction to the bias of the honorable senator from Tasmania, mine is scientifically based. All fair-minded senators will agree that no commission has the right to say to a State government “Look at your budget; you are down so many hundreds of thousands of pounds. You would not have been down so much if you had not spent your money prodigally “.
– It is just as well that the commission did not visit Queensland.
– My colleague, Senator J. V. MacDonald, informed the honorable senator yesterday exactly where Queensland stands under a Labour administration. I content myself by saying that we do not agree with the altered attitude of the commission. We do not agree that this or any other commission should arrogate to itself power greater than that of this Parliament. What would . be thought if the Leader of the Government took to task the State which I represent because of its budgetary position’ I know that the Prime Minister or the Treasurer at premiers’ conferences and meetings of the Loan Council has that opportunity, but, in a general way, what would be thought if this Parliament arrogated to itself the right to tell the Government of Queensland how to control its finances ? If that were done there would be such a wave of indignation that the Government would be swept out of office. Yet we have a commission to which we have given supreme authority to do its job setting itself up on a pedestal, and presuming to dictate to the States as to the manner in which they should control their finances. If a Labour government were in control of the affairs of this nation it would soon stop that kind of thing.
– That is why the Labour party is not in control.
– What surprises me is how the party to which the honorable senator belongs ever got into power. But I am digressing. While the policy of this Government is in operation, instead of the policy of the Australian Labour party, the creation of authorities, which in a few short months . become greater than the National Parliament, will, I suppose, continue. In this case, the commission has suggested a course which meets with the approval of the Government. But this state of affairs should be ended. The Commonwealth Grants Commission should be told to confine its attention to the simple problem of ascertaining, in terms of money, the actual disabilities suffered by the various States under federation. If that had been done, I am satisfied that the grant for Western Australia this year would have equalled the amount paid last year. As for the other States, and, indeed, for Western Australia, also, other honorable senators are in a much better position thanI am - Queensland not being an applicant for any form of assistance due to federal policy - to support their claims. We should, however, bear in mind that unfair treatment by this Parliament may place in the hands of secessionists a useful weapon with which to injure the Commonwealth.
– Does the honorable gentleman think that unification is the remedy ?
– We should, I repeat, be careful not to give to those who favour the secession movement in any of the States any argument with which to buttress their cause, because the preservation of the Commonwealth under this centra] government is the one thing worth while in the political life of this country.
– I was pleased to hear the Leader of the Opposition (Senator Collings) say that he intends to support the claim of Western Australia for an increased grant this year. With greater confidence on that account, I move -
That all the words after” That “ be left out with a view to insert in lieu thereof the words - “ the bill be withdrawn and redrafted to provide that, owing to the special circumstances of the State of Western Australia, the special grant be the sum of £800,000.”
Whilst I do not question the ability of members of the Commonwealth Grants Commission, I challenge their impartiality, and in support of my view I direct attention to the manner in which they have arrived at. their decisions. The effects of Commonwealth policy claimed by Western Australia are summarized as follows in the commission’s third report -
Unequal incidence of the tariff.
Unequal effects of interstate freetrade.
Western Australia complains of the inability to develop secondary industries owing to interstate freetrade, and puts forward two other grounds of claim, viz.: -
Isolation from the large centres of population.
Special dependance on primary industry.
It has been an accepted principle from the inauguration of the federation that certain of the States have a definite claim for financial assistance as part compensation for the disabilities which they suffer from federal policy, and the Parliament has always accepted that view. On page 13 of the commission’s last report, appears the following: -
The Attitude of the Commonwealth Treasury is indicated in the following extract from the evidence tendered to the commission by the Treasury in Canberra recently : - “ It is not now proposed by the Commonwealth Treasury, however, to continue to stress the principle of payment on the ground of disabilities, seeing that that basis has apparently been abandoned by the commission. The Treasury intends rather to address itself to the task of assisting the commission to apply the basis set out in the second report in a manner acceptable to all the governments concerned, whilst at the same time securing as great a degree of fairness in the incidence of the scheme as is possible under the circumstances, having regard to what may be accepted as the inherent dangers of a scheme of basic Commonwealth grants on budgetary results.”
It was generally recognized, when the commission was appointed, that its recommendations in respect of the claimant States should be based on disabilities due to federation and Commonwealth policy, and I protest most emphatically against the departure from that accepted principle in the third report presented recently. I also warn the Government of the danger of assessing these grants on budgetary results, and I remind the Senate of the liability incurred by the Commonwealth in connexion with some happenings in New South Wales a few years ago, following default by the then State Government in respect of its financial obligations. The Commonwealth was obliged to go to the rescue of New South Wales and accept responsibility for the obligations of the State. There is, then, the danger that unless we get back to the accepted principle of assessing States’ claims on disabilities due to federation and Commonwealth policy, the Commonwealth may, in the future, be faced with heavier obligations in respect of other States. Therefore we should reaffirm the adherence of the Commonwealth to the accepted principle to which I have referred. The commission was appointed to assess the disabilities of the States.
– Evidently it could not do that.
– Nevertheless it is the plain duty of the commission to persevere in its task. In the report there is reference to many aspects of State disabilities which it was unable to examine because of the time which such investigations would have occupied. I am at a disadvantage, in that this is the first, occasion upon which I have had an oppor- tunity to speak in the Senate concerning the work of the commission. I have been obliged to concentrate my attention on the third report; my examination of earlier reports has not been so complete. I would, however, direct attention to section 87 of the Constitution, which enacts that for a period of ten years after federation and thereafter “until Parliament otherwise provides “ the Commonwealth shall return to the States not less than three-fourths of the customs and excise revenue. I cannot help thinking that an Irishman was responsible for the drafting of that “ Kathleen Mavourneen “ provision, which “ may be for years and it may be for ever “. Appendix 5 of the report deals with the distribution of the tariff burden and states -
The Western Australian investigation gives the net burden for that State as £1,188,000 in 1933-34.
In the table which appears on page 185 the net tariff burden in Western Australia is shown to be £1,188,000, and the net burden a head, £4.90. This compares with the net burden for South Australia of £2,150,000, or £2.24 a head. These figures were compiled two or three years ago, and it should be noted that conditions in the pastoral and agricultural areas in Western Australia have entirely altered during the last two years. That State has suffered partial drought for two seasons; so the condition of its people is definitely worse than it was. I am aware, of course, that some time must elapse before existing conditions are reflected in reports from the commission and during that period many primary producers who are now suffering so severely will have gone off the land.
I have an intimate knowledge of farming conditions in Western Australia. I know the difficulties of our producers bettor perhaps than any other honorable senator, excepting you, Mr. President, and I speak feelingly of the desperate fight which they are putting up to make a living and develop their holdings. A few days ago the Leader of the Opposition referred to some disgraceful buildings in this beautiful capital city, and made a plea for improved housing. If only he would come with me to some of the farming areas in Western Australia I could show him homes that would almost break his heart; yet these are the dwellings of some of the fine old pioneers who are valiantly struggling to create wealth from the land so that Australia can meet its overseas obligations.
The figures supplied in support of the case of Western Australia, particularly those relating to interstate trade, were more complete than from any other State. Thus the commission was able to assess more accurately the disabilities suffered by Western Australia, and it should have known that a reduction of the grant could not be justified. Yet by some process of reasoning which cannot be understood by those possessing first-hand knowledge of the conditions in that State, it has recommended that the grant this year be £500,000, against the grant last year of £800,000. It would appear that the commission fixed upon a certain figure, then added something, subtracted something more, and perhaps doubled it-
– And the answer was the figure first thought of.
-No ; I think the original figure was £460,000, but after looking around a bit and having heard a whisper about a partial drought in some of the farming areas of Western Australia, it added £40,000, to bring the total up to the round sum of £500,000.
– If the commission had recommended an increase of the grant, the honorable senator would have thought that its members were very fine fellows.
– The honorable gentleman has been a member of this chamber for very many years. He has been here long enough to know that it is customary to extend to new senators the courtesy of permitting them to present their case without unnecessary interruption. When I have been here as long as he has, I hope to be as alert with my replies as he is with his interjections. In order to show the value of production in unsheltered industries in the different States I cite . the following figures, appearing on page 205 of the commission’s report: -
It will be seen from those figures that 60.34 per cent. of the production of Western Australia is provided by unsheltered industries which have to carry the burdens imposed upon them by protected industries in the eastern States, particularly in respect of agricultural machinery, which has to be purchased in the highest market in the world. If I. remember aright the commission, in arriving at the rough estimate of the burden in this respect, placed the disability at £1,360,000. The burden per capita of those engaged in unsheltered industries in the various States is as follows: -
The average amount for the whole Commonwealth is £20 5s.1d. Notwithstanding these convincing figures these three wise men of the east accuse Western Australia of being an extravagant State. Practically all those who engage in developmental work make mistakes, and it is unreasonable to assume that in opening up huge areas in Western Australia mistakes would not be made. The commission should, however, have borne in mind the fact that when some of the principal gold mines in Western Australia began to peter out men had to ‘seek employment in other spheres, and a commencement was made to develop vast agricultural areas, which, during the past six years, have produced over one-fourth of the primary produce marketed by Australia overseas. It is astounding that onesixteenth of the population has provided one-fourth of the produce exported, and by making additional funds available, has enabled the Commonwealth to maintain its prestige in the eyes of the world. I challenge any honorable senator to deny that, had the primary producers of Western Australia not displayed such energy and ability in opening up undeveloped lands and producing the quantity they did, the Commonwealth would have been faced with default four or five years ago. During the last six years Western Australia’s excess of exports over imports amounted to £62,811,682, out of a total excess of exports over imports of £220,000,000. The mistakes made in developing some rural areas in Western Australia are insignificant when compared with those made by Commonwealth governments in developing the Northern Territory and the Federal Capital Territory. During the six years mentioned Western Australia expended approximately £9,000,000 annually in purchasing goods from the eastern States, most of which could have been bought in cheaper markets and brought to Australia by the vessels which carry our produce overseas. At present Great Britain is the best customer of the eastern States, and if we deduct Western Australia’s contribution to the Japanese markets, then Western Australia comes next, and Japan third. Notwithstanding this fact the Government is spending thousands of pounds in negotiating trade treaties with other countries, including New Zealand, some of which may be of benefit to primary producers. Treaties have been entered into with Belgium and Czechoslovakia, but the trade with those countries is insignificant when compared with Western Australia’s trade with the eastern States. During a period of six years we have purchased £9,000,000 worth of goods annually from the eastern States. In making this comparison, I am not criticising the Government’s policy of endeavouring to negotiate trade treaties.
– The amount has been over £10,000,000.
– Yes, in one year it was £10,300,000. We are compelled to purchase most of our requirements from Victoria and New South Wales, where the prices are unnecessarily high, and this adds to the disabilities experienced in developing huge rural areas. It is only twenty years since a commencement was made to develop the heavily-timbered country in the north-eastern wheat belt, where the position of the farmers is at present most acute. Practically the whole of the money used in opening up our agricultural, pastoral and mining industries has been borrowed overseas or from financial institutions in the eastern States, so that the bulk of the revenue derived from production is used to meet interest charges and pay for goods purchased in other States. I do not suppose that 4 per cent. of the graziers in W estern Australia have substantial reserves upon which to draw during periods of depression. In some parts of the State wool has to be hauled hundreds of miles by means of motor transport, which is the life-blood of industry in Western Australia, but I am afraid that within the next year or two the cost of this form of transport will be increased as the result of federal policy. On a per capita basis Western Australia produces more than twice as much as any other State, and at the same time assists in improving the financial position of the other States. Ample territory is awating development in Western Australia, but as the population in that State is not sufficiently large to provide an adequate home market, produce has to be exported, whereas in other States where secondary industries are established, substantial home markets are available. The big financial institutions in the eastern States do not offer favorable terms to assist industries likely to compete with industries in which they are directly or indirectly interested in another State. According to the budget, the assistance from the Commonwealth Consolidated Revenue to be given to the various States in the current year as compared with 1935-36, will be -
It will be seen, therefore, that despite statements that Western Australia is not being badly treated, it will be a big loser. In its last report, the Commonwealth Grants Commission said -
The main causes of Western Australia’s inferior financial condition are the serious losses arising from the reckless financing of wheat settlement in an area well suited to wheat . . .
That is a remarkable statement to be made by men of the ability of the Commonwealth Grants Commissioners. In order to develop land, money must be expended on it. Possibly mistakes did occur in the group settlement plan, but the Western Australian Government was encouraged in that enterprise by the governments of ‘both the United Kingdom and the Commonwealth. As a matter of fact, the commission has commented that the Commonwealth cannot entirely be absolved from blame for its part in the scheme. But, after having encouraged the establishment of the group settlement, the Commonwealth Government left the State to carry the baby.
– Not only that, but it has also imposed a heavy fine on the State for what was done.
– That is so. I feel that the reduction by £300,000 of the grant to Western Australia is going to raise the cry of secession in the west, and the clamour will take some quelling unless the grant is restored. I regret that this point has been introduced, but as it was mentioned in the House of Representatives no harm can be done by a statement of my own views on the subject. I am a secessionist, but I realize that it will not be in the best interests of the Commonwealth in the troublous times which the world is experiencing to raise the cry of “ Secession “ at present. But it will be raised, and taken up with fervour all over the State. I believe that this unfair treatment of Western Australia will be used against this Government, and not in the best interests of the Commonwealth as a whole. That is a big admission for a secessionist to make. Unless this grant is restored to the amount of last year, the agitation for secession will again become live and active.
– I have much pleasure in seconding the amendment so ably moved by Senator Marwick. It follows the lines of a resolution unanimously agreed to by the Parliament of Western Australia on the 29th September last. I carefully examined most of the metropolitan newspapers in the eastern States, ‘but was astounded to find that no reference was made to this important resolution which protested against the reduction of the State grant. It is extraordinary that a matter of such first class national importance should not have been published in the metropolitan newspapers of the eastern States. The resolution which was moved by the Deputy Premier (Mr. Troy) read -
This House views with apprehension and alarm the serious effects of the reduction of
the Commonwealth grant by £300,000 on the economic position of the State, and respectfully request the Commonwealth Government to restore the grant to the same amount as was paid in the year 1935-30.
That amount of course was£800,000. In bringing this matter before the Western Australian Parliament, the Deputy Premier pointed out that the case presented by the State to the commission had contained evidence in support of a claim for an annual grant of £1,500,000. Western Australia, which had received £800,000 in 1935-36, submitted evidence in support of an application for an increase to £1,500,000. By the time the commission had dealt with it on a basis, which I declare is opposed to government policy and has never been accepted by Parliament, it not only refused to increase the grant by £700,000,. but actually reduced it by £300,000. That is an immense drop, and is entirely opposed to the spirit of the Commonwealth budget. The outstanding feature of the budget is the financial relief granted in every direction, except where the grants to Western Australia and South Australia are concerned. The grants to those two States represent ‘the only two adverse phases of the budget of any moment ; and this aid to them has been reduced, notwithstanding that the budget had also been relieved of assistance to the wheat industry, which is predominant in each, of the two States that are being penalized. Mr. Troy continued -
Western Australia’s claim was based on disabilities imposed upon us as a result of Commonwealth policy. Right from the inception of federation this has been recognized as legitimate ground- and almost the only original ground- for Commonwealth assistance.
The Leader of the Opposition in this Parliament (Mr. Curtin) ably, in previous years, presented the case for Western Australia before the Commonwealth Grants Commission, but. unfortunately, he. did not. do this work in the current year. The following were the main grounds submitted in appealing for relief from the disabilities imposed on Western Australia under federation : -
First. The relationship of population to the Size of the territory, and the consequential high administrative or overhead costs of the services of government.
In this connexion we hear a great deal in this Parliament about big Australians, but I do not see in. this measure any desire on the part of big Australians to assist a small community of 440,000 people who are charged with the responsibility of occupying and developing one-third of the continent of Australia and preparing, by occupation and development, for its adequate defence. I say deliberately that if the people of eastern Australia do not help Western Australia to develop its unoccupied and less fertile territory, they entirely- fail to show a proper federal spirit. It is their duty, from a national point of view, to assist liberally in the development of the western third of the continent. Mr. S. M. Bruce, when Prime Minister of the Commonwealth, said on many occasions that the paramount duty of the Commonwealth was the development of this territory.
– He was the first Prime Minister to recognize that duty.
– But in this measure the Government ignores that responsibility. The second main ground advanced by the State was -
The inequality in the relative burdens of federation upon a State which is predominantly engaged in agricultural and other primary industries.
Commission after commission appointed by the Federal Government, including the commission of five economists appointed by the Bruce-Page Government to inquire into the incidence of the Australian tariff - none of these commissions included a member from Western Australia - has said that the burden of the tariff falls more heavily on Western Australia than on any other State.
The third, ground put forward by the State Government was -
The absence of economical compensation to the State to balance the effects of national fiscal policy, and the resulting inability of the State to assist adequately the primary industries, or develop secondary industries without a special enabling grant by the Commonwealth.
It is true that the secondary industries of Western Australia are . ‘backward. Not only does that State lack big urban populations in the eastern States, but also its secondary industries are subject to most intense competition, and even to dumping by the better established and richer secondary industries of the eastern States with, their much greater output.
The fourth submission of the State Government was -
Thu effects of the foregoing upon the finances of the Government of the State.
The State asked that the effects of those four factors should be considered. Reference was made before the commission to the drought from which Westtern Australia is now suffering. There has been a recurrence of last year’s drought in large areas of the wheat belt and practically the whole of the pastoral areas of Western Australia. During the last recess, I paid a brief visit to the northwest of the continent. I travelled as far as Darwin, and at the various ports at which the vessel called, I gathered what information I could. I learned that the drought in the northern portion of Western Australia is the most severe in the history of the State. The losses of sheep and of wool have been so heavy that pastoralists doubt their ability to obtain money or animals to restock their holdings when the drought breaks. Although that portion of the continent is subject to periodical droughts, it is not often that drought conditions extend over the whole of .the pastoral areas at the same time, as is the case this year. The fact that the pastoral areas of Western Australia are experiencing the worst drought in their history, and that portions of the wheat belt are suffering from two successive droughts, are reasons why additional assistance should be given to that State this year. It is certainly not a year in which assistance should be withdrawn, and the grant reduced by nearly one-half, as has been done by this unsympathetic Government.
I emphasize that the claim of Western Australia has always been based on disabilities imposed on that State as a result of federal policy, and in this connexion, I wish to refer to remarks made by the Leader of the Senate (Senator Pearce) when the first disabilities grant was made to Western Australia. The right honorable gentleman was at that time a member of the Bruce-Page Government. I do not blame the Minister for the changed policy of the Commonwealth Grants Commission; but I shall blame him and his Government if, by the rejection of the amendment, the altered policy of the commission is permitted to have effect. It is time that the Government told the commission that the policy so long recognized, and approved by successive Governments, namely, the taking into consideration of the disabilities imposed by federal policy, shall continue, and that it disapproves of that body arrogantly claiming for itself the. right to adopt an entirely different basis for these grants.
– The honorable senator expects the Leader of the Senate to combine in himself all the qualities possessed by the greatest leaders the world has known.
– I have no such expectation. On the contrary, I commend him for the views that he expressed on the occasion to which I have referred, and as reported in the West Australian of the 19th October, 1925, when he said -
The Government of which I am a member took action to appoint a Disabilities Commission to investigate the effect of federation upon Western Australia. It is undoubted that the finding of the commission is that Western Australia is suffering, and has suffered, severe disabilities as a result of federation.
I entirely agree with those remarks, and I wish the Government would live up to them to-day. I heartily disagree with the commission’s view that disabilities under federation are not the main factor for its consideration.
– The commission says that it cannot assess those disabilities, without also assessing the benefits arising from federal policy.
– What are the benefits to Western Australia i On the occasion to which I have referred the right honorable gentleman proceeded -
The Commonwealth Government, after fully considering the position, has decided to ask Parliament for authority to make a, special grant this year of £450,000, which will be inclusive of the grant now paid. Although tin; proposal is for this year only, pending tinholding of a conference with the State governments on Federal and State relations to which I have already referred; it is a recognition and an admission by the Commonwealth that the findings of the royal commission justify Western Australia’s receiving that amount of financial compensation, and it therefore establishes a basis upon which any decision as to future financial relationships
Those remarks were received with approbation in Western Australia. I believe that, at the time, the right honorable gentleman and the Government intended that that basis should continue. The commission has acted wrongly in departing from it.
I shall now refer to the commission’s second report, in order to show how completely it has departed from the wishes of the Government of the day, as expressed when the bill to establish the commission was introduced. In paragraph 73 of that report the commission said -
Some Status are certainly in serious financial difficulties. It must be made possible for them to function as States of the Commonwealth at some minimum standard of efficiency. It rests with the Commonwealth to make thatstandard as low as it pleases, to impose a task on the States as severe as it thinks proper.
There is nothing in that paragraph about sympathy, or the existence of a federal spirit, or the necessity to develop this country’s empty spaces, or assist, weak communities. Paragraph 69 of that report contained the following: -
The only ground for this assistance is the inability of the State to carry on without jilt follows then that the adverse effects of federal policy - even the net effects - are not in themselves ground for assistance.
What impudence! In spite of the sympathetic statements by leaders of the Government in both Houses, the Commonwealth Grants Commission has the impertinence to say that the adverse effects of federal policy are not in themselves ground for assistance. In view of the sympathetic, speeches made by Mr. Lyons during his recent visit to Western Australia, I hope that the Government will tell the commission plainly that it has exceeded its duty, and that the Government is not prepared to permit it to continue to function on a basis which has neither legislative nor ministerial authority. A body which acts as the commission has done is deserving of the most severe rebuff at the hands of the Government.
– The ‘Government has knuckled under to the commission.
– Yes. It was the duty of the Government to show its disapproval by refusing to accept the recommendation for a reduction of the grant to the State farthest from Canberra, a State, moreover, which has the greatest difficulty in developing the huge territory under its control.
– There is no guarantee that the grant will not be increased next year, if the present basis is continued.
– I do not approve of the altered basis. I prefer that laid down by the Bruce-Page Government, and so eloquently expressed by the Leader of the Senate in 1925. The commission has acted impudently in departing from that basis without parliamentary or, so far as we know, ministerial approval. The commission’s report continued -
If. in spiteof the. effects of federation, the Statu can continue to function on what has been decided on as the. minimum standard, there is no ground for assistance.
That is a nice thing for the people of Tasmania, Western Australia, and South Australia to be told! Evidently the commission desires to override section 96 of the Constitution, which provides that the Federal Government may make grants to the States on such conditions as it thinks fit. Notwithstanding that Ministers and even Prime Ministers, have told us of the conditions that they think fit, the Commonwealth Grants Commission says -
If. in spite of the. effect of federation, a State can continue to function on what has been decided on as the minimum standard, there is no ground for assistance.
I do not believe that the federal Government subscribed to that view, and the amendment moved by Senator Marwick to-day will afford to honorable senators an opportunity to show that they do not accept it. Western Australians strenuously objected to that new policy laid down by the commission, even at a time when we were receiving benefits under it. When this policy was first laid down, Western Australia received an increase of £200,000, and, although we took the money, the Government of Western Australia, and members of all parties representing that State in both Houses of this Parliament, seriously protested against the alteration of policy. We foresaw twelve months ago, when we were receiving benefits from the commis- sion’s recommendation, the state of affairs which has now developed, and to which so much exception has been taken in Western Australia.
I noticed in the debates which took place in the Western Australian Parliament, that members of all parties referred to the ‘recent alterations of the personnel of the commission. Although it was recognized that appointments to the commission were not made on a State basis, at the same time there was a feeling of want of confidence in the commission, because of the continued failure of the Government to appoint a Western Australian to sit on that body. As a matter of fact, on no occasion has a Western Australian been a member of a commission appointed to inquire into the disabilities of the States. When the Commonwealth Grants Commission was first appointed, Mr. E. W. Eggleston, a Victorian - a capable gentleman, but one who, unfortunately, had most adversely criticized the financial policy and the position of the State of Western ‘Australia - was appointed chairman. Mr. J. W. Sandford, of South Australia, was the second member, and the third, Professor Giblin, was not only at one time a member of the Tasmanian Parliament, but also had actually been employed by the Government of Tasmania to prepare Tasmania’s claim for a grant before the commission was established. Honorable senators will appreciate that, naturally, Western Australians did not have confidence in a commission which comprised residents from the other two of the three claimant States. Their outlook was made further hopeless by the fact that the chairman had caustically condemned the financial policy of Western Australia. When it was known that both Professor Giblin . and Mr. Sandford were retiring from the commission, the then Premier of Western Australia, Mr. Collier, at once approached the Commonwealth Government, and pointed out that the people of his State would have a good deal more confidence in the commission if a Western Australian were appointed to one of the vacancies. Such an appointee would have a greater knowledge of the problems affecting his State, and Mr. Collier urged that, in the circumstances, the appoint ment of a .Western Australian member would do much to relieve the uneasiness of people of that State. I am sorry that the Government did not see its way clear to grant that request, lt has appointed Mr. Creasy, a Tasmanian, to one of the vacancies. It is a pity, if only for sentimental reasons, that the Federal Government permits to continue a policy of exclusion which causes Western Australians to fear that, above the door of the Commonwealth Grants Commission offices, is written the prohibition, “ No Western Australians shall enter here.” The first commission which inquired into the disabilities of Western Australia was very ably presided over by Mr. W. G. Higgs, an ex-Treasurer of the Commonwealth. Western Australians had a sincere regard for that gentleman, and great appreciation of the way in which he did his work. Associated with him were representatives of other States, but no’ citizen of Western Australia. The appointment of a Western Australian to one of the vacancies which recently existed on the Commonwealth Grants Commission would have provided the basis for more cordial relations between Western Australia and the Commonwealt’h than have existed for some time.
– Provided the commission recommended an increase of the grant to Western Australia !
– Whether it recommended an increase of not, that arrangement would have been much more satisfactory to Western Australians. I am sure honorable senators will agree that there are fair-minded men in Western Australia who might well have been appointed* to one of the vacancies, and even if the newly-constituted commission had recommended a reduction of the grant to Western Australia, I should have been less displeased than I am to-day. This aspect of the matter was widely referred to by members of all parties in the Western Australian Parliament during the debate last week.
The commission has made a charge of extravagance against the Government of Western Australia; it has criticized the expenditure of loan moneys, alleging that the main cause of the inferior financial position of Western Australia is the serious loss which has arisen from the reckless financing of wheat settlements, and the attempt at dairying settlement in the extreme south-west portion of the State. In regard to the charge of extravagance, it is noteworthy that, in thb sixteen years since 1920, “Western Australia has expended £30,000,000 of loan money on the development of agriculture, whilst in the same period the imports from the eastern States have totalled £12S,000,000. We are accused of extravagance for expending over sixteen years £30,000,000 on wheat lands and on the group settlements of the south-west, despite the fact that, during that period, w6 hav«. been wonderful customers of the established secondary industries of eastern Australia. On a conservative estimate, based on an inquiry made by the State Statistician of Western Australia, the subsidy paid by the consumers of that State to the manufacturers of the eastern States on goods thus imported would not be far short of the total amount expended on agricultural development during that period. If we had not incurred the expenditure for which we are now criticized, penalized, and condemned, the manufacturers of the eastern States would not have enjoyed the Western Australian market, which absorbed their goods of an aggregate value over the period of sixteen years of £128,000,000. Western Australia constitutes a wonderful market for t)he established factories of the eastern States, and it would be a very nice gesture on the part of their representatives in this Senate if they joined with other honorable senators in this chamber in supporting the amendment as a protest against the unfair treatment of those who are their very best customers.
– Would not that be tantamount to a vote of no confidence in the commission.?
– ‘Certainly. I have no confidence in the commission, and I should like to see. all honorable senators support the amendment. The commission has made the charge against Western Australian group settlements that the soils were unsuitable, and that the only valuable feature was the heavy rainfall. Any one possessed of even the slightest knowledge of the south-western portion of Western Australia knows that this criticism is entirely wrong and valueless. Though that portion of Western Australia is greater in area than the State of Tasmania, on information gleaned during two brief visits to the group settlement areas, the commission condemned the soil as unsuitable. So far as the charge of unsuitability is concerned, I remind honorable senators that early settlement in Western Australia took place very largely in those areas, and subsequently settlement was extended on land similar to that which the commission has condemned. The development which is taking place there is the direct result of the enterprise and hard work of the pioneers who settled in one of the most fertile parts of the Commonwealth. The commission made only two brief visits to the group settlement area, and its attitude fully justified the remarks of Mr. Troy, the Deputy Premier of Western Australia, and the Minister controlling land settlement. He said it appeared to him that the commission had already made up its mind to recommend a reduction of the grant to Western Australia. He also pointed out that when the commission visited that State last year, evidence was submitted to it showing that the areas upon which the group settlements had been established were quite suitable for dairying, so its statements were altogether too sweeping and were wholly unjustified.
The commission’s report stated that, because of Western Australia’s extravagance in loan expenditure, State taxation should be 10 per cent, in excess of the average taxation of all States. In its third report, the commission declared that taxation in Western Australia is now normal. I hope that every honorable senator present will bear this in mind, because on previous occasions the charge made by the commission was that taxation in Western Australia was below the average for Australia. For this reason, the western State was penalized in earlier reports. The Labour Government has altered all that. It has increased taxes severely on. the higher incomes. It has imposed a financial emergency tax, beginning at 4£d. in the £1 on incomes above the basic wage, and running up to 9d. in the £1 without exemption on the higher incomes.
– Does the commission mean that taxation in Western Australia is normal or equal to the average rate in Australia ?
– Yes. It means that it is now equal to the normal rate, which, of course, means the average rate. Now the commission condemns Western Australia because of its alleged extravagance in the expenditure of loan money, a charge from which neither the Commonwealth nor any State is exempt. As the eastern manufacturing interests benefited very substantially from the expenditure of loan money in Western Australia, it is grossly unjust for the commission to suggest that taxation in that State should he 10 per cent, in excess of the average rate for the Commonwealth, merely because, according to the commission, it was reckless in its expenditure of the money and losses were incurred over the group settlement scheme, which had the approval of the Empire migration authorities, and to which, by the way, the Commonwealth Government ‘was a party.
– Who spent the money on the group settlement scheme?
– The State Government of course. Does the honorable senator suggest that some other authority should have been entrusted with that expenditure? I contend that it was more wisely spent by the State Government than it would have been by any federal authority. I disagree entirely with the commission’s opinion that there has been more reckless expenditure of loan money by the Western Australian Government than by the Commonwealth Government. Because the Empire migration scheme has not been a success financially, the Commonwealth Government, following the recommendation of the commission, is prepared to penalize Western Australia although, as I have shown, it was a -partner in that project.
– Not a partner in the expenditure of the money.
– If the Commonwealth adopts the recommendation of the commission, its action will be tantamount to that of a man who “ bilks “ his partner. It is bad enough for Western Australia that the Commonwealth does not bear some portion of the losses which have occurred; it is infinitely worse that Western Australia should be penalized by an additional 10 per cent, of taxation simply because of past mistakes. I, therefore, hope that honorable senators will support the amendment. The net losses on the public debt of the claimant States are: - South Australia, £4 13s. 8d. ; Western Australia, £4 lis. 7d.; Tasmania, £4 2s. 9d. Whereas the commission holds that Western Australia should be subject to a penalty of 10 per cent., it considers that a penalty of only 7 per cent, is necessary in the case of South Australia, whilst Tasmania, where the per capita loss is not much below the losses of the other States, is to suffer no penalty whatever. In the circumstances, I really cannot help feeling that it is a good thing for Tasmania that the Leader of the Government comes from that State. He takes good care to see that Tasmania has representation on commissions that are appointed. But I am glad that, in the matter of Commonwealth grants, justice has been done to Tasmania. I agree that that State is entitled to the additional £150,000 to be given this year, but it seems extraordinary that Western Australia, which shows similar losses in connexion with loan expenditure, should be penalized so very heavily. It would seem that the more distant States receive less favourable consideration from the central government at Canberra. Many instances could be cited of substantial assistance being given to States which are nearest to the seat of government. Tasmania, as I have shown, is getting an additional £150,000; South Australia, which is only 700 miles from Canberra, has had its grant reduced by £170,000, whereas Western Australia has to suffer a reduction of £300,000, or 37 £ per “cent, of the amount received in 1935.
This reduction is altogether too drastic, especially when made without any prior notice to the State Government. Actually, the State Treasurer was not informed until after he had introduced his budget.. I protest against the instability in the amount of grants. One reason for the appointment of the commission was that State governments should be able to make their budget arrangements with reasonable certainty of the amounts to be received from the Commonwealth. The first grant given to Western Australia was £450,000 for one year. Subsequently there was an arrangement to pay £300,000 for five years. Under that arrangement the State Treasurer knew what budgetary provision to make each year, and, acting on the assumption that there would he no alteration this year, his budget estimate included £800,000 to be received from the Commonwealth. About a week later he received a telegram from Canberra intimating that, the Commonwealth grant this year would be reduced from £800,000 to £500,000. It i.3 the plain duty of the Government to review the system under which grants to the States are made. I understand that it is intended to reappoint the Interstate Commission. If so, that body should be entrusted with the duties now being discharged by the Commonwealth Grants Commission which has proved such a failure.
– Next year Western Australia might receive more favorable consideration from the commission.
– We object to the system upon which the n mounts of grants is determined. The fact that a motion of protest was moved in the Western Australian Parliament l-.y a Labour Deputy Premier, was seconded by a Country party Leader of the Opposition, and supported by the loader of the Nationalist party, shows bow strong is the feeling in Western Australia against this biased commission which this year has recommended a reduction by £300,000 of the grant to bc made to Western Australia.
I commend the Leader of the Opposition (Senator Collings) for his promised support of the amendment moved by Senator Marwick: but I disagree entirely with the honorable gentleman’s views on. unification. Every section of the people in my State is opposed to any trend in that direction. Mr. Collier, an ex-Labour Premier, has condemned it repeatedly. I do not wish to be drawn into a discussion on the possi bility of secession, but I tell the Leader of the Opposition that if he persists with his advocacy of unification he will materially strengthen the secession movement in Western Australia. The people in that State have the courage of their convictions, and would very strongly oppose any movement for unification. I again express my appreciation of the honorable senator’s promised support of the amendment, and I am glad to know that, in this matter, his colleagues in the House of Representatives have joined hands with Mr. Gregory, the honorable member for Swan, in protesting against a reduction of the grant to Westren Australia. Mr. Curtin, the leader of the Labour party, delivered an admirable speech on this subject last night. He is well qualified to speak of the needs of my State, and the disabilities which it has suffered under federation, because he prepared the case for Western Australia for submission to the Commonwealth Grants Commission, two or three years ago. The contents of the budget a.nd the recommendations of the Grants Commission remind one of a party at which all the guests with the exception of the poor relations receive gifts. In this instance the poor relations are the States of Western Australia and South Australia. Ministers of the Crown, members of Parliament, public servants and others all receive something, but the Governments of the States far removed from. Canberra get only a black eye. The further people are removed from Canberra the worse treatment they receive. There is intense feeling in Western Australia concerning the action of the Commonwealth Government in accepting the recommendation of the Grants Commission, as i3 evidenced by the resolution passed by the Parliament of that State.
– That does not mean anything.
– That is an arrogant statement by a representative of the wealthy State of New South Wales where the principal newspapers did not even publish the resolution. It may not mean anything to a representative of New South Wales but it is of vital importance to 440,000 persons spread over one-third of the Commonwealth, upon whom devolves the responsibility of developing a vast territory. The
Minister who pointed to the fact that the reductions were recommended by the Grants Commission did not refer to the basis upon which the recommendations were made. Why should the Government be so anxious to accept this recommendation of the commission when it has refused to ad-opt recommendations from more capable commissions? The full responsibility rests upon the Government. Quite recently recommendations by other commissions, many of which were of major importance to the people of Australia, have been rejected by the Government. For instance the Royal Commission on the Wheat industry recommended a scheme of rural rehabilitation under which the wheat farmers were to be assisted to purchase plant, horses and general farming equipment, but that recommendation which was of vital importance to the primary producing States has been rejected. The Wheat ‘Commission also recommended the establishment of a compulsory wheat pool but that recommendation also was ignored. Two commissions recommended new electoral boundaries for Western Australia which we’re not adopted by Parliament. In view of these facts I should like to know why the recommendations of the Grants Commission have been accepted. Although the Government must admit that it has made a serious mistake it is not yet too late to withdraw from its position, particularly as the attitude it has adopted is meeting with such serious opposition in Western Australia. I invite the Government to accept the amendment moved by Senator Marwick and in that way do justice to that State. I trust that a similar amendment will be moved when the South Australia Grant Bill is before the Senate. If the grants to these two States are increased to at least the amounts at which they stood last year two most objectionable features of the budget will be removed. It is astounding to realize that the only major reductions in the budget are imposed against the less populous States. The Western Australian Government is in a most unenviable position in that it had prepared its budget without any knowledge that the grant would be reduced. The real needs of Western Australia have been, accentuated by a serious drought in the pastoral areas and also by drought conditions in the north-eastern wheat belt where, this year, an even larger area will be affected. This measure will be a bitter disappointment to the Western Australian people, particularly when they realize that the inconsistent and contradictory arguments submitted in support of the commission’s recommendations have been swallowed by the Government. The Grants Commission decided to make this drastic reduction and then, by specious arguments endeavoured to justify it. The commission as it is now constituted has proved a failure, and I invite the Government to prevent that body from incurring further unnecessary expenditure.
– The honorable senator has exhausted his time.
Senator Sir GEORGE PEARCE (Western Australia - Minister for External Affairs) [12.44]. - The Government cannot of course accept the amendment. Senator Marwick and Senator E. B. Johnston, who spoke as if the whole measure of Commonwealth assistance to the States is bound up in. the recommendations of the Commonwealth Grants Commission, apparently overlooked the fact that the Commonwealth Government grants substantial assistance to Western Australia in other ways. The following is a list of the payments to be made to that State during the present financial year : -
L also direct the attention of the Senate to the effect of the assistance rendered to Western Australia upon, the financial position of that State. According to this year’s budget the revenue, excluding public utilities and trading concerns, will be:- From taxation £2,195,000; from land, mining, timber, &c, £1,300,000; and from Commonwealth grants which are taken into revenue, £1,006,000, or a total of £4,501,000. Therefore, 22.5 per cent, of the total public revenue of Western Australia is contributed by the Commonwealth. If grants for roads, works, mining and forestry, which would be a charge on the revenue, were taken into account, the proportion of Commonwealth grants to the total revenue of Western Australia would be 34 £%.
Sitting suspended from 12.45 to 2.15 p.m.
Senator Sir GEORGE PEARCE.Senator Marwick drew attention to Western Australia’s tremendous production and export of primary products. He said that one-fourth of the total exports of primary products from the Commonwealth went from Western Australia. We are proud of that fact, but that does not constitute a disability due to federation, because Western Australia, by being able to export that great amount of primary products, reaps a greater proportionate share of the advantage of exchange than does any other State. The amount of £701,760, by which he said the contributions of the Commonwealth to Western Australia would be less this year than they were last year, is made up of two items, one of about £400,000, which was the special payment in 1935-36 to the Western Australian wheat-growers to offset low prices; and the other the amount of £300,000, by which the special grant has been reduced.
I was glad that both Senator Marwick and Senator E. B. Johnston repeated an incorrect statement which frequently has been made in my State, because I have now an opportunity to nail it down. That statement is that the Commonwealth encouraged Western Australia to establish the group settlement scheme and then left the State to “carry the baby”. It i3 absolutely and totally incorrect. The group settlement scheme in Western Australia was initiated and carried out en tirely by the Government of Western Australia. No Commonwealth government was ever consulted about its initiation. No Commonwealth government had any voice in the matter or was ever consulted in that regard.
– The Commonwealth Government contributed towards the interest payments.
– I am coming to that aspect, but that is not the charge. The charge is that the Commonwealth inveigled the State into the scheme and then, after having done so, left it to “ carry the baby”. The scheme was initiated by the State Government and carried out by the State Government, but, after it had been in progress for some considerable time, and after large liability had been incurred, the Empire settlement scheme came into existence. Under that scheme the British Government and the Commonwealth Government undertook to contribute agreed proportions of the interest charge on State schemes. After the Empire settlement scheme had been initiated, and after the Government of Western Australia had begun its own scheme and incurred liability in respect thereof, it approached the Commonwealth Government with a inquest that its scheme be brought under the Empire scheme. The Commonwealth Government agreed to do so, and is to-day still bearing a share of the interest charge on it. The British Government also is bearing a share of the burden. Yet the charge laid against the Commonwealth Government is that it inveigled the State Government into heavy expenditure and then left it in the lurch. What I have said absolutely refutes that charge; yet the group settlement scheme of Western Australia is claimed to be one of the injustices that the Commonwealth has inflicted upon the State.
Some honorable senators have . suggested that the Commonwealth Grants Commission should base its recommendations on disabilities suffered in consequence of federation, and on that alone. The commission has stated that if it had done so it could not have recommended any grant to South Australia or Western Australia. In the interests of my State I am not prepared to say to the commis- sion, “ You must make your recommendations on disabilities alone.” I want my State to get some grant. It is entitled to Commonwealth assistance and, therefore, I am not prepared to join with Senators Marwick and Johnston in saying to the Grants Commission that it must base its recommendations only on disabilities due to federal policy.
Senators Marwick and Johnston said that they resented the imputation contained in the commission’s report of extravagance in connexion with the settlement of the wheat-growing areas and the group settlement. I draw the attention of the Senate to something of which you, Mr. President, are well aware, and of which I think Senators Marwick and Johnston should be well aware; that is, that the allegation of extravagance was not in the first instance made by the Grants Commission. “With respect to the settlement of wheat-growing areas, the allegation was first made by a Royal Commission appointed by the Government of Western Australia to inquire into the affairs of the Agricultural Bank. That commission, I remind Senator Johnston, was composed entirely of Western Australians. The allegation of extravagance - a stronger term was used ; it was “ incompetence,” I believe - in connexion with the group settlement scheme was also made by a Royal Commission appointed by the Government of Western Australia and consisting entirely of Western Australians. It is not fair to lay the responsibility for this charge upon the Commonwealth Grants Commission when that body merely took up statements made by State Royal Commissions composed entirely of citizens of that State. I am no less an enthusiastic Western Australian than is any other honorable senator from that State, but that does not blind me to facts: nor do I think that the best interests of Western Australia are served by shutting our eyes to the facts. On the contrary, I believe that truth is our best friend in the long run.
Senator HARDY (New South Wales) [2.24T. - I had anticipated that after the speech of the Leader of the Senate (Senator Pearce) the amendment would be withdrawn. The right honorable gentleman adduced a convincing argument in support of the basis on which the Grants Commission made its recommendations to the Government. I listened attentively to Senator Marwick. One point in his speech which struck me forcibly was his statement that he was glad to have the support in this matter of the Leader of the Opposition (Senator Collings). This .Senate has seen many political somersaults, but none so complete as that of Senator Collings. In 1935 when a similar measure was before this chamber, Senator Collings opposed a request by Senator Johnston for an increase of the grant to Western Australia and also voted in favour of the bill as it was presented to the Senate. His speech began at 11.8 a.m. and ended five minutes later. Twelve months after that legislation was introduced and passed by this Parliament Senator Collings said, “ I am entirely opposed to the basis on which the commission has reached its conclusions. We do not agree with the altered attitude of the commission.” I remind Senator Collings that this basis is not new.
– I said the same this morning.
– That is the trouble. The honorable senator did not say it twelve months ago. We want to know why the honorable senator is so inconsistent. Is it because the Leader of the Opposition in the House of Representatives is a Western Australian and has broadened the outlook of the Queensland members of this chamber? Replying to Senator Johnston, who had spoken of the alleged injustices that had been done to the State of Western Australia, Senator Collings said last year -
Instead of imputing that some sinister motives are at work against Western Australia, Senator Johnston would have done better to have como straight to the point and asked that the grant to the State be increased.
– They are doing that now and I am supporting them.
– The honorable senator continued -
Yesterday and to-day the honorable senator has iterated and reiterated ad nauseum charges against, the Commonwealth Grants Commission and insinuations that federal policy is directed specifically against Western Australia.
To-day Senator Collings has made charges similar in substance to those made by Senator Johnston. Last year he made practically no further comment and voted with the Government in support of the bill. Is it logical, therefore, for the Leader of the Opposition to support the amendment submitted by Senator Marwick? Senator Collings’ speech twelve months ago, continued -
If lie is not satisfied with the amount of the grant, he should have said so, instead of proceeding on devious by-ways and side tracks, so that honorable senators were more confused when he finished than they were before he started. He has repeated over and over again that tile Commonwealth Grants Commission lias been made superior to Parliament, but I desire to impress upon his mind that that is not original.
It would be more honest for the honorable senator to say that straight out, and then use his influence with the Government to get an increase next year, instead of insinuating that sinister forces are at work to penalize Western Australia.
He concluded with this most significant statement -
I do not believe that there is the slightest scrap of evidence in support of the honorable senator’s insinuations.
– ‘Ghosts are walking.
– I know that these ghosts of Ilansard sometimes walk in the chamber.
– They do not cause me any fear.
– I cannot understand the contention of honorable senators from Western Australia that grants should be based on disabilities rather than on the financial needs of the States. In analysing the case, the commission reported -
The only three definite items of federal policy which are accused of adverse effect on the claimant States are the three specified - tariff policy, the Navigation Act, and the Federal Arbitration Court. Of these, the tariff policy is much the most important; but while the tariff policy is found to bo a very serious burden on the claimant States, the effect of the other two is judged to be relatively small.
That is an analysis of the actual case submitted by the claimant States. I think that honorable senators representing those States are in agreement that, of the disabilities, those -arising from the tariff are the most important.
– We do not all argue that way.
– The official case for Western Australia was presented oi> that basis. There may be points in it with which individuals do not agree, but I submit that the predominant feature of the case for Western Australia was the effect of the tariff It has often been said that the tariff presses unduly harshly on Western Australia because of that State’s unsheltered industries, and therefore it may bi enlightening to honorable senators to know the facts in relation to other States. Senator Marwick gave the percentage of unsheltered industries in Western Australia, but I remind him that that State has not a monopoly of such industries. In volume, such industries in New South Wales are 185 per cent, more than in Western Australia, irrespective of the fact that that State exports approximately 60 per cent. of its production. Appendix 19 accompanying the third report of the commission shows that the value of the production of unsheltered primary industries of New South Wales is £43,296,000, as compared with £15,751.000 for Western Australia. If the tariff is to be regarded as a burden we must ascertain where that burden falls. Owing to the smallness of Western Australia’s population the burden certainly falls harshly on that State, but it would be wrong to say that only the States with small populations feel the effect of that burden. In an attempt to assess the benefits, as well as the burden, of the tariff, the commission shows that, whereas New South Wales gains by £10,070,000, it carries a burden of £12,020,000. In other words, the net effect of the tariff is to place on New South Wales a burden of £1,950,000 a year. Yet, hearing some honorable ‘senators speak, one would think that that State received nothing but benefit from the tariff.
– New South Wales has compensating advantages.
– I have endeavoured to show that the burden of the tariff does not fall on Western Australia alone. Queensland benefits by £7,510,000, and carries a tariff hurden of £3,460,000, the net benefit to that State from the tariff policy being, therefore, £4,050,000. The figures for Western Australia show a benefit ©f £6S0,000, and a .burden of £2,830,000. That is to say, the net burden imposed on that State by the tariff is £2,150,000 a year. 1 have mentioned these figures in order to show that the tariff burden is distributed over the whole of the Commonwealth; that being so, the only sound basis for grants is the need of the States, rather than the disabilities arising from federal policy.
Senator BADMAN (South Australia) [2.36J. - I am astonished at the antagonism displayed towards grants to States which are suffering from disabilities, particularly when the present Government, as well as that which preceded it. has admitted that those States are entitled to compensation for such disabilities.
– It is now said that the disabilities have disappeared.
– The effect of the commission’s report is that there are no disabilities, and that grants are now made on the basis of the needs of the States. This bill is the outcome of a weakness of the federation. Whatever may be said in favour of federation, it must be admitted that there are some weaknesses associated with it, in that some States derive great benefits from the partnership, whilst other States are losers. Thirty-six years of fighting in an attempt to adjust matters in this Parliament has not removed those weaknesses. Only to-day the Leader of the Senate (Senator Pearce) quoted tiopinion of the commission that those States which are seeking grants might have been in the same financial position had there been no federation. The statement was applauded by some honorable senators who thereby showed an attitude unfavorable to the necessitous States. No previous government has done for the weaker States what the Lyons Government has done, even in the depression years. In 1931-32, the year before the Lyons Government came into office, South Australia received a grant of £1,000.000, Western Australia £300,000. and Tasmania £250,000, a total of £1,550,000 for the three States. In the following year, South Australia received. the same amount as in the previous year, but the grant to Western Australia was increased to £500,000, whilst Tasmania was paid £330,000, the total grant for that year amounting to £1,830,000, an increase of £280,000 over the total grant for the previous year. The Commonwealth Grants Commission was not appointed until May, 1933. Before any recommendation was received from it, the Lyons Government introduced legislation to give to South Australia £1,150,000, to Western Australia £600,000, and to Tasmania £380,000 in 1933-34. That total of £2,130,000 was an increase of £300,000 over the expenditure during the former year. Following the first recommendations of the commission, the grants for 1934-35 were - South Australia, £.1,400,000; Western Australia, £600,000; Tasmania, £400,000, a total of £2,400,000, or £270,000 more than the total grant for 1933-34. Those figures show clearly that, notwithstanding the grants for which the Lyons Government was responsible before the establishment of the commission, that body recommended increased payments to the States which suffered disabilities. Senator’ Hardy said just now that there were more unsheltered industries in New South Wales than in Western Australia, but I remind him that the former State derives compensation in respect of its secondary industries, whereas primary industries, mainly wheat-farming and grazing, predominate in the western State. If the effect of the tariff on Western Australia were shown, it would be seen that the burden on that State is greatly in excess of the amount which the commission has decided shall be the basis for future grants. The payment of special grants to necessitous States prior tq the appointment of the commission is evidence that successive governments recognized that those States suffered, disabilities under federation. The findings of the commission in its first two reports are further evidence of the existence of disabilities. Notwithstanding that £2,130,000 was disbursed by way of grants in 1933-34, the amount paid in the following year, after the commission’s first report had been submitted, showed an increase of nearly £300,000, and in the following year, 1935-36, that increased grant was further augmented when a total of £2,750,000 was paid to the three claimant States. For 1936-37, however, a reduction of £320,000 is proposed, because the commission lias departed from the principle adopted in connexion with earlier grants. Instead of recommending payments on the basis of disabilities, the commission in its latest report has substituted the needs of the States as a basis for grants. Paragraph 191 of the commission’s third report reads -
We are strongly of opinion that no State in such a position of prosperity should receive a special grant. States federating expose themselves to certain hazards, and must stand by their decision. It cannot be expected that federation will have precisely the same effect on the prosperity of all States. It would be absurd, even if it were possible, to attempt a strict debit and credit account for each State for all of the effects of federation. On the contrary, there is in general some more or less automatic arrangement, like the per capita payments in Australia, by which the financially stronger States help the weaker. We have taken the position that grants should be given to States in financial difficulties sufficient to make it possible for them with reasonable effort to maintain Australian standards of government, whether the financial inferiority is duo to the effects of federation or any other case. We cannot see any valid grounds for recommending a grant to a State whose financial position is inherently as favorable as that of the other States which have to find the money , for the grant.
Paragraph 201 reads : -
We have found that special grants will in general be necessary to supplement the other transfers of revenue from Commonwealth to States, and that these grants should be determined from a strict comparison of the financial position of a claimant State with that of other States. If a State is in financial difficulties it must be made possible for it by a “ reasonable “ effort to get as good financial results as other States . . .
In paragraph 202 the commission says -
The estimation of grants will be a matter of some difficulty. It will require a comparison of the inherent financial position - that is of its actual budget position taken in relation to variations between States of accounting practice, of economy in expenditure and severity of taxation and other charges.
The charge has been levelled against South Australia and “Western Australia’ of extravagant loan expenditure. So far as South Australia is concerned, the present Government led by Mr. Butler has been the most economical the State has ever had. There has been a paring down of social services and other governmental expenditure, and the Government has done its utmost to meet its liabilities and at the same time to show a surplus. Thanks to the grant of £1,400,000 in 1933-34 the South Australian Government was able to show a surplus of about £36,000 the next following year. Since that time the Premier and Treasurer (Mr. Butler) has endeavoured to keep expenditure as low as possible. With the grant of £1,500,000 made by the Commonwealth last year South Australia was able to show a surplus of approximately £140,000 for 1935-36. This year, even after having budgeted for a surplus of only about £2,000, Mr. Butler finds that the Commonwealth grant recommended by the commission is to be cut down by £170,000. I am afraid that because of adverse seasonal conditions South Australia will show a deficit next year even greater than is estimated at present. We have heard a good deal of the difficulties confronting Western Australia as the result of adverse seasonal conditions, but in. all my experience I have never seen a season develop more disastrously than it has in South Australia during the last -five weeks. Recently the Premier of South Australia communicated with the Commonwealth Government pointing out the plight of many people in that State as the result of adverse seasonal conditions, and requested that further consideration be given to South Australia’s needs upon which the Commonwealth Grants Commission has based its recommendation. It is estimated that this year South Australia will produce only 20,000,000 bushels of wheat, or between 10,000,000 or 11,000,000 bushels less than last year. This will bring about a shrinkage of railway revenues and will add to the disabilities under which the State labours. With regard to natural disabilities we are not caviling. But South Australia claims that it has suffered very definite disabilities through federation. Many of its secondary industries which previously had been in a flourishing condition were driven to the wall after federation, and have not been able to carry on since because of large corporations in the eastern States, forcing their goods on the South Australian market at prices against which the local manufacturers cannot compete. South Australian indus- tries, particularly the machinery and the bootmaking industries, are now almost extinct. It appears that South Australia’s needs are likely to become greater than they have been during the last two years. Prior to the establishment of the Commonwealth Grants Commission during the depression period, the Lyons Government had already generously recognized the disabilities imposed upon States by federal policy, by giving them special grants to assist them out of their difficulties. The State governments have made every endeavour to balance their budgets by drastic curtailments of social services. In paragraph 76 of its second report the Commonwealth Grants Commission stated -
The tariff policy of Australia may be accepted as successful, and, on the whole, beneficial. One effect of it, however, is to put the other States at a disadvantage in comparison with Victoria and New South Wales, and this inequality is likely to grow rather than diminish in the future.
The present position of South Australia is comparable with that of Western Australia; both States are in great need because of adverse seasonal conditions. The Commonwealth Government need not have accepted the recommendations of the commission. In view of the fact that it showed a surplus of over £3,000,000 last year, it might have dealt more sympathetically with Western Australia and South Australia, despite the recommendations of the commission, and have granted the same amounts as were given last year.
I intend to support the amendment as a protest against the recommendations of the commission. I consider that if the commission, based its recommendations on the needs of the States, then both South Australia and Western Australia certainly need at least the amount which wa3 granted last year.
– I appeal to the Leader of the Government and to honorable senators to agree even at this eleventh hour to the withdrawal of this bill. I do not approach the subject with any preconceived idea that the commission has come to a correct or an incorrect decision with regard to the amount of the grant to be made to Western Australia this year, but I appeal to honorable senators as members of a federal authority to bring to the consideration of this problem a truly federal spirit. In Ais Parliament we are met with requests from various States for grants for different purposes, but no State in the Commonwealth at the present time has a more genuine case for extra relief than h:.: Western Australia, apart altogether from the question of disabilities under federation. I have contended for many years that there has been too much loose talk in Western Australia with regard to the effect of federation on that State. But on the ground of sheer necessity and dire need I appeal to honorable senators to treat sympathetically this endeavour to secure an extra £300,000 for Western Australia. To some of the more prosperous States it is not a large sum of money, but it represents a good deal to Western Australia, and is required urgently to meet a condition of affairs which I hope will never again exist. In addition to having had to survive two partial droughts during the last two years, Western Australia is now facing unparalleled drought conditions especially in the north-western and Murchison districts. It has been computed by a reputable authority that no less than 40 per cent, of the flocks of sheep in those districts has been lost through drought, and even if rain, which is urgently needed, does fall it is feared that another 10 per cent, will be lost, because the sheep are becoming so weak that when the rivers flow again large numbers will be drowned or bogged. With the loss of ever 40 per cent, of our Wool clip this year we are facing a position which, I submit, calls for sympathetic treatment by the Fedora! Government. It has been said that Western Australia is in a much better position than its representatives here will admit. Senator Leckie, on one occasion last session, referred to the wonderful go’d-mining industry in Western Australia and the great wealth produced by it. The honorable senator said we always choose to remain silent about it. The goAmining* industry has certainly been a wonderful stand-by for Western Australia, and had it not been for the gold produced in that State not £S00,000, but double that amount would have been required to tide it over the difficult period through which it is passing. But even the gold industry is not the immense producer of wealth which many honorable senators seem to think it is. Fluctuating share market values indicate great activity on the part of speculators, but the actual amount of gold produced has not increased to anything like the extent that some people believe. It is true that many new holes have been sunk in the ground, and many new companies have been floated, but the increased gold production comes mainly from mines that have been worked before and since 1902. I have in my hand an. interesting diagram of gold production in my State. It entirely disposes of the belief that the industry is so prosperous as to render unnecessary further financial assistance to Western Australia. The peak period was in 1906, when 1,800,000 fine ounces of gold were produced. The output declined badly and in 1926-1927 and 1928 touched its lowest level, hut this year it is expected to be 900,000 fine ounces, or exactly one-half the quantity produced in 1906. Next year it is anticipated, the production will be 1,200,000 fine ounces, still 600,000 ounces less than the 1906 figures.
– But the value of the gold is much higher.
Senator ALLAN MacDONALD.There are compensating figures as regards values. In 1906 the cost of treating the ore was less than one-half the present day costs, so the actual value is not such an important factor as is the aggregate number of fine ounces won. Thus I would hasten to assure Senator Leckie and other people who, I know, are greatly interested in gold production in Western Australia, that the wealth taken from the mines in that State is not sufficiently great to justify the reduction of financial assistance by the Commonwealth. Moreover, Western Australia alone does not benefit from the recent mining activity. The lion’s share of the wealth extracted from gold-mines in that State goes to Victoria, and the lioness’s share to New
South Wales, because each year Western Australia imports approximately £10,000,000 worth- of manufactured goods from the eastern States.
– Western Australia gets full value for its money.
– I do not doubt that, but I remind the honorable gentleman that Western Australia provides a wonderful market for the manufacturers of Victoria and New South Wales. It is a much better market than the Dominion of New Zealand, and it is nearly as good as the Canadian market. Be it remembered that outside the United Kingdom market, which takes most of our surplus primary products, Western Australia ranks very high indeed as a customer of the eastern States. Therefore it has good reason to expect the sympathetic support of manufacturers and commercial men for its claim for an additional grant this year. I suggest to representatives of the eastern States that it is wise to retain, instead of estranging, such a valuable market. They can do this by supporting the representatives of Western Australia in their appeal to the Government to withdraw the bill, and bring in another measure to increase the grant by £300,000.
Yesterday, when speaking on the motion for the printing of the Estimates and budget-papers, I referred to the dissimilarity in the trade and commerce figures of the three claimant States, and emphasized that no matter what mathematical formula was applied to them, obviously a mistake had been made somewhere, because the per capita grant to Tasmania recommended by the commission is £2 32s., whereas the per capita grant to Western Australia is only £1 3s. There is bound to be some rearrangement of the figures, and I submit that however good the case may be for Tasmania - f do not question it for one moment - Western Australia is entitled to a larger grant than £1 3s. a head of population. Tasmania has always been in a fortunate position. It has always had a representative on the commission. The first was the erudite Professor Giblin, who laid down the original headings under which the commission takes evidence and reaches its decisions. The personnel of the commission has been changed, but again that State has a representative on it. Western Australia has never had representation on that body. I contend in all sincerity that no matter how clear and convincing may be the evidence placed before the commission, a proper appreciation of a State’s difficulties is not possible without first-hand knowledge of local conditions. Western Australia is in dire need of additional assistance. Other States may be in a similar position in the future. As a representative of Western Australia I was glad to be able to lend my support to the proposal to renew the sugar agreement which means so much to the financial stability of Queensland. Now, on behalf of my own State, I appeal to Queensland senators as well as to the representatives of other States to do justice to Western Australia. The present is a- most inopportune time to reduce the grant. The commission’s recommendation was based, on evidence of conditions that obtained approximately eighteen months ago.
– Two years ago.
Senator ALLAN MacDONALD.Therefore, without embarrassing the Government in its relations with the commission, we can urge that, on the latest evidence available, Western Australia is fully entitled to further financial help, because it is facing a drought that is unparalleled in its history.
The Leader of the Senate (Senator Pearce) must know that a reduction of the grant will add fuel to the fire of secession which has by no means died out, as has been suggested. It was dying down, but I fear that the adoption of the commission’s recommendation to reduce the grant from £800,000 to £500,000, will be like spraying kerosene on a smouldering fire; it will cause secession to blaze up again, and will further encourage those who wish to disrupt the federation. The people of Western Australia, by referendum, decided to ask the Imperial Parliament for leave to secede, and if the movement be renewed. I, as a representative of that State, elected after the referendum had been held, would deem it my bounden duty to support it. I, therefore, appeal to the Go vernment to give sympathetic consideration to the amendment, and if possible, agree to the withdrawal of the bill with a view to the introduction of another measure to increase the grant to £800,000.
.- There are two sides to the issue before the Senate - the interests of the people who would have to provide the money for this suggested additional grant to Western Australia, and the interests of the people who will receive it. It is about time that something was said for the people who have to find the money. How long will they be able to continue to give. It is, I think, indisputable that but for the special grants to the States this year, the Commonwealth Government would have been able to remit a further £2,000,000 of taxes. I am inclined to think that the representatives of Western Australia in this chamber are like the foolish man who looked a gift horse in the mouth. To put the position bluntly, if the bill is withdrawn they take a risk that it may not be re-introduced.
Senator Allan MacDonald presented a much better case for an increased grant than did. the previous speakers from his State. They based their claim on what they regard as an. established right, apparently for all time. Senator Allan MacDonald, on the other hand, urged that Western Australia is. in a bad way financially, and is in urgent need of additional assistance. His was much the better way to approach the eastern States. I am sure that if they believed that Western Australia were in grave difficulties they would not hesitate to respond to a genuine appeal. The other representatives from Western Australia did their State a great disservice. One honorable gentleman would have us believe that it is a land of desolation and poverty.
– The figures prove that.
– Senators Marwick and Johnston pictured Western Australia as a country not worth saving, whereas it is by no means an unimportant State of the Commonwealth.
– Senator E. B. Johnston said something about poor relations at a tea-party.
– I heard the honorable senator use that comparison. I am wondering what the people of his State will think about it. From observations made in Western Australia, I know that the people are industrious, and that there are large areas of fertile land ; but, unfortunately, drought conditions prevail in certain parts of the State and these justify the earnest appeal made by Senator Allan MacDonald. If the remarks of some honorable senators representing Western Australia are given publicity throughout the Commonwealth it will be thought that that State is unworthy of financial assistance. If a State is in actual need, it should receive help, but its representatives should not make demands upon the Commonwealth.
– Those who have rights are entitled to make demands.
– I do not think that the people of Western Australia are in such sore straits as to be justified in demanding that the Commonwealth shall make a grant which has to be provided by taxpayers in other parts of Australia. The assistance which the Commonwealth proposes to render is to enable Western Australia to rehabilitate itself. The following interesting paragraph appears in the commission’s report: -
It cannot be said that Western Australia lias made any special’ sacrifice to put her finances right. During the eight years prior to 1034-35 her taxation had been lower than that of most other States, and it has been a practice to postpone losses and spend out of loan funds what should have been found out of revenue.
The people of the eastern States have to assist Western Australia because the Government of that State has not imposed sufficient taxes to meet its liabilities. Senator Allan MacDonald put the case for Western Australia fairly by showing that, owing to drought and other conditions, assistance is needed, and if an additional grant were given on those grounds I should be very sympathetic towards it. I do not believe that the Western Australian people, through their representatives, are entitled to make demands upon ether taxpayers
– Perhaps the conditions in Queensland are due to bad government.
– Not at all. But for the wealth which the sugar industry produces, Queensland would have to ask the Commonwealth Government for £2,000,000 annually.
– New South Wales is also thinking of submitting a claim.
– I would support its claim if it could be substantiated. The report of the commission clearly discloses that New South Wales and Victoria have benefited by federation at the expense of the other States. Prior to federation, manufacture in Queensland was increasing, but immediately tariff barriers were removed the position changed.
– The Queensland Government has taxed manufacturers out of existence.
– It has not. The unsatisfactory position in which Queensland manufacturers are placed is due to the competition from mass producing industries in Victoria and New South Wales. The Queensland manufacturers have the same complaints concerning the competition from those States as Senator Leckie has against British manufacturers. It is only the protective tariff which enables mannufacturers in the States I have mentioned to produce at a profit. Sir Hal Colebatch, who has given close attention to the financial position of the States, said that but for the sugar industry Queensland would he in a financial position similar to that of Western Australia.
– What Queensland factories have been closed down ?
– The output of boots and shoes, to give one example, is decreasing rapidly?
– The working conditions and wages are practically the same in Queensland and Victoria.
– The existence of an anti-sweating league in Melbourne shows that sweated labour is employed in Victorian factories. Under conditions slightly different from those obtaining to-day, Queensland would be seeking financial aid from the Commonwealth.
– Yet Senator Brown has said that Queensland is particularly well off.
– When Australia has been seeking loans overseas, we have all read statements to the effect that the whole continent is a land flowing with milk and honey, but we know that, as a matter of fact, one-third of it is desert.
– The honorable senator seems to think that New South Wales is the bee that sucks the honey.
– I have no prejudices against New South Wales, but there is no doubt that it gathers a lot of the honey, in this respect being second only to Victoria. Senator Leckie who is usually fair in his utterances, was certainly somewhat hard on the claimant States. It is not true that they are simply demanding so much money, the property of the non-claimant States. Hearing some honorable senators, one would think that New South Wales and Victoria came into possession of all this money in a manner quite apart from their trade and industrial relations with the other States. The fact is that the strong financial position of Victoria and New South Wales is due mainly to their very advantageous trade relations with the smaller States. There is no doubt that financia’l interests in Victoria and New South Wales have a tremendously strong hold upon the economic activities of the rest of the Commonwealth. When I visited Western Australia for the first time, I was surprised to learn that there was no Western Australian bank. There had been one, I was given to understand, but it had been absorbed by the Bank of New South Wales. Even the mercantile associations in Western Australia are largely controlled from South Australia and Victoria. This financial dominance by the eastern States is so strong that the other States must always be liable to get the worst of the bargain. It have had to listen to many attacks on the Queensland sugar industry, but I remind honorable senators from Victoria and New South Wales that, though they could probably buy cheaper sugar from Java or Cuba, they would never be able to sell to those countries anything like the same quantity of manufactured goods that they sell to Queensland.
I have addressed myself to this subject of grants to the States on many occasions, and I have never quibbled about the amount of the grants. We should not bother about a few hundred thousand pounds one way or the other. The great need is to put an end to this talk of secession, to remove the feeling of discontent that undoubtedly exists in some States. Some of the representatives of Victoria and New South Wales have spoken of the claimant States as if they were beggars crying for alms - as if they were seeking something to which they were not entitled. I submit that the claimant States are entitled to all the grants they have ever received. We should not forget that the industrial interests of Victoria and New South Wales, by virtue of being first in the field, obtained a start which they have maintained up to the present time. Even in Queensland, the pastoral industry was largely developed by capital from Victoria, and we know that those who invest money in such enterprises always take their full share, and more, of the profits. I trust that the economic position in Western Australia will improve. The increased price of wheat will undoubtedly help both Western Australia and South Australia, but if the Western Australians can show that they should receive even greater assistance, the representatives of the other States should not quibble over the amount to be given. There is no doubt that Western Australia has been badly hit. The production per head of population is higher in Western Australia than in any other State, but it is all primary production. I intend to vote for Senator Marwick’s amendment, and I hope that it will receive the support of other honorable senators. I have no sympathy with those honorable senators who ask how much longer the claimant States will seek financial assistance from the Commonwealth. I do not think that under our system of federation, there will ever be a time when one or other of the States will not be in need of financial assistance of some kind.
– There is no escape from it.
- Senator Leckie, who is usually a model of good sense and brevity, adopted a wrong attitude in this regard. In my opinion, a financially weaker State is quite justified in approaching the federal Government for a grant to compensate it for its disabilities under federation. If the people of Victoria or New South “Wales suffered a great disaster from flood, fire, or other cause, their fellow Australians of Other States would be perfectly willing to assist them in their hour of travail by subscribing to a relief fund on their behalf; but the payment of grants to States, in competition for disabilities, is a far more important matter. Any State which considers that it has suffered financial injury owing to federation has the right to appeal for assistance. There has been ample evidence in recent years to show that if that right is not recognized, the existence of thu federation itself will be endangered.
– Nobody denies the right of the States to appeal for assistance.
- (Senator Leckie has done so. He asked how much longer would these grants to the smaller States continue, and how much longer would they make appeals for assistance? Up to date, Queensland has been fortunate enough not to require a disabilities grant, but the day may come when some disaster, economic or otherwise, may overtake it. If the necessity should arise for that State, to appeal for aid, its people would deeply resent any insinuation from, another State that it had no right to ask for assistance from the Commonwealth.
– The other day the Premier of Victoria said that his State was being bled white by the Commonwealth.
– I read that passage, which, in my opinion, waa pure nonsense. Undoubtedly, some nasty statements have from time. to time been made iri respect of Commonwealth grants to the weaker States. The explanation, I think, is that persons like Mr. Dunstan - and there also may be some of them in Queensland - do not really understand the position; if they were taken to task for their statements, they would probably express regret for having made such foolish remarks. In my opinion, the payment of grants to the financially weaker States is inescapable under the present federal structure, and, until the tide of prosperity turns, such States must continue to appeal for Commonwealth grants. I sincerely support the amendment moved by Senator Marwick, and I hope that it will have the approval of the majority of honorable senators.
– I rise to support the bill. These grants vitally affect the finances of .South Australia, as well as Western Australia. In my opinion, South Australia does not receive all that it is entitled to for its disabilities under federation as revealed in the evidence submitted to the Commonwealth Grants Commission, but we appreciate the fact that the Commonwealth has seen fit to grant us the full amount that was recommended by the commission. Unfortunately, no intimation iu regard to the reduction of the grant this year was sent to the State Treasurer before he prepared his budget, with the result that he informed Parliament that he expected to complete the current financial year with a small surplus. Only two days before the budget was presented to the House of Assembly the Government was informed of the amount of the grant; the Treasurer was therefore placed in the embarrassing position of having to revise his estimate and budget for a deficit instead of a surplus. The convenience of the Treasurer would have been better served if he had been informed of the amount of the grant at an earlier date.
I support the remark of Senator Badman that the Lyons Government has clone more for the smaller States, and appreciated more than any other federal government their difficulties and disabilities. I note that the Grants Commission is now considering the financial needs of the States rather than the necessity for compensating them for their disabilities under federation. A decision on the latter basis is difficult to make. The report of the commission is a well prepared and exhaustive document, containing a considerable amount of valuable informa- tion. The commission admitted the difficulty of assessing in actual money the disabilities of any State under federation; the acid test is the financial position, of the States themselves, having regard to economy in administration. In this connexion, the Government of South Australia has admirably carried out its responsibilities. It has economized and taxed the people in an endeavour to balance its budget. On previous occasions, I pointed out that the position of South Australia is similar to that of Western Australia. A considerable percentage of the obligations incurred by the State represents expenditure on the development of the Mallee, or second-class land. Thirty years ago, South Australia embarked upon a vigorous policy of land settlement after the introduction of superphosphate. From the view-point of the State Government, this was a sound economic proposition ; but it conflicted with the policy of the Commonwealth Government. Only those persons who have been closely associated with the business can appreciate the real effect of that conflict upon the State and the people. Without labouring this aspect, I quote from the third report of the Commonwealth Grants Commission to explain the position -
There were several reasons why the development of primary production after federation assumed a more progressive and deliberate form, and involved large capital expenditure by the States. A great deal of land had been alienated to pastoralists, which, if used for agriculture, would produce many times the wealth and employ many more people in the same area. It was thought that some stimulus was needed to bring this land under the plough, and States provided this by purchase and subdivision for closer settlement. The Commonwealth Government took a hand in 1!)0S) with an improved hind tax designed for the same purpose. Irrigation required huge expenditure for head works, reticulation, pumping, land purchase and settlement. Extensions of settlement required developmental railways, which would not pay at first. It will thus be seen that the States were, within the limits of their powers, carrying out. a policy of protection for primary industry parallel to the Commonwealth policy of protection for secondary industry. In the case of the States, protection was afforded in part by direct subsidy and in part by taking the risk involved in large capital expenditure. In many cases the risk resulted in loss, and these losses constitute the chief item in the budgetary difficulties of the States. The States pursued their policy of development cautiously up to the date of the war, but after the war much, less restraint was exhibited. Leaders in Great Britain and the Commonwealth were preaching the duty of Australia to settle migrants, and this was a contributing factor in postwar development.
In paragraph 72 of its report, the commission stated -
The interaction of these two protective policies .is vital to the problems the commission has to consider. Though the heavy losses which make up State disabilities at present are partly explicable on the ground of the unsoundness of the financial methods and control, and partly on the ground of the fall in prices, it is obvious that a tariff which extracts from export industry a substantial subsidy, must add seriously to the burdens of States attempting to develop such industry. More? over, as one developmental activity, that connected with land settlement, is in the hands of the States, and the other developmental instrument, the tariff, is controlled by the Commonwealth, there is a lack of consistency and co-ordination in the two policies. There is almost a competition between the two factors of development; ‘each frustrates the effect of the other; the burdens created by the one make the protection required for the other the greater, so that the clash we noticed earlier becomes more intense as each protective effort grows. There is an increasing amount of protection to primary industry in the Commonwealth tariff, but the broad distinction set out above still remains.
That shows clearly one of the greatest difficulties associated with this subject. In respect to South Australia, I am certain that that is where the difficulty lies. 1 am not so much concerned as to the( basis which is adopted as I am that assistance shall be obtained from tin Commonwealth. I shall not labour the subject further, although I could adduce plenty of evidence that neither the legislation nor the administration of the State is at fault. Much of the land which waa taken up about 30 years ago in South Australia was held successfully for a time, but, later, the ever-increasing burden of the tariff made its occupation unsound economically. South Australia has experienced great difficulty in connexion with land settlement. It is difficult to draw the line, and say where settlement should cease. In any case, the experiment in the marginal country had to be made in order to test the capacity of the land. I assure the Commonwealth Government that South Australia is making strenuous efforts to put its house in order. Although I sympathize with Western Australia, I cannot see that any good purpose would be served by withdrawing the bill for redrafting,and,therefore,Icannotsup- porttheamendmentofSenatorMarwick. IntheseMeasure,theclaimantStates are promised a certain measure of assistance, and, therefore, I shall support them. I am willing, however, to join with representatives of Western Australia in making a special appeal for a further grant. South Australia is in much the same predicament as is Western Australia. Only this afternoon I received a telegram from my State intimating that, owing to drought conditions, many of the crops will be an utter failure, and suggesting an appeal for a special grant at a later stage. There is precedent for that action, for a few years ago Victoria received a special grant of about £50,000 because of the damage caused by thrips.
– That had no relation to a disabilities grant.
SenatorUPPILL.- That may be, but, as I have said, I am not particularly concerned whether the grant is made on the basis of needs or of disabilities, so long as it is adequate.
Question - That the words proposed to be left out be left out (Senator Marwick’s amendment) - put. The Senate divided. (President - Senator the Honorable P. J. Lynch.)
Question so resolved in the negative.
– I now desire to move the amendment which I foreshadowed yesterday.
The PRESIDENT (Senator the Hon. P. J. Lynch). - The honorable senator has already spoken on both the substantive motion and the amendment just disposed of, and I cannot allow him to move a further amendment.
Original question resolved in the affirmative.
Bill read a second time and reported from committee without amendment or debate; report adopted.
Motion (by Senator Sir George
Pearce) proposed -
That the bill be now read a third time.
– I gave notice yesterday of my intention to move an amendment to the motion for the second reading of this bill but you, Mr. President, ruled that I could not do so, as I had already spoken on the measure. I believe that ruling to be correct. I wish now merely to record the terms of the amendment that I intended to move, particularly as they are in conflict with remarks made by the Leader of the Senate (Senator Pearce) as to the attitude of honorable gentlemen who supported the amendment that was defeated a few minutes ago. The amendment that I desired to move was as follows: -
Leave out all words after “ That “ insert “ the bill be withdrawn and the Commonwealth Grants Commission be requested to reconsider their recommendation for a reduction of £300,000 in the grant to Western Australia, and submit an appropriate recommendation giving weight to the evidence submitted by the Government of Western Australia with regard to the disabilities of that State under federal legislation, and particularly: -
the relationship of population to the size of the State and the consequential high administrative costs of the services of government,
the inequality in the relative burdens of federation upon a State which is predominantly engaged in agriculture and other primary industries.
the absence of economical compensation to the State to balance the effects of national fiscal policy, and the resulting inability of the State to assist adequately the primary industries or develop secondary industries without a special enabling grant by the Commonwealth,
the effects of the foregoing, and of the droughts of 1935 and 1936 inthe pastoral and agricultural districts, on the finances of the State.”
If I had been permitted to move that amendment my proposal might have commended itself to the majority of honorable senators. Some honorable gentlemen might have supported a reference of the recommendations back to the Commonwealth Grants Commission although they were not prepared to go as . far as was desired by the amendment, namely, to fix the grant to Western Australia at £800,000, the amount recommended last year by the commission and accepted by the Commonwealth Government. In fact the beneficial effects of this amendment on Western Australia might have gone a good deal further, because I feel sure that if the commission gave full weight to the request for special relief owing to the drought conditions in the agricultural and pastoral districts of the State, the claim made by Western Australia for a grant not of £800,000, but of £1,500,000 would have been allowed. Something substantially in excess of the money voted last year would have been recommended by the commission.
– The commission based its recommendation on evidence in relation to conditions that existed two years ago.
– Yes ; that is entirely wrong. It should give weight to the existing position. However, I do not wish to detain the Senate as I have achieved my desire to have my proposed amendment placed on record.
Question resolved in. the affirmative.
Bill read a third time.
Bill (on motion by Senator Sir George Pearce) read asecond time and passed through its remaining stages without amendment or debate.
Bill ( on motion by Senator Sir George Pearce) read a second time and passed through its remaining stages without amendment or debate.
The PRESIDENT (Senator the Hon. P. J. Lynch). - In conformity with the Sessional Order I formally put the question -
That the Senate do now adjourn.
Question resolved in the negative.
Bill received from the House of Representatives.
Standing and Sessional Orders suspended.
Bill (on motion by Senator Sir George Pearce) read a first time.
[4.8]. -I move -
That the bill be now read a second time.
The purpose of this bill is to appropriate from the Consolidated Revenue fund, the sum of £12,000,000 for invalid and old-age pensions. It is the usual practice to seek parliamentary approval of periodical appropriations for this purpose. The last such appropriation was £12,000,000 in October last. That amount is now almost exhausted, and it thus becomes necessary to ask Parliament to appropriate a further sum. It is estimated that the £12,000,000 now asked for will meet pensions expenditure for about ten months. The total amount appropriated by Parliament since the inception of the invalid and old-age pensions system is £183,250,000, and the actual expenditure to the 31st August of this year was £180,500,000 leaving a balance of only £2,750,000 to meet future expenditure. This is sufficient for the requirements to the end of October. In accordance with the usual custom, the amount provided for in the bill will be paid to the credit of the invalid and old-age pensions trust account as required. The bill has no relation to the rates of pensions or to the conditions under which they are payable.
– The only objection of the Opposition to this bill is that the appropriation is not sufficient to enable the pension to be increased to the amount of £1, at which it stood prior to the redactions made under the financial emergency legislation.
Question resolved in the affirmative.
Rill read a second time, and passed through its remaining stages without amendment or debate.
The following paper was presented : -
Lands Acquisition Act - Land acquired at Castle Hill, New South Wales- For Postal purposes.
Motion (by Senator Sir George Pearce) proposed -
That the Senate at its rising adjourn till a dayand hour to be fixed, by- the President, which time of meeting shall he notified to each senator by telegram or letter.
.- I urge the Leader of the Senate (Senator Pearce) to endeavour to arrange for the reassembling of the Senate on a Thursday. At the present time, only two trains weekly run from Western Australia and honorable senators returning to Canberra must reach here on Mondays or on Thursdays. If the Senate is called together earlier in the week than Thursday, those senators who take the opportunity now presented to make a short visit to Western Australia will have to reach Canberra two or three days before the next day of meeting, or a day or two late.
– We shall endeavour to meet the wishes of honorable senators in that regard.
Question resolved in the affirmative.
Senate adjourned at 4.24 p.m.
Cite as: Australia, Senate, Debates, 9 October 1936, viewed 22 October 2017, <http://historichansard.net/senate/1936/19361009_senate_14_151/>.