24 August 1937

14th Parliament · 2nd Session

The Senate, on the 1st July, 1937, adjourned till a day and hour to be fixed and to be notified by the President to each honorable senator.

The Senate met at 3 p.m., pursuant to the notification of the President.

The Clerk informed the Senate of the unavoidable absence of the President. Thereupon, the Chairman of Committees (Senator Sampson) took the chair as Deputy President and read prayers.

page 3



Motion (by Senator Sir George

PEARCE) agreed to -

That during the absence of the President on account of ill health, Senator Burford Sampson, Chairman of Committees, shall take the chair of the Senate as Deputy President, and shall perform the duties and exercise the authority of President in relation to all proceedings of the Senate during such absence.


The DEPUTY PRESIDENT.- It is with very great regret that I have to announce to the Senate the death of Senator J. V. MacDonald, which occurred on the 17th August, 1937. On behalf of honorable senators the President conveyed an expression of sympathy to Mrs. MacDonald pending a more formal resolution” of the Senate.

Senator Sir GEORGE PEACE (“Western Australia - Minister for External

Affairs). - by leave - We all share with you, Mr. Deputy President, deep regret, at the sad news which you have officially imparted to the Senate this afternoon. The late Senator J. V. MacDonald was well liked by all members of this chamber. He rendered considerable public service to this country, having been a member of the Senate chamber on three occasions - in 1922 and 1928 for brief periods, and again from 1932 until hisdeath. The late honorable gentleman took a keen interest in every bill that was brought before this chamber, and freely gave to us the benefit of his knowledge and experience in relation to legislation. He was, at all times, moat conscientious in the discharge of his public duties. We know, too, that he was a home-loving man, and his death in comparatively early middle life is a very great loss to his wife and the other members of his family, to whom we extend our deepest sympathy. I move -

That this Senate expresses its deep regret at the death of Senator John Valentine MacDonald, places on record its appreciation of his meritorious public service, and tenders its profound sympathy to his widow and family in their bereavement.

Senator COLLINGS (Queensland).I second the motion. I knew the late Senator J. V. MacDonald very well. I was a member of the committee which was instrumental in bringing him to Queensland in 1912 to edit the Daily Standard, the Labour newspaper which had been established in that State. Because of his acknowledged ability and experience as a journalist, he was selected from a large number of applicants, and occupied the post for many years, with the exception of the terms when he served as a senator for Queensland in 1922 and 1928. We therefore knew him as a journalist of ability, as a loyal and capable champion of Labour’s policy, and, later, as a colleague in this chamber. Thus we learned to appreciate highly his capabilities and those attributes of character which were alluded to by the Leader of the Senate (Senator Pearce). Many of us were aware, during the last session, that he was unwell, but neither I nor my colleague. Senator Brown, had any idea, when we three left at the close of the last sitting, that only two of us would come back. We were in close touch with the late honorable gentleman and members of his family during the few weeks that preceded his death, and we realized then that there was very little chance of his recovery. The knowledge that nothing that could have been done to avert the end was left undone must be, I am sure, some comfort to his widow and her family. I am sure that all honorable senators will understand how keenly the members of the Opposition in this chamber feel the loss of a trusted colleague.

Senator HARDY:
New South Wales

– On behalf of myself and the other senators of the United Country party, I support the motion. In common with many other honorable senators, my friendship with the late Senator J. V. MacDonald was limited to the comparatively short span of about five years, since he was last elected to this chamber; but I have no hesitation in paying a tribute to his ability and undoubted sincerity jn espousing the policy of the Labour party.

Question resolved in the affirmative, honorable senators standing in their places.

page 4


The DEPUTY PRESIDENT. - I have to inform the Senate that in accordance with section 21 of the Constitution, steps have been taken to inform the Lieutenant-Governor of Queensland of the existence of a vacancy in the representation of that State.

page 4


Minister for External Affairs · Western Australia · UAP

by leave - I move -

That this Semite expresses its deep regret at the deathl of the Hon. Arthur Bruce Smith, K.C, a former member of the New South Wales and Commonwealth Parliaments, and a former State Minister, places on record its appreciation of his valuable public service, and tenders its deep sympathy to the members of his family in their bereavement.

The late honorable gentleman had a most distinguished career. He first entered Parliament in 1882, as the member for Gundagai in the Legislative Assembly of New South Wales. For a short period he retired from Parliament, but in 1889 he again sought election and became the representative of Glebe for five years. He attained ministerial rank as Minister for Public Works in the last ministry of Sir Henry Parkes. Upon the inauguration of the Commonwealth, he transferred to the federal sphere, and was the representative of Parkes in the House of Representatives until the general election of 1919. The late honorable gentleman was one of the older generation of parliamentarians who preceded federation and took part in the campaign for and against the union. He was not so well known to the younger generation, but those of us who were in the earlier parliaments remember him as an outstanding personality. He entered the Federal Parliament at a time when the political opinions of all parties were undergoing radical changes because of altering circumstances in a changing world. Mr. Bruce Smith, however, adhered steadfastly to the opinions that he had always held, and was convinced that the political ills which befell us were due to our having strayed from the path which he had followed with courage and persistence. At the advanced age of 86 years, a man of remarkable personality has passed away and it is fitting that we should pay this tribute to his memory.


-. I second the motion. , I had not the privilege of personal acquaintance with the late Honorable Bruce Smith, but I remember well many of his activities, especially those to which the Leader of the Senate (Senator Pearce) has referred. In the stormy times to which reference has been made one could always be sure of the attitude of the late honorable gentleman. He expressed himself definitely and clearly regardless of the opinions of others. Gentlemen, such as he, who render public service in the Parliaments of Australia are entitled to our respect, both while they are with us and after they have departed from our midst. The members of the Opposition desire to be associated with the motion, particularly that part of it which expresses sympathy with the family of the late honorable gentleman.

Senator HARDY:
New South Wales

– On behalf of the members of the United Country party I support the motion.

Senator LECKIE:
VICTORIA · UAP; LP from 1944

– I, too, desire to associate myself with the motion. I was a member of the House of Representatives when the late Mr. Bruce Smith was also a member, and I can bear out what has been said this afternoon regarding him. He and I held different political views, butwe were, nevertheless, firm friends. A staunch and true gentleman in the best sense of that word has passed away, full of years and honour. I desire to place on record my appreciation of a great man who was worthy of the respect and affection in which he was held. I regret his passing, and tender my sympathy to the members of his family.

Question resolved in the affirmative, honorable senators standing in their places.

page 5


Motion (by Senator Sir George Pearce) agreed to -

That, as a mark of respect to the memory of the late Senator John Valentine MacDonald, the sitting of the Senate be suspended till 5 p.m. this day.

Sitting suspended from 3.17 to 5 p.m.

page 5


The following papers were pre sented : -

Health and Pensions Insurance - Report, dated 15th June. 1037, by Sir Walter S. Kinnear, R.B.E., F.C.E.I., Controller of Insurance Department, Ministry of Health, and Deputy Chairman, National Health Insurance Joint Committee, Great Britain.

Monetary and Banking Systems - Report of Royal Commission, dated 16th July, 1937.

Air Navigation Act - Regulations - Statutory Rules 1937, No. 81.

Arbitration (Public Service) Act - Determinations by the Arbitrator, &c. -

No. 12 of 1937 - Amalgamated Postal Workers’ Union of Australia and others; Commonwealth Storemen and Packers’ Union ; Commonwealth Naval Storehousemen’s Association; Arms, Explosives and Munition Workers’ Federation and others; and Amalgamated Engineering Onion, and others.

No. 13 of 1937 - Amalgamated Engineering Union; Australasian Society of Engineers; Australian Federated Union of Locomotive Enginemen; Australian Workers’ Union; Electrical Trades Union of Australia; and Federated Society of Boilermakers, Iron Shipbuilders, and Structural Iron and Steel Workers of A ustralia.

No. 14 of 1937 - Arms, Explosives and Munition Workers’ Federation of Australia: Amalgamated Engineering Union: and Australasian Society of Engineers.

Commonwealth Grants Commission Act -

Fourth Report of the Commonwealth Grants Commission, dated 19th July, 1937. on the Applications made by the States of South Australia. Western Australia and Tasmania, for Financial Assistance in 1937-38 from the Commonwealth under Section 96 of the Constitution.

Commonwealth Public Service Act -

Appointments - Department of -

Attorney-General - L. H. Walker.

Commerce - H. I. Dunbar and L. Moody.

Interior- L. C. Bell. J. H. Glasscock, J. J. Hogan. J. W. Lillywhite, W. S. Lucas, A. R. Martin, and P. Squires.

Regulations amended - Statutory Rules 1937. No. 78 - No. 87 - No. 90- No. 91.

Defence Act - Regulations amended - Statutory Rules 1937. No. 76 - No. 79.

Lands Acquisition Act - Land acquired at -

Bullsbrook, Western Australia - For Defence purposes.

Coffs Harbour, New South Wales - For Defence purposes.

Junca, Western Australia - For Defence purposes.

Nailsworth, South Australia - For Postal purposes.

Naval Defence Act - Regulations amended -

Statutory Rules 1937. No. 80- No. 89.

Papua Act - Infirm and Destitute Natives’ Account - Statement of Transactions of the Trustees for theyear ended 30th June, 1937.

Australian Soldiers’ Repatriation Act - War Pensions Entitlement Appeal Tribunals -

No. 1 Tribunal - Report for year ended 30th June, 1937.

No. 2 Tribuna. - Report for period 18th January, 1937, to 30th June, 1937.

Customs Act- Regulations amended. &c. - Statutory Rules 1937, No. 72- No. 73.

Papua and New Guinea Bounties Act - Return for 1930-37.

Raw Cotton Bounty Act - Return for 1936-37. Sulphur Bounty Act- Return for 1936-37.

Wine Export Bounty Act - Return for 1936-37.

Financial Relief Acts - Regulations amended -Statutory Rules 1937, No. 84.

Jury Exemption Act - Regulations amended - Statutory Rules 1937, No. 75.

Transport “Workers Act - Regulations amended - Statutory Rules 1937, No. 82.

Wine Overseas Marketing Act - Regulations amended- Statutory Rules 1937, No. 77.

page 6



Senator BROWN:

– I ask the PostmasterGeneral whether the splendid postal exhibit, representing a parliament of telephones, at the Brisbane Exhibition, was a child of his brain? Did he not think that the telephonic figure representing himself would have done more popular work if the voice which, issued from it had given to the listeners of Brisbane some idea of the date when the new Brisbane Post Office will be built?

Senator A J McLACHLAN:

– I have no paternal responsibility for the exhibit to which the honorable senator has referred. I have no doubt that wherever it was exhibited it was an ornament to the show.

page 6



Senator FOLL:

– Is the Postmaster-

General aware of the fact that the Australian Broadcasting Commission last week refused to broadcast the speech of the Prime Minister of Australia and the Premier of Queensland at the luncheon held in connexion with the Brisbane annual show, which is one of the largest and most important functions conducted in Queensland? Furthermore, is the Minister aware that afterwards the commission made a statement to the effect that the reason why it did not broadcast those proceedings was because the federal elections would be held within three months? In view of the fact that the date of the election has not yet been announced, can he tell us how the Broadcasting Commission could assume that the elections would take place within three months? Will he also inform the commission that the people of this country, who are paying substantial licence-fees, expect it to make available the national stations when matters of great public importance have to be made known to them by the Prime Minister and other Federal and State Ministers?

Senator A J McLACHLAN:

– The control of broadcasting in Australia is vested by statute in the Australian Broadcasting Commission. That an election will be held within three months is fairly obvious from the fact that the life of this Parliament expires on the 22nd or the 23rd October. Presumably, that was the basis of the commission’s assumption.

Senator Foll:

– The election may not be until December.

Senator A J McLACHLAN:

– Honorable senators are well aware of the nature of the arrangements in connexion with the broadcasting of party political propaganda through the national stations. I have no doubt that, in its desire to give effect to that policy, the commission saw fit to takethe actionto which Senator Foll has referred.

Senator FOLL:

– Does the Australian Broadcasting Commission consider that important statements made by the Prime Minister relating to the great constitutional crisis in the United Kingdom, the trade dispute with Japan, and other subjects of national importance, can be placed in the category of party political propaganda ?

Senator A J McLACHLAN:

– I did not assert that those statements were in such a category. My reply alluded to recent events, to which the honorable senator referred in his opening question.

page 6


Assent to the following bills re ported : -

Federal Aid Roads and Works Bill 1937.

Primary Producers Relief Bill 1937.

Judiciary Bill 1937.

Medical Research Endowment Bill 1937.

Supplementary Appropriation Bill 1935-36.

Supplementary Appropriation (Works and Buildings) Bill 1935-36.

Primary Produce Export Charges Bill 1937.

page 6


The DEPUTY PRESIDENT.-I have to inform the Senate that the following reply has been received from His Excellency the Governor-General in con- nexion with the resolution passed by the Senate on the 24th September, 1936: -

Government House,

Canberra, 3 July, 1937

My Dear President of the Senate,

I have received advice that the resolution passed by the Senate on 24th September, 1936, the terms of which were contained in your letter dated 8th October, 1936, relating to a proposed world convention with the object of developing a common international language, has been laid before the King. I am commanded to inform you that His Majesty is unable to accede to the prayer contained in the resolution.

Yours sincerely, ( Sgd. ) Gowrie,


The Honorable the President of the Senate,

Parliament House,


page 7


Minister for External Affairs · Western Australia · UAP

[5.12]. - I lay upon the table of the Senate the following paper: -

Imperial Conference 1937 - Summary of Proceedings, and move -

That the paper be printed.

A speech relating to the Conference is being delivered by the Prime Minister (Mr. Lyons) in the House of Representatives this afternoon; I have a copy of it which I propose to read for the information of honorable senators. (Vide pages 21-37.)

Sitting suspended from 6.15 to8 p.m.

Debate (on motion by Senator Collings) adjourned.

page 7


Senator A J McLACHLAN:
Postmaster-General · SOUTH AUSTRALIA · NAT

. - by leave - The International Sugar Conference held in London from the 5th April to the 6th May of this year, was, in effect, the culmination of prolonged efforts by many sugar-producing countries to deal with the related problems of excessive stocks of sugar, world overproduction, and very low prices in world markets.

The sugar depression started nine years ago, and so preceded the general world economic depression by some years.

For the nine years up to the end of 1936, the price of raw sugar in the world’s markets was little more than one-half of the cost of production, even in the most efficient countries which employ native labour. The London price of raw sugar in bond during that period was usually between £4 and £5 a ton, compared with the estimated cost of production of about £9 a ton, which would enable the great sugar-producing countries, such as Java and Cuba, to function at a profit and also pay reasonable wages to their workers.

The long-continued period of abnormally low sugar prices produced suffering and great loss in those countries in which sugar is the principal crop. Overproduction and excessive world stocks, which a few years ago reached 9,000,000 tons, forced Cuba to reduce its annual production from 5,200,000 tons to 2,300,000 tons, and Java to do so from 2,900,000 tons to as low as 450,000 tons. This abnormal and uneconomic position caused unprecedented chaos and losses in some countries which export all or most of their production. Other countries which produced some part of their own consumption of sugar were obliged to meet this situation by bounties and payments to enable their producers to meet at least the cost of production.

Australia, happily, did not require to increase its’ domestic price, but actually was able to reduce it four years ago. This was due partly to continued improvement in the already high efficiency of our sugar industry, and partly to lower wages and other costs which followed from Australia’s general economic readjustment during 1931. Even so, sugar exports from Australia have been returning unsatisfactory financial returns, despite assistance from exchange and British and Canadian tariff preferences, so that the industry’s position had become substantially weakened, to the marked detriment of the producers, as is clearly shown, apart from other evidence, by the very small amounts now received from sugar producers in respect of Federal and State income taxation.

Reverting to. the general world sugar position, honorable senators may remember that, in May, 1931, the International

Sugar Agreement, known as “ the Chadbourne plan “, was signed by representatives of Cuba, Java, Germany, Czechoslovakia, Poland, Hungary, Belgium and Peru. The objects of this plan were the immediate reduction of world sugar production to something below then current consumption, and the segregation of excess stocks held by the signatory countries for the purpose of liquidating all excess stocks within five years, and thus restoring remunerative world prices.

The eight countries which adopted the Chadbourne plan severely reduced their production and exports, and even went so far, subsequent to signing the agreement, as further to reduce their outputs. Unfortunately, however, several countries outside the Chadbourne plan concurrently increased their production and exports, and thus nullified the sacrifices of the “Chadbourne” countries. In these circumstances, world market prices remained hopelessly unprofitable to any sugarexporting nation.

There was such distress in sugarproducing countries that the problem of sugar was brought up at the World Monetary and Economic Conference of 1.933, which was held under the auspices of the League of Nations. That conference decided to hold an international sugar conference to deal with the problem. The United Kingdom Government was requested to convene the conference at the earliest practicable date. It was clear, after the experience of the Chadbourne agreement, that no international agreement could hope to succeed unless the great bulk of the world’s sugar production and export fell within its ambit. In consequence, all the principal sugarproducing countries of the world were invited.

Towards the end of 1935, it was expected that the conference would be held about March, 1936, but owing to difficulty on the part of several large producing countries in sending representatives at that time, it became necessary to postpone the conference until April, 1937, when the attendance of 22 nations was ‘secured, representing about 90 per cent, of all production and exports of sugar in the world.

Preparations for the participation of Australia in the conference began some time before its meeting in London. Considerable correspondence by despatch and cable was exchanged with Great Britain during the eighteen months prior to April, 1937, in order to ensure that, when the conference met, Australian interests should not suffer.

The Government appointed the Treasurer (The Honorable R. G. Casey) as principal delegate to the International Sugar Conference, together with the High Commissioner, the Right Honorable S. M. Bruce; and the Premier of Queensland, the Honorable W. Forgan Smith, who went to London on the invitation of the Queensland sugar producers to watch their interests, and was given recognition by the Commonwealth Government as a substitute delegate.

The ‘British Empire countries met “ frequently to decide their attitude towards new situations that frequently developed as the conference proceeded. .The conference held a large number of meetings, both in public and in private. The conflicting interests of a wide range of countries necessitated protracted negotiations. It was the aim of all those concerned with the preparation and presentation of Australia’s case to endeavour to obtain the right to export as high a tonnage of Australia’s raw sugar as was possible from the lands already devoted to sugar production. In 1936, Australia exported 409,000 long tons of raw sugar. The 1936 season had been propitious, and we were fortunate in being able to secure that discussion of future export tonnages at the International Sugar Conference should be on the basis of the 1936 production, and not on that of any earlier, and, for Australia, less productive year.

By reason of the long years of experience which Australia has had of the economic control of sugar production, and because of the not inconsiderable interests that we had at stake, the Australian delegation took a leading part in the manifold negotiations of the conference, both in the international sphere and in the discussions with the representatives of other members of the British Empire. There were many occasions when the work of the conference seemed doomed to failure, but the fact that failure to agree would have meant a continuance of conditions approaching chaos in the world’s sugar market forced acceptance of the allocation of quotas that eventually emerged.

The International Sugar Agreement contains a carefully devised five-year plan, to commence ou the 1st September, 1937, for establishing and maintaining an orderly relationship between world supply and demand in respect of sugar with the object of securing average prices in the free markets of the world that will ‘be equitable to both producers and consumers. By “ free markets “ is meant those countries which purchase sugar unassisted by import quotas, preferential tariffs, or any other means. The quantity of sugar so involved is approximately 3,600,000 tons per annum. The agreement constitutes one of the few outstanding achievements to date in the realm of international economics. There has not previously been a world agreement, dealing with a commodity, signed by so many nations, or covering such a complex problem as sugar. Already the agreement has stabilized the free-market price at nearly 50 per cent, above the average level of the last nine years, and it is not impossible that further price rises will occur in the world’s markets. It guarantees to Australia an irreducible basic export, quota of 400,000 long tons, or 406,423 metric tons, for each year of the agreement, starting on the 1st September, 1937, and also, after the first year, an addition to that quantity representing Australia’s proportionate share of any increase of consumption by those parts of the British Empire which import sugar. The minimum quota of 400,000 long tons is actually only 9,000 tons less than the export surplus available from the record 1936 season, which was partly due to phenomenally good climatic conditions in nearly all the sugar-producing districts. When considering this result, it has to be borne in mind that practically every other sugar-producing country in the world experienced substantial reduc-tion of its previous export total.

Australia, therefore, emerges from the International Sugar Conference under happy conditions. T.t is clear that we shall at least be able to maintain the full production that at present exists and that there will be no reduction of the areas under sugar or of employment in the industry. With the prospect of increased exports in the future as consumption in Britain rises, as it is now doing, even better conditions in our sugar districts are more than probable. When this agreement comes into force, the present British tariff preference of £3 Jus. a ton on dominiongrown sugar of 96 degrees polarization will be renewed for the term of the agreement, namely, five years. Furthermore, when he was in London, the Treasurer wa3 able to ensure retention of the valuable provision whereby the British Government must give at least eighteen months’ notice of any intention to modify this preference of £3 15s. a ton on Australian sugar entering Great Britain-

The agreement will be administered by an International Sugar Council and an executive committee. The Government has appointed the High Commissioner, Mr. S. M. Bruce; his Official Secretary, Mr. S. G. McFarlane, and the AgentGeneral for Queensland, Mr. L. H. Pike, to act as Australia’s representatives on the council. The two first-named gentlemen have already been appointed to the provisional council which is doing the preliminary work necessary to bring the agreement into force on the 1st September next. For the very important first year of the agreement, when all the administrative machinery will be created, and most of the problems of world control will be determined, Australia has been fortunate enough to secure a seat on the executive committee, which will meet far more often than the council, and will be responsible for most of the work arising out of the agreement. Mr. Bruce has been appointed to represent Australia on this committee, with Mr. Pike as alternate representative. The Government took the necessary steps some weeks ago to ratify the International Sugar Agreement, and the instrument of ratification is now in the possession of the Government of the United Kingdom as required by the agreement.

The safeguarding for ‘five years of a minimum market for Australian raw sugar, practically equal to our previous record exports, and ut improved prices, is a satisfactory outcome. The net return on our exported sugar at to-day’s price is about 30s. a ton higher than the average for 1936. This is a direct result of the success of the conference. On an export volume of ‘f00,000 tons, this return represents increased export income to Australia at the rate of about £600,000 a year. I need hardly say that the references which I have made to higher prices for sugar relate solely to the markets of the world outside our shores, and have no relation to she retail price of sugar within Australia, which, of course, will remain unaltered.

The position of the Australian sugar industry to-day is that it has a greater measure of security than it has ever enjoyed, with consequent benefit to over 30,000 sugar fanners and workers and their wives and families, and the large amount of capital invested in the industry. Reflex influences of an equally favorable character will he felt by the many towns, business people, and municipal authorities in the sugar districts of Queensland and New South Wales, and by State railways, ports, and general finances. The maintenance of sound, vigorous settlement in the far north is of great importance to Australia for national reasons, and the sugar industry, which is hy far the most significant factor in such settlement, has now been assured of the opportunity to continue at its present level, and, indeed, to expand as the years go on.

Senate adjourned at 8-25 p.m.

Cite as: Australia, Senate, Debates, 24 August 1937, viewed 22 October 2017, <>.