15th Parliament · 1st Session
The President (Senator the Hon J. B. Hayes) took the chair at 3 p.m., and read prayers.
page 439
Land Resumption
– Is the Minister for the Interior aware that some time ago there was considerable concern amongst the business people of. Darwin because it had been announced that the Department of the Navy intended to resume areas on which business premises were situated, and that in consequence building operations were being held up? What is the position to-day?
– I looked into this matter very carefully when in Darwin a few weeks ago, and I also discussed it with the Minister for Defence. I understand that the Department of the Navy was looking well ahead and had in mind certain land that might be required for future use, but it is not intended to make further resumptions in Darwin, as there is ample Crown land available for all purposes.
page 439
– On Thursday, the 7th September, Senator Keane asked the Minister representing the Treasurer the following questions, upon notice: -
The answersto the honorable senator’s questions are as follows: -
page 440
Senator FOLL laid on the table the report and recommendation of the Tariff Board on the following item: -
Vessels not exceeding 600 tons gross register.
Also the Annual Report of the Tariff Board for the year 1938-39, accompanied by a summary of the Tariff Board’s recommendations, which have been finally considered by the Government, and a statement of what action has been taken in respect of each recommendation.
page 440
asked the Minister representing the Minister for External Affairs, upon notice -
– Before answering the question asked by Senator Ashley concerning the appointment of Major J. L. Treloar I suggest that some honorable senators should be more careful in the manner in which they frame questions. In some instances questions contain inferences and imputations.
– I rise to a point of order. Instead of the Minister answering my question he is attempting to lecture me.
– Order ! I take it that the Minister is answering the question and he may do so in his own way.
– Recently insinuations caused the death of an outstanding public servant. I am not blaming anyone in particular but I remind honorable senators in the most friendly way that they occupy a privileged position and that in asking questions insinuations should not be made against any one. The rules on the back of the question paper are for the guidance of honorable senators and contain these words, “ Questions ‘Should not contain inferences or imputations “.
– The Minister is now going beyond an answer to the questions.
– Senator Ashley asked whether Major J. L. Treloar was a member of the New Guard. The answer is “ No “, but already an injustice has been done to that gentleman.
page 440
asked the Minis ter representing the Treasurer, upon notice -
– This matter comes under the control of the Department of Trade and Customs. The price controlling machinery isbeing set up by the Government and details of administration will be announced in due course.
page 440
Debate resumed from the 12th September (vide page 386) on motion by Senator McLeay -
That the papers be printed.
– I am not rising to speak on this motion in response to the challenge made by Senator Brown last night, who said that it was the responsibility of the supporters of the Government to reply to some of the arguments adduced by the Opposition. The Leader of the Opposition (Senator Collings), who delivered one of his eloquent speeches, was must emphatic. As usual he paused for breath at the conclusion of some of his well-formed phrases as much as to say. “ That puts the lid on that “. He was followed by Senator Darcey, who gave us the benefit of his ideas with regard to financial problems, and admitted that we had., heard them previously. Senator Cameron followed with his customary plea regarding unemployment and other problems, and he even went further afield than usual by referring to industrial conditions in Great Britain. Senator Brown made a eulogistic reference to the remarks of Senator Darcey; but, before he concluded his speech, he was unkind enough to fire at Senator -Darcey a question which the advocates of social credit can never answer.
We are now dealing with the annual budget, and unfortunately we are doing it, under war conditions. It is 21 years since the last wartime budget was presented, and we all hope that a further period of at least similar length will elapse before this Parliament is called upon to discuss another. This preliminary balance-sheet indicates merely what may be expected to be the financial position at the end of the ensuing year. At a meeting of shareholders on one occasion, one speaker declared that there were three kinds of untruths - white lies, black lies, and balance-sheets. In the present case, however, I think that it will be agreed that the budget contains an honest forecast by the Government. Under the most favorable circumstances, budgets are liable to serious alterations that cannot be foreseen by the framers, owing to changes in seasonal conditions; but, in this instance, we have no doubt that supplementary provision will have to be made in the near future. The old saying that finance is government and government is finance is as true to-day as ever it. was. For generations, the British Dominions have obtained their finances for governmental purposes by means of taxation or loans, or by both, whilst the taxpayers’ financial resources have mainly been derived from services rendered. For the convenience of the public, banks and other financial institutions have been found necessary adjuncts to the life of the community, and 98 per cent, of the charges levelled against them of acting contrary to the public interest are without foundation. Bank profits are not nearly so lucrative as those of many industrial trading companies, such as Broken Hill Proprietary Company Limited and the motor body building industry.
We have heard some criticism of Broken Hill Proprietary Company Limited, although it is the most outstanding industrial organization in the southern hemisphere. It provides a great deal of employment, and its record for the utilization of Australia’s natural resources and for the conversion of raw material into finished articles at prices that defy world competition is most commendable. Only a few days ago a striking instance was furnished of the value of this organization to the people of Australia. Our New Zealand neighbours, requiring a great deal of iron and steel, contracted with Broken Hill Proprietary Company Limited for the necessary supplies. After one shipment had been forwarded to the dominion, a quibble arose with regard to payment. The New Zealand buyers became indignant, and decided to open negotiations with firms on the other side of the world, but they discovered that the prices overseas were 100 per cent, higher than those charged by the Australian company. That is a great tribute to this comparatively young organization.
Much has been heard in this chamber regarding the extension of credit. “We all realize that probably before long it will be almost imperative to avail ourselves of a credit extension in Australia, but it would be unsafe at this juncture to put into operation what is glibly referred to as social credit, a system which I prefer to describe as one involving the getting of something for nothing. A few days ago, and again yesterday, Senator Brown took honorable senators on this side of the chamber to task for their apparent levity in having the audacity even to smile when Senator Darcey addressed the Senate on social credit.
– I did not use the words “ social credit “.
– But we were reproved for having dared to smile. I may have done Senator
Darcey an injustice in suggesting that he favoured social credit, but I think that he will agree with me that his sc heme, and all like it, are regarded by the people generally as a form of social credit. I hope that he will pardon me if I continue to allude to his proposal in those words. I assure Senator Darcey that honorable senators on this side who happen to smile have no disrespect for him. We believe him to be sincere in the financial views that he expresses, but, if we are tempted occasionally to smile, he should remember that we, like him, have the right to our own opinions. I remind Senator Darcey that we had heard all about social credit long before his advent to this chamber. It is not new to us. Honorable senators, generally, have studied the literature on the subject and have passed their private judgment upon it. Should any honorable senator hesitate to resolve this matter for himself he has only to examine the failure of social credit wherever it has been applied. We know of Alberta’s experience, for instance.
– Social credit was never put into operation there. The honorable senator says we are all entitled to our opinions, but I ask him what is the good of his expressing his opinion on a subject of which he knows nothing.
– I admit that I do not know as much about the subject as I should like, but I know something about it. Social credit failed in Alberta. A scheme of social credit was also put into operation in Germany.
– Germany is doing the right thing; it has applied social credit - to the detriment of the British people.
– I agree that Germany’s adoption of a scheme of social credit has been to our detriment insofar as it has been the main cause of the present war. That system has brought ruin to Germany, which has resorted to what is international highway robbery. Germany spoke about recovering sections of its people lost to it in the last war, but it is obvious that that has notbeen the reason for German aggression. We know how Germany has treated the J ews. But Germany took fine care not to allow the. Jews to take their money and valuables with them when they were driven from the country. Undoubtedly, Germany’s adoption of social credit has been mainly responsible f or the present war.
Honorable senators opposite suggest that it would be an easy matter to extend credit along the lines they propose. They say that the Prime Minister need only give a direction to the Commonwealth Bank in order to put their scheme into operation. But the task is not so easy as that. The Prime Minister could not provide for the extension of credit advocated by honorable senators opposite without taking legislative action.
– What will the Prime Minister do if he cannot borrow money ?
– I shall leave that problem to the Prime Minister himself, because I feel sure that he will solve it to my satisfaction, if not to the satisfaction of honorable senators opposite. I remind honorable senators that the ministerial party won the general election in 1934 on the issue that the Government must keep its hands off the Commonwealth Bank. I do not know whether the Government has power under the National Security Act to take over direct control of the Commonwealth Bank.
– Of course it can.
– Honorable senators opposite have repeatedly declared that the National Security Act enables the Government to grind down the workers, whilst, at the same time, it precludes the Government from interfering with big business, including our financial institutions. On their own showing, therefore, despite Senator Darcey’s interjection, it would appear that the Government has not the power to exercise that control over the Commonwealth Bank which they have advocated. In addition to the verdict of the electors in 1934 that, the Commonwealth Bank should be kept free from political control, we had another potent reminder of the dangers of government intervention in commerce and finance in our experience with the Australian Commonwealth Line of Steamers. During the last war the then
Prime Minister of Australia made up his mind to purchase a shipping line. He did not hesitate or consult any one as to whether he should do so or not. He purchased the ships in London at a cost of £3,000,000, and honorable senators are aware of the history of that venture. Surely we do not want to repeat that disastrous experience. Honorable senators opposite have asked why it is that money is so plentiful in a time of war, whereas in peace we cannot find sufficient for our requirements. The answer to that question is obvious. In private life when we are faced with an emergency in the home, when, perhaps, the health or life of a member of the family is at stake, no one hesitates, even at the risk of beggaring himself, to do everything possible to overcome difficulties. I submit that the position is much the same when the life of a nation is threatened. In a time of crisis the people instinctively rise to every sacrifice required of them in order to save their nation.
I trust that we shall profit from the lessons of the last war, particularly insofar as they emphasized the value of trade within the Empire. I do not know why we do not consolidate the finances of the Empire. We want, not lip service, but, a permanent agreement of a more comprehensive nature than the Ottawa Agreement. I take my mind back to a time, not long ago, when the Lyons Government was subjected ito a great deal of abuse in connexion with a trade agreement entered into between it and the Government of Japan. People asked why the wool-growers of .this country should be subjected to such treatment. I now ask the people who then complained whether they are glad that Australia is an ally of Great Britain, rather than J apan ?
– Does the honorable senator think that we have a great deal of love for Japan?
– At the time that I have mentioned, honorable senators opposite appeared to have much love for that country.
– We had more than the Minister for External Affairs (Sir Henry Gullett) had.
– I do not know whether the ‘budget makes provision for the payment of a bounty to assist the ship-building industry in this country, as the Government promised, but I doubt whether the establishment of that industry would be of such benefit to Australia’ as the Leader of the Opposition believes.
– If we build the ships here, we shall have both the ships and the money.
– In framing a policy for Australia, we should take into consideration the fact that some things can be produced more cheaply in other parts of the Empire, and that we, in turn, have certain advantages over those countries.
– What a great policy for Australia !
– I ask honorable senators .to take their minds back to the time when Australia had its own ship-building industry.
– What was wrong with it?
– That industry died a natural death a’bout 1925.
– It was strangled by a tory government.
Senator JAMES McLACHLAN.The then government was well advised to strangle it. Practically the last ship built at Cockatoo Island Dockyard was the Fordsdale, of 12,800 tons. That vessel cost £821,000, or about £64 a ton. A similar vessel could have been built in England for £293,400.
– What is the honorable senator’s authority for that statement?
– My authority is the fact that ship-building at Cockatoo Island Dockyard cost about £64 a ton, compared with £23 a ton on the Clyde. For the cost of the Fordsdale, Australia could have obtained nearly three ships of similar size. However, if the Government can find the money necessary for the purpose, I am prepared to give the system of building ships in this country a further trial.
– What amount is still owing for the ships that were disposed of?
– Does the honorable senator think that Australian workers-
The PRESIDENT (Senator the Hon. 3. B. Hayes). - If Senator Cameron- persists in interjecting, I shall be compelled to take action. I endeavour to treat both sides of the Senate fairly, and cannot allow continual interjections.
– With all respect, I submit that I was subjected to almost continual interruption during my speech.
– Senator Brown expressed his opinions on internal and external borrowing. Having studied this subject for a number of years I do not altogether agree with the honorable senator. I am not . certain that a policy of borrowing within the Empire would not be of benefit to Australia. Whenever an internal loan is floated, persons who have money available for investment put it into the loan, and then sit back and do a little gardening. Were i; not for the opportunity to invest in such loan, they would have to put their money into industry. During the last few years the Government has borrowed from the people of Australia many millions of pounds. I am of the opinion that if half of that money had gone into industry or been used for the development of this country, we should be much better off to-day.
I assure Senator Cameron that I am prepared to accept my share of the responsibility for the unemployment that exists in Australia. I sympathize with the honorable senator in having Jio represent Victoria in view of the deplorable conditions which he said exist under the present administration. A few weeks ago a conference of Premiers met to discuss the wheat industry. Many of us hoped that that would be the last conference on subject, but the Premiers of Victoria and Tasmania would not . agree to the stabilization proposals submitted by the Commonwealth, and consequently the scheme fell through. In view of Senator Cameron’s remarks yesterday as to the number of unemployed in Victoria. I cannot follow the reasoning of the Premier of that State, that it is the responsibility of the national Government to find money to assist the wheat industry, and that he could not allow any of the loan money allocated to his State to be used for that purpose because ii was needed for public works. Under the scheme submitted to the Premiers, Victoria would have had to find about £300,000 to assist the wheat-growers of Australia. Mr. Dunstan said that he wanted money to keep men in employment. Even if he had £300,000 available for a public works programme, approximately one- third of that sum would be expended in the purchase of materials, leaving only about £200,000 to assist, the unemployed. With that amount he could give employment at the basic wage to 1,000 men for twelve months. I suggest, however, that if the Commonwealth Government had made an arrangement to pay Australian farmers 3s. a bushel for their wheat, the wheat-growers of Victoria, instead of employing 1,000 men for twelve months on the basic wage, would have been able to employ at least 4,000 for the same period. Therefore, Mr. Dunstan ‘“s reasoning is all wrong.
– And if the Commonwealth Government had not expended £40,000 on improvements to Yarralumla, the Governor-General’s residence, it would have been able to find employment for many more people.
– Did not that expenditure give employment to workers?
– I agree with Senator Collings. Yesterday Senator Cameron spoke of widespread malnutrition among children in Victoria. The honorable gentleman led as to believe that, due to that ca.use, a considerable number of school children in that State were suffering from all sorts of troubles. If this be true, the thought occurs to me that Mr. Dunstan might at least see that even at this time of crisis school children in his State do not suffer unnecessarily. The Commonwealth Government, notwithstanding the heavy expenditure provided in this budget, is maintaining all ite social services intact. There has been no suggestion of the curtailment of invalid and oldage pensions or repatriation services. Mr. Dunstan might note this.
– We could do more if we had a Labour government in Victoria.
– I thank the honorable senator for his interjection, because I was just a’bout to remark that since Victoria is virtually under a Labour government, it is strange that some of the ‘troubles to which Senator Cameron referred yesterday have not been rectified.
– Victoria is not under a Labour government.
– But since it is kept in office by Labour, Labour members must accept responsibility for a government which is, if anything, worse than even a Labour government would be.
Senator Cameron, as we know, is an assiduous reader. Yesterday he made extended quotations from English publications concerning social conditions in Great Britain. It seemed to rae that the book from which the honorable senator was rending was almost as threadbare as his arguments. I invite him to study Metropolis, written by Upton Sinclair, because f am sure that in it he will find an ample supply of blood-red illustrations of the poverty and depressing conditions in Loudon that will be suitable for speeches on the Yarra bank.
But speaking seriously, I suggest that the honorable senator should cease endeavouring to belittle not only the British Government, but also the governments of the British dominions. It would not be amiss if he took note of what the British Government is doing in this crisis by evacuating many hundreds of thousands of women and children from the congested areas of London and other cities to country areas where there is a greater margin if safety and where the people are being well housed, clothed and fed, whilst the schooling of the children is being continued.
– All that has been done is the result of Labour agitation.
– The honorable senator might note. too. that British bombing plane3, instead of dropping bombs over German cities, and thus destroying countless numbers of human beings, have been dropping leaflets for the purpose of educating the people of Germany to a proper understanding of the reasons for the present conflict between Great Britain, France and Poland on the one hand, and Germany on the other. The honorable senator might also do what he can to bind the people of the Empire together for the purpose of making a united effort for a common objective - the successful issue of the struggle in which we are now engaged, and also to ensure that budgets in this Parliament shall continue to be presented by Treasurers who are British.
.- Notwithstanding forecasts in the newspapers of a welcome announcement that the Government proposes to call up three times the number of militia forces originally intended, and to double the period of camp training, the concensus of opinion outside governmental and departmental circles is that the numbers and the period should still further be increased. In these strenuous times one hesitates to criticize even mildly those responsible for our home defence preparations. The Cabinet, the Minister 50/ Defence, and the army authorities arc carrying a heavy burden, but the thinking public, not the panicky section, believe that the Government is not. moving fast enough. It is in this Parliament that their anxiety can best be expressed.
The reason for the Government’s policy of treading warily, in the opinion of outsiders, is the danger of economic dislocation. That dislocation has to be faced and overcome sooner or later. What the nation is looking for eventually, is ite man-power ready and conversant with its duties, in the three defence services. With 40 years’ military service, including two wars, I know what is necessary as far as the Army is concerned. Tn fact, every man who took part in the Great War knows full well what number of trained personnel is required. We arc n long way from that objective. The foundation, upon which an Australian home defence army can be created, has been in existence for many years. Tha Militia is that foundation. Over the yon rs. a nucleus of staffs, regimental officers, non-commissioned officers and specialists have been trained for what has now happened - the necessity to defend this Commonwealth. Pacts between nations are made and broken over night. Japan’s neutrality is ambiguous. No one can accurately foretell what the new year has in store for us. Only divine intervention or a miracle can restore the world to normality.
Nothing would give the people of this country a greater feeling of confidence and composure, than an official announcement that a trained home defence force, equal in numbers to the Australian Imperial Force, is the Government’s objective. Honorable senators should not think for one moment that I am visualizing an expeditionary overseas force. I have already said in this chamber that the despatch of such a force, voluntarily enlisted, is a remote possibility. No government would dare denude this country of its virile manhood unless some extraordinary developments warranted such action. No one can foretell what the future has in store for us. I, for one, would not stampede the Government into doing what the Opposition, for political reasons, imagines will be done. Our defence problem is different altogether from that of New Zealand or any other dominion.
The Opposition, always so keen on adequate home defence, ought to throw its entire weight behind the building up of the Militia, now numbering 75,000, to a strength of 400,000 as well trained as our economic life permits. The first step is the combing out of this 75,000 all who are below active service medical standard, and all who are engaged in essential industries concerned with the defence of the Commonwealth. That combing out would, I venture to say, reduce the militia strength by one-third. The gaps in the ranks would soon be filled. The time has now arrived for the appointment of a Commander-in-Chief in order to relieve the Military Board of a great measure of its responsibilities in the matter of training and administration. So vast is the board’s administrative functions that it cannot carry on effectively. The scheme of command districts recently authorized, but not yet in full operation, is a step in the right direction. In peace times these militia commands can function reasonably well,but when called into ramp for longer war-time periods of training, as is now being done, a coordinating authority is essential. A CommanderinChief with a small staff chosen from the many highly trained staff corps officers who, at present, spend too much time in office chairs, should be that authority. One officer stands out as eminently fitted for that position. I refer to Lieutenant-General Sir Brudenell White, who was responsible for the Australian Imperial Force’s great reputation. He is the man who prepared the plans for evacuating the Australian Imperial Force from Gallipoli in the presence of the enemy, with only one casualty - a sprained ankle. He is at present holding a high position in the commercial world. He will shortly be 63 years of age, but it does not matter that he is over the regulation age of 62 years. The Government and the Defence Department are making a huge mistake in substituting youth for experience in these critical days. Such an appointment would allay the fears in the public mind and lighten the burden of the Minister for Defence. Honorable senators must bear in mind that the staffs, regimental officers, non-commissioned officers, and specialists, who have given so much of their leisure hours in past years, at no inconsiderable personal expense, represent only one-twentieth of the numbers needed on a war footing. There are hundreds of ex-service personnel who could, with a fortnight’s “ brush-up “, supply this deficiency. It does not matter if they are a year or two over the prescribed age, so long as they are medically fit. Their experience will be invaluable. Meanwhile, the services of these men in country centres could be made use of at no expense to impart elementary instruction at convenient centres at week-ends. These veterans of the Great War are straining at the leash to do something for the younger generation who, when called up as they undoubtedly must be, will have, if this opportunity be given to them, some knowledge at any rate of what is required of them before their intensive camp trainingbegins. Possibly the Defence Department has in mind some such plan for the local instruction by war veterans and the skilled members of civilian rifle clubs. I do not know if it has, but it is time that such a plan was put into operation.
Senator CUNNINGHAM (Western Australia; [3-54]. - We should all realize that the budget which we are now discussing has been presented under most unusual conditions. Many issues which will be submitted for our consideration before this financial year closes will need very serious attention, not only by the Government but also by every member of the Federal Parliament. Finance has been a live question for some years past, and it deserves special consideration at this juncture. During the past months the workers’ representatives in Australia have been asking the Government for money to provide more employment, requests have been made by primary producers for funds to tide them over the crisis that has prevailed for a considerable time, and numerous other requests huw been presented concerning the housing of the Australian people; but on every occasion we have been told that money could not be provided for such purposes. We must face these issues. To-day money is being found and additional sums will also be provided for defence purposes. The public mind is agitated by the fact that when we are faced with a war, finance, whether Ave term it money, credit or currency, can be provided, and yet for the purpose of stimulating industry and trade, and establishing those avenues of employment that are so essential to the people, money cannot be provided. A tremendous alteration must take place, not only in Australia, but also throughout the world. For some years past there have been requests throughout the civilized world for monetary reform, and new methods have been adopted in various countries. We were told to-day that Ger many, by adapting a system of social credit, has brought its position to such a state of chaos that it is now at war with Britain, France and Poland. In Australia we are confronted with a great crisis, and, whether we like it or not, we shall have to face up to the position and lay our plans accordingly. When the present conflict is over, Australia will have to meet the huge responsibility of placing men back into industry and plans must now be laid accordingly. But we cannot plan unless we are in a position to know that the- necessary finance will ba available. Every thinking man and woman in Australia knows that enormous war expenditure will be incurred ; but when the war comes to an end, the expenditure on the production of munitions will cease. We cannot allow a condition of stalemate to prevail. Wc should now be considering this problem which is so vital to Australia. We should now be planning to place men in industry when the war it over and to carry on the affairs of the nation in the interests of the people. I do not care what system of monetary reform be adopted, provided that it will serve the needs of the nation. The members of the Opposition have attempted to throw some light upon this subject, and honorable senators opposite should give some lead us’ to the remedial measures x to be adopted in order to bring about an alteration for the good of the people. I remind honorable senators that when Mr. Roosevelt was elected President of the United States of America he was faced with a national crisis; there were bankruptcies from one end of the country to the other. No fewer than 13.000 banks had crashed under the financial system then in operation. The credits made available by the banks by way of overdrafts and other orthodox methods of finance had caused the crash, but Roosevelt immediately used the credit of the American nation and started a system whereby people were able to obtain work and industry was able to flourish. His methods were criticized, and he was told that in sending huge parcels of “ greenbacks “ to various centres, to rehabilitate business h« had invoked unorthodox methods of finance, but trade started to flow and the country was resurrected. It was reported in the newspapers that Roosevelt’s methods were failing, and that the people throughout the American States were fearful of another crash ; but we were not informed that those in opposition to the new method were those who were responsible for the crash which had previously occurred. Roosevelt is still in control, and the position in the United States of America is much better than when he was elected. We cannot continue to support the .policy which has been in operation for the last ten years. Prior to 1929, there was unprecedented prosperity, following the termination of the last war, but shortly after that there was a general financial collapse throughout the civilized world, which was brought about largely as a result of the credit system that had operated in all countries during the war period. InWestern Australia prior to the declaration of war, unemployment was at. least as great as in the first and second years of the depression. Action rather than talk is needed concerning the flow of credit that is necessary if the wealth of Australia is to be utilized to the best advantage.
Latent wealth is not being used to-day, because, owing to the control of credits, people are not in a position to carry on industries that would prove beneficial to the country. The majority of businesses, large and small, are carried on with the aid of bank overdrafts. Even some of our largest manufacturing and commercial undertakings are conducted under a system of overdrafts arranged between the banking institutions and the captains of industry. Overdrafts, as agreed to by the banks, must be taken by those who need credits to enable them to carry on their businesses. It may be truly said that this country is governed by overdrafts. Irrespective of what methods of finance governments adopt, they work on overdrafts, because only with the consent of the established banking institutions are credits made available. I believe that at least 50 per cent. of the men representing the people in the various parliaments of Australia are connected with business undertakings that are operated by means of overdrafts. This is a state of affairs that should be altered, because the banks control, not only the functions of all governments, but also the very livelihood of the parliamentary representatives of the people. The banks, therefore, control the Governments of the Commonwealth and of the States. By their control over industries they can force business men to contract their activities, or bring about a reduction of their capital outlay. They can call on the representatives of the people to make adjustments of their overdrafts, because these are at call from time to time.
Would it not. be much better to utilize that which the people own, namely, the credit of the nation ? This credit is used by the banks to-day for their own backing, but they pay nothing for it.
– What does the honorable senator mean by that?
SenatorCUNNINGH AM.- Under the present monetary and banking systems, the people have faith for the time being in the banks, and this faith has been brought about because the banks are satisfied to base their transactions on promises that are guaranteed by the productivity of the people’s labour. This labour ‘ produces about £700,000,000 worth of goods per annum, and that is the basis of the credit of the nation. What brings about faith and confidence in our currency credit is not the mere fact that stone, brick or concrete buildings are occupied by banks. The flimsy things called bank-notes are, of themselves, worth nothing. They derive their value from their backing, which is the wealth-producing ability of the people from year to year. This credit is not owned by the banks, although it is utilized by them.
– Was that the back ing of the Government Savings Bank of New South Wales?
– Yes, but even that bank was not controlled by the people of New South Wales. The savings banks in all of the States, and the very premises in which they function, are dove-tailed into the financial system operated by the banking companies in Australia. That is why it was easily possible to strangle the Government Savings Bank of New South Wales when that was deemed necessary because a government of a certain political colour was in office in that State.
– Could the honorable senator suggest an amount by which credit might he extended?
– I have, already referred to the fact that, through the application of the labour of the people, Australia produced, in the last financial year, goods to the value of not less than £700,000,000. We could use the backing of the nation, but, as was pointed out by Senator Brown last night, the present Leader of the Federal Country party (Sir Earle Page), when Treasurer in a former government, declared that the banks had taken to themselves the power to use credits belonging to the people. That is an absolute truth, and. the position must be altered. Every honorable senator knows well that the monetary system must be changed, because it has failed.
How many of the young men being called to the colours to-day have been given employment since they left school?
– Ninety per cent. oT them.
– Included among that number, perhaps, is an army of young men who have been employed on relief work, but, having no security of tenure, were not happy and contented. They lacked an assured outlook. Why do so few young men and young women marry to-day ? The reason is that they regard marriage as too heavy a responsibility for them to undertake, when they have no prospect of earning a reasonable living or of securing a home for themselves. Thousands of them have never had an opportunity to save sumcient money to provide for a home, because they have merely had intermittent employment on relief work. We should be evolving a system under which, when a lad leaves school at the age of fourteen oi- sixteen years, his training would be continued by serving an apprenticeship, or by being placed in some calling or profession so that he could qualify to render service to the community, and secure for himself a decent living. That is our responsibility. It is not sufficient to point to the fact that we have elementary schools, secondary schools and universities, and that the children of the people may enter those institutions and acquire certain educational qualifications. Unless avenues of employment are made available to them, we shall fail in our duty to them. Many young men have taken various courses of study for the purpose of qualifying themselves for occupations better than those they now follow, with the result that there is a surplus of young men trained for various professions. Lads who have passed through the University of Perth have been forced to drift into the mining industry and wield a shovel. We shall not make the best use of our system of education unless the services of the scholars are used to the best advantage of the nation. We can do that only by providing employment. We have been told that a certain sum of money has been made available for the vocational training of youths, but what is the use of doing that when the youths, on completing their course, find themselves unable to secure a job? To solve this problem we must plan employment; we must plan our economy in order to build up our industries. Australia is a rich country. It has huge supplies of raw material, and, in addition, our people are progressive. In this respect their spirit is unrivalled. In our brief history we have accomplished wonderful things. We are a virile race, and our people only need the opportunity to develop this country fully, and to do their share towards raising the world to a higher plane. In order to do that, however, we must alter the present monetary system, which has proved a failure.
– What alteration would the honorable senator suggest?
– We should restore to the Commonwealth Bank its old charter, in order to enable it to function in the interests, not of the private financial corporations, but of the nation. The credit of the nation should be utilized to meet the nation’s needs. I feel certain that Senator A. J. McLachlan will not dispute that contention. I believe that he realizes the need to expand credit in order to overcome the present economic stalemate.
– What does the honorable senator mean by expansion of credit? Does he mean the issue of notes?
– As a matter of fact, I own a cheque-book. I do not pay my accounts with notes, but with cheques ; and the people I pay settle their accounts with cheques. I am not concerned whether our token of currency be notes or cheques or anything else. All I wish to do is to loosen the grip which the private banks now have upon the credit resources of the nation. So long as credit, is restricted through the influence of private financial institutions, those institutions will continue to receive their profits, while many of our people will be obliged to remain workless. If any honorable senator opposite can suggest any system which will improve our present economic position, I shall be prepared to listen to him.
– But the honorable senatorhas not told us how it can be done.
– It can be clone. This Government should not restrict the activities of the Commonwealth Bank in order to enable private financial institutions to tie up the nation’s credit. Are we merely to give way to hopelessness and say that we cannot solve this problem? As representatives of the people must we not endeavour to solve our economic difficulties, and do all we can to build up the nation’s assets? That is our business as parliamentarians, and if we are bankrupt of ideas we might just as well not be here.
– If the Labour party had any ideas on these problems, it might have consented to participate in the formation of a national government in the present crisis.
– Interjections of that sort will not help this Government through the struggle in which we are now involved. I am rather surprised at the silence of members of the Country party in this chamber. I suspect that they are suffering from portfolio tetanus. I have no doubt, however, that when they are represented in the Government they will have some ideas to put forward.
This Government has had ample opportunity to help the wheat industry in its present difficulty. I am aware of the proposal of the British Government to purchase our surplus wheat. But has the Commonwealth Government really done anything to help the industry through its present crisis ? Senator J ames McLachlan referred to the deadlock which arose at the conference of Commonwealth and State Ministers, when Victoria refused to agree to the Commonwealth’s plan. The other States accepted that plan in sheer desperation, because they could see no other way out of the difficulty. The stabilization of the price for wheat, in order to enable the industry to survive, is the responsibility of the Commonwealth. Wheat is grown in every State, including Tasmania. Any difficulties which may arise in respect of marketing can be overcome by State action, but naturally the States cannot afford to reduce their proposed loan expenditure on public works for the purpose of financing the wheat crop. I have no doubt that the Commonwealth Government could have secured all of the money required to provide a stabilized price for wheat.
– Where from?
– From the Commonwealth Bank. We should willingly have agreed to legislation to enable the Government to indemnify the bank against any loss that might occur. The Prime Minister knew quite well that the money needed could have been provided in that way, but he made no such offer to the States. It cannot be said, therefore, that this Government has fulfilled its promise to the wheat-growers of Australia. When the Prime Minister made his first pronouncement on this problem, he did not say that any financial assistance by the Commonwealth would be contingent upon the States shouldering some portion of that responsibility.
– It was made contingent upon the States agreeing to control production, and Victoria would not consent to do so.
– That difficulty could easily have been overcome. The’ point I emphasize is that had the Commonwealth agreed to provide the finance necessary in order to stabilize the price of wheat, not one State would have dared to stand out of the scheme.
– Victoria did stand out.
– No ; the Prime Minister seized upon that excuse because he would not budge from the Commonwealth offer to provide £2,000,000 and no more. If the Commonwealth had been sincere in its offer to help this industry as far as possible, it would have found the money necessary, and in that case even Victoria would not have stood out.
– But it did stand out.
– Victoria stood out because the Prime Minister would not say definitely that the Commonwealthwould accept the responsibility of finding the necessary finance. Instead, he asked the States to trim their public works programmes in order that they might be able to divert some of their loan money for this purpose. This Government, and this Parliament, have a tremendous responsibility to assist the wheat industry. Any legislation introduced for the purpose of doing justice to the wheat-growers will receive the full support of members of the Labour party. We make that promise definitely.
The Labour party stands for the adequate defence of Australia in accordance with the policy which has been enunciated by our leaders, both in this chamber and in the House of Representatives. We are just as anxious as are honorable senators opposite to ensure that Australia is effectively defended. I sincerely hope that a change for the better in world, affairs will soon occur. All of us hope that the war will soon be over. However, while the war is on, we must shoulder our responsibilities as Australians, and do our utmost to bring it to a successful conclusion.
– I congratulate the Government upon the accuracy of its Estimates for the last financial year. The budget papers reveal that the figures of actual expenditure agreed with the Estimates as near as was reasonably possible. The Estimates for last financial year were more accurate than those submitted for several years past. I support the suggestion put forward by Senator Brand for the intensification of the training of the man-power of Australia. We do not know what part Australia will be obliged to play in the defence of the Empire, but whatever that part may be, it is essential that we take immediate steps to train our men as fully as possible. I congratulate the Government upon the methods by which it proposes to raise the additional revenue required to meet commitments arising out of the present crisis. By levying an additional tax on beer the Government has taxed a luxury item. All honorable senators will agree that that commodity can stand a proportion of the burden associated with the defence of this country. The same may be said of the other excise duties. Every effort has been made to maintain the principle of ability to pay, and to spread the burden in a manner which will cause the least injury to the community.
Senator ‘Cunningham referred to wheat stabilization. The failure of the stabilization plan was due not so much to financial difficulties as to the problem of control of production. Had the Government of Victoria agreed to take the action necessary to prevent the stabilization scheme from getting out of hand through an increase of production, the financial difficulties could have been overcome; but that Government refused to accept not, only any financial responsibility for the scheme but also any responsibility for the control of production. It would, therefore, have been possible for the farmers of Victoria t« smash any stabilization scheme, by increasing their production, and consequently adding to the financial responsibility of the scheme. However, many of the difficulties which existed at the time of the Premiers Conference have now been removed. At that time, the powers of the Commonwealth Government were definitely limited ; but, following the declaration of war and the passing of the national security legislation, the Commonwealth now has powers which are limited only by Section 92 of the Constitution. It is now within the power of the Commonwealth to implement a stabilization scheme under which it can provide the necessary safeguards against a possible increase of production. As the war continues, it may be found necessary, in the interests of Empire defence, either to increase production or hold production at its present level instead of decreasing it. But whatever is found necessary, the Commonwealth is nowvested with complete power to control the situation. In my opinion, a mere increase of price does not absolve the Commonwealth Government from the responsibility of introducing a plan to stabilize the wheat industry, and give to farmers the security that they so urgently need. For years their outlook has been almost hopeless. After a period of record low prices, their hopes were raised by high prices for a year or two, only to have those hopes again dashed to the ground by successive years of low prices. Then the farmers saw governments taking an interest in their problem. Farmers, standing solidly together in their demand for wheat stabilization, saw commerce and industry urging governments to implement immediately plans for the stabilization of wheat prices. I submit that never before lias there- been such a united demand for any legislation as there has been during ibc last twelve months for action to stabilize the price of wheat. There have been differences of opinion as to price and method, but there has been no difference of opinion as to the need for stabilization. The farmers ask, and other sections of the community agree, that the wheatgrowers are entitled to the same security and the same standard of living as is enjoyed by persons who are engaged in other industries. Now that there is a possibility of an increase of wheat prices, 1 ask the Government not to shelve this problem and leave the farmers in a state of insecurity, but to take action now to provide a permanent plan of stabilization. If, as the result of the purchase by Great Britain of a large proportion of Australia’s crop, wheat reaches a payable price, the Government should not therefore abandon its proposals for wheat stabilization. In that event the financial requirements would be less, and the safeguards which the Commonwealth Government ?;iw fit to propose to the Premiers Conference and which it did not then have the power to impose, could be imposed by the action of the Commonwealth Government alone, so that its task would be easier. Never before has the time been more opportune for the introduction of a plan of wheat stabilization, and never before has the Commonwealth Government had greater power to bring in a scheme.
– At what price does the honorable senator think that wheat should be stabilized?
– I think that the figure which the royal commission found was the cost of producing wheat, namely 3s 6d. a bushel at ports, is as nearly a correct price as pan be ascertained. The proposal of the Commonwealth Government, namely, a minimum of 3s. 4d. a bushel at ports, was, in my opinion, reasonable. From my discussions with hundreds of farmers in almost every part nf South Australia. T learned that farmers generally are prepared to accept a stabilization plan based upon a minimum penalization price of 3». 4d. a bushel.
– Would the honorable senator differentiate between small and big growers?
– No. The object of a stabilization plan is to give a payable price to producers. Whatever the number of bushels produced by any wheat farmer, the need for a payable price is just as great. It would be a mistaken policy to help only the small growers and to allow the larger growers gradually to become bankrupt, and then, when they, too, became small growers, try to rehabilitate them in the industry. Every person is entitled to a payable price for his product. Stabilization means not charity, but giving to every producer a fair return for his labour. Therefore, I urge the Commonwealth Government to keep wheat stabilization in the forefront of its policy, and to exercise the powers that it undoubtedly now has in order to implement a stabilization scheme, while providing such safeguards against overproduction as it thinks necessary.
Several honorable senators dealt with the rather popular theory of social credit, or community credit, as some prefer to describe it. It would appear that some honorable senators believe that past governments have not made use of the credit of the nation. There are three ways in which governments can obtain money: first, by imposing taxes; secondly, by borrowing; and, thirdly, by inflation, expansion of the currency, social credit, or community credit - whatever name we like to give to it.
– Does the honorable senator say that social credit is the same as inflation?
– Yes. All of those methods have been used in the past; and all will be used in the future. The first and third methods can be employed without cost to the Government. Taxation is free of cost to the Government, hut not to the community. Credit expansion can be free of cost to the Government, but it certainly is not free of cost to the community. Some people choose to take certain paragraphs of the report of the royal commission out of their context, and also to read into the words of the report declarations that are not there, and are not intended to be there. I am sorry that Senator Darcey is not here, for T think that he should know that in paragraph 504 of its report the royal commission did not say that the issue of credit by the Commonwealth Bank would be free of cost to the community.
– No one has suggested that the royal commission said that.
– During the last war the then government adopted extensively the three methods that I have mentioned in order to obtain money ; it taxed heavily, it borrowed extensively ; and, through the issue of treasury-bills, it extended credit. Whether a treasury-bill is made subject to interest, or is free of interest, is immaterial; the issue of such a bill by the Government is undoubtedly an expansion of credit. When treasurybills, or notes, are issued, the currency of the people is diluted, but no more wealth is created. All that happens is that the value of the tokens of exchange is depreciated.
– Would not the issue of treasury-bills withdraw from the currency the amount of the bills?
– No. Should the Government issue treasury-bills to the value of £50,000,000 to-morrow, and give to the Commonwealth Bank an IOU, or a treasury-bill for that amount, the Commonwealth Bank could then issue notes to that value, to be used by the Government for its particular service.
– What about private individuals?
– I do not know what their position would be. I have told the Senate what happens when treasury-bills are issued. Immediately additional notes are placed in circulation, an indirect tax is imposed upon the holder of every note. Simply because the tax is an indirect one, its effect is not im mediately noticeable. Therefore, it is a popular way of raising money.I think, however, that most of us remember what happened after the last war, when the day of reckoning came. The credit expansion which had taken place during the four years of the conflict forced up all prices, and when the crash came this country paid very dearly.
I do not wish it to be thought for one moment thatI subscribe to the proposition that governments cannot obtain money in this way free of cost to themselves. I entirely agree with the statement in paragraph 504 of the report of the Royal Commission on Banking and Monetary Systems, that by utilizing the Commonwealth Bank the Government can obtain interest-free money in this way. But I agree also with the further statement in the report that there are limits beyond which it is not safe to go. In other words, there are limits to the height to which prices should be allowed to rise. If Senator Darcey would read and study carefully the paragraphs following paragraph 504, he would realize that the authority which he cites for his proposal also utters a word of warning and suggests a definite limit to the policy of credit expansion.
I have not the slightest doubt that during the war which, unfortunately, is now in progress, the Government will be compelled to resort to credit expansion in order to obtain portion of the money which it will require. But I am quite sure that it will take this course with its eyes wide open.
– The Government will turn on the tap, as the Treasurer has suggested.
– I agree that it will have to do something like that.
– At 4 per cent. interest, which the people will have to pay.
– If the Government; turns on the tap, as Senator Darcey has suggested, it will do so with a full knowledge of the consequences of its action. Even though credit expansion will have evil effects, the Government will fully realize that the consequences of not getting all the money which it will require to prosecute the war would be far more serious than the consequences of getting it in the way indicated.
I hope thatI have made my position clear on this topic of credit expansion. It is not a new theory. It has been practised by governments for hundreds of years.It is immaterial whether a government issues treasury-bills subject to the payment of11/2 per cent. interest, or whether they are issued free of interest. The only object of issuing treasury-bills subject to interest charge is to place some safeguard against using this easy money too freely, vo the detriment of the community.
– The honorable senator said a little while ago that 3s. 4d. a bushel was a fair price for wheat. What does- he think should be done with wheatgrowers who, according to the royal commission which inquired into that industry, are unable to grow wheat profitably at 5s. a bushel?
– I believe that any person who cannot produce his commodity at an economic cost must eventually go out of industry.
– The honorable senator considers that those- wheat-growers must go out of the industry?
– I say that a farmer who cannot produce wheat at a cost of under 5s. a bushel must go out of the industry.
– This Government has set aside £500,000 a year to assist them.
– The honorable senator is correct. This Government, through its flour tax legislation, has provided £500,000 a year for the assistance of primary producers in marginal areas. Unfortunately, some farmers working on good land are unable to produce wheat profitably at 5s. a bushel. Those producers must go out of the industry, because we must put this country on an economic basis.
– That being so, wheat farming in unsuitable areas must cease.
– I agree with the Leader of the Opposition. Lands that are not suitable for wheat growing must be put to other uses.
The time is ripe for the introduction of a wheat stabilization plan to ensure a return of 3s. 4d. a bushel to growers, and to give to them some sense of security. Since the Government now has unfettered power it should proceed with this work without delay.
– What about the unemployed ?
– Everything possible has been done to provide work for the unemployed. It is not now suggested that additional provision will have to be made. We are at war, and every one who wants work will be able to get it.
In his remarks this afternoon, Senator Cameron conveyed the impression that the Militia Forces were drawn chiefly from the ranks of the unemployed. The honorable gentleman is wrong. Members of the Militia are composed of average Australian citizens - some young men of independent means, some in lucrative employment, some in poorly paid clerical positions, some unemployed and some men on the basic wage. All sections of the community are represented, and all have offered to serve their country; so it is quite wrong to suggest that the Militia Forces are composed largely of unemployed persons. Within the last three weeks, in the militia unit of 100 to which I belong, a call was made for those who were unemployed to take permanent positions that were being provided by the Defence Department. Only two stepped out from the ranks, showing clearly that, with the exception of those two, every member of the unit was engaged in some productive occupation.
– No wonder; that unit is in a blue-blooded area.
– No. Senator Keane knows, as well as I do, that all Australian citizens, whether they be fortunate enough to have means or whether they are unemployed, are loyal to their country. The members of the Militia are representative of no particular class; they are drawn from all sections of the people and every man is prepared to do any duty that may be required of him by the defence authorities.
I congratulate the Government upon the budget which it has presented, and upon the equitable manner in which it proposes to levy taxation in the current financial year. I urge it to intensify militia training and to proceed with its plan for the stabilization of the wheat industry.
– In this debate sufficient has been said already concerning the Government’s defence and financial proposals, so I shall refrain from saying anything on those subjects. The attitude of the Opposition has been fully stated by previous speakers. I have always held the opinion that equipment. for the Militia Forces in the various States should be provided in those States. In this way, something could be done for the unemployed. The adoption of this policy would help to benefit the State of Western Australia, which I assist to represent in this chamber. The whole of the clothing and boots for the Militia Forces in that State could be manufactured there. The Albany Woollen Mills Limited recently fulfilled a £3,000 contract for the supply of clothing for the Militia, but I believe that no further orders have been placed with that company, the reason no doubt being that the larger manufacturers in the eastern States can manufacture at slightly lower costs, thoughI feel sure that costs would not be lower if freight from the eastern States to Western Australia were taken into account. Last year a new firm, the Westate Engineering Company, was established in Perth to manufacture conduit piping. It now complains of undercutting by the Western Australia Electrical Dealers Association. It states that when it started manufacturing conduit piping last year, the Western Australia Electrical Dealers Association was distributing conduit piping to the trade at l1s. a 100 feet. To-day it is selling at7s. a 100 feet, with a rebate of 6d. a 100 feet conditional on the buyer purchasing all conduit from members of the association. The product of the Westate Engineering Company is second to none, but its competitors in the eastern States are now trying to drive it off the market.
The following paragraph appeared in the Sydney Morning Herald on the 9th September last: -
The president of the Boot and Shoe Manufacturers’ and Allied Trades Association, Mr. P. G. Goldstein, said yesterday that the action of the Commonwealth Government in having boots for the army in New South Wales manufactured in other States was “ farcical “.
He said the Commonwealth Government had accepted tenders for the supply of 77,000 pairs of boots, of which 89,000 were to be manufactured in South Australia and the remainder in Victoria.
As it is the responsibility of the Government to distribute such work as evenly as possible, it would be interesting to know why contracts have not been let to manufacturers in Queensland and
Western. Australia. The report continues -
Although labour conditions enabled South Australian and Victorian manufacturers to quote slightly lower prices than local factories, the difference in the tenders would be more than outweighed by the freight costs involved in shipping theboots to the other States.
– Some firms are not anxious to tender for these contracts, because they contend that there is very little profit in them.
SenatorCLOTHIER. - I was manager of a factory in Western Australia during the last war, and I know that in some instances when there was a difference of only l1/2d. a pair between the price submitted by a Western Australian tenderer and that quoted by manufacturers in the eastern States, the Western Australian manufacturers lost the contract.
It is gratifying to learn that the Government proposes to appoint price-fixing authorities in the various States. When I was a member of the Western Australian Parliament a majority of the members of the House of Assembly supported a proposal for theappointment of a price-fixing board, but the scheme was rejected by the Legislative Council. As a member of the business community in Western Australia, I found that price-fixing authorities were controlling the sale of commodities to the disadvantage of consumers, and I trust that this Government will give full effect to the policy which it has outlined, and inflict heavy penalties upon those who are endeavouring to exploit the people. The rationing of necessary commodities should also be undertaken by the same authority, so that profiteering, which was carried on so extensively during the last war to the detriment of the Australian people and particularly the workers, may be prevented. All the States should be placed on an equal basis, and under a complete price-fixing scheme no State could enjoy an advantage over other States, as happened during the last war.
Recently a paragraph appeared in the press to the effect that fitters and other skilled tradesmen have been sent to Great Britain to be trained in the assembling of aircraft, and that when they return they are to be employed in every State with the exception of Western Australia. and Tasmania. Engineers and fitters in Western Australia are as highly skilled as those in any other part of the Commonwealth, but again that State has been overlooked. . The Minister for Supply and Development (Mr. Casey) said -
To meet the requirements of the Bristol Aeroplane Company, the trainees had been divided into four parties, the first of which consisting of 22 men and a supervisor, would leave for England by the Mooltan on the 25th July. The second, third and fourth parties would leave at five-weekly intervals thereafter. The period of training in England would last for about ten weeks, but would vary according to circumstances. Mr. L. H. Hart, of the New South Wales Railways De- partment, who had been chosen as supervisor, would remain in England until training was finished. It was expected that all of the trainees would have returned to Australia before the 1st March, 1940. The establishment of the aircraft industry in Australia would provide employment at the peak of production for approximately 4,300 men, of whom 1,000 would he employed in Victoria, 1,000 in New South Wales, 1,800 in South Australia, and 500 in Queensland.
Why cannot some of this work be undertaken in Western Australia and Tasmania?
Reference has been made from time to time to the construction of naval bases, but apparently the Government does not propose to construct a naval base in Western Australia. TheFremantle harbour, comprises 25 square miles of protected deep water. Some years ago a site for a naval base at Cockburn Sound was selected by Admiral Henderson; his choice was supported by the late Admiral Jellicoe, and endorsed by Sir Maurice Fitz-Maurice, a highly skilled naval engineer. A newspaper paragraph on the subject reads -
This naval base should be completed without delay, because the statement that the channelswere silting up was a “ prevarication of the truth “ and a gigantic lie, which does not redound to the credit of the Commonwealth Government, or the State Government of Western Australia.
Yesterday when Senator Cameron was speaking on the industrial situation, an honorable senator on the Government side of the chamber asked why the unions did not establish industrial undertakings. As a former secretary of an industrial organization I know that that is impracticable, because union funds have to be used to fight unscrupulous employers. Unionists may establish small businesses on their own account, but union funds cannot be used for that purpose.
Should the present war continue it may be necessary to transport troops from New South Wales to Western Australia or vice versa, but it is not difficult to imagine the confusion that would occur in transporting, say, 25,000 men over a railway system in which there are several breaks of gauge. I understand that it would take approximately two months to transport a complete division from New South Wales to Western Australia. The standardization of our railway gauges should be commenced immediately. W ork could also be provided by duplicating some of our more important railway lines, and in constructing additional roads and bridges. The Commonwealth and State Governments should co-operate, particularly in the construction of roads, which could serve as feeders to the railways. We have been informed that the volume of cargo carried between Sydney and Melbourne by water is seven times greater than that transported by rail, due probably to the fact that the break of gauge between those two cities causes undue delay and expense.
The Government should also assist those engaged in ship construction in Australia. Some small vessels are built in New South Wales and in Victoria, and motor boats which are used in conjunction with seaplanes have been built in Western Australia. As Australian manufacturers are now producing many commodities which were not manufactured in Australia during the last war, the Government should adopt a more definite policy to assist shipbuilding. In May of this year the Government called tenders for the construction of a motor vessel to be used in the New Guinea trade, but the contract has not yet been let and the deposit of £25 paid by one tenderer is still retained. A manufacturer of socks in Subiaco, Western Australia submitted a tender to the Defence Department some time ago, but the department has retained the deposit and has failed to notify him of the acceptance of a tender. It is pleasing to note that our wool and wheat-growers and our manufacturers of foodstuffs will probably experience better times in the near future than they have for a considerable period, but I regret that the favorable prospects are due to war conditions. Senator Wilson spoke at length regarding the needs of the wheatgrowers. I have always held the view that if representatives of the wheatgrowers, the consumers and all of those connected with the sale of wheat held a conference, the growers would obtain a greater measure of justice than they have received in the past.
I draw attention to the unsatisfactory manner in which appointments are made to the staff of the Australian Broadcasting Commission. I am informed that an appointment was made recently to the position of “ Talks and School Broadcasts Officer “. I have no objection to the gentleman who was selected for this position, but all applicants should receive the same treatment, irrespective of the States from which they come. Therefore, positions of this kind should be advertised in every State in the CommonwealthThis officer was required to fill a post in Western Australia, but no advertisement was published in the press regarding the position. I have been advised as follows with regard to the matter: -
The position filled is a Western Australian position, but no advertisement appeared in any Western Australian paper, and, in fact, the actual position itself was not advertised. What actually did happen was that a position in South Australia was advertised some time previously, and it is understood that the Australian Broadcasting Commission, in order to obviate further advertisement, selected one of the applicants who had not been successful in obtaining the South Australian position.
– The person appointed is a Western Australian, and he was living in that State.
– My information is from the State School Teachers’ Union of Western Australia, and I do not think that that body would advise me wrongly.
The Commonwealth Government should do everything possible to keep men at work, because, as soon as Commonwealth employees are dismissed, similar action is taken by the governments of the States, by municipal authorities, and by private employers. It is to be hoped that the people of this country have learned a lesson from the last war. Seeing that money can readily be found for war purposes, it should be possible to obtain it for peace needs. Western
Australia, Tasmania and South Australia should demand better treatment than they have had in the past. The situation to-day is different from that in 1914. Twentyfive years ago the Australian community found itself faced with disturbance of trade, and industry was dislocated. As the result of the experience of the last war, Australia is now manufacturing the great bulk of the commodities needed by the people. Valuable work is being carried out by the Council for Scientific and Industrial Research. It should investigate the possibility of establishing new industries in Western Australia, such as the production of cotton. I should welcome co-operation on the part of Western Australia, South Australia, Tasmania, and possibly Queensland, with a view to the expansion of secondary industries in those States. Greater secrecy than has been evident in the past should be observed in regard to the manufacture and placing of armaments.
The. safety of the people of the Commonwealth depends entirely on the Government. Three things we must not forget: (1) The right of every citizen to earn a living; (2) the natural rights of all men, women, and children are equal ; (3) therefore the right of every one to earn a living is equal. Bearing these three principles in mind, we must try to ensure that industry is kept going, and its claims respected. A nation is created by family life, religion and tradition. It is made up of the hearts of mothers, the wisdom of fathers and the joys of children. In Australia we pride ourselves on our progressiveness and initiative. This is a country in which democratic rule should prove more beneficial than in any other part of the world. I hope that Commonwealth and State Governments will do their best for Australia, and thus contribute to the happiness of the people.
– The statement was made by Senator James McLachlan that money is easily obtained in time of war, because the people desire to defend something that is dear to all of them.
– That is the honorable senator’s interpretation.
– I claim that it is an interpretation which any reasonable person would place upon the honorable senator’s remarks. He said that the reason why money could be obtained readily in time of war was that it was required for the defence of the nation. 1 submit that during times of depression, when thousands are homeless and without a job, their welfare should be just as important to us as is the property of tho wealthy people who should to-day offer their money for the defence of this country. If the wealthy class considers that our democratic rights are at stake, why should not we. uphold the democratic rights of those who suffered during the depression, when funds were not made available to a sufficient extent to help them out of their distress? It is easy to obtain money in time of war for destructive purposes, but hard to get it in time of peace for reproductive work. That is my reply to Senator James McLachlan, and Senator Wilson.
I hope that the Government will noi. take advantage of the present crisis to deprive the workers of any rights that they have enjoyed in the past.
– Does- the honorable senator suggest that the Government would rob anybody?
– If the honorable senator will follow my remarks closely, he will find, from replies received by mc to questions asked in this chamber, that there are Ministers in the Cabinet who might take action against the interests of employees. On the 1st June last, I asked a question regarding the hours of work of lighthouse-keepers. The reply given was that at certain stations the keepers were required to perform station duties, and to he in attendance up to 70 hours a week. They are called upon to work seven days a week. I was told that the hours and duties of lighthouse-keepers were under review, with a view to reducing the hours of attendance and watchkeeping from the 4th July. A few days ago I asked a further question with regard to lighthousekeepers, and the reply furnished to me was -
When ray reply to the honorable senator’s original question on this mutter was given on the 1st June last, it was the intention to discontinue day watches for shipping at other than lighthouse signal stations, and to introduce, where practicable, standard hours of duty which were being drawn up for the various types of light stations. lt subsequently became apparent, however, that in a national emergency the duties of light-keepers would have to be correlated with other important aspects of defence. Action along the proposed lines, therefore, has, unfortunately, had to bt deferred.
When, in the opinion of the Government, did that state of emergency suddenly arise? It was not in June, and I cannot see that it existed on the 4th July any more than on the 1st June. .Judging by the answer given to my question, the Minister for Commerce (.Senator McLeay) is endeavouring to take advantage of the present national crisis in order to shelve the matter of reducing the hours of lighthousekeepers.
– He has taken nothing away from them.
– He cannot do that, unless they are kept at work day and night, without a break.
– Our lighthouse keepers would be only too eager to do their share of national work in a time of emergency.
– No emergency existed on the 4th July, when the Government promised to redress this grievance. I protest against the Government’s policy of abandoning essential public works which could very well be carried out in spite of difficulties arising from the present crisis. Such a policy causes unemployment. If we can find money for defence, we should also be able to find sufficient for reproductive works essential to the development of this country. For some years past residents of New Norfolk have been petitioning for a new post office. The honorable member for Barker (Mr. Archie Cameron) when he was Postmaster-General, inspected the present post office and, although the department then anticipated repairing the building, he was so disgusted with it that he said it was not worth repairing, and expressed his intention of erecting a new post office as soon as possible. I have no doubt that had the honorable member continued in charge of the Postal Department he would have honoured that promise. To-day, however, the department has reverted to the attitude it adopted when Senator A. J. McLachlan was
Postmaster-General, and says that no new postal or telephonic facilities can be provided unless they will be payable from the start. There are other ways of looking at a request of this kind. When a State government constructs a road it does not ask whether the road promises to be a payable proposition immediately. The fact that the road will help to develop a particular district is sufficient to justify its construction. No question of revenue arises in that case. Furthermore, when a farmer takes up a virgin block of land, he does not expect his proposition to be payable at once. If the Postal Department persists in denying postal and telephonic facilities where such services have no prospect of paying right from the start, it will fail to make any contribution to the development of this country. Indeed, such an outlook is in marked contrast to that of the State governments and those pioneers who are opening up our outback country.
I also request that a telephone line be constructed between Queenstown and Bronte. This would establish telephonic communication from Queenstown right through to Hobart. This service would help considerably in opening up the west coast district of Tasmania, in which are situated the hydro-electric power station and many important mills, which figure prominently in the industrial life of the State. In the absence of such communication the lives of people who might be snowed in this district for weeks at a time will be endangered.
I urge the Postmaster-General to use his influence with Australian National Airways to restore the service between Flinders Island and Tasmania. Recently this service was reduced to a tri-weekly schedule. It was reported in the press that the reason for this restriction was that only one passenger a day was being carried. That report is entirely incorrect. The demand for this service has been increasing since it was inaugurated some years ago. In 3933, it carried 90 passengers compared with 855 passengers for the year ended the 31st December, 1938, whilst for the first five months of 1939 the numbers of passengers carried were: - January, 127; February, 82; March, 129; April, 116; and May, 118; making a total of 572 passengers in five months. Remembering that this Government subsidizes .this company in respect of its mail service, the public has every right to an adequate passenger service. The residents of Flinders Island are also clamouring for a post office, which the department declines to provide because, it says, the population is not sufficient to warrant it.
I draw the attention of the Minister for Commerce (Senator McLeay) to the threatened shortage of shipping space for fruit cargoes from Australia. Consignors have been advised by the shipping companies that as from the 4th September space will not be available for fruit. In this connexion, we should bear in mind the difficulties which arose in 1914 owing to the lack of shipping space for the transport of our primary products overseas. Surely we do not want such difficulties to recur in the present war.
– The honorable senator should advise Hitler about that.
– If the Australian Commonwealth Line of Steamers, which was purchased in order to overcome this difficulty in the last war, had not been given away by a government politically akin to this Government, I should have no need to raise the matter now.
– What was the total loss incurred by that Line?
– The total gain to the producers of Australia greatly exceeded the losses directly incurred in the operation of that Line. If the Government would lend a hand, it might be possible to arrange with neutral countries to provide shipping space for fresh fruit from Australia. I hope that the Government will do everything possible to secure shipping space for Australian fruit.
– It is doing so.
– I am pleased to hear the Assistant Minister’s interjection, and I hope that the efforts of the Government will be successful, so that the orchardists of Australia will not be faced with ruin. Although during recent years, the production of apples and pears has increased by about 100 per cent., only about one-half of the total production is exported. As it may not be possible to provide space for all of the fruit grown in Australia, I asked a question to-day relating to the canning of certain varieties of apples. In its negotiations with the British Government for the sale of produce from Australia, the Government would do well to explore the possibility of selling canned apples.
I disagree with some of the methods by which the Government proposes to raise additional revenue. I refer particularly to the increase of the sales tax. Whenever an added fax is placed upon the workers of this country, their purchasing power is reduced.
– Does the honorable senator remember which government first imposed the sales tax?
– I know the history of the sales tax from its inception in this country. I disagree with the Government’s claim that the increase of the sales tax will not greatly affect the workers of this country.
– It will affect them very little.
– It will affect them a great deal. Almost every article of clothing required by the working man and his family will cost more.
– Food and clothing are practically exempt from sales tax.
– I know what I am talking about. A man’s hat, collar, shirt, singlet, trousers, socks, overcoat and pyjamas - practically ail ‘ articles of clothing with the exception of boots and shoes - are subject to the tax. The position in regard to the clothing of women and children is much the same. The working man has to buy all of these articles, and when they are taxed at a higher rate than formerly, the effect is to reduce his purchasing power. But that is not all. The retailer who pays the tax in the first instance calculates his profit on his outlay; and as his outlay will be greater because of the tax, so also will his profit be greater, with the result that the purchaser of his goods will pay, not only an increased rate of tax, but also an increased profit to the retailer. I am strongly opposed to the sales tax. There are fairer ways of extracting money than by taxing those who are least able to bear the burden.
– The sales tax was first imposed by a Labour government.
– I know that. The Scullin Government, which first introduced the sales tax, was faced with a considerable adverse trade balance and had to do something to save the nation from default. The country was almost bankrupt as the result of the extravagance of the Bruce-Page Government. It had to impose higher and in some cases prohibitive tariffs in order to check the adverse trade balance. The country did not then enjoy the huge revenue from customs which the policy of the Bruce-Page Government made possible. Some means had to be found to compensate in some degree for those losses. The tax was imposed as an emergency measure. Unfortunately, the Scullin Government, although in office, was not in power, and it did not last long. It was succeeded by the first Lyons Government.
– That Government removed the sales tax from many of thegoods required .by the workers.
– Although the tax was imposed as an emergency measure, the Lyons Government did not remove it when the customs revenue again began to soar, and many more millions of pounds are collected now than ever before.
There are many aspects of the Government’s defence policy to which I could refer, but I shall confine my comment to one only. Yesterday I asked the Minister representing the Minister for Defence whether he considered that Tasmania’s defences were adequate to meet any emergency. The Minister replied that the Government’s proposals with regard to the defence of Tasmania are related to the defence of Australia as a whole. He ako said that it was not a wise question at the present time. It would have been better had he answered “ No “ in the first instance. I asked that question because of the unfair treatment of Tasmania in the allocation of defence expenditure. If the defences of Tasmania are adequate - and the Prime Minister has said repeatedly that Australia is prepared to meet any emergency–
– He has never said that.
– Then the newspapers must have misreported the right honorable gentleman. I am certain that the Minister would have answered “ Yes “ if the facts had enabled him to do so. I am not exposing anything that is not already known. Every potential enemy knows the state of our defences.
– Does the honorable senator himself know?
– I know the posi tion in Tasmania. I again draw attention to the treatment of Tasmania in the matter of defence expenditure. Some time ago I asked a question relating to the expenditure in each State by the Supply and Development Department. The reply which I received corroborates everything that I have said as to the unfair treatment of Tasmania. During 193S-39, Few ‘South “Wales received from that department, £250,000, or 833 times as much as was paid to Tasmania, notwithstanding that the population of Mew South Wales is only eleven and a half times that of Tasmania. Victoria received £2,083,000, which is 6,943 times as much as Tasmania received. Yet the population of Victoria is only eight times that of Tasmania. South Australia, which received £2,200, has a population which is only two and a half times that of Tasmania, yet it received seven and a half times as much as was paid to the island State. Queensland, with a population four times that of Tasmania, received £2,250, or seven and a half tunes the amount paid to my State. Western Australia, with a population not quite double that of Tasmania, received £2.700, nine times more than was given to Tasmania, which received only £300.
– Does the honorable senator suggest that defence expenditure should be apportioned according to the population of each State!
– -Of course not. I do contend, however, that Tasmania should receive a more equitable proportion of the total expenditure on defence. Of the total amount provided last year for defence works in Australia, only £12,000 was expended in Tasmania. Yesterday when I asked for some information concerning the Government’s expenditure on defence in my State, I was informed that the asking of the question at this juncture was not wise.
– Tasmania gets a great deal from the Commonwealth under the States Grants Act.
– I shall have something to say on that subject when the next States Grants bill comes before the Senate. It is as well to remind the Minister that Tasmania. Western Australia and South Australia do not appeal as paupers to the Commonwealth. All they expect is a reasonably fair distribution of Commonwealth revenue in order to make good the disabilities which they suffer under federation and as the result of Commonwealth policy.
We have been told that some manufacturers have intimated that, in an emergency, their establishments would be placed at the disposal of the Government for the manufacture of munitions and other war materials. On this point I remind the Senate that if war came to Australia, that is to say, if fighting took place on Australian soil, many thousands of Australia’s young manhood would freely volunteer to defend this country, and probably many thousands would make the supreme sacrifice. This being so, is it unreasonable to expect that manufacturers who, in normal times, make substantial profits, should, in time of war, manufacture the requirements of the Government without profit to themselves? The great majority of the men who will do the fighting have little to defend apart from their liberty.
– Is not that something worth fighting for?
– I agree that it is; but what I mean is that a great many of them have little, in the way of material possessions, to defend. Some, indeed, have not even citizenship rights. This Government through legislation has taken such rights from them.
Under the national emergency legislation passed last week, the Government has power, by regulation, to take over control of any factory required for the manufacture of arms or munitions. If, in time of emergency, it called upon men to defend Australia it should, at the same time, take control of manufacturing establishments and itself manufacture its war needs.
The States Grants Commission, which submits recommendations for the pay* ment of grants by the Commonwealth to the States, should have a more secure tenure. It should not be necessary for that body to examine the financial relations of the Commonwealth and States every year in order to make a recommendation as to the amounts to be paid to claimant States. If the Commonwealth wishes to secure the co-operation of State governments it should make some alteration of the system of paying these grants and fix them over a term of years ahead. At the present time, State Treasurers are unable, with any degree of certainty, to budget for the year’s expenditure because they do not know, in advance, what will be the amount of Commonwealth grant for the current financial year. The present arrangement is most unsatisfactory.
Sitting suspended from 6.15 to 8 p.m.
– Additional Estimates will have to be submitted before the end of the financial year, and the Government may have to find another £25,000,000 for defence purposes. If the Government considers that that amount is. needed it will be found. Senator Wilson said that the financial and economic depression which Australia, in common with other countries experienced some years ago, was due to an expansion of credit during the last war. That depression did not commence until 1929, and had there been an outbreak of war in that year instead of this year the additional £50,000,000 required would have been made available. When money or credit is required for war purposes it can always he found. That being so, Senator Wilson’s argument cannot be substantiated. If money can be provided for war purposes, it should also be provided to prevent a financial and economic upheaval.
– Although the circumstances with which we are now confronted are deplored by every honorable senator, we are entitled to express our opinions concerning the way in which the Government is handling the finances of this nation. The Prime Minister (Mr. Menzies) has presented a budget which will be followed by additional financial proposals for the current year, and consequently we are unable to estimate at this stage the effect which a complete budget will have upon the Australian people. Provision is made principally for defence expenditure and for the payment of interest on loans and it is to be regretted that nothing is being done to improve the conditions of the masses. Certain newspapers are endeavouring to show that work is plentiful, and that factories, shops and other business establishments are working overtime, but according to an advertisement which appeared in the Sydney Morning Herald, the employees of the New South Wales Traders Association have been warned that their present employment will be available for only one month, and that possibly after that period restrictions will be imposed. Should work be rationed the employees would he in the unfortunate position they occupied in 1931, when many persons had to be satisfied with only part-time work. During the depression the people suffered in consequence of the activities of those controlLing world finance. Overdrafts were called in and other financial restrictions were imposed in order to weaken the masses, who were organizing all over the world, and commercial stagnation was brought about in the United States of America, Great Britain, Australia and other countries.
– Those controlling world finance did not cause the depression in Australia.
– We have been told what caused the depression.
– It was caused by low prices.
– Low prices ruled because people lost their jobs and consequently did not receive any wages. Many professional men, including doctors, surveyors, dentists, engineers and others had to wait in a queue to receive the dole. Some of them had possessed valuable homes and other assets, their children had been attending colleges, and generally they had enjoyed all the good things that life has to offer; but in the end they’ lost all that they possessed. Men became desperate and joined organizations which they thought could assist them. In 1933 a great villian, who has murder and ruthlessness in his make-up, came into power in Germany. The oppressed workers in that country were prepared to do almost anything to secure better conditions, and have since became a part of a great war machine directed by a man intoxicated with power. In Russia and in Italy different forms of government have been adopted by the people in an endeavour to obtain a reasonable standard of comfort. The conditions which we may soon have to encounter will be similar to those which existed in 1931. According to the figures issued by the Commonwealth Statistician, unemployment at the end of the last financial year was 14 per cent, greater than it was in 1929.
– Has it ever been lower than 7 per cent?
– We have been told that 9.5 per cent, of the registered trade unionists are unemployed, but surely no honorable senator opposite believes that that percentage represents the actual number of unemployed, because many men who are out oi work have never been members of a. trade union.
– The basis is the same.
– Thousands are not included in the Statistician^ figures. In Australia as in other countries, the people will submit to the inevitable, but if they are imposed upon it is difficult to say what they will do. The members of the Australian Imperial Force were regarded as the most kindly men in the world, but if they were oppressed they showed who was master. If during a time of war this Government thinks that it can continue to oppress the people there will be trouble.
– Who is oppressing them?
– I was speaking in the King’s Hall last week to a prominent Canberra medical man, who told me that even in this city, to say nothing of crowded industrial centres, cases of malnutrition are reported. How can it bo said, therefore, that the people are not oppressed ? The statistics prove my statement to be correct.
Immediate steps should be taken by the Government to adopt some of the suggestions offered ‘by Senator Darcey, who, ever since he has been a member of this chamber, has urged drastic changes in the monetary and banking systems. He speaks as a member of the Australian Labour party, and his constant and eloquent appeals for monetary reform have won for him many admirers. The Douglas Credit group is a party that will have to be reckoned with in the future. Its members are mostly of the middle class, and are not supporters of the Labour party, but they are disgusted with the party now in power in this Parliament.
All of the banking and financial theories that had been adhered to throughout the world prior to the 4th August, 1914, as the only principles upon which banking and finance could be satisfactorily conducted, were thrown overboard immediately after the war commenced. The world finished that war with a burden of debt so great that, if anybody had contemplated it for any other purpose, he would have been branded a sheer lunatic. Nations are defended with manpower, guns, munitions and other material things, and their capacity cannot be limited by the amount of currency that they have, or by any particular measure of credit that any band of experts likes to fix.
It is essential that, in the interests of the people generally, a policy of expansion of credit should be adopted. When the Commonwealth Bank was established by a Labour government, its governor, Denison Miller, proved himself a genius. Had his policy for the financial rehabilitation of the nation been put into operation we should not have witnessed the depression in 1931. Those dark days, which were as bad as war, would have been averted, because the Commonwealth Bank could have financed a programme of reproductive public works involving the expenditure of £350,000,000. Instead of the bank carrying out that policy, the Government, led by Mr. Bruce, set up a financial oligarchy that has brought ruin to Australia. The chief qualification of a man recently appointed to the Commonwealth Bank Board seems to be that he is a good polo player. He represents the private banks, to whom he will refer from time to time for instructions; but the Commonwealth Bank was not established to satisfy a coterie of private bankers. It has been suggested, not by Senator Darcey, but by honorable senators opposite, that an expansion of credit will be necessary for the purpose of prosecuting the war. If credit could be expanded in Sir Denison Miller’s time, there iB no reason why it should not be done to-day.
The people have the right to live. If they know ‘ that they will have sufficient food, clothing and shelter, they will willingly rally to the defence of the country. I was under the impression that those enlisting in the Militia are mainly coming from the ranks of the unemployed, but Senator Wilson informs us that that is not so. Evidently the unemployed are disgusted with the treatment that they have received. Senator Wilson remarked that in his company in South Australia only two militiamen have been numbered among the unemployed. T?he thousands of men who have ‘been unable to obtain work for a long period cannot be expected to have any enthusiasm for fighting in the present war. When Mr. Bruce was in Australia about six months ago, he told members of this Parliament that never again would troops be asked to leave Australia for service overseas. A similar statement was made by the Prime Minister (Mr. Menzies). I do not accept those assurances. If Australians will not be asked to serve abroad, I suggest that employment should be provided for all who are in need of work.
A water main extends from Pott’s Hill to Prospect in New South Wales, and it is guarded night and day. If that line, should be blown up, or damaged in an air raid, not only would Sydney’s water supply be cut off, but also Granville, Bankstown, and adjacent suburbs, would be inundated and many thousands of people drowned. Surely that is a work which requires immediate attention.
– Is that the pipe line which Lord Kitchener condemned ?
– I have heard it said that Lord Kitchener condemned it. The line consists of four pipes which run along the surface. To-day, men are standing guard over it. The placing of that main underground is only one of in any works of an urgent national character which should be undertaken immediately. I feel sure that honorable sena tors know of similar works of equal urgency in their respective States. Why does not the Government take immediate steps to attend to these matters? It could find the necessary money by expanding credit. By embarking on such works it would provide continuity of work for many thousands of men who are now unemployed, and who would then be more willing to defend this country. I trust that the Government will take every step possible to prevent profiteering in the present crisis. It should be on the alert to prevent, for instance, such action as was taken recently by the Broken Hill Proprietary Company Limited when that company expanded its credit by allotting 64 bonus shares to every holder of 100 shares. In view of the fact that the shareholders in this company are not numerous, those who benefited under this arrangement received a very fine bonus indeed. The Government should not allow that sort of thing to recur.- That company watered its stock because it knew that the Government proposed to bring in certain legislation which would reduce its margin of dividends. By the watering process a declared dividend of 6 per cent on £100 of share money, becomes 6 per cent, on £164.
– That company took a leaf out of the book of the Australian Glass Company.
– If the honorable senator knows something of that kind about the Australian Glass Company, it is his duty to tell this Parliament about it. I trust that he will do so. It is the duty of every honorable senator to turn the spotlight on racketeering of this kind. Last Monday night I attended a meeting at which over 400 people were present. The meeting unanimously resolved to urge the Government to re-acquire the Cockatoo Island. Dockyard, in order to overcome the excessive charges which were being made by the people now in control of that establishment.
– Was that a political meeting ?
– That is beside the point. The fact remains that 400 Australians came to that, decision.
– That was Jack Lang’s final kick, was it not?
– It was not his final kick. In any case 1 have not heard the honorable senator say anything about Mr. Stevens’ recent eclipse. I assure the honorable senator that Jack Lang will be on top when the honorable senator is plain Mr. Dein. The Government should watch very closely the activities of these people to whom it made a present of the Cockatoo Island Dockyard. I understand that that concern is now getting contracts from this Government on a percentage basis. It is wrong for any government to let contracts on such terms t hat the contractor’s profit is fixed in relation to the expenditure incurred. Under such an arrangement there is no limit to the contractor’s outlay. I ask that that system be stopped immediately. The Government should also guard against profiteering by shipping companies. Senator James McLachlan criticized the Australian Commonwealth Line of Steamers and said that the last vessel constructed for the line at the Cockatoo Island Dockyard had cost £800,000. The fact remains, however, that the Government of the day was forced to acquire that line because the shipping companies determined to raise freights by 25 per cent., and refused to take certain classes of cargo. They wanted to handle only the cream of cargoes. The Government had no desire to purchase ships, but was compelled to do so in order to ensure that our primary products would be carried overseas at reasonable rates,It first acquired a line of wooden steamers. Subsequently the Government purchased what was known as the Bay Line of Steamers, and I am assured by many people who travelled on that line that the service it rendered was equal to, if not better than, that provided by any private shipping company. In passing, I suggest that honorable senators opposite should not condemn the man who was responsible for that transaction, because only quite recently some of them desired to make him Prime Minister again. The purchase of those vessels ensured that the people of this country, particularly our primary producers, would be protected against exploitation. We were thus enabled not only to transport our primary products to markets overseas, but also to ensure that Australian troops abroad would be fed. Those ships did a noble job. However, the BrucePage Government got rid of them at the first opportunity, and Australia has not yet been paid in full for them. Should the shipping companies attempt to exploit this nation by charging exorbitant freights in the present war, the Government should not hesitate to stop them from doing so. We are told that the British Government proposes to buy our surplus wheat. I do not know whether in that transaction the British Government will be acting for itself, or as agent for certain interests in Great Britain, in much the same way as the Australian Government might secure goods for various industries in this country.I should like to be enlightened on that point. Furthermore, I wish to know whether the freight on primary products exported under this arrangement will be charged to the producers or paid by the purchasing government. I trust that some honorable senator opposite will answer that question. Senator James McLachlan said that he was proud of the fact that Britain proposed to purchase our surplus primary products, and added that we must feel very pleased to-day that Australia is not an ally of Japan. My reaction to the bedtime story about the Yellow Peril has always been that whilst I do not want Australia to be an ally of Japan. I do desire Australia to be at least friendly with that country. I recall that the present Chief Justice, Sir John Latham, when be was AttorneyGeneral, led a goodwill mission to Japan; that mission caused the people of Australia some concern. At. that time it was thought that the Japanese might not be friendly towards the British nation. A few years ago the Government, appointed as Administrator of the Northern Territory a gentleman who, at the time of his appointment, was a member of the House of Representatives. He had not been in his new office long before trouble arose in connexion with some Japanese luggers. Legal proceedings were taken which caused a grave situation at Darwin, but Judge Wells demonstrated British justice to the world. He did a good job when he found in favour of the Japanese, who up to that time had had a “ raw deal “. In the face of die facts associated with that case, I cannot understand why Mr. Abbott is still Administrator of the Northern Territory. His retention in the office has not been in the best interests of Australia.
– He has done a good job.
– I do not, agree with the honorable senator. I believe that Mr. Abbott acted contrary to the best interests of Australia when he allowed a machine-gun to be used against the -Japanese. In ray opinion, both he and the. captain of the Larrakia should he relieved of their positions.
The Government pays a subsidy to Australian pearlers in northern waters, but I have grave doubts of whether those to whom the subsidy is paid are not really agents for -Japanese merchants. The following table shows the number of licensed luggers and also the number of Europeans and aliens employed on them : -
I understand that a Commonwealth subsidy of £1,000 was granted to the Darwin master pearlers during the 1935-36 season. On the 18th May I asked the following question : -
Is it ft fact that Captain Gregory, of Darwin, chief of the Australian pearl industry, bought a. cattle station at Adelaide River’
In reply, I was informed on the 30th May- “”
It has now bee” ascertained from the Administrator of the Northern Territory that Captain A, C. Gregory and William Wyatt, in partnership, purchased Mount Bundy station on the Adelaide River, in January, 1938, and are “till the holders of the property.
They employ three Europeans and a large number of Japanese. While in receipt of a subsidy from the Commonwealth Government they were able to. buy a valuable station on the Adelaide River. I believe that, pearl-diving is a dangerous occupation because of the risk of paralysis, but many Australians would be prepared to do the job if they could be assured of the Australian standard of living. No doubt, it is cheaper to employ Japanese and Malays. These may be regarded as small matters, but I urge that attention be given to them. I bring them before the Senate in good faith.
I assure the Senate that I have no desire to do anything that would be contrary to the best interests of Australia and the Empire generally, but I believe that it is my duty to show where mistakes have been made. It cannot be said that the actions to which I have referred have been in the best interests df Australia. In my opinion, the Government should show a friendly attitude towards Japan. If it was wise to make a gesture by sending Sir John Latham to Japan on a goodwill mission, a continuation of that friendliness would be equally wise. The sending of a similar mission would be a diplomatic move. Mention has been made of the Government’s intention to appoint a trade commissioner to Canada. I should like to sec a trade commissioner appointed to Tokyo also.
– The Government has never been anything but friendly to Japan.
– That may be; but on occasions it has acted in an unfriendly way. Unfortunately, some people, when placed in positions of authority, become drunk with power, and do not know what they are doing. Even when they have made serious mistakes, their employment has been continued by the Government.
.- On other occasions I have asked certain questions and I now thank the Government for having supplied the information T sought. There has been a good deal of talk lately on the subject of banking, both orthodox and unorthodox. As the present war continues, the Government will be faced with the necessity for finding large sums of money. I shall not make any comment on the subject, of orthodoxy in finance, but I do say that a Labour government would take steps to place the Commonwealth Bank on the same footing as in 1925, when it was a competitor with the private banks. Also we would require all State governments and local governing bodies to trade with the Commonwealth Bank. Beyond that, the Labour party would not go. Australia’s financial position at the moment is extraordinary. A few’ days ago the Treasurer (Mr. Menzies) introduced a budget of £102,000,000. Australia’s overseas and internal liabilities amount to £1,295,000,000. Its interest bill is £45,000,000 a year, or £3,800,000 a month, which is equivalent to £128,000 a day. Before the present struggle ends, those figures may be greatly increased, so that it may well happen that the Government will be forced to take unorthodox action in the interests of the finances of this country. I have a vivid recollection of the position of Australia between 1929 and 1931. When the Scullin Government came into office, it inherited from the Bruce-Page Administration grave financial responsibilities. At that time, the London financial market was closed to Australia, not because a Labour government was in office, but because the last two loans which the Bruce-Page Government attempted to float in London were a distinct failure.
– Both loans were under-written.
– For six years the Bruce-Page Government had borrowed at the rate of £38,000,000 per annum. I admit that most of that money was obtained on behalf of the States. The Scullin Government soon found that that source of money was cut off because of the world depression. Many public works had to be suspended, thereby throwing large numbers of men out of employment. Private enterprise also commenced to dismiss employees, and Australia was in a desperate position.
– But Labour won the election.
– That is true. We won the election on the arbitration issue. But that victory never deluded me. I regarded the industrial plank of the. Bruce-Page Government’s election policy as one of the smartest political tricks ever perpetrated in this country. The industrial arbitration issue was deliberately raised by the United Australia party government in order to confuse the people and enable the Bruce-Page Government to “ get from under “. In my electorate I could not find the man whom I was supposed to be opposing. It was a trap into which the Labour party walked. Nevertheless, I do not agree with those people, even including some members of our party, who say that it is a good thing that Labour is not in office to-day. I do not subscribe to that view now, nor did I then. I contend that, provided Labour has a majority in both Houses, it should take office; the party has the platform, and its members the capacity to govern this country wisely. Whatever the issue which we may be called upon to face, we are at least as competent as are honorable senators opposite, who for so long have had control of the government of this country..
When the Labour party came into power the price for all primary products was extremely low, and there was an army of unemployed such as this country had never previously known. There was a huge adverse trade balance, to correct which the Scullin Government had to prohibit importations; that action meant an ‘ annual loss of £5,000,000 of customs revenue. The Government, being faced with’ a most desperate situation, introduced proposals to inflate the note issue by £18,000,000. The purpose of the fiduciary issue was to provide £1,000,000 a month for, the workers and £500,000 a month for primary producers. Honorable senators will recall that the bill to amend the Commonwealth Bank Act was passed by the House of Representatives and came before this chamber. Although the Labour Government did not have a majority here, the Senate did not reject the measure, because that might have given the Government an opportunity to force a double dissolution, in which case tho people would, in all probability, have stood behind the Government. Labour’s opponents in this chamber were not courageous enough to reject the bill ; instead they carried an amendment referring it to a select, committee which, however, did not complete its report.
Great Britainhas for long had a fiduciary issue of more than £400,000,000, which, under economic pressure, has been increased to over £500,000,000, for purely domestic needs.
During the election campaign, which led to the defeat of the Scullin Government, our opponents had but one cry: “ Hands off the people’s savings “. What earthly connexion the financial relief measures which the Labour Government introduced had to do with the savings of the people I shall never be able to understand. However, the people were in a state of unrest owing to widespread unemployment, which certainly was not the fault of the Labour Government. A. great many people who heard that cry - “Hands off the people’s savings” - were stampeded, with the result that we were defeated. Probably the only bank that some of my electors had ever known was the bank of the BendigoCreek, and the only thing they had ever drawn was their breath ; but they were carried away by that political catch-cry and voted for our opponents, who persuaded them that something terrible would happen if the Scullin Government were allowed to inflate the note issue by £18,000,000. So much for that phase of the political battle. The ink was hardly dry on the commission of the new Prime Minister (the late Mr. Lyons) when his government, which had promised to rehabilitate the finances of the Commonwealth, shipped the whole of the gold issue to London, with the result that to-day the Commonwealth note issue of £53,000,000has no gold backing.
– It has sterling backing.
– That exposes the humbug of honorable senators and others who criticized the action of the Scullin Government.
But let me say a little bit more now about the much-discussed Government led by Mr. Scullin, of which I was a strong supporter. In 1929 - the worst year of the depression - the Scullin Government floated in Australia a loan of £10,000,000 for works. In the following year it successfully negotiated a further loan of £12,440,000, also for works; and later in the same year two internal conversion loans amounting to £78,000,000. The success with which these operations were conducted should be a sufficient answer to those people who contend that Labour cannot be trusted with the financial control of this country. The master-stroke of government policy was in . 1931, when the Government successfully undertook the conversion in Australia of £536,000,000 at an interest rate 221/2 per cent. below the average rate then being paid on that debt. That was the biggest financial undertaking in the history of the world up to that date. Its effect on Australian finance has been most marked, the total savings of interest payments up to June of this year having been £60,000,000. It is not too much to say that this Government could not have remitted £15,000,000 of taxes to its rich friends but for the courageous and statesmanlike action of the Scullin Government in 1931. The succeeding United Australia party Government claimed that it. restored prosperity to Australia. The truth is that the courageous action of the finest Government that Australia has had made recovery possible.
– Who defeated that Government ?
-Not the Labour party. It was defeated by the vote of the United Australia party, the Country party, and certain other people who rebelled against the Labour Government. The same people had been commending Mr. Scullin for many months on his skilful handling of a most difficult situation, but at the first opportunity they stabbed him in the back. In addition to floating internal loans amounting to nearly £30,000,000, as well as conversion loans of£78,000,000 and £536,000,000, the Scullin Government negotiated a London loan of £3,750,000, and had commenced negotiations for a maturing loan of £40,000,000 when it had to vacate office. Its financial record was a most distinguished one.
– The late Mr. Lyons was Treasurer then.
– The late Mr. Lyons was for a time Treasurer of the Scullin Government. But he was an honest man and I recall that he always admitted that he knew nothing about finance. That, I think, was clearly proved after he left the Labour party.
The present Government has also attempted some loan operations, but with not very satisfactory results. It attempted to float a loan in London, but obtained only 20 per cent. of the amount it sought. Later it essayed to raise two loans in Australia. Nearly 30 per cent. of the required amount was left in the hands of the Common wealth Bank, which, by underwriting the issue, brought about inflation - something which it declined to do for the Scullin Labour Government. That bank, a creation of the Commonwealth Parliament, represents interests which, I believe, are identical with those of the private banks. If Labour were in power it would do nothing rash, but it would bring the management of the Commonwealth Bank under the control of the Government.It would not interfere with the private banks, but it would make the Commonwealth Bank a competitor, and would insist that State governments, municipalities, and councils should deal only with the Commonwealth Bank.
Senator Darcey this afternoon once more read some of the findings of the Royal Commission on Banking and Monetary Systems. That commission, whichcost this country £17,000, was set up by the Lyons Government. Its members, among whom was Mr. Chifley, an ex-Minister of the Labour Government, represented a wide variety of interests. It is worth remembering that in 1929 and 1930 Mr. Scullin urged that where the Government policy conflicts with that of the Bank Board, the Government policy should prevail. The commission’s report fully justified the action taken by the Scullin Government in the crisis of 1929 and 1930. That cannot be truthfully denied by any supporter of the present Government or of private banking interests.
I agree with Senator Darcey that people do not want to be worried about banking theories. Their concern is that the Government should be able to get all the money that it wants for war purposes. As Senator Cameron and many others in every part of Australia have said during the last five years, some of the money now being expended on defence should have been made available for the relief of the great army of unemployed, to whom this Government offers nothing.
Criticism that has been offered from this side of the Senate during the present: crisis has notbeen destructive. When honorable senators opposite seek by innuendo to throw discredit on the capacity of this party to govern the country they invariably find that there are men on this side who understand the subject just as thoroughly as they do. Senator Dein said that Mr. Lang closed the Government Savings Bank of New South Wales. Evidently the honorable gentleman knows nothing about what happened at that time. Mr. (now Sir John) Latham was Leader of the Opposition in the House of Representatives. He, and also his colleagues in this chamber at that time, continuously bombarded the Scullin Government with reference to the stability of the New South Wales bank. Even members of our own party helped to throw doubts on its stability. As a consequence, a. run occurred on the bank when the Labour Governmentwasin power. The then chairman of the board, the late Sir Robert Gibson, was not anxious to undertake the rehabilitation of the bank until the Lyons Government came to power. Then the matter was fixed up. I state in all fairness to Mr. Lang, or whoever was the political power in New South Wales then, that the bank was closed as much by action in the Federal Parliament as by the policy of any political leader in New South Wales. The catch-phrase - “ Return the Labour pa rty and lose your savings “ - was merely so much rubbish. Probably that cry will be heard at. the next election. If so. I hope that I am about when some of our opponents give voice to it.
I endorse the opinion expressed by the Leader of the Opposition in the House of Representatives (Mr. Curtin) that notwithstanding the proposed expenditure on defence for this year it is possible that before Christmas Parliament will be asked to appropriate an additional. £60,000,000 to £80,000,000. The amount of taxation collected has reached’ the amazing figure of £120,000,000 per annum , as according to the published figures £80,000,000 is collected by the Commonwealth and £40,000.000 by the various State governments. Notwithstanding these astounding figures, there are approximately 200,000 persons unemployed in the Commonwealth. Senator Dein’s old friend, Mr. Spooner, who recently had a brawl with Mr. Stevens of financial fame, said that there are 60,000 persons out of work in Sydney and suburbs.
– Where did the honorable senator get that figure?
– It was published in the New South Wales Hansard. Senator Cameron said that there are 40,000 out of work in Victoria, and therefore I am safe in assuming that 200,000 men in Australia are workless. I do not know whether any of these men will render military service in some capacity, but while the country is in its present state - I say this without reflecting on the Government’s efforts to defend the country - overtime in the munition works should be discontinued, and all the employees should be permitted to work only one shift. Men could then be absorbed at work where they could earn something to maintain themselves and their families. As was stated by Senator Cameron, if a call is made for men - I” believe the Government could get all the men it required - it should not ask them to go into camp without offering them reasonable pay such as they would receive if the nation were not at war. In the matter of youth employment, the Government has made some effort, because large sums have been appropriated to assist t.o train young men and to provide them with work.
Some comments have been made concerning ship construction in Australia. The figures cited by Senator James McLachlan were, I believe, taken from the Harbour, and are evidently official; therefore I do not challenge them. I cannot, however, see why this country cannot build ships of a reasonable tonnage even if it means bringing trained artisans from overseas to instruct our men. The trade union organizations would not raise any objection, because a nucleus staff of trained men could instruct our engineers in the important work of ship building. Too much reliance is placed on the Old Country, and insufficient regard is paid to the mechanical skill of our own workmen. I have seen as much of the mechanical side of industry in Australia as has any honorable senator. I remind the Senate of the quality of the rolling stock used on Australian railways, and particularly the Spirit, of Progress, the de luxe passenger train between Melbourne and Albury. Every portion of that train was built by Australian workmen in Australian workshops, and the craftsmanship is of the highest possible character. Ships constructed in Victoria and in New South Wales are still in operation. The cost of construction would perhaps lead us into a long debate.
– Ships have been built by Walkers Limited in Maryborough.
– Yes, and good ships too. It has been said that an Australian mercantile marine would be useful in an emergency. We once had a line of ships under our control, but I do not propose to recite the whole of the mournful story of that line. It is sufficient to say that the right honorable member for North Sydney (Mr. Hughes), when Prime Minister, made an effort to’ establish an Australian mercantile marine, and on the operation of the line some lose occurred. But losses have occurred in other governmental activities; they are absolutely unavoidable. Finally, the ships were sold to an overseas firm, but were never fully paid for.
Our relations with eastern countries have been mentioned. I ‘believe with Senator Amour that in our dealings with Japan some mistakes were made on which I do not propose to comment. Australia should be friendly with a nation which purchases large quantities of our main primary product. That country is one of our nearest neighbours, and if it were considered desirable six years ago to dispatch to it a goodwill mission it is surely wise to endeavour to avoid alienating a nation which should be our nearest friend in the Pacific.
Some months ago when Parliament adopted a regulation prohibiting the export of iron ore, the Government promised that it would expedite an examination of the iron ore deposits at Yampi Sound in Western Australia and at the Iron Monarch in South Australia, with a view to reviewing the regulation. It has been alleged that certain companies are exporting iron ore from Australia, and. although .1 do not. know whether that, is or is not so,I ask the Minister to expedite the examination of the resources.
The international situation completely dominates this budget of £102,000,000, but the responsibility of the Government and of the Opposition is to see that the expenditure of this huge amount is drastically policed so that there shall not be any reckless or foolish commitments to meet in the future.
Why cannot honorable senators receive some information concerning the activities of the Australian Broadcasting Commission? Why were not John Brownlow, John McCormackand Majorie Lawrence - three leading vocalists who visited Australia - engaged by the commission? This body, although functioning under a separate act of Parliament, is more or less under the control of the Government; yet when honorable senators ask questions concerning the activities of the commission they receive only meaningless replies. There are many aspects of the work of the commission that should be inquired into. I raised one matter during the last period of the session, which was handled most unsatisfactorily by the Government Moreover, while the war is in progress some censorship should be exercised over individuals who broadcast, and whose statements may have an undesirable effect upon excitable persons. Some of the statements broadcast should be rigorously censored.
In the Melbourne Age, andI believe in other’ journals, it has been reported that arrangements have been made for invalid and old-age pensioners, who so desire, to receive their pensions by post. When I represented the electorate of Bendigo in 1929.I arranged with the then Acting Leader of the Government (Mr. Theodore) for the system to be introduced in my electorate. The Labour party first introduced this necessary reform. We urged that if it were right for retired judges and government officials to receive their pensions by post, it was equally rightthat the aged and infirm should receive similar consideration. I am glad to hear that the Government has improved the present system. I mention the matter not in a spirit of egotism, but to remind the Government that the system of paying pensions by post was introduced by a Labour government some years ago.
I do not propose to deal at length with sales taxation which was introduced as an emergency measure, but during the eight years this and similar governments have occupied the treasury bench no attempt has been made to remove the tax, which seems to have become permanent. Fully 90 per cent. of the exemptions were made at the request of the Labour party. The increase of the tax from 5 per cent. to 6 per cent. will raise to some degree the cost of living.
I trust the Government will give effect to the recommendations made by the honorable member for Indi (Mr. McEwen) when Minister for the Interior, with respect to Australian aborigines. Excellent recommendations were made by Mr.McEwen and also by Mr. Thompson, the anthropologist, who reported on this subject in December, 1937. It will be news to some honorable senators - it was to me - that we still have in Australia 53,698 full-blooded aboriginals and 23,000 half-castes. It is amazing to realize that their numbers have decreased alarmingly during recent years, whilethe Sioux Indians in the United States of America, whom I thought to be nearly extinct, number some 348,000 and are actually increasing. According to some of the letters I have received, this is a. vary urgent problem. Although we have treated the original owners of this country unfairly, the Government is to be commended for having decided to complete the job and to provide a reserve for these unfortunate people. I understand that approximately 250,000 square miles is to be reserved and I believe that the aborigines could live in comparative comfort if removed from the influence of the white man. When the representatives of an organization in Melbourne interviewed Senator Cameron and me on this subject, I said that when the opportunity occurred I would again bring it under the notice of. the Government and urge that something be done.
As I stated at the outset of my remarks, the consideration of the budget is overshadowed by the international situation. We are involved in war and we shall have to face colossal commitments. This country will have to do those things which it has pledged itself to do. We must see that the money appropriated is expended in the most useful way, and that employment is provided for an additional number of men by eliminating overtime in munitions works. Every additional man employed helps to strengthen Australia as a nation. While wc are legislating for the defence of this country we must not forget our own people, all of whom should receive proper consideration by this Parliament and the Government.
Debate (on motion by SenatorCollett) adjourned.
page 472
Reservation of assent notified.
page 472
The following paper was presented : -
New Guinea Act - Ordinance No. li of 1939 -Supply 1939-1940.
Senate adjourned at 9.32 p.m.
Cite as: Australia, Senate, Debates, 13 September 1939, viewed 22 October 2017, <http://historichansard.net/senate/1939/19390913_senate_15_161/>.