15th Parliament · 1st Session
The Senate, on the 22nd September, 1939, adjourned till a day and hour to be fixed and to be notified by the President to each honorable senator.
The Senate met at 3 p.m., pursuant to the notification of the President.
The President (Senator the Hon J. B. Hayes) took . the chair and read prayers.
– With much regret I have to inform honorable senators Of the death, on the 22nd October,of that distinguished figure in
Australian life, the honorable Sir John Langdon Bonython, K.O.M.G., who was one of the original members of this Parliament. He was elected to the first House of Representatives in 1901 for South Australia, and again in 1903 for the division of Barker in that State. His public activities are so widely known that think it unnecessary to remind honorable senators of the great number of valuable services rendered by him to the community. He became a successful business man as a newspaper proprietor, and devoted a strenuous life to public welfare, and especially to the advancement nf education. ‘He was president of the South Australian School of Mines and Industries from its foundation in 1889, and his gifts to that institution include ono of the most modern chemical laboratories in the Commonwealth. He was a member of the Council of the Adelaide University, and from 1916 to 1926 was deputy-chairman of the Advisory Council on Education. He was for some years president of the South Australian branch of the Royal Geographical Society of Australasia, and was also a vice-chairman of the Royal Colonial Institute, London.
His benefactions for educational and other institutions were lavish. There were donations of £50,000 for the erection of n great hall in the University of Adelaide, £20,000 for the endowment of the chair of law in the university, and £20,000 to the School of Mines. There was also a munificent gift of £100,000 for thu completion of the parliamentary buildings in Adelaide.
His public services in Commonwealth affairs extended over many years. He was a member of the Select Committee of Parliament on Old-age Pensions in 1904. and of the Royal Commission on Pensions in 1905-6. He was one of the fourteen trustees appointed under the Australian Soldiers’ Repatriation Fund Act 1916, and was also a commissioner appointed under the Australian Soldiers’ Repatriation Act of 1917. In 1922 he wan appointed a member of the commission to make arrangements for the representation of Australia at the British Empire Exhibition of 1924. He was chairman of the Commonwealth Literary Fund from 1908 to 1929.
Sir Langdon Bonython was honoured by the King on three occasions - in 1898, in 1908, and in 1919, when the Order of K.C.M.G. was conferred on him. In recognition of his long and honorable service to Australia, the Commonwealth Government accorded him a State funeral. I ask honorable senators to join with me in an expression of sympathy with the members of his family. I move -
That the Senate expresses its deep regret at the death of the Honorable Sir John Langdon Bonython, K.C.M.G., a member of the House of Representatives for South Australia in the first Commonwealth Parliament, and subsequently member for the division of Barker, places on record its appreciation of his distinguished public service, and tenders its sincere sympathy to the members of hia family in their bereavement.
– I second the motion. I had not the privilege of personal acquaintance with the late Sir Langdon Bonython, hut I did know of his many benefactions to the State of South Australia. Ono may see, on Northterrace, Adelaide, tangible evidence of his philanthropy and public spirit to which the Loader of the Senate has referred. It it fitting always that this Parliament should express gratitude for distinguished public, service by whomsoever rendered.
– With the consent of my colleagues, I associate Country party senators with the motion so fittingly submitted by the Leader of the Senate. We, too, express our appreciation of the long list of distinguished services rendered by the late Sir Langdon Bonython, and we express the hope and belief that his example will be a guiding light for Australian citizens.
Question resolved in the affirmative, honorable senators standing in their places.
– It is with regret that I inform honorable senators of the death, in Sydney on the 20th October, of Dr. Francis Liddell, a former member of the House of Representatives. Dr. Liddell was elected to represent the division of Hunter at the general elections of 1903 and 1906. He was defeated at the general election of 1910. A long time has elapsed since Dr. Liddell was associated with the Commonwealth Parliament, but honorable senators will, I think, agree that it is proper that we should to-day honour his memory and record our sorrow at the passing of one who belonged to an earlier generation of members of this Parliament. I move -
That the Senate expresses its deep regret at the death of Br. Francis Liddell, M.B., M.S., a fenner member of the House of Representatives for the division of Hunter, places on record ite appreciation of his public services, and extends its sincere sympathy to his relatives in their bereavement.
– I second the motion. I had not the privilege of personal acquaintance with Dr. Francis Liddell, but it is fitting that we should express sorrow at the death of one who contributed to the splendid work that has been done in the development of the Commonwealth and of our parliamentary institutions. “We regret that, one by one, they pass away and leave us the poorer for their going. I am sure that all members of this chamber extend their deepest sympathy to the relatives of the deceased gentleman.
Question resolved in the affirmative, honorable senators standing in their places.
– I regret that I have to inform honorable senators of the death on Wednesday last of the Honorable. William Caldwell Hill, late member of the House of Representatives of this Parliament. Mr. Hill was elected as member for the Division of Echuca in 1919 and represented that division continuously till 1934 - a period of fifteen years. He became Minister for Works and Railways in August, 1924, and held that porfolio for over four years. He was a member of the Commonwealth delegation of the Empire Parliamentary Association which visited South Africa in 1924. and he was president of the River Murray Water Commission from 1924 to 1.92’S. He wog also chairman of the Federal Aid Roads Board from 1925 to 1928. He was a capable administrator of his department, and was regarded as an authority on matters relating to rural industries, especially those associated with the growing and marketing of wheat. He took a keen interest in all problems relating to primary production and was the first president of the Victorian Farmers Union. His personality earned for him the high esteem of his parliamentary colleagues. I move -
That the Senate expresses its deep regret at the death of the Honorable William Caldwell Hill, a former member of the House of Representatives for the Division of Echuca, and Commonwealth Minister, places on record its appreciation of his meritorious public services, and extends its sincere sympathy to his widow and family in their bereavement.
– I second the motion. The late Honorable W. C. Hill was a member of this Parliament when I first became associated with it. My acquaintance with the deceased gentleman was quite superficial, but still I knew a good deal concerning his actual parliamentary work, and his great interest in matters affecting primary production. I gladly associate the members of my party with the motion, and particularly with the sympathy expressed towards the family of the deceased gentleman.
– As a member of the Country party I associate myself and the members of that party with the motion. Those of us who entered this Parliament in recent years knew the late Mr. Hill very well. He was certainly a leading Australian authority on wheat, and a very prominent man in the organization of other rural industries. He was a pillar of strength in farmers’ co-operative movements in Victoria, and I believe that the Farmers Voluntary Pool and the Phosphate Co-operative Company in that State are monuments to the work which he did for primary producers. He was a nian of great public spirit and possessed a genial personality. He was one of the leaders of the Country party, which he assisted to represent in the Bruce-Page Government for some years. I am sure that throughout rural Australia there will be many expressions of regret at his demise.
– Perhaps I was longer and more closely associated with the late Mr. Hill than was any other member of this Parliament. He and I were pioneers of the Country party in Victoria and in fact pioneered that party into the federal sphere - I in 1918, and he in 1919. Mr. Hill was a man of upright character and transparent honesty, and he won the esteem and affection of primary producers throughout the length and breadth of Victoria, and, indeed, of Australia. He was a representative of the Government on the Victorian Wheat Pool, which was then a government organization, and when that pool ceased to function he was one of those who formed a voluntary pool which is still carrying on as a pooling and wheat-selling organization in Victoria. As Senator J Johnston has said, the late Mr. Hill was associated with many co-operative concerns in Victoria. As a Minister in the Bruce-Page Government he took the keenest interest in the conservation of water along the River Murray, including the construction of the Hume Weir. He also took a keen interest in road construction, particularly in the development of arterial roads throughout Australia. But I think that his crowning effort was in the establishment of the Phosphate Co-operative Company by which he aimed to give to the farmers of this country cheap fertilizers. He would not commence that undertaking until sufficient capital Avas available to enable production on a huge scale, and he lived sufficiently long to see the price of fertilizers reduced to the lowest level it has ever reached in Australia and to see the company producing 130,000 tons per annum. The primary producers of Australia are indebted to him, and his life is an example to those who are to follow him. We extend to his widow and family our sincere sympathy in the loss of a great and good man.
– As one who was at one time associated with the late Mr. Hill in the House of Representatives, and knew of his work in various avenues, I add my meed of praise to the memory of the deceased gentleman. Like Senator Gibson, I pay tribute to his absolute honesty, and when I say that I speak from actual experience’ as one who was in opposition to him when he was a Minister of the Crown. He was always fair, and in subsequent years when I met him out of the House he was always the same genial Mr. Hill. This Parliament is the poorer for his passing. That his good work as a legislator was not merely an accident his success in industrial life demonstrated. He possessed great natural capacity. I join with other honorable senators in paying a tribute of respect to his memory and in . extending sincere sympathy to the members of his family.
– Like Senator Gibson, I was associated with the late Mr. Hill in the Bruce-Page Government, and learned to esteem him for his personal worth and his devotion to the primary producing interests which he mainly represented in this Parliament. Above all, we learned to esteem him for his outstanding integrity, his sound common sense and his knowledge, not only of primary production, but also of all those matters with which he had to deal officially, as Minister for. Works and Railways. On this occasion, when we are paying tribute to the memory of one of Australia’s most distinguished sons - the late Sir Langdon Bonython - and another who was prominent in the sphere of primary production, we cannot but regret that the great fund of knowledge and wisdom that naturally came from their experience of years and mature thought is for ever lost to the country. I learned to like Mr. Hill personally, but in addition esteemed him for his tremendous capacity .to work and investigate problems. I respected the soundness of his judgment, of which we had many examples during the short time I was associated with him in the BrucePage Government. With other honorable senators, I join in expressing regret a1., the passing of so fine a citizen.
Question resolved in the affirmative, honorable senators standing in their places.
Assent to the following bills reported : -
Flour Tax (Wheat Industry Assistance)
Assessment Bill 19.39. Customs Tarin* (No. 2) 1.939.. Excise Tarin” 1939. Income Tax Assessment Bill 1939. Income Tax Bill 1939.
Sales Tax Exemptions Bill 1930. States Grants Bill 1939. Loan Bill 1939. Tractor Bounty Bill 1939. Sulphur Bounty Bill 1939. Wire Netting Bounty Bill 1939. Defence Bill (No. 2) 1939. Supply Bill (No. 2) 1939-40. Supply and Development Bill (No. 2) 1939. Supplementary Appropriation Bill 1937-38. Supplementary Appropriation (Works and Buildings) Bill 1937-38.
– by leave - Honorable senators will understand that, by reason of the formation of the War Cabinet and the Economic Cabinet, it has become expedient to make a different allocation of the representation of Ministers in the Senate. I have accordingly to announce that representation of Ministers in the ‘Senate will henceforth be as follows: I shall represent the Prime Minister and the Attorney-General; the Minister for the Interior (Senator Foll) will represent the Minister for the Army, the Minister for the Navy, the Minister for Air and Minister for Civil Aviation, and the Minister for Supply and Development; the Minister assisting the Minister for Commerce (Senator McBride) will represent the Treasurer, the Minister for Trade and ‘Customs, the PostmasterGeneral, and the Minister for Health and Social Services; the Minister in charge of War Service Homes (Senator Collett) will represent the Minister for Repatriation, the Minister for External Affairs and Information, and . the Minister in charge of External Territories.
– by leave - I have to inform honorable senators that the Government has appointed Sir Ernest Fisk to the position of Secretary of the Economic Cabinet and Director of Economic Co-ordination. As the Prime Minister announced last week, the Government intended to seek for this position a man with the highest possible qualifications and the ripest experience in business administration. The Government counts itself fortunate in having been able to obtain the services of such a man in Sir Ernest Fisk. The appointment is the result of negotiations with not only Sir Ernest Fisk, but also Amalgamated Wireless (Australasia) Limited, of which company he is managing director. The company has generously placed the services of Sir Ernest Fisk at the disposal of the Government for a period of twelve months, during which the company will continue to pay his salary whilst the Commonwealth will be responsible for the payment of travelling expenses. At this stage I should like to express the thanks of the Government to the company for making such an appointment possible.
The Government believes that the Economic Cabinet, in bringing about coordination and control of economic and financial aspects of governmental activities so as to make our war effort more effective, and in planning along sound lines for the ultimate transition from war to peace conditions, is embarking upon national work of the utmost value. The qualities which Sir Ernest Fisk is able to bring to a task demanding vision, initiative and executive ability, make me confident that his association with Ministers who are to serve in the Economic Cabinet will be most fruitful.
– I ask the Assistant Minister what steps the Government has taken to establish Albany and Geraldton as wool appraisement centres, as was done during the last war?
– The Central Wool Committee, which has been set up to carry out the appraisement scheme necessitated by the sale of our wool to Great Britain, has made a thorough examination of the claims of Albany and Geraldton to be proclaimed appraisement centres. Acting on the principle that normal trade channels should bo disturbed as little as possible the committee came to, the conclusion that, in view of the f act that no wool sales were held at either of these centres in peace time, it was undesirable that these towns should be established as appraisement centres under the present scheme.
Senator ALLAN MacDONALD.Will the Leader of the Senate indicate why the Senate was called together approximately one week later than the House of Representatives? In future, especially during the present crisis, will steps be taken to call the Senate together simultaneously with the House of Representatives ?-
– The Senate was called together one week later than the House of Representatives, for the convenience of honorable senators. It is well known that at the commencement of a session the Senate usually has to wait for business from the House of Representatives, and several senators requested mo to consider their convenience in the matter. I appreciate that during the present crisis the position is somewhat different, and I assure Senator Allan MacDonald that I shall use my best endeavours to meet the wishes of honorable senators.
– Will the Minister representing the Minister for the Army state for what period the Government anticipates that the camps now being constructed for military training purposes will last? Are they intended to be temporary or permanent?
– The constructional details of these camps vary according to the purpose for which they are required, and the period for which they are expected to be used. Some of them have been so substantially constructed that they would last for, perhaps, 50 years, whilst many others are of merely a temporary nature, because they will be required only temporarily. I could answer the question more definitely if I could foretell the duration of the present war.
– (1) Has the Minister representing the Minister for lack of Information-
– Order !
– (1) Has the Minister representing the Minister for Information received any news regarding the financial blockade exercised by the financial Huns on the City Council sector of the Brisbane home front? (2) If so, what steps, if any, are being, taken by the Government to relieve the industrial soldiers who have been forced out of the trenches and are now suffering from lack of wages? (3) What ethical difference is there between the starving of women and children directly by forcing their breadwinners out of jobs and the starving of women and children by acts of war?
Question not answered.
Senator ALLAN MacDONALD.Does the Minister for Commerce propose to make” an official pronouncement of the Government’s intention with regard to the acquisition of wool, wheat, apples and pears, meat, butter and other exportable primary products, and is it the intention of the Government to inform members of this chamber of the provisions of the agreement in respect of wool between the Commonwealth Government and the Government of the United Kingdom?
– The Government proposes to make a statement in the Senate on the matters mentioned. Statements have already been made in the House of Representatives. Details of the wool agreement have been announced, but for the information of honorable senators I have had distributed particulars of the sales to the United Kingdom, and as much other information as I think is necessary.
– As the Leader of the Senate has not answered the second part of my question I ask the Assistant Minister for Commerce whether it is the intention of the Government to advise the members of this chamber regarding details already completed between the Commonwealth Government and the Government of the United Kingdom relating to the compulsory acquisition of wool?
– As the Minister for Commerce has already told the Senate, statements on this matter have appeared in the press, and a statement was made by the Prime Minister in the House of Representatives last week. I shall be prepared to supply information with respect to any particular point which the honorable senator may have in mind concerning the wool acquisition scheme.
sub-contractors anda ward Conditions.
– I ask the Minister for the Interior what action has been taken to ensure the observance of award conditions when a successful tenderer sublets any portion of his work?
SenatorFOLL. - In all Government contracts there is a provision requiring contractors to observe award rates and conditions. If a successful tenderer desires to sub-let any part of his contract he must first obtain permission of my department. As the terms and conditions upon which sub-contracts are let can be laid down by my department, the position should be amply safeguarded. I think that one ofthe difficulties which the honorable senator has in mind relates to the position of a sub-contractor who is purchasing large supplies of materials. If the honorable gentleman will put a further question to me later, I shall ascertain the position. The machinery of the court and of the unions should be sufficient to ensure that in all cases suppliers of material shall observe award conditions.
– Can the Leader of the Senate inform me when the report, of the Minister for Trade and Customs (Mr. John Lawson) recommending the repeal of the licensing provisions of the Transport Workers Act will be laid on the table of the Senate?
– I understand that the report has been laid on the table, but I shall make further inquiries.
– I ask the Minister representing the Minister for Information whether it is the intention of the department to publish information, other than that which is culled from the press, for the benefit of members of this Parliament ?
– Such information as affects the working of the Ministry for Information will be placed at the disposal of honorable senators next week, I hope.
– Is the Minister representing the Treasurer aware that despite an exhaustive inquiry by a select committee of this chamber into the case of Captain T. P. Conway, and its recommendation for the payment of £100 to that gentleman, the Treasurer has not yet paid the amount? Will the Minister impress on the Acting Treasurer that it is not in the best interests of Commonwealth legislation to ignore a decision of this chamber?
– The Government has considered the matter and has decided not to pay the £100.
The PRESIDENT (Senator the Hon. J. B. Hayes). - I have received from the Leader of the Opposition (.Senator Collings) an intimation that he desires to move the adjournment of the Senate for the purpose of discussing a definite matter of urgent public importance namely, “ the parlous position of the wheat industry, and the need for immediate action by the Government to grant the request of the wheat-growers for an initial payment of 2s. 6d. a bushel, exclusive of railway freights and handling charges, so as to obviate any hold-up in wheat deliveries “.
Four honorable senators having risen in support of the motion,
– I move -
That the Senate, at its rising, adjourn till 10 a.m. on Thursday next.
I submit this motion for the purpose of directing attention to - “ the parlous position of the wheat industry, and need for immediate action by the Government to grant the request of the wheatgrowers for an initial payment of 2s. 6d. a bushel, exclusive of railway freights and handling charges, so as to obviate any hold-up in wheat deliveries “.
The Opposition views this matter very seriously. I wish to assure the Senate, and I hope the Senate will accept my assurance, that the motion is not in any sense of the word a party move. I desire, as a matter of fact, to assist the Government to find a way out of the very difficult and deplorable situation in which the wheat industry is involved. Honorable senators will, perhaps, recall that, on the 6th September last, from my place in this chamber I said that the Opposition would endeavour to assist the Government. On that occasion I made an official declaration of the attitude of the Opposition to the conditions arising out of the state of war. The fourth point of that declaration -was in the following terms : -
As to the conduct of Australian affairs during this unhappy period, the Australian Labour party will preserve its separate entity, it will give support to measures having for their object the welfare and safety of the Australian people and of the British Commonwealth of Nations.
I said that we had adopted that attitude because we believed that we could be of most assistance to the Government by functioning as His Majesty’s Opposition, and offering what I hoped would be constructive criticism whenever we thought that the Government was deserving of criticism.
The wheat-growers are not wild-eyed revolutionaries or Communists; unfortunately, many are not even Labour supporters. The difficulty with which the Commonwealth is faced in this respect cannot be overcome by imputing motives. The wheat-growers would not threaten direct action unless they were desperate. At the present juncture Australia cannot allow this threat, which involves a refusal to harvest the crop or to deliver it when it is harvested, to develop. It is obvious that we cannot allow such a course to be followed, because if ever there was a time when the fullest co-operation of all sections is needed it is now. The wheatgrowers have been forced to act because they are desperate. An investigation of the -wheat industry showed that it is loaded with a debt of £150,000,000. Wheat-growers, like others, are expected to pay their way ; they wish to meet their commitments, but under present conditions find it quite impossible to do so.
– What price does the Leader of the Opposition suggest should be paid?
– I shall not leave the Senate in any doubt as to what we desire. Practically every representative body of wheat-growers in Australia is unanimously supporting the action which the Opposition is taking.
– Does the honorable senator say that all the wheat-growers are behind the Opposition?
– Many wheatgrowers are in such a serious position that they are not even getting the basic wage or its equivalent. We have only to visualize what that means to the wheatgrower and to his family. It does not need a very vivid imagination to see what the present position means not only to the wheat-growers and their families but also to the districts in which wheat is grown, and to every one connected directly or indirectly with the wheatgrowing industry. Unless a price more favorable to growers is decided upon, townships in the wheat-growing areas will become depopulated, and there will be barren wastes where they are now productive lands. Hundreds of storekeepers will become insolvent, - the value of the industry as an employing agency will be lost, railway earnings will fall, and the number of railway employees will decrease. Those engaged in the handling of cornsacks and in the bagging and stacking of wheat will suffer, and the final result will be that the number of unemployed will increase to an alarming, degree. I do not believe for a moment that the Government has any desire to encourage such a state of affairs. Apparently it has been in doubt as to how far it can go in the matter of expenditure. Its first decision was to pay the wheatgrowers1s. 9d. a bushel on delivery at country sidings or silos, less rail freight. It has been estimated that the average rail freight from the whole of the wheatgrowing areas is approximately 4½d. a bushel; but, of course, in some districts it would be less and in Others it would be more. In addition to the Government’s decision to make a first payment of ls. 9d. a bushel at country sidings or silos, leas railage, a second payment of ls. a bushel was to be made on the 1st April next. In response to numerous protests the Government decided to vary the arrangement first proposed and to pay ls. 9d. a bushel at country sidings or silos without any deduction from that amount for freight, and instead of making the second payment on the 1st April it was to be made on the 1st February, and the deduction in respect of freight was to be made from it. The members of the Opposition are asking very definitely, respectfully, and determinedly, for a payment of 2s. 6d. a bushel on delivery, and a second payment of ls. a bushel on the 1st February, from which payment rail freight would be deducted. No one knows what the final price of the wheat acquired is likely to be, but we are hopeful that eventually the wheat-growers will get the amount recommended by the Royal Commission on the “Wheat Industry. I do not think that the report of any royal commission was prepared with greater care or contained more detail than that of the commission presided over by Sir Herbert Gepp, which recommended 3s. 10$d. a bushel at ports, which is not an excessive price.
– When* did the Royal Commission on the Wheat Industry recommend 3s. 10½d. a bushel at ports?
– That price is recommended in the commission’s report. The commission went even further and said that at a lower price the wheat-growers could not show a profit or provide themselves and their families with decent living conditions to which they, in common with other sections of the community,, are entitled. The wheat-growers are producing a commodity without which this nation cannot exist. As wheat probably plays the most important part in the economics of the nation, there should, not. be any dispute concerning an additional 1½d. a bushel. I have shown that this is a matter .of urgency, and I leave it in the hands of honorable senators, trusting that as a result, of the representations that are now being made the Government will again review the situation and offer a price which will give the wheat-growers some hope. The point may be raised as to whether in the final analysis there may be a loss on the transactions, and whether such loss should be borne by the wheatgrowers or by the nation. We say most definitely that should a loss result it should be borne by the nation. If the recommendation by the Royal Commission on Monetary and Banking Systems were adopted that difficulty would be solved. I feel sure that other honorable senators more closely associated with the wheat industry than I am will support the reasonable request which I have made on behalf of those carrying on an industry that is so vital to the nation.
– At the outset I should like to say that Senator McBride and I were sworn in as mem-. bers of the Government on the 25th April, and we commenced to tackle the problem of the wheat industry on the following day. I do not propose to go into the details of what has been done to assist the wheat-growers since that date because the facts are known to honorable senators. In August of this year following upon requests by Senator Wilson, Senator Uppill and many other honorable senators interested in wheat-growing, the Government gave careful consideration to the position. It realized that in orderto deal successfully with the wheat industry some plan of stabilization and control of production should be formulated. The scheme finally adopted by the Commonwealth and submitted to a conference of Commonwealth and State Ministers in August, would have been of great benefit to the wheat-growers. One of the essential features of the scheme, which wethought would be agreed to by the States, having regard to the enormous increase of production in other countries, particularly in the four large exporting countries,, was some control of production. It was also suggested that, in. view of” the heavy defence expenditure which the Commonwealth has to- face, the Statesshould contribute something towards that scheme; but as the proposal was rejected by Victoria and Tasmania wasnot proceeded, with. The Governmentthen decided that the £2,000,000’ promised: at the conference should still be made available to assist the industry. I would remind honorable senators that apart from wheat, the Department of Commerce has to deal with the activities of 23 other rural industries, many of which are feeling the effect of depressed prices. Since the outbreak of war the position has altered, and the Government has decided to meet the position by making what I consider a very generous first advance. I resent the attitude adopted by persons outside, many of whom are not associated with the wheat industry, in order to make political capital out of the plight of the wheat-growers. I am satisfied that 99 per cent, of the wheat-growers resent the action of some persons in this respect. The advance proposed is equivalent to an average of 2s. iii. a bushel at country sidings. I would remind the Leader of the Opposition (Senator Collings), who suggests a first payment of 2s. 6d. a bushel, and a second instalment of ls. that growers in parts of South Australia where wheat is grown 25 miles from the main shipping ports, will receive 2s. 9d. & bushel less rail freight of l£d. a bushel, leaving a net return of 2s. 7id. a bushel If we consider the proposed advance in relation to export prices we must realize that an advance of 2s. 9d., less rail freight, coupled with the fact that the Commonwealth Government has to meet the bill for receiving, storing, handling and shipping charges, which we estimate at 3d. a bushel, is equivalent to 3s. a bushel f.o.b. which i3 higher than the present export price. The “Wheat Board has advised me that it has sold small parcels at 2s. lid. and 3s. a. bushel, but we say that for large quantities the export price to-day would be approximately 2s. 9d. a bushel. However, that is not the only difficulty which confronts us. The provision of adequate shipping is also a real and urgent problem. I take this opportunity to inform honorable senators that for some months we have been negotiating with the Government of the United Kingdom, where we hope to dispose of a considerable quantity of our export surplus.- The Australian High Commissioner in London, Mr. Bruce, and the Minister for Supply and Development (Mr. Casey) have already conferred with representatives of the British Cabinet on this subject. “We are doing all in our power to induce the British Government to take from Australia as large a quantity of wheat as it possibly can, but the principal problem confronting the British Government is that of providing shipping to lift the wheat. I do not propose to dwell on the present international position. Honorable senators are aware of the difficulties of Great Britain in that respect. If I indicate that during the months of December, January and February, we should normally require about 120 vessels to lift the wheat we would sell in that period, honorable senators will appreciate the seriousness of the shipping problem in the present circumstances. Previously we have been able to charter additional boats, but in view of the pre sent threat of German submarines no neutral country desires to run risks by making their vessels available as freely as they did in the last war. The Government is unable to say what price will be realized for this year’s wheat crop. I anticipate that about 160,000,000 bushels of wheat will be delivered for sale and, allowing 30,000,000 bushels for home consumption, 130,000,000 bushels will be available for export. When we receive a reply from the United Kingdom Government as to the quantity of wheat it can take, and the price it can pay, we shall be in a better position to deal with this problem. Should, we be left with a large quantity on our hands we should have to provide storage, and thus incur additional expenditure.
– Briefly, what is the cash difference between the Government’s proposal and that of the Leader of the Opposition?
– I understand that the Leader of the Opposition suggests a flat rate of 2s. 6d. a bushel at country sidings.
– That is the initial payment.
– Yes. The first payment proposed by the Government is 2s. 4£d. a bushel at sidings.
– But the Government proposes to deduct railway freight from that figure.
– The price proposed by the Government is 2s. 9d. a bushel less railway freight. I have indicated that freight varies from 1-Jd. a bushel to 6-£d. a bushel, but the average for Australia would be about 4½d. a bushel. Deducting that 4½d. from the 2s. 9d. the average payment to the farmer would be 2s. 4£d. a bushel.
– That covers two moieties.
– The farmers, will receive the second payment, which will be ls., on the 1st February, and the freight will be deducted from that payment. Any one with knowledge of the industry realizes that the great bulk of the wheat will not be delivered until January. I suggest, therefore, that the Government’s offer to make the whole of the money available by the 1st February is most generous, particularly in view of all the difficulties which I have just explained.
– I propose a payment of 3s. 6d. a bushel at sidings, made up of two payments of 2s. 6d. and ls.
– The position of the wheat industry has varied considerably since the Gepp report was made. Nobody appreciates more than do members of the Government the difficult times through which the wheat-farmer has passed. I draw the attention of honorable senators to the world position of wheat - the enormous quantities available on the markets of the world, and Canada’s vast surplus. That dominion is much nearer to the United Kingdom than is Australia, and that is an important consideration at a time when shipping is restricted, ft is obvious to all .associated with the industry that production of wheat will have to be controlled in order to help the farmer. In addition, the farmer will be obliged to concentrate more on mixed farming, particularly the production of pigs, butter, wool and eggs. Increasing numbers of our farmers will need to go in for the side lines, and, judging by the market available for these commodities in Great Britain, I feel certain that the producer’s return on these particular lines will be increased very considerably.
In conclusion, I repeat that the Government’s proposed first payment is most generous. We are satisfied that a. great number of farmers appreciate the Government’s difficulties and know that so soon as the Government is in a position to know what further sales can he made, it will be better able to decide the future policy of the wheat industry.
– Twelve months ago I called the attention of the Senate to the distress existing in the wheat industry. I pointed out that previous governments had made substantial advances from time to time to the industry, which, however, was no more secure, owing to the wide fluctuations of price and the lack of any permanent stabilization plan. I then urged the Government to introduce legislation to save the industry from chaos and give to it permanent security by assuring to the wheat-farmer the same standard of living as that which our laws give to those who are engaged in secondary industries. I also urged the Government to compensate the wheat-farmer for the disability he suffers as the result of our tariff policy. The royal commission in 1929 estimated that disability to the industry at 3d. a bushel. That was the last official survey made of the industry, but if a fresh survey were made to-day, the disability would be assessed higher.
– That statement is not warranted, surely.
– If the honorable senator would read the reports of leading Australian economists on this subject, he would be convinced that the tariff disability suffered by the wheat industry to-day is considerably more than 3d. a bushel. However, since that date the Government has acted sympathetically towards the industry, and has introduced legislation to establish a homeconsumption price, thereby providing compensation to the industry for the disability it suffers in respect of tariff policy. Unfortunately, that compensation went only part of the way. It is not permanent and still fails to give to the industry the security which is so necessary. More recently this year the wheat-farmers of Australia were delighted to hear that the Government proposed to bring in a plan for the permanent stabilization of the industry. The Government offered to provide a minimum equalization price of 3s. 4d. a bushel free on rail at outports. In addition to the flour tax, which was estimated to yield £3,500,000, the Government offered to make a further contribution of £1,750,000 in order to provide permanent stabilization for the industry. At that time it asked the States to make a similar contribution of £1,750,000 and to take certain steps for the control of production. Unfortunately, owing to the refusal of the Country party Premier of Victoria to fall into line with the other wheatgrowing States, this plan could not be carried into effect. However, I point out that at that time wheat was under 2s. 4d. a bushel, and to provide an equalization price of 3s. 4d. a bushel, approximately £7,000,000 was required, of which the flour tax was to provide £3,500,000 and £1,750,000 was to come from the States and a similar sum from the Commonwealth. Since that time, the price of wheat has firmed and, difficult as it may have been at that time to secure a payable price, it is far less difficult to-day when the price is about 3s. a bushel.
– But suppose that we cannot ship the wheat?
– I shall deal with that aspect in a moment. At the time to which I refer, a little over £7,000,000 was required to provide a guaranteed minimum price of 3s. 4d. a bushel at ports. With a similar amount of money to-day, the Government could do a real job on behalf of the industry. It could give to the industry permanent stability and the same advantages as it has given to our secondary industries. It could provide for the industry a price which would give to the grower his cost of production, plus a minimum profit. The royal commission in 1936 worked out the average cost of production, and no more exhaustive inquiry than that has ever been made into the industry in Australia. The commission’s finding was that, after giving credit for side lines, the average farmer could produce wheat at 3s. 6d. a bushel free on rail at outports. I suggest that the Government should continue to plan permanent stabilization for the industry. That is what the farmer wants. He demands permanent stability in place of .the insecurity with which he has been confronted over so many years, and which has rendered many farmers completely destitute. With a price of 3s. 8d. a bushel at ports, which was the price I urged the Government to adopt-
– I thought the commission’s recommendation was 3s. 6d.
– That was the commission’s estimate of the cost of production. No land-owner, whose property is taken over for defence purposes, is asked to part with it at a price below its value. The wheat-grower is entitled to the cost of the production of his commodity, plus a profit sufficient to enable him “to enjoy the minimum Australian standard of living.
– r-How could such a scheme be operated on a falling overseas market?
– I shall deal with that point in a few moments.
– Does the honorable senator consider 2d. a bushel a fair profit?
– No, but a minimum profit of that amount would give the farmer something over -the cost of production and so enable him to struggle on.
I urge the Government to go ahead with its plan for the permanent stabilization of the industry, but to increase the equalization price of 3s. 4d. a bushel that has been suggested to one that would cover the cost of production and give a fair measure of profit, namely, to 3s. 8d. a bushel at ports. That would not cost the Commonwealth Government one penny more than it was prepared to pay when it met the Premiers of the States in August. The price of wheat has risen 5d. a bushel since that date, and that increase would enable the Government to increase the stabilization price to 10s. a bag on the farm - a figure that the farmers would be prepared to accept. The average farmer is accustomed to talking of the price, not at port or. on board, but on the farm, and 3s. 8d. a bushel on rail at ports represents, on the average, 10s. a bag on the farm. That is the figure we should aim to get. As it would not cost the Government, on present prices, any more than its own plan when it met the Premiers would have cost, I consider that there is no good reason why the Government should not proceed with that plan. 1 agree that the Government must put some limit-
The DEPUTY PRESIDENT. - We are discussing a motion submitted by the Leader of the Opposition in order to discuss a specific matter of urgency.
– The motion, much as I welcome it, merely plays with the problem. Unless we get permanent stability and security for the wheatgrowers, the industry will remain in its present chaotic state.
The DEPUTY PRESIDENT.- We are discussing a motion submitted for a specific purpose.
– The subjectmatter mentioned in the notice given by the Leader of the Opposition, mentioned only the payment of 2s. 6d. a bushel as a first advance. The Standing Orders provide that an honorable senator shall state in writing his reasons for submitting a motion for the adjournment of the Senate. Apparently he stated in writing only part of his reasons, because an entirely different proposition from that appearing in the notice emanated from him as he addressed the Senate. On the subject of the advance to the growers, I am not unmindful of the difficulty facing the Government in regard to the shipment and disposal of the wheat. I agree with the Leader of the Senate (Senator McLeay) that the Government’s offer to advance to the industry £20,000,000 is an extremely liberal one, and, had it been made at the Premiers Conference, it would have blinded the representatives by reason of its generosity. If the Premiers had been asked how much they thought the Government would agree to advance at the August conference, not one of them would have thought of suggesting so great a sum as £20,000,000.I think that the Go vernment has made a most liberal offer, and my only criticism is that it is only half doing the job. The real problem we have to solve is the permanent stabilization of the industry. It is of no use to proceed as though we were making a patchwork quilt, but both sides seem determined to make up this garment in patches.
Some time ago, a deputation from the Labour party waited on the Prime Minister (Mr. Menzies) and put forward a proposition similar to that advocated by Senator Uppill and myself. We have not been told whether that proposal has been abandoned and whether that now ‘ suggested by the Leader of the Opposition is the present scheme of the Labour party. I remember the deputation that waited on the Prime Minister and asked for a permanent stabilization plan. It was suggested that the price at out-ports should be 3s. 10½d. a bushel, that there should be a compulsory pool, and that the plan should be reviewed after twelve months ; . but now, apparently, we have a different proposal from the Opposition.
– It is the same one.
– The present proposal is for a price of 3s. 6d. a bushel.
The DEPUTY PRESIDENT.- The honorable senator has exhausted his time.
– This is a matter of serious moment to the people of Australia. The Leader of the Opposition (Senator Collings) has submitted a motion for the purpose of drawing attention to a very serious crisis that has arisen in connexion with the wheat industry. . There is a hold-up of the wheat harvest. That is the issue before this chamber.
– That is not correct.
– I know that it is.
– Where is wheat being held up?
-On the farms.
– The farmers are quite entitled to do that.
– There is a hold-up in connexion with the present harvest, and the farmers are not delivering wheat to the railway sidings or the silos. What is the reason for this? Most people are in business or in employment to secure sufficient income to enable them to pay their debts and live. A hold-up has been decided upon in Western Australia, and farmers in Victoria have decided to do likewise in regard to deliveries of this season’s crop to silos or sidings.
– The farmers in Victoria are thinking differently now.
– They were thinking that way on Saturday and yesterday, but I do not know what they have decided to-day. What has been done in Western Australia and Victoria will probably be done in South Australia and New South Wales.
– The honorable senator is quite wrong there.
– I have some knowledge of strike psychology, and I know that once a movement of this kind begins, it is likely to grow.
– Is the honorable senator urging the farmers on ?
– I am not organizing the wheat-growers in Western Australia. They have most capable officers, who have spent a great deal of valuable time with most beneficial results to the wheat-growers in that State. My services are required in Canberra, and I am doing my best for the growers in my State. The Leader of the Opposition has asked the Senate to take note of the fact that there is a hold-up in connexion with the wheat harvest in one State, and that this movement is supported in another State.
– Who is being penalized ?
– The holdup affects others besides the wheatgrowers. The economic and financial factors are so inter-dependent that a stoppage of the delivery of wheat affects the whole economic structure of the country. I urge honorable senators to treat this matter as a most serious one. I may be told that there is not a holdup in certain parts ofthe Wheatbelt; that is true and the explanation is that in some districts the crop is not yet ripe. Of course, the farmers in the later districts are in a much happier position than are those in the earlier wheat-producing areas in the various States.
– Wheat is being delivered at the present time.
– But a hold-up was decided upon at a conference in Perth, representative of the wheatgrowers of Western Australia, and attended by from 280 to 300 direct representatives. The Minister said that the total of the moieties payable under the Government’s proposal is 2s. 9d. a bushel, less 4½d. freight, leaving a net price of 2s. 4½d. a bushel. The wheatgrowers ask that the first payment be 2s. 6d. a bushel. They are concerned not with freights, or the price that wheat will bring at ports, but with what they will get for their wheat.
– Are they not concerned about what the wheat will realize ?
– That is a matter for the nation. The wheat-grower, like any other business man, is concerned with his income, because it means his living. The wheat-farmers have held up the harvest,and have asked the Government for a first payment of 2s. 6d. a bushel. They will welcome a second payment of1s. a bushel in April, which would bring the total to the amount mentioned by the Leader of the Opposition, namely, 3s. 6d. a bushel. As that honorable gentleman said, it was hoped that when the harvest had been disposed of, the price at ports would be not less than 3s. 10½d. a bushel. Is there anything wrong with that? That price was based on the recommendation of the Gepp Royal Commission, which pointed out that 50 per cent. of the wheat-farmers of Australia could make a living at 3s. 6d. a bushel, whilst 75 per cent. of them could make wheat-growing pay at 3s.10½d. a bushel.
– At sidings.
– That was the price adopted by the Labour party when it formulated a scheme for presentation to the wheat-growers of Australia. I have no desire to refer to the muddling and bungling that has taken place in connexion with wheat and other primary products, but I do want the Government to take a serious view of the hold-up in the wheat industry throughout Australia. I assure the Senate that the wheatgrowers of Western Australia are not indulging in shadow sparring. They are serious. There are, within the Commonwealth of Australia, between 65,000 and 75,000 persons directly engaged in wheat production. Within the Commonwealth, approximately 1,000,000 persons are directly or indirectly affected by the success or failure of wheat production. I believe that the Government will be faced with another issue. Such are the conditions in the wheat-producing areas of Australia and so serious is the financial position of many engaged in primary industries, especially wheat production, that before long the Government will be called upon to introduce moratorium legislation in order to protect the primary producers during the period of the war, and for at least one year afterwards. I know that many business people in the larger centres of population throughout Australia are so busy that they are not inclined to examine the conditions under which other sections of the community exist, but, after all, what affects one section of the community affects other sections also, and has an influence upon the wealth production of the country, which is the source from which we derive our national income. The national income keeps the wheels of industry moving, and feeds, clothes and houses the people. Wheat production is a very important part of the production of the people of Australia. I am aware that certain business will be brought before the Senate later. I understand that the Minister for Commerce (Senator McLeay) will present to the Senate a certain paper, upon which there will be a further discussion on wheat, when, I predict, the Government will be subjected to some severe criticism of its handling of the wheat harvest. I ask the Government to give serious consideration to this matter. The wheat-growers of this country are not fast to move. For a number of years they have been considering seriously what they should do. Now, in sheer desperation, they have been forced to take a stand; they have decided on a hold-up - a refusal to deliver wheat to the silos. They have done so in the full knowledge that the laws of this country provide heavy penalties for breaches of such laws. They know that on the statute-book there is a law entitled the National Security Act, but such are their conditions that they have been forced to take this action.
– I support the motion of the Leader of the Opposition (Senator Collings), who put the case against the Government’s wheat proposals fairly and moderately, and on non-partisan lines.
– He did not make out a case at all.
– The Government is not unacquainted with the dissatisfaction with which the wheatgrowers of Australia have received its proposals in respect of wheat, because throughout the whole of the wheat belts that dissatisfaction has been expressed vociferously. I have been associated with wheat-growing in Western
Australia for about 37 years, but never before have I encountered so much dissatisfaction among the wheat-growers of that State as exists to-day. Under the pressure of war conditions, the Government has, at last, recognized that the support of the wheat industry is the responsibility of the Commonwealth Government.
– Were it not for the National Security Act, the Commonwealth Government could do nothing.
– Whatever assistance has been given to the industry in the past, has- been given by the Commonwealth Government. The Minister knows that under the Constitution, and without the National Security Act, the Government has full power to make grants to the States.
– But it could not acquire the wheat.
– Assistance to the wheat-growers of Australia during the last decade has cost the Commonwealth Government over £14,000,000. The Government has done the right thing in recognizing its responsibility to this industry, but it is most disappointing to find that its proposals are so inadequate. The Minister for Commerce (Senator McLeay) spoke of 2s. 9d. a bushel, but that rate is to apply only to bagged wheat. ‘ Those “farmers who did not have sufficient money to order their bags early are now forced to pay from 12s. to 14s. a dozen for cornsacks. In Western Australia where nearly all the wheat is dealt with in bulk the advance of 2s. 7d., with freight deductions, nett only 2s. 2£d., not the 2s. 4½d mentioned by the Minister.
– The wheat-growers of that State are not required to buy bags. The difference is less than the cost of the bags.
– These proposals are entirely inadequate, and do not represent fair treatment of the wheatgrowers. It is not too much to say that those engaged in wheat production in Australia are to-day in a state of open revolt against the Commonwealth Government and all federal authorities, as the result of the Government’s decision. The Government has compulsorily acquired the whole of the growing wheat crop. So far as I am aware, it came to that decision without consulting the growers at all. The compulsory acquisition of the crop carries with it the responsibility for finding a just price for the wheat. Section 51 of the Constitution provides that the Parliament shall have power to make laws with respect to -
The acquisition of property on just terms from any State or person for any purpose in respect of which the Parliament has power to make laws.
– Will the honorable senator be satisfied if the Government does not buy the wheat at all ?
– I shall be satisfied with the acquisition of the wheat, provided that the Government carries out its constitutional obligation to pay a just price for it. That is a legal obligation resting on the Government. There is no power for the Government compulsorily to acquire wheat except oh just terms; and that, in my opinion, means at least the average cost of production, because no lower price could be regarded as just. Paragraph 11 of the first report of the Royal Commission on Wheat indicates that 3s. a. bushel at sidings would enable about half of the wheat farmers of Australia to meet their expenses and commitments under the then existing conditions of cost and interest. The report went on to say that it appeared that three-fourths of the producers would be able to continue without re-adjustment when the price reached 3s. 10-Jd. a bushel at sidings. This is, therefore, the price which the Government should pay.
– Provided other prices did not increase.
– The prices of other commodities have increased since the report was tabled nearly five years ago.
– To which report does the honorable senator refer?
– I know that there was a later report in which reference was made to by-products; but the Minister knows that in some districts the return from by-products is comparatively small, because there are no big local markets as there are in parts of Victoria and New South Wales. I am aware that that disadvantage is in some degree offset by legislation providing for a home-consumption price for wheat. Unfortunately wheat-growers in Western Australia and South Australia cannot add to their incomes to any great extent by the sale of by-products, certainly not to the same extent as can some wheat-growers in the more fortunate eastern States. At a meeting held in Anzac House, Perth, on the 11th March last, Mr. Curtin, the Leader of the Labour party, as reported in the Western Australian Wheatgrower of the 16th March, advocated 3s. 10£d. a bushel at sidings. The report of the same meeting in the Western Australian does not mention sidings. That report of Mr. Curtin’s speech contains the following paragraph -
The Gepp Royal Commission had recommended a price of 3s. 10½d. but it was no good paying 3s. lOJd. if the farmer was to be exploited by iniquitous charges imposed by other interests (Applause). Other steps would have to be taken. He would use every resource to implement the plan for a price of 3s. 10£d.
The full report of that meeting published in The Wheatgrower indicated that the demand was for 3s. 10£d. a bushel at sidings. This afternoon Senator Collings advocated 3s. 10£d. a bushel at ports.. There is considerable difference between his request and the statement made by the Leader of the Opposition in the House of Representatives. I should like to have a definite statement of Labour’s policy on this matter, because there has been silence on this point among Labour members in the House of Representatives during the last few days. Is it 3s. 10£d. at ports or at sidings ?
– What is the honorable senator’s plan? .
– I agree with the motion submitted by the Leader of the Opposition in this chamber so far as it goes, but it does not go far enough. Judging by the report of various country meetings, the wheat-farmers of Western Australia are prepared to make some concession owing to war conditions, but the least that will be acceptable to them is 3s. 10-Jd. at ports.
– The honorable senator has adopted Labour’s policy.
– Not at all. With regard to the withholding of deliveries, I do not think that this has been decided yet on any Australian basis. There is to be a meeting of the Australian Wheat Federation in Melbourne this week, when this question will be further considered. I am not in favour of a hold-up of wheat deliveries. Any such move would be doomed ‘to failure if wheat deliveries were made in some States or districts. The following resolution was carried at a mass meeting in Perth on the 16th instant: -
This mass meeting, representing all the wheat and wool growers, solemnly and sincerely declare their intention of holding their wheat garnered in the present season until such time as the Federal Government shoulders its .responsibilities, and sets the correct lesson in patriotism by paying adequately and reasonably for services rendered by those whose efforts can make the safety of the Empire secure, on the basis of a minimum of 3s. 10*d. a bushel at sidings.
This resolution is typical of many being carried in the wheat areas, and shows that the wheat-growers’ organization is asking for that price at sidings. The action of the Government in offering 2s. 2½d. a bushel in two payments, with the possibility of the amount being supplemented by a doubtful grant of £2,000,000, is placing the wheat-farmers of Australia in a desperate position. On other occasions, they have demonstrated that they are among the most loyal and patriotic sections of the people, but they are in a perilous position. Owing to the inadequate nature of the Government’s proposals, they have declared that they will withhold their wheat from the market unless they get a more adequate return. They remember the promises contained in the first speech delivered by Mr. Menzies as Prime Minister. On that occasion he said that it was the desire of his Government - and I appreciate the difficulties confronting the Ministry due to war conditions - to secure for all the people in Australia, including the wheat-growers, an Australian standard of living. Under present market conditions our wheat-growers are unable properly to feed and clothe their families and meet their heavy interest commitments. The Leader of the Opposition is right in asking for a first ad vance of 2s. 6d. at sidings. I support that request, and also the further request for a second payment of at least ls. a bushel, less freight. The present low prices simply make the wheat-farmers of the Commonwealth the economic slaves of the rest of the community. I do not know whether there will be any organized hold-up of deliveries, but I am afraid that there will be. I exceedingly regret this possibility in some districts.
– What will the growers do if they withhold deliveries ?
– They will make an organized protest, but I say that the Government is “wrong in forcing them into this attitude. There have been meetings of protest in all the wheat-growing belts of Western Australia during the last few weeks.
– Is the honorable senator advising them to withhold deliveries ?
– No, and I regret that the resolutions to this effect were carried at the meetings to which 1 have alluded. At the same time if farmers in my district withhold deliveries, I shallreluctantly do likewise.
– The honorable senator has exhausted his time.
.- In common with other honorable senators I deplore very much the present serious position of the wheat industry. This year there will be very substantial holdings of wheat in all wheat-growing countries. It is regrettable that political capital should be made out of the misfortunes of our growers. Unfortunately we have many extremists in our midst. As Senator Cunningham and Senator Johnston have told us, these extremists are advocating a hold-up of wheat deliveries. That Senator Johnston has said that he will be among them is most regrettable. What will the growers do with the grain? Unfortunately the wheat-growers are not told the facts of the world wheat situation. I am surprised at the modesty of the Leader of the Opposition (Senator Collings). This afternoon he claimed for wheat-farmers 3s. 6d. a bushel less freight, or an average of 3s. ltd. a bushel.
– He advocated 3s. 6d. a bushel at sidings.
– The Leader of the Opposition spoke of 2s 6d. a bushel for the first payment, and ls., less freight, for the second payment.
– The honorable gentleman’s statement is not in accordance with anything that I said.
– If I have misrepresented the Leader of the Opposition I am sorry, but I feel sure that all honorable senators on this side of the Senate understood him as I did. This Government has agreed to find £20,000,000 for our wheat-growers. That is a big sum of money but it would be a mere bagatelle if the Government could find a market for the wheat. But what is the position? Where are we to find purchasers for the Australian wheat ? The present world holdings of wheat amount to 1,100,000,000 bushels, and the world consumption is only 500,000,000 bushels. This leaves a surplus of approximately 600,000,000 bushels.
– And millions of people in all countries are starving.
– Great Britain consumes 200,000,000 bushels a year, but wheat-growers of the Mother Country produce 60,000,000 bushels yearly, so the import requirements of the United Kingdom amount to only 140,000,000 bushels. Canada alone has 300,000,000 bushels of wheat which it does not know what to do with, and this year Australia will have an exportable surplus of about 160.000,000 bushels. Where are we going to sell it? We have been told that Great Britain has, in pursuance of its war policy, bought 100,000,000 bushels of wheat from Argentina and 100,000,000 bushels from Rumania. Where then is the market for Australian wheat?
– How will our wheat-growers pay their way?
– I agree that something will have to be done for our growers, but I point out that the Government will lose possibly £10,000.000 on its wheat deal. I venture the opinion that Great Britain will take the whole of its immediate requirements from Canada, which is so much nearer to the Mother Country that three shipments of wheat could be landed from the sister dominion in the time taken to deliver one shipment from Australia. While the war lasts all shipments will have to be convoyed, and as the voyage from Canada to England will occupy one week, as against a month from Australia, the wisdom of the course to be adopted by Great Britain is obvious.
– The sea voyage from Canada takes less than a week now.
– Troops from Australia would also have to be convoyed.
– No one in authority has yet said that troops are to be sent from Australia in this war.
– The Prime Minister has said that they will be.
– I know that some honorable gentlemen will argue that in other years there have been just as large surpluses of wheat in the world’s market, but I remind them that the world’s position was very different from what it is to-day. France was then importing 60,000,000 bushels of wheat yearly, Germany and Italy were taking about the same quantity, and Holland and Switzerland were also importers. To-day none of these countries is taking foreign wheat. As the result of the policy of economic nationalism all European countries are growing their own wheat, and the result is the present glut in the world’s market.
I believe that the Government is doing the fair thing by our wheat-farmers. Those who criticize its action should not forget that the arrangement made does not represent the final payment. The Government has not yet sold any of next year’s wheat. It has sold only last season’s grain, and it is going to sell next year’s wheat at the highest price it can get It has arranged to find £20,000,000 for our wheat-farmers and has submitted a proposal for a first payment of ls. 9d. and a second payment of ls. less freight. Any excess, when the wheat is realized, will go, not to the Government, but to the growers. We are all hoping that the market will improve. Senator Wilson has told us that the present world price is 3s. a bushel.
– Would this Government say to the Broken Hill Proprietary
Company Limited, “ If we win the war you will get profits ; if we do not, you will get nothing”?
– With the world’s market of 3s. a bushel there is little prospect of profit. Where could we get buyers for Australian export wheat at 3s. a bushel? No country will buy wheat in Australia and pay £20,000,000 for the simple reason that shipping is not available. We shall have to wait until we can see what will be the developments in regard to shipping.
– Is not our problem, how our wheat-growers are to live in the meantime ?
– That problem will have to be faced. I anticipate that after the next harvest there will be at least 100,000,000 bushels of wheat in Australia, because shipping will be scarce and the world market will not be able to absorb it. I think that much of the present trouble among wheat-growers is due to a misunderstanding of the position. I would like to see them guaranteed 3s. 4d. a bushel at ports. That would be a fair price, and I believe that all reasonable wheat-growers would accept it, subject to any increase of price that might take place. On that basis the Government would lose probably £7,000,000 or £8,000,000. It would be absurd, however, for the Government to guarantee the price that has been suggested in some quarters. If it guaranteed growers 3s. 4d. a bushel at sidings, next season we should have an exportable surplus, not of 160,000,000 bushels, but probably 260,000,000 bushels.
SenatorFraser. - The Government would have to take precautions against over-production.
– It could not take action to prohibit production. That would be impossible.
– It was done in Queensland in connexion with the growing of sugar cane.
– That was made possible only by the mill companies refusing to crush surplus sugar cane.
Senator McLeay has, I am sorry to say, raised another point. He said that the wheat-farmers throughout the Commonwealth would have to turn their attention to mixed farming. If that were done, the lamb and mutton market would soon be in much the same position as the wheat market is to-day. It would be unreasonable to force men now engaged in wheat-growing to produce butter and fat lambs, as that would have the effect of ruining those who are now engaged in mixed farming. But for the position in which Denmark is now placed there would be an over-production of butter. It is utterly impossible to restrict production without dealing with every individual concerned. It is easy to visualize what would happen if such an attempt were made in the Wimmera and Mallee districts of Victoria. I trust that the difficulty confronting the Government in this respect will be overcome by the early termination of the war, as the wheat produced in Australia could then be transported to the other side of the world without difficulty. We have to be tolerant in this matter, and realize that in order to finance the scheme the Government has to provide £20,000,000 which is a very big undertaking and may involve a huge loss.
SenatorFRASER (Western Australia) [5.22]. - In common with other honorable senators I deplore the unfortunate position in which the Australian wheatgrowers are placed “to-day. I agree with Senator Gibson that the position which now prevails is due largely to the fact that many countries which previously imported wheat are now exporting that commodity, and that has had the effect of reducing prices and interfering seriously with the sale of Australian wheat. In an endeavour to solve the problem with which the Government is faced, we should recall that in 1929 the Scullin Government asked the wheat-growers to produce more wheat, and in that way increase our exports in order to enable Australia to meet its overseas commitments. Some honorable senators opposite representing Western Australia, who supported the Labour party’s policy in that respect, assisted to defeat the Scullin Government. The Labour party submitted a definite policy to stabilize the wheat industry.
– At the expense of the State governments.
SenatorFRASER. - Several days ago the party to which Senator Johnston belongs was prepared to commit the States to certain payments in order to try to get the wheat-growers out of their difficulties. The Labour party, which has formulated a definite wheat stabilization scheme, is also willing to assist Senator Wilson to implement the scheme submitted to the Prime Minister. We contend that the wheat-growers should receive a minimum price of 3s. 10½d. a bushel. I have not read the speech of the Leader of the Opposition in the House of Representatives (Mr. Curtin), but I was present at a meeting held at Anzac House, Perth, when he said that he was willing to support the recommendation contained in the report of the Royal Commission on the Wheat Industry.
– I too support that recommendation.
SenatorFRASER. - The Leader of the Country party said that the wheatgrowers would be satisfied with a first payment of 2s. 6d. a bushel at country sidings, and that, I presume, represents the views of the members of the Country party in this chamber. The Prime Minister’s offer of 2s. 9d. a bushel at ports is equivalent to 2s. 4½d. a bushel at country sidings, and therefore there is little difference between that price and that suggested by the members of the Country party. I agree with Senator Cunningham that the primary producers in every State have been treated most unfairly. That is shown by regulation No. 14 under the National Security Act which provides : -
For securing the public safety and the defence of the Commonwealth and the territories of the Commonwealth, for the efficient prosecution of the war, and for maintaining supplies and services essential to the life of the community the Minister may, from time to time, by order published in the Gazette, declare that any wheat described in the order is acquired by the Commonwealth and that wheat shall thereupon become the absolute property of the Commonwealth, freed from all mortgages, charges, liens, pledges, interests and trusts affecting that wheat, and the rights and interests of every person in that wheat (including any rights or interests arising in respect of any moneys advanced in respect of that wheat) are hereby converted into claims for compensation.
Under that regulation the wheat industry has been treated differently from all other industries. For instance, legislation passed by this Parliament provides that those engaged in the manufacture of certain munitions shall be allowed a pro fit of 4 per cent. on turnover, which means that by the end of a year their profits may be 60 per cent. or 70 per cent. The wheat-growers have been treated most unfairly by this Government, and whatever may be said in regard to the inability of the Government to make the necessary money available or to secure the necessary shipping space, the difficulty with which it is confronted is due largely to its own action in selling the vessels which it once owned.
– That is not correct. This Government has not sold any ships.
– The ships to which I refer were sold by a Government of the same political colouring as this Government, which must inherit the errors of its predecessors. Now that a war is in progress and difficulty is being experienced in exporting our surplus primary products, we are told that sufficient shipping space is not available. The ships which were sold and are not yet paid for should now be commandeered by this Government.
– Had the Government still been in control of those ships they would have been commandeered.
– Had they been under the control of the Government today the export of primary products could have been facilitated. Notwithstanding the serious position in which the wheatgrowers are placed, the Australian Wheat Board established by this Government is incurring unnecessarily heavy expenditure on salaries, and I venture to suggest that many wheat-growers will be astounded when they realize the salaries and fees which are being paid to certain persons associated with that board.
– To whom is the honorable senator referring?
– Mr. Thompson, the general manager of the West Australian Farmers Co-operative Society, is chairman of the board, and receives a salary of £3,000 annually and a disability allowance of £2,000. Those amounts are paid at the expense of the growers. Is it fair to make such unnecessarily high payments to officials when wheat-growers, particularly those in the back-blocks of
Western Australia, are being deprived of a few additional pence a bushel for their wheat ?
– The administration of Mr. Thompson may be the means of saving to the farmers millions of pounds.
SenatorFRASER. - I doubt very much whether any man is worth such a high salary, plus a substantial allowance. To earn that salary he would have to serve the interests of the farmer to a greater extent that the honorable senator has done.
– The honorable senator is referring to the executive officers of the board, who, presumably, are earning the amounts they receive.
– Does not the wheat-grower earn his money?
– He earns it but he does not get it.
– Exactly. The secretary of the board receives £900 per annum and each member of the board receives £5 5s. a sitting and a travelling allowance of £2 2s. a day. Is it fair that the wheat-growers, who have held on to their farms for many years under most disadvantageous circumstances, should be compelled to take direct action in order to secure their rights? Why should not their interests be protected by legislation, as have the interests of those engaged in the manufacture of munitions, who are entitled to make excessive profits while the wheat-growers are denied even the cost of production? I support the motion of the Leader of the Opposition.
– I was surprised to hear the Leader of the Opposition (Senator Collings) say that the proposal he submitted embodied the policy of the Labour party, because he should recall that several months ago when the Government attempted to stabilize the price of Australian wheat its efforts were opposed by two Labour governments. Had it not been for the action taken by the Victorian and Tasmanian Governments, the wheatgrowers would have been in a better position than they are to-day.
– A Labour government is not in power in Victoria.
– The two governments mentioned prevented the price of wheat from being stabilized. The threat of a wheat strike has been mentioned in this debate. Like other honorable senators, I was very much surprised when Senator Johnston promised to join the strikers.
– If, against my wishes, the farmers decide to have a strike, I shall be with them.
– I hardly think that any action by the farmers to withhold their wheat can be termed a strike.
– It is a holdup.
– Whatever it might be called, I fail to see how the farmer can expect to get any advantage by such action.
– It will direct attention to their position.
– It might do that, but it will not obtain any cash for them. Under the regulation dealing with the acquisition of the wheat crop during the war, the Commonwealth Government has constituted itself the only buyer of wheat in this country, and should the farmers in Western Australia or in any other State refuse to sell to this Government they will not be able to sell it otherwise. Perhaps many of the people who are talking in favour of this socalled strike, or hold-up, have not realized that such a regulation exists, and for their enlightenment I read it: -
I, George McLeay, Minister of State for Commerce, in pursuance of the powers conferred by regulation 14 of the Wheat Acquisition Regulations, hereby declare that the following wheat is acquired by the Commonwealth, namely -
all wheat harvested on or after the eighth day of October, One thousand, nine hundred and thirty-nine, which on the date of the publication of this order in the Gazette, is situate in Australia, and
all wheat which is harvested in Australia on or after the date of the publication of this order in the Gazette, except -
wheat stored by the grower thereof on his farm for his own use (other than for gristing) and which is not’ for sale-
That implies that the farmer can keep as much of his wheat on his farm as he wishes. Such action will not interfere with the Government plan at all -
In view of this regulation there need be no strike or hold-up whatever. It permits the farmer to retain complete control of his wheat, but it stipulates that the Commonwealth Government shall be the only buyer of wheat in Australia at the present time. Therefore, if the farmer does not care to sell his wheat to the Government he can keep it on his farm. I agree that the price offered by the Government is not a payable one; but I realize also that present conditions are not normal. However, as Senator Gibson has pointed out, the price proposed is not final. Should, the world price rise the farmer will get the benefit of the increase. At present, however, the position is that the Government is setting aside £20,000,000 for the purchase of the wheat crop. The Prime Minister (Mr. Menzies) has stated distinctly that in the event of the wheat realizing 2s. 9d., which will return to the Government its outlay of £20,000,000, the Government will put an additional sum of £2,000,000 into a pool for the benefit of the farmer.
– Plus a certain amount from the flour tax.
– Yes, and that sum averages 5½d. a bushel. If the world market for wheat remains as at present, and the Government is able to ship all of the wheat available, the farmer will receive between 3s. and 3s. 4d. a bushel. The problem of shipping, of course, is very serious. We have also heard a good deal in this debate concerning a stabilized price. It has been said that when this subject was discussed previously the Government contended that it could not find more than £7,000,000’ for this purpose, whereas ‘ to-day it proposes to find £20,000,000. I point out that the position to-day is altogether different from that which obtained when we discussed this matter previously. To-day the Government is offering to the farmers of Australia £20,000,000 for their crop. It does not know exactly what it is going to do with it when it gets it; it does not know how much of the crop it will be able to ship overseas; half, or more than half, of the crop may be left on the Government’s hands. When the earlier proposition was discussed the world price for wheat had fallen to a very low level, and the Government was asked to make up the price to 3s. 4d. a bushel to the Australian grower. While Senator Johnston was speaking this afternoon I could not help recalling the views he expressed five weeks ago in connexion with the gold tax, so far as it affected Western Australia. I believe that he would have some difficulty in reconciling the statements he made on that occasion with his remarks this after noon.
– -I should like the honorable senator to indicate how the price of any product can be stabilized if producers are not prepared’ to contribute something from prices in good times in order to offset very low prices in bad times. Although the price offered! by the Government cannotbe said to be payable, nevertheless the guarantee of £20,000,000 is generous. I am as anxious as any one to see the farmer get 10s. a bag for his wheat on the farm, and I am hopeful that eventually he will obtain that under this scheme. It has been asserted in this debate that all of the wheat-farmers of Australia are behind the proposal made by the Leader of the Opposition.
– Nobody made any such suggestion.
– Senator Collings said, “ All of the wheatgrowers of Australia are behind this move.”
– Yes; I questioned the honorable senator’s statement at the time.
– The honorable senator’s statement is so much at variance with fact that I must correct him. I said, “Practically every representative body of wheat-growers is behind the Opposition in the demand it is making to-day”. That is very different from what the honorable senator said.
– 1 apologize to the honorable senator if I have misrepresented him. However, 1 say distinctly that all of the wheatgrowers of Australia are not behind his proposal.
– Does the honorable senator say that definitely?
Senator JAMES McLACHLAN.Yes. Wo have loyal wheat-growers in Australia who realize that the Government to-day is doing everything possible in the circumstances to assist them.
– Are the other farmers disloyal?
– I am talking of loyal wheat-growers who believe that the Government is doing all it possibly can to assist the wheat industry.
– I should not use the term “ loyal “, because I do not think that any of our wheat-growers are disloyal. The growers whom the honorable senator calls loyal are so hard up that they have to take anything the Government offers them.
– Itis not a matter of loyalty or disloyalty. Many people are trying to grow wheat on land which is utterly unsuitable for the purpose. Those poor unfortunate people are up against it, and they have to do anything they can to make a living.
– Why does not the Government transfer them to land suitable for wheat-growing?
– The Government is doing that. The sum of £500,000 is annually allocated from the flour tax for the purpose of repatriating growers now engaged on marginal areas. The great difficulty confronting the industry to-day is that many men are endeavoring to grow wheat in marginal areas and on land where it is uneconomic to grow wheat. The Leader of the Opposition referred to the Gepp Commission’1? report. I remind honorable senators, however, that that commission, in compiling its averages, included the farmers on these marginal areas, and it was on such averages that the commission worked out its payable price for wheat. I am sorry that the farmers will not receive 2s. 6d. a bushel as the first advance, but I hope that they will ultimately get a payable price of about 10s. a bag.
– I am glad that at last the Labour party realizes the predicament of the wheat-growers. For many years that party has advocated a policy of high protection, which has had a most detrimental, effect upon the wheat industry. Looking back to the time when superphosphates were introduced, I recall that the governments of the various States set out to bring into production a great deal of second-class land, some of which is known to-day as marginal land. Since the advent of superphosphates over 30 years ago, the cost of wheat-growing has increased by about 50 per cent. Much of this marginal land could now be cultivated profitably for wheat-growing if the cost of wheat-growing had remained at the figure prevailing when that land was taken up.
– What about the interest charges those settlers have to meet?
– Those charges have fluctuated from time to time. No matter what prices were paid for that land, some of the farmers could not possibly carry on to-day. In South Australia, in certain areas, the farmers cannot do more than get back sufficient wheat for seed purposes, and I am afraid thai, we shall have to face up to that sombre fact. Although the sum of £500,000 is distributed annually to assist distressed farmers, the governments of the various States will have to move quickly if the difficulties of the farmers are to be overcome.
– Does the honorable senator say that the cost of production has not increased since the report of the Wheat Commission was presented?
– That would be difficult to say, but I think that that report showed that the cost of production had risen by from 50 to 75 per cent. I know that a twine binder for which I once paid £37 now costs £93.
– How could that be due to the fiscal policy of the Labour party ?
– I have said that I am glad to note that at last the Labour party realizes the serious position in which the farmers have been placed by reason of the policy of high protection which has always been favoured by the Labour party. The Leader of the Opposition referred to a certain paragraph in the report of the Royal Commission on Monetary and Banking Systems, under which he suggested the Government could finance the wheat industry, but he omitted to mention another paragraph in the report which indicated that the financial expedient he had in mind should not be resorted to.
I commend the Government for the effort it has made to introduce a scheme for the stabilization of the wheat industry. The proposal made by the Government a few months ago was not given effect because of the attitude of two of the States. That was most unfortunate. The industry will always be in difficulties if the Government assists it merely by means of a dole. Already the industry has received £12,000,000 or £14,000,000, and I hope that the Government will, at an early date, introduce a stabilization plan. I move, as an amendment -
That the words “ 1.0 a.m. on Thursday next “ be left out with a view to insert in lieu thereof the words - “9.30 a.m. on Thursday next “.
I submit this amendment for the purpose of debating a matter of urgency, viz. : - “the parlous position of the wheat industry, and the need for immediate action by the Government to set up a permanent equalization fund for the purpose of securing to wheatfarmers a price for their product not being less than 3s. Sd. a bushel f.o.r. outport (being estimated cost of production plus minimum profit), such fund to be financed by the Commonwealth Government or the Commonwealth Bank to an amount not exceeding £20,000,000 for the harvest 1939-40. The fund to have the right to reduce the minimum equalization price proportionately, or limit the amount upon which the equalization .price will be paid in the event of the crop offered for sale exceeding 140,000,000 bushels. It to be further provided that, in the event of sale price exceeding 3s. 8d. a bushel f.o.r., farmers to contribute 50 per cent, of the increase over 3s. 8d. a bushel for the purpose of providing a reserve against future low prices.
– The motion before the Chair is, “ that the Senate, at its rising, adjourn till 10 a.m. on Thursday next “. That motion was submitted to permit of the discussion of a definite matter of urgency, which was set out in the written notice submitted to me by the Leader of the Opposition. The amendment provides that the Senate shall adjourn until 9.30 a.m. on Thursday; but, as the matters which the mover of the amendment desires to be discussed are different from that on which the original motion was based, I rule, particularly at this stage of the debate, that the amendment is out of’ order.
– Senator Cunningham has dealt at length with the difficulties experienced by the wheat-growers throughout Australia, and, particularly, Western Australia. Much has been heard about the price that the farmer should receive for his product, and I am now at a loss to know what price he should get to recompense him for his labour. I have always advocated the payment of 4s. a bushel, but I am prepared to go back to the price of 3s. 10£d. a bushel advocated by the Labour party. The cost to the farmer of preparing and sowing an acre of wheat is about £2, and, assuming that the average return is twelve bushels to the acre, the price of 3s. 4d. a bushel barely, covers the cost of production.
– Is the price of 3s. 10£d. a bushel at ports or at sidings?
– On the farm, if the honorable senator likes. I do not agree with his plan at all. Is it not fair that the farmers should be as well paid for their work as are the people in the cities? The farmers should be kept on their holdings because they are the biggest employers in the Commonwealth. They pay good wages, but they could not do it on a return of 2s. 9d. a bushel for wheat.
– The Labour party has not always said that the farmers pay good wages.
– They do, nevertheless. I may mention that members of. the party with which the honorable senator is associated have paid their employees, for work done in Western Australia, 15s. a week and tucker. I know some of them who pay 7s. 6d. a week to girls who milk cows.
The Commonwealth Government should not let the farmers down, for they are the backbone of Australia. We rely mainly on the exports of meat, wool and wheat to. build up our credits overseas, yet we are quibbling over a paltry 3s. 10^d. a bushel for wheat. We should be patriotic, realizing that wheat is a vitally necessary commodity on which the Empire depends, and that the industry should be financed on a war footing. The wheat should be taken over by the Government, to he held in reserve for British people overseas, should they require it. Some honorable senators have said that Great Britain to-day may not need our wheat; but what would be the result if vessels carrying wheat from Canada to Great Britain were sunk? The argument has been used that Canada is only a week’s steam from Great Britain, compared with the longer journey from Australia. What does it matter how many weeks are occupied in transit, so long as the cargo reaches its destination safely?
Every patriotic citizen would agree to the payment to the farmers of 3s. 10^d. a bushel as proposed by the Labour party. I believe in fair wages being paid for work done, and the farmer should not be excepted. The difficult conditions under which he has to work entitle him to at least a payable price for his product. If there is a better price coming to the farmers. I congratulate them upon the results of their gamble, but ls. 9d. a bushel for the first payment is not sufficient. The reason why there is much discontent among farmers is that they are uncertain as to their position. I have travelled through the wheat areas in Western Australia and have found them in a quandary. The parliamentary representatives of Western Australia are unanimously supporting the farmers in their intention to hold their wheat. Senator Johnston has been criticized because he spoke about holding his own wheat. Knowing the conditions which exist in Western Australia, Senator McBride must admit that the farmers there and, indeed, throughout Australia, deserve all of the assistance that can be given to them by the Commonwealth Government. In order to ascertain the true position of the wheat industry, the Government should consult, not tho farmers of St. Georges-terrace, Perth, or Collins-street, Melbourne, but the growers of the wheat.
.- Senator Wilson reminded us that about twelve months ago he placed before the Senate a scheme for stabilizing the price of wheat. At about the same time, I also submitted a proposal to the Senate. I then asked why Senator Wilson and others did not get down to fundamentals when dealing with the problems confronting the wheat-growers. It is generally admitted, as sound economics, that prices are determined by the amount of money in circulation. That is a matter which, under existing conditions, rests entirely with the banks. It is said that there is a big surplus of wheat in the world, and the reason given is that the nations of Europe have been growing more wheat than before the war of 1914-18. But how can any one say that there is a surplus production of wheat when millions of people are on the bread line, and, indeed, below it? I remind the Senate that bread is the staff of life, and is made from wheat. There is not an overproduction of wheat; the trouble is that many millions of people have not the money wherewith to buy the bread that they need. In Senator Wilson’s own State it was proposed last August that the State Governor should approach the GovernorGeneral of the Commonwealth to urge that the Commonwealth Bank be used for all national purposes, such as defence, and the assistance of Australian primary industries. A motion to that effect which was submitted to the State Parliament was carried by a majority of 17 to 13 votes.
– Does not the honorable senator think that the Commonwealth Government is using the Commonwealth Bank?
– Not to any great extent. The £10,000,000 loan to be floated privately will be supplied by the private banks.
– Thi. South Australian House of Assembly had to adjourn for want of a quorum; the’ seventeen who voted for the motion were absent.
– How could they vote if they were not in the House? On a number of occasions I have referred to paragraph 504 of the report of the royal commission appointed by the Lyons Government to inquire into monetary and banking systems. In his budget speech the Treasurer (Mr. Menzies) said that I had taken a portion of the report from its context. That is not true. Last session I told Senator Wilson that after explaining banking to him for about twelve months it appeared to me that he was suffering from mental paralysis if he was unable to grasp the meaning of what I told him. I say again that money can be advanced through the Commonwealth Bank, free of interest, and further, that it need never be repaid. I shall cite the opinion of a leading banker in Canada, Mr. Graham Towers.
– Can wheat be shipped by means of Douglas credit?
– I understand, Mr. President, that interjections are disorderly, and I ask that I be not interrupted. The Menzies Government is merely a continuation of the Lyons Government, which appointed a royal commission to inquire into the banking and monetary systems. A year ago I asked if the Government was prepared to allow a discussion of that commission’s report, and received an affirmative reply. Although twelve months have elapsed since then no opportunity for, such a discussion has been provided. Obviously the Government does not want the commission’s report to be discussed. In his budget speech, the Treasurer said -
I have been increasingly conscious of late, as have all honorable members, of the growth of a tendency in the minds of many people which may be put in this way: somewhere there is a hidden spring of wealth. It is called the credit of the community. All you have to do is to tap it. Be bold enough to put enough taps into it and draw off enough, and all your problems will be solved.
He went on to say -
The belief, apparently, is that if you did get money in this way the result would be that we would have no taxes, no public borrowings and, to put it in the old phrase, ‘* Everything in the garden would be lovely “.
After much questioning, I ascertained that the conversion of loans in London by Mr. Bruce cost Australia £3,000,000. That charge could have been avoided if the loans had been floated through the Commonwealth Bank. No legislative action would be necessary for the Government to issue instructions to the Commonwealth Bank to issue credit in favour of the wheat-growers.
– Does not the honorable senator think that there is danger of an over-production of not only wheat but also credit?
– Borrowing is excessive only when more money is borrowed than is earned. A nation which consumes more than it produces gets into debt. I say again that the banks do not lend money; they merely extend credit. The finding of the royal commission was that the farmers could be given a payable price for their wheat. It can be done. The opinion expressed by the royal commission is not new to me. The chairman of the Royal Commission on Banking was a judge of the Supreme Court who ought at least to understand constitutional law, and he told the Lyons Government that it could be done. Why has effect not been given to the recommendation of the royal commission of which that judge was chairman? Why has not the report of the commission been discussed? Mr. Graham Towers, the governor of the Central Bank of Canada, a government institution, said that if money were advanced by a government in order to increase the productivity of the people, the government would indirectly be repaid the amount advanced. If we give effect to the recommendation of the Royal Commission on Monetary and Banking Systems we shall put the farmers on a sound footing. On previous occasions I challenged any honorable senator opposite to controvert anything that I have said in relation to the financing of Australia, but not one honorable senator accepted the challenge. T repeat that challenge to-day. I ask honorable senators opposite to show, if they can, that what I am saying is not correct. The farmers can be paid a fair price for their wheat. An expert has recently told the world that many millions of people in the world are underfed. In the face of that statement, how can any one say that there is an over-production of wheat? Every report on national health refers to the existence of malnutrition. I repeat that bread, which is the staff of life, i3 made out of wheat, and that, if malnutrition exists, and people are underfed, it cannot truthfully be said that there is overproduction of wheat. I admit that if money be not advanced to .the people they cannot buy wheat, or bread, or other commodities.
– The honorable senator claimed protection from interjections, but he invites interjections.
– Last year Senator Cooper interjected only once while I was speaking, and I let him off as a first offender. The war has dislocated the Tasmanian apple trade, but what I have said about the wheat industry is equally true in respect of the fruit industry. By means of advances through the Commonwealth Bank, the fruit-growers of Tasmania can be given a payable price for their products.
Sitting suspended from 6.15 to 8 p.m.
– Notwithstanding the advance in general knowledge of finance, the Menzies Government is determined to finance its requirements in the old-fashioned and orthodox way. The following is a newspaper report of a statement made by the Premier of Tasmania, Mr. Dwyer-Gray, in connexion with the last meeting of the Loan Council : -
“LOAN IGNOBLE CONCESSION.”
The Loan Council’s decision to raise a bank loan of ?10,000,000 was vigorously criticized to-night by the Tasmanian. Premier (Mr. Dwyer-Gray ) . “ There was no reason whatever why the Commonwealth should pay any interest on necessary defence expenditure,” he said. “ The Council’s arrangement was an ignoble concession to an antiquated system of finance. If Australia finances its war effort by the same old-fashioned idea of borrowing at interest this will really mean that a victorious Australia will find herself utterly ruined. All business people who remember the taxation following the last war are beginning to realize that if Australia is to escape ruin it is necessary for it to defeat the existing financial system as well as the Germans. Instead of extending national credit the Commonwealth Government has come forward with a proposal to postpone the real issue by borrowing ?10,000,000 at 3i per cent., and it has actually come to an arrangement with the private banks to enable them to share part of the resultant boodle.”
I have on more than one occasion declared that whenever I have sought to bring about a change of financial methods I have found myself up against strong conservative opposition, and I have come to realize that nothing hurts a conservative more than a new idea. There is no doubt in my mind that the Commonwealth Bank could finance the whole of the Government’s requirements for the purpose of stabilizing the price of wheat in Australia at a payable level, and could do so without the payment of interest. I have already told the Senate that I find support for this view in a series of answers given by Mr. Towers, the governor of the Central Bank of Canada, in evidence before the Committee on Banking and Commerce. Mr. Towers was asked this question -
So far as war is concerned, to defend the integrity of the nation there will be no difficulty in raising the means of financing whatever those requirements may be?
To that question Mr. Towers replied -
The limit of the possibilities depends on men and materials.
On many occasions I have said much the same thing in this chamber. I have declared that, so long as we produce commodities in this country to our fullest capacity there need be no interest charged on any finance required for the prosecution of this war. The report of the Canadian Committee on Banking and Commerce continues -
Question. - . . . And where you have an abundance of men and materials you have no difficulty, under our present banking system, in putting forth the medium of exchange that is necessary to put men and materials to work in defence of the realm?
Mr. Towers. That is right.
Question. - Well, then, why is it where we have a problem of internal deterioration that we cannot use the same technique … in any event you will agree with me on this, that so long as the investment of public funds is confined to something that improves the economic life of the nation, that will not of itself produce inflationary result?
Mr. Towers. Yes, I agree with that, but I shall make one further qualification, that the investments thus made shall be at least as productive as some alternative uses to which the money would otherwise have been put.
To what better purpose could the national credit of this country be put than to rehabilitate the wheat-growers and “guarantee to them a proper price for their production? That would be sound finance. It would be the economic solution of their difficulties. It can be done and it would be done if the Government recognized that what was physically possible was also financially possible. It is physically and financially possible to pay Australian farmers 5s. a bushel for their wheat. I have high authority for this opinion’ - the governor of the Central Bank of Canada, a government-owned institution, whose evidence I have just read. Yet what do we find? Earlier in my speech, Senator Wilson said that he thought it was a joke that two State parliaments should have passed a motion calling upon the Commonwealth Bank to use the national credit for national defence and to aid primary producers. The honorable senator laughed, and said that only a few members were present when that motion was adopted.
The DEPUTY PRESIDENT . - The honorable senator’s time is exhausted.
– I warn Ministers and members supporting the Government that the threat from the wheat-growers of Western Australia that unless a more adequate price be guaranteed to them they will withhold deliveries is not an idle one, and should not be taken lightly. The growers in that State have been very patient for many years under a heavy burden of debt. I have the fullest sympathy with them in their struggle to remain solvent. Judging from reports which I have received from Western Australia, they mean business.
-Are they unanimous?
Senator ALLAN MacDONALD.They are not unanimous. Very rarely indeed are primary producers unanimous in matters affecting their industry, but in their present plight they are, as far as is humanly possible, united in the . opinion that the time has come when more consideration must be given to their needs. I am very sorry that Senator Uppill’s amendment providing for the stabilization of the industry was declared to be out of order, and therefore could not be debated in conjunction with the motion submitted by the Leader of the Opposition (Senator Collings), which only covers the first advance. The remarks of Senator Johnston with regard to the threatened withholding of deliveries are substantially correct. The honorable senator’s declaration as to his own position reveals the seriousness of the situation of the wheatgrowers of Western Australia, so I ask Ministers to give to the matter their immediate attention. I have received a report of a meeting held at Merredin on the 11th instant, and attended by a large number of growers from the surrounding wheat . districts. The resolutions indicated very clearly that the growers were determined that the Commonwealth Government should take definite action for the acquisition of this season’s harvest at a price which would ensure to them a fair return for their labour on the basis of cost of production, plus a reasonable profit. The meeting agreed that 3s. 4d. a bushel at sidings was the minimum price that would return the cost of production in the 1939-40 season. With regard to finance, the growers declared that the initial advance should be not less than 2s. 6d. a bushel and that the balance should be paid in non-negotiable scrip, bearing interest at current rates. One resolution read as follows : -
That this mass meeting of farmers and others inform the president of the Wheat Growers Union and Primary Producers Association, both organizations being affiliated with the Wheat Growers Federation, that we farmers do not intend to deliver any wheat in this season until the demands made by the Wheat Growers Association to the Federal Government for 3s. 4d. a bushel at sidings is granted, and that both presidents should immediately contact- with the Wheat Growers Federation for similar action throughout the Commonwealth .
I understand that action is now being taken in accordance with the terms of that resolution, and I am very much afraid that if the growers’ requests be not given full consideration, there is going to be serious difficulty in connexion with the compulsory acquisition of this season’s harvest. I firmly believe it will be possible for the Government to make an initial payment of 2s. 6d. a bushel. I say this because only a few months ago the
Commonwealth declared that it found some difficulty in financing the harvest to the amount of £3,250,000, yet now it is prepared to find £20,000,000. If it can contemplate such a tremendous increase of expenditure in so short a time, it should not be unreasonable to ask the Commonwealth Bank to finance the coming harvest for, say, a further £10,000,000, as, I believe, the bank would be secured better than some people think. My reason for offering this opinion is that it is well recognized that, despite our huge war. expenditure, the enhanced prices for our primary products will greatly strengthen our position in London. On the sale of wool alone, having regard to the fact that we received approximately 10.3d. per lb. for the last clip, and the present clip should realize in the vicinity of 13Vi.cd., our London position will be improved by approximately £11,250,000.
– More than that.
– If we take into consideration the possible profit on the resale of wool to neutral countries, our position in London may improve by about £13,250,000. Last year our wheat-growers received as low as ls. 0 5/8 d. a bushel. To-day wheat for local requirements is being quoted in Sydney at 2s. lOd. a bushel in bulk and 3s. in bags. On the basis of the Government’s offer, the realization of the crop should improve our London position by an additional £5,500,000 to £7,250,000! The value of gold exports will be increased by from £2,500,000 to £3,000,000, and if one considers the sales to the United Kingdom of meat, butter and other primary products it is safe to assume that an additional £25,000,000 to £30,000,000 will be received this season for Australian primary produce. It is not unreasonable to suggest that the Australian wheat sold to the United Kingdom, Japan and other countries will produce more than is anticipated, and that it will be possible to increase the amount to be received from wheat sales by from £7,500,000 to £10,000,000. I realise that for the next few years there will be a somewhat heavy strain upon London funds owing to the war, but at the same time our actual commitments overseas for war purposes could be financed with the assistance of that maternal financial agency - the United Kingdom Government. As that Government assisted in that direction during the last war, it would be prepared to do so again and thus enable the Commonwealth Government to assist the export of primary products.
– Does the honorable senator support the whole of the resolution which is cited?
– No. I agree with the resolutions which I have read in regard to a first advance of 2s. 6d. a bushel and a minimum basis of 3s. 4d. at sidings, but I do not agree with the proposal to withhold wheat -because in so doing the growers will not achieve their objective. I mentioned earlier that I realize the gravity of the situation, and I want to impress upon Ministers and their supporters that the position is serious. Owing to the huge accumulation of wheat something must be done regarding the planting of the next crop and possibly the following crop. In this matter the Commonwealth is not the sole authority, as the governments in the wheat-growing States must bear their ‘ share of the responsibility to put the industry on a stable basis. In order to do so, restriction of production must be faced squarely. Farmers must realise that so long as the present huge accumulation of world stocks remains, the acreage to be sewn to wheat next year must be restricted. The Commonwealth will be unable to give effect to such a policy without the assistance of the State governments, because with the exception of a few hundred acres in the Australian Capital Territory, the Commonwealth Government has no jurisdiction in the matter of wheat production. The Premiers of Victoria and of Tasmania have to face the position with the Premiers of the other States, and co-operate with the Commonwealth Government in a comprehensive scheme to regulate the wheat industry for the next season and possibly the following season. Unless most unusual circumstances develop, resulting in the destruction of huge quantities of wheat, restriction of output must be provided for.
The DEPUTY PRESIDENT. - The honorable senator’s time has expired.
– I was very disappointed with the speech delivered by the Leader of the Opposition (Senator Collings) in submitting the motion now before the Senate. We expect and usually get from that honorable senator some well reasoned arguments in support of the proposals which he brings forward from time to time; but to-day we were not supplied with anything in the nature of sound arguments or statements which would indicate that he has given the wheat industry very careful, consideration. In fact, the only thing he did this afternoon was to make a demand on the Government. He also endeavored to mislead the wheat-growers of Australia into believing that the party which he leads in this chamber has a policy in regard to wheat production and marketing. Unfortunately for him, the party which he now leads in this chamber has been in control of the treasury bench, and, unfortunately for it, at a time when wheat prices were low. If this party has, as we have been told by its supporters, a policy for the control of the wheat industry, that was obviously the time when effect could be given to such a policy. An examination of the records of the Government at the time to which I have referred shows what actually happened. For the information of honorable senators opposite and for the enlightenment of some wheat-growers who may be misled by the statements made by honorable senators opposite, I propose to read a portion of the speech delivered by the Minister for Trade and Customs (Mr. Forde) in the Scullin Government, when introducing a bill which contained, according to his own statement, the policy of the Labour party at that time in regard to wheat.
– At that time?
– I know that its policy varies, so that we have difficulty in knowing what it really is. In Hansard, vol. 27, page 1425, Mr. Forde, who, I presume was speaking on behalf of the Government of which he was a member, said -
The Government has examined all the proposals that have been made for the assistance of the wheat-grower, and has come to the conclusion, that the only practical method of help ing him is to guarantee him a fair price for his wheat having regard to the present price of wheat on the world’s market.
– Has this Government had regard to the world’s market ?
– Regard must be paid to the price ruling in the markets of the world, but that factor has been overlooked in the demand that has been made in this chamber. Mr. Forde continued -
It has been decided after very careful and serious consideration to guarantee the grower 3s. a bushel f.o.b. equivalent to an average of about 2s. Od. a bushel at country sidings for f.a.q. wheat for- the 1930-31 crop.
The bill which the Minister was then explaining passed through both branches of the legislature, but, notwithstanding the extravagant statements made by honorable senators opposite to-day, it was not given effect to by the Scullin Government.
– Because it could not arrange the necessary finance. Senator Fraser stated this afternoon that “ We must inherit the errors of our predecessors “, and I therefore ask him to accept his own dictum on that particular point. Although the bill was passed through both chambers, the Labour Government then in office did not give effect to its provisions. The Scullin Government advised the Australian wheat-growers to grow more wheat.
– Which they did.
– Unfortunately in the year in which that act was to apply there was a record wheat crop, up to that period, of 213,500,000 bushels, and the price realized f.o.r. Williamstown was 2s. 5Jd. a bushel. The Scullin Government in its generosity paid a bounty, not from revenue but from loan, of slightly under 5d. a bushel.
– Fourpence halfpenny a bushel.
– Slightly more than that. I am giving the Government of that time the benefit of id. a bushel by saying that the amount was under 5d., so that in fact the farmers that year received 2s. lOd. a bushel for their wheat f.o.r. In consequence of the generosity of that government, the people of this country are paying off the loan raised to subsidize the wheat industry during that period. In fact, the taxpayers are paying approximately £300,000 a year to liquidate the loan. In these circumstances it is useless for the party in opposition to advocate schemes such as Labour senators have mentioned to-day, when we have the actual experience of what the party does when it has the opportunity. This Government has followed the same reasoning as was enunciated by Mr. Forde; it has examined very carefully the position of the wheat industry, not only in Australia, but also throughout the world. It has given full consideration to .the whole of the facts, and, interpreting the possibilities on a most generous scale, has offered to finance the wheat-growers of Australia for this year’s crop to the amount of £22,000,000. Various statements have been made as to the price of wheat. Senator Allan MacDonald, for instance, mentioned the price quoted in Sydney, but I point out that that price has little relation whatever to world parity. At the moment world parity is an entirely nominal quotation. If we could secure sufficient shipping we could sell a considerable proportion of the coming crop. However, the possibility of securing shipping to lift the whole of this year’s wheat is very remote. That fact has emerged clearly from negotiations which we are urgently pressing forward. Consequently, whilst we can use 30,000,000 bushels on the Australian market, and whilst we are hoping that the British Government, at a very generous estimate, may buy anything up to 40,000,000 bushels, the plain fact which confronts both this Government and the people of Australia is that at the end of this season we shall have to store between. 60,000,000 bushels and 70,000,000 bushels of wheat in this country. I draw the attention of honorable senators to the position which existed in the last war when a similar problem had to be met. We know that at that time millions of bushels were destroyed by weevils, mice and other pests. Whilst we are determined to exercise every care to prevent a recurrence of those losses, we are under no illusion as to the difficulties of storing wheat for any considerable period. The Government has taken all of those facts into consideration. Above all, it is fully aware of the position of the wheat-farmer to-day.
Exaggeration does his cause no good whatever. I remind honorable senators that the majority of our wheat-growers at the present time engage in several side lines. The man who grows wheat only cannot possibly carry on economically. Every one who is versed in the industry realizes that in order to carry on wheatgrowing profitably a farmer must produce side lines. Consequently the majority of our wheat-farmers to-day engage in mixed farming, and, therefore, they have sources of income other than wheat. In view of the satisfactory sales of these commodities which we have been able to negotiate with the British Government, I suggest that the return to the farmer from these side lines will be infinitely greater than it was last year.
– in reply - It is obvious that the Government is not prepared to accept the motion now before the Senate in the spirit in which I submitted it.
– I rise to a point of order. The Leader of the Opposition, who has been given the call by the Chair, is now about to reply to the debate. Is he entitled to do so until all honorable senators have exercised their right to speak within the time allotted to this debate?
The DEPUTY PRESIDENT (Senator James McLachlan). - The Leader of the Opposition has the right of reply, and the debate must conclude at 8.47 p.m.
– I submit that should honorable senators wish to occupy the whole of the time allotted to the debate, the right of the Leader of the Opposition to reply automatically lapses. That being so, honorable senators who have not yet spoken have the right to speak irrespective of the mover’s right of reply. This practice has always been followed in the past, and, surely, on this occasion we are not to be denied our right. It seems to me, Mr. Deputy President, that your ruling is gravely unjust to honorable senators who have not yet spoken in this debate.
The DEPUTY PRESIDENT. - Obviously some honorable senators will not have an opportunity to speak within the time allowed for the debate.
– It is obvious that the Government is not prepared to accept my motion in the spirit in which I submitted it. The Assistant Minister (.Senator McBride) suggested that we do not realize the tremendous task which confronts the Government. In my opening remarks, I said that I desired to assist the Government to find a way out of this difficulty. I did not minimize the seriousness of the position in any way. Obviously, however, it is impossible when making a motion of this kind to satisfy senators like the Assistant Minister. He said that I had led the wheat-growers to believe that the Labour party has a wheat policy. I am very pleased if I did so.
– I said that the honorable senator endeavoured to do so.
– Either the Assistant Minister is not acquainted with the facts or he is acquainted with them. If the latter be the case, he is misinterpreting the position. If he is not aware of the facts, he is displaying surprising ignorance for a Minister of the Crown. Not only has the Labour party a wheat policy, but in Queensland, a. Labour government has put such a policy into operation. In that State a wheat board has been established for many years, and throughout its existence the wheat-farmers of Queensland have benefited. They are receiving at present 5d. a bushel for their wheat over the prices received by growers in any of the other States.
– That is because Queensland does not export wheat.
– I shall be truthful; Queensland exported wheat for the first time last year. Even on that j>oint, therefore, the Assistant Minister is wrong. The Labour party, however, also lias an Australian policy in connexion with wheat. I do not propose to waste time by reading it. Apparently I am all wrong because in my speech I failed to deal with a lot of side issues. I deliberately left every side issue out of my speech. However, I have been asked why I did not say something about stabilizing the industry. Senator “Wilson dragged in that issue. I point out to him that that subject is not under discussion. An examination of Hansard will reveal that whenever the Government has proposed to grant assistance to the wheat-growers the Opposition has declared that it is a disgrace to ask the farmers to approach the Government annually for a dole. On every occasion we have declared that the Government should stabilize the wheat industry on a scientific basis. I have also been accused of failing to deal with the restriction of production. Tt is obvious that if we allow farmers to grow wheat for which there is no exportable market we must take steps to control the areas that are to continue in production. However, I did not submit my motion in order to discuss that subject. Another honorable senator opposite dragged in the issue of growing wheat on marginal lands. We say that that phase of the industry is an example of the ruthlessness and planlessness of the capitalistic system, under which the farmers are allowed to settle on land on which they have no hope of even making a living. Lt is the duty of the Government to transfer such farmers to more suitable land. Apparently Senator James McLachlan would leave these unfortunate farmers On marginal areas to the tender mercies and vagaries of overseas markets. We say that under our proposal the farmer on marginal areas would benefit, according to his production, as would the man engaged on good land. I did not introduce interest rates or shipping freights, but an honest government which tackled this problem in the only decent way in which it can be tackled would see to it that these burdens were removed from the backs of our primary producers. The Assistant Minister is very perturbed about what the Scullin Government did for the wheat industry. Honorable senators opposite invariably adopt a cowardly attitude when dealing with the record of the Scullin Government. They are not honest enough to acknowledge the fact that, although that Government was in office it was never in power, because the Senate of the day was hostile to it and threw out every piece of legislation that did not suit the non-Labour Opposition.
– The Senate passed the Government’s wheat bill.
– Of course it did. When the Scullin Government took over from its predecessor, the Bruce-Page
Government, it inherited an adverse trade balance of £30,000,000. In its appeal to the country to help it to rescue Australia from economic disaster, it also called upon the farmers to grow more wheat, and so splendid was the response that through the heroic efforts of the Scullin Government the then adverse trade balance of £30,000,000 was converted into a favorable balance of £30,000,000, an achievement which none of its successors has been able to equal. The Labour party will not stand for profiteering on the part of any industry, primary or secondary, in connexion with any goods which we sell to the United Kingdom, and it will also oppose any attempt on the part of this Government or the United Kingdom Government to profiteer at the expense of the primary producers of this country. For commodities sold to the United Kingdom Government, the Opposition will demand a price sufficient, not only to lift the growers above the bread line, but also to pay them a wage equal to the basic wage received by the workers in secondary industries; and that wage, God knows, is low enough. We shall insist that our primary producers shall receive that wage, and a little more. Ministerial senators have endeavoured to misrepresent what the Opposition asks for. We are asking that the price to be paid to the wheat-grower shall be a first payment of 2s. 6d. on delivery at the sidings, plus a second payment on the 1st February of 1s., less railway freight. In my speech I also said -
And we are hopeful that, in the final cleanup, the growers will get ait least the amount recommended by the GeppRoyal Commission -3s.10½d. at ports.
There can be no equivocation about those words. The Government cannot escape from its responsibility in this matter. There isa national crisis clue to the war, and the Government needs the cooperation of every section of the community. If the action it takes prevents that cooperation, drives wheat-growers off the land, depletes townships of their population, and reduces a section of the primary producers to a state of poverty, the Government will increase unemployment, insolvencies, and malnutrition. It will have done nothing whatever except spoil its chance of providing for the effective defence of this nation in the emergency with which we are now confronted. Having expressed the views of the Opposition in regard to this matter I now ask leave to withdraw the motion.
Motion - by leave - withdrawn.
asked the Minister representing the Treasurer, upon notice -
What was the amount of the guarantee given by the Scullin Government to the Wiluna Gold-mining Company?
– The Treasurer has supplied the following answer to the honorable senator’s question: -
The State of Western Australia guaranteed the payment by Wiluna Gold-mining Company of £300,000 to the Midland Bank Limited, London. The Commonwealth, under the Western Australian Agreement (Wiluna Goldmines) Act 1930, indemnified the State against any loss arising in such circumstances as those specified in that act. The loan was repaid in full by the company.
asked the Minister representing the Treasurer, upon notice -
– The Treasurer has supplied the following answers : -
– by leave - Although two and a half months have elapsed since the outbreak of the war we are, one might say, waiting for the war to commence, as far as the land forces are concerned, and, at the same time, there is a great deal of discussion regarding the possibility of peace. During the last two or three years, the rulers of Germany have absorbed one country after another by means of bloodless victories; but the patience and tenacity of the British Empire and the patriotism of the French nation are calling a halt to aggression. This war was not lightly entered into, and the cause for which we entered into it will not be lightly abandoned. We have two war aims, the first and paramount being victory - victory for the peace and happiness of simple men and women. We cannot compromise with regard to things that are vital to civilization. After victory, we desire that there shall be a better Europe and a better world, and abandonment of the mad and threatening competition of armaments. We are not out to make a slave state of Germany.
I desire to bring under the notice of honorable senators many of the changes that have taken place in regard to the control of the fighting services in Australia. It became apparent to the Government that, with the tremendous amount of additional work placed on the Minister for Defence (Mr. Street), who is now Minister for the Army, it was necessary to divide the Defence Department into three branches. Therefore, Mr. Street will henceforward be Minister for the Army, Sir Frederick Stewart will be Minister for the Navy, and Mr. Fairbairn will be Minister for Air, including Civil Aviation. The work will be co-ordinated by the Minister for Defence Coordination, the Prime Minister, whose function will be confined to matters of policy, the actual administration being left to the appropriate Ministers.
In future the War Cabinet will consist of the Prime Minister, the AttorneyGeneral, the Minister for Supply and Development, the Minister for the Army, the Minister for External Affairs, the Minister for the Interior, the Minister for the Navy, and the Minister for the Air, with the Acting Treasurer co-opted, if necessary. There will be no bottle-neck in administration. It is necessary to give instant and close attention to the problems of supply, shipping, internal finance and overseas finance, and of minimizing shock to business. The Commerce Department has boards controlling primary products, shipping, wheat, wool, barley, &c. The Treasury has advisory committees on capital issues, taxation, financial and economic policy. The Trade and Customs Department has an Economic Warfare Advisory Committee and a Prices Commissioner. The Supply Department has consultants on industrial organization, oil, and sea-borne trade.
The Prime Minister pointed out that it is quite impossible for us to imagine that, at the end of the difficult period through which we are passing, when peace does come - and we all sincerely hope that it will come soon, and will be a just peace, with the smallest amount of sacrifice possible - this country will revert to the same economic structure as it had prior to the outbreak of war and the necessity for setting up organizations to control various industries. Therefore, as my colleague, Senator McLeay, has pointed out, an Economic Cabinet has been formed, side by side with the War Cabinet, and will consist of the Prime Minister, the Minister for Supply and Development, the Minister for Commerce, the Postmaster-General, the Minister for Trade and Customs, the Acting Treasurer and the Assistant Minister for Commerce. A Treasury Finance Committee has been established in connexion with defence expenditure. The War Cabinet has made two major decisions. It has decided to keep the Militia Forces at 75,000 men. Service abroad is to be of a voluntary character, there being no question of conscription overseas. The Government is definitely pledged against that. Compulsory training for home defence has been decided upon by the Government. Liability to serve in Australia will be imposed, first, on those who attain the age of 21 years during the current financial year. As time goes on, men of 22 and 23 years of age, and so on, will have received a substantial measure of military training.
– Is that not conscription ?
– I said quite clearly that, as far as overseas service is concerned, the training will be on a purely voluntary basis. This Government does not think that the obligation for service for home defence should be confined to any particular sections of the community. It believes that the defence of Australia is an obligation that should be shared equally by every section. A vast Empire air- training proposal, which is the second major decision of the War Cabinet, has been designed in co-operation with Great Britain, Canada and New Zealand. Mr. Fairbairn is now in Canada discussing principles and details. The pilots, observers and gunners will number thousands. This will, on the personnel side, tend to make Australia almost a first-class air power.
I propose to give now a brief outline of the various activities of the fighting services.
In the Navy, the personnel has been doubled, and the ship construction programme has been greatly expanded. Naval reservists have been called up for continuous service. The strength of the Navy has been considerably augmented by chartering merchant ships and arming them for naval service. The smaller types of vessels are readily convertible into mine sweepers, and anti-submarine vessels, etc. Thirteen mine sweepers and anti-submarine vessels, two fast mine sweepers, ten examination steamers, and one store carrier have been fitted up, manned, and placed in service. Five other vessels have been armed as merchant cruisers. Over 80 merchant ships have been defensively armed in Australia and gun crews allotted. Signal and coast-watching stations have been established and have been functioning satisfactorily. Merchant ships are controlled and allotted routes by the Navy. For 1939-40 the expenditure on the Navy will be £14,500,000, of which £5,333,000
Will be expended on special war measures.
As far as the Army is concerned, garrison battalions have been raised for guarding vulnerable points and internment camps. About 300 aliens have been interned in Australia. The policy of the Government is to intern only those aliens actually suspected of activities likely to be prejudicial to the interests of Australia and the British Empire. At all ports throughout the Commonwealth, fixed coast and anti-aircraft defences have been put on a war footing, and a defence scheme for Papua and New Guinea has been completed. The first months training of the Militia will be completed next month, and three months training will commence early in 1940. It was ascertained that about 16,350, or 22 per cent. of the members of the Militia are married men. Instructions have been issued that these are to have the option of being transferred to the reserve at the end of a month’s training, lt was never anticipated in the original enlistment scheme for the Militia that it would be necessary so quickly to establish long term camps such as we have had to provide on account of war conditions. Consequently many of the militiamen who have families found themselves in great difficulty through being required for a longer period of training than it was anticipated they would be called upon to serve when it was decided about a year ago to increase the strength of the Militia to 75,000. The decision of the Government to reintroduce compulsory military training will ensure that the military forces will be maintained at 75,000 men, in addition to the division known as the 2nd Australian Imperial Force. This division now comprises about 16,000 men who are concentrated in three camps - at Ingleburn and Allandale in New South Wales, and Puckapunyal in Victoria. The estimated expenditure on camps of the 2nd Australian Imperial Force is £1,250,000. Artillery organization is taking place on lines adopted by the British Army, and the process of mechanization has been accelerated. The first step is also being taken in the re-organization and re-equip-, ment of the infantry battalions on modern lines.
I wish to pay a tribute to the Government departments and commercial firms for their wholehearted co-operation with the Government in getting so many men into camp. The Repatriation Department which, unfortunately, still has to handle the cases of many men who were injured or became ill as a result of their service in the war of 1914-18, is now actively operating with the public hospitals in connexion with the present mobilization. The total estimated expenditure on the Army for 1939-40 is £28,200,000, or £17,770,000 over the prewar allocation.
At the outbreak of war the Royal Australian Air Force was mobilized, and all members of the Citizen Air Force were called up for continuous service. This branch of our defence organization is actively co-operating with the Navy in patrolling coastal areas. The original order for 50 Lockheed Hudson aircraft from the United States of America has been increased to 100, whilst the rate of production of Wirraway aircraft has been greatly accelerated. The Australian pilots and the air crews who were sent to the United Kingdom to take delivery of flying boats will form the nucleus of an air squadron which will serve with the Royal Air Force. Australia is the first dominion to have a complete air squadron with that force. In order to provide for increased training of flying instructors, a flying instructors school was formed at Point Cook, and an eight weeks’ course for 46 pupils was commenced on the 16th October. In addition, the elementary training of a batch of air cadets was transferred to civil flying training establishments. For the supply of pilots for the home defence force, 100 air cadets will commence training on the 27 th December. Two group commands have been established. The head-quarters of No. 1 group will be in Melbourne, whilst No. 2 group will have its head-quarters in Sydney. These groups are responsible for the close supervision of training, general preparedness for war, and the administration of all units within the group. During 1939-40 it is expected that £11,900,000 will be expended on the air force. That is an increase of £2,442,000 on the prewar allotment, and is exclusive of the cost of the Empire training scheme.
I desire also to include some information relating to the work of the construction branch of the Department of the Interior which, at present, is almost entirely engaged on the construction of defence works. These works are given priority over all other construction, but that does not mean that other forms of construction have been entirely abandoned. The requirements of the Defence Department have imposed a tremendous strain upon the officers of this branch.
Prior to the outbreak of war, my department was undertaking a programme of defence works estimated to cost. £10,000,000 over a period of three years. Owing to the strained international situation in September, 1938, the defence: programme was considerably accelerated, and proposals were developed at an earlier period than was originally intended.
I propose to deal more specifically with matters with which my department has been connected since the outbreak of war. Shortly before the declaration of war, advice was received from the Defence Department, that in the event of hostilities, emergency accommodation, including furnishing, would be urgently required at the Royal Australian Air Force Stations at Pearce, Western Australia, Laverton and Point Cook, Victoria, and at Richmond, New South Wales. All necessary preparations were made by my department, and within 24 hours of advice being received from the Defence Department that the buildings were required, material was on the site and the works actually commenced. All this accommodation was completed in a remarkably short time. On the day following the outbreak of war advice was received of vital defence requirements at Darwin. In this instance, too, a commencement was made on these urgent defence works, costing approximately £37,000 within 24 hours of notification to the department. Despite the extreme pressure on all sections of the Works and Services Branch of the department, which was organized for a normal defence programme, the central office and branches in the various States have been able to meet all demands for defence works, including encampments for the new Australian Imperial Force. Al Ingleburn, in New South Wales, camp accommodation to the value of £192,000 has been put in hand, the first section of which was completed at a cost of £98,000 within five weeks of notification to the department. This achievement called for the closest co-operation between officers of my Department, contractors, merchants and the workmen engaged in the erection of the structures. As many as 1,000 men were employed at the one time on the constructional work at Ingleburn. In order to accommodate portions of the 2nd Australian Imperial Force at Allandale, New South Wales, contracts to the value of £73,000 have been let. The first contract was let on the 9th November, and is to be completed by the 13th December, whilst the second contract which was accepted on the 16th instant, is due for completion by the 19th December, 1939. It is a tribute to the organization of the contractors concerned, that the camp works in all States have been completed to schedule. At Seymour, in Victoria, a contract was let for six groups of buildings, comprising 570 structures in all. Pour of these groups were completed in four weeks, and all six groups within six weeks from the date of notification to the contractor. A second contract for 176 buildings is nearing completion, whilst a third contract was let on the 16th November for a further group of 245 buildings. The expenditure involved in the case of the emcampments at Puckapunyal, near Seymour, is £200,000.
My department is undertaking the construction of new air force stations at Wagga in New South Wales, and at Amberley and Townsville in Queensland, and a new seaplane base at Rathmines, New South Wales. Owing to the acute distress in the coal fields area in th<3 vicinity of Rathmines, the Prime Minister (Mr. Menzies) promised that every effort would be made to carry out such of the work by day labour as could be economically undertaken by that method. Following a conference with my colleagues, the Minister for Defence and the Acting Treasurer, it was agreed that my department would immediately commence work to the value of £46,000 on the Rathmines seaplane base by day labour. This work will comprise the construction of roads, paths and paving, kerbing and guttering, sewerage and stormwater reticulation and water supply reticulation within the aerodrome boundaries. Twentyfive wooden huts for the accommodation of the defence personnel will be done by day labour at a cost of £15,500, which amount is included in the £46,000 aforementioned. All this work is of such a nature that it should provide considerable relief to the unemployment position in this district.
With a view to assisting the local unemployed wherever possible, the Works Directors in all the States have been instructed that a clause is to be inserted in specifications providing that, whereever possible, the contractors shall make use of the services of local unemployed. Tt will, of course, be realized that contrac tors must continue to employ certain of their own skilled artisans, but the intention is to use the local unemployed wherever possible.
Statements have appeared in the press that workmen employed on defence works are not being paid award rates.
In the conditions of contract embodied in all contracts let by my department provision is made for the observance of relative awards. Contractors are required to ensure that all persons employed on the works, whether employees of the contractor or not, are paid at rates which are not less than those fixed by any relevant award, or judgment, or order of any competent court, board, commission or other industrial tribunal or by any relevant industrial agreement in force under any State law or Commonwealth law, including any law of any territory of the Commonwealth of Australia, and are employed under the rates prescribed in any such award, judgment, order or agreement. The contractor is also responsible for the observance, by any subcontractors, of the provisions of the agreement relating to award rates. It should, of course, be understood that my department can accept responsibility for the payment of award rates by contractors and sub-contractors only to workmen employed on the site of the works, and not in secondary industries indirectly associated with the execution of the various works.
Tenders have been invited for the completion of the Royal Australian Air Force station at Townsville. The plans of this station were prepared in a remarkably short time, due to the concerted efforts of the architects on the central staff of my department. The station, which is estimated to cost £195,000, is to be completed within twenty-six weeks of the date of acceptance of a tender.
Tenders for the Amberley station will be invited during this week. In this instance, too, the majority of the plans were prepared by architects on the central staff. Wherever possible, plans have been standardized for the various stations; this has assisted greatly in the expeditious completion of working drawings. The Works Director, Sydney, is completing the working drawings for the stations at Wagga and Rathmines, and will be in a position to invite tenders within the next two weeks, whilst the architects on the central staff are now concentrating on the drawings for the Royal Australian Air Force station at Duntroon. . The construction of the Darwin station is proceeding rapidly.
In order to meet the shortage of skilled tradesmen in Darwin, brought about by the tremendous amount of defence work now in hand, arrangements were made to transport 150 artisans from the eastern and southern States to Darwin by aeroplane. This is the largest individual aerial transport which has taken place in the aviation history of Australia. Extensive additions are being made to the aerodrome at Laverton, Victoria, for Royal Air Force purposes.
With a view to meeting the requirements of military and heavier commercial type aircraft, investigations of all the principal aerodromes and landing grounds throughout Australia have been made, and arrangements are being made for the extension of many of these grounds, including the provision of runways to provide for their use during all weathers. My department has also undertaken the construction of buildings for the Aircraft Assembly Corporation at Fisherman’s Bend and Mascot. Works to the amount of £125,000 at each centre are at present in hand.
A heavy building programme is proceeding at the ammunition factories at Maribyrnong and Footscray, Victoria, and at the Lithgow small arms factory, New South Wales. The need for this has been brought about by the increased armament production. For the Munitions Supply Branch of the Department of Supply and Development £806,000 has been authorized up to the 31st October, but this total has been considerably increased since. The sum of £70,000 was approved this week for a new machine shop at Footscray. My department is also constructing oil storage tanks for naval purposes in Queensland, Darwin and Port Moresby.
I desire to place on record my appreciation of the keen desire exhibited by all State governments to assist in the defence works programme. The services of the instrumentalities of the State governments have been freely availed of, particularly in New South Wales and Western Australia. The State Government carried out all the road work in connexion with the establishment of the Australian Imperial Force camp at Ingleburn, New South Wales, and is now proceeding with the execution of the engineering services at the new Air Force station at Wagga. This work consists of the provision of roads, paths and pave-, ments, storm-water drainage and sewerage reticulation, electric light mains and other engineering services, estimated to cost £36,000. The local council at Wagga is carrying out the water-supply scheme to the boundary of the aerodrome.
For the first four months of the current financial year the authorization for defence works, exclusive of war emergency expenditure is £4,194,695. Of this amount, £32,126 represents expenditure for the Central Administration, £850,847 for the Navy, £960,227 for the Army, £1,545,013 for the Royal Australian Air Force, and £806,482 for the Munitions Supply Branch of the Department of Supply and Development. The total amount authorized for New South Wales, up to the 31st October, is £867,646; Victoria, £1,117,156 ; Queensland, £441,759; South Australia, £167,742; Western Australia, £337,498; Tasmania, £39,422; Northern Territory, £879,508; and the Australian Capital Territory, £343,964. The expenditure for the first four months of the financial year totals £780,316 exclusive of any war emergency expenditure.
The intention of the Defence Department to proceed immediately with the construction of new Air Force stations at Wagga, Rathmines and Townsville, in addition to a large programme of defence works, will increase the authorization to a great extent within the next few weeks. It is anticipated that the expenditure on completed defence works as at the 30th June next will amount to approximately £5,000,000.
The total amount authorized on war services expenditure, including the provision of camps and other urgent necessary precautions for protection of defence properties and vital points, exceeds £600,000. Immediately following the outbreak of war, in order to cope with the defence requirements, a works and services branch of the department was opened in Port Moresby. The Works Director, who is an architect, also has on his staff a civil engineer and works supervisor, and is at present engaged in carrying out numerous defence projects at Port Moresby.
In addition to the work carried out for the Department of Defence, my department is carrying on its normal programme of works for other departments and administrations, the principal expenditure being in relation to the PostmasterGeneral’s Department and the Commonwealth Bank. Plans were prepared by my department for the new Commonwealth Bank premises in Bourke Street, Melbourne. The Governor of the Commonwealth Bank announced last week that a tender had been accepted for this work at £122,856. Plans are practically completed for the new studio for the Australian Broadcasting Commission in Sydney.
The normal building programme in the Australian Capital Territory is proceeding without interruption. At the present time the department has 210 houses in various stages of completion, whilst the contracts for the new patents office, war memorial, and naval wireless stations at Belconnen and Harman are proceeding according to schedule. A considerable amount of engineering work is involved in opening up new suburbs for the Canberra housing scheme. Additions are also being made to storages of water to meet the requirements of Canberra. For this purpose a second reservoir is being constructed on Red Hill.
On the 17th instant an amount of £2,000,000 was approved as an Unemployment Relief Works Grant for 1939. This amount has been allocated as follows : -
There is in reserve £40,000 for the completion of works for which sufficient provision may not have been made.
This programme of relief works was drawn up in consultation with the State Premiers and in almost every instance represents developmental work or works which have a decided potential value for defence purposes. In allocating the money regard was paid to population, percentage of unemployment, and defence requirements.
In New South Wales, approximately £165,000 is to be expended on railway works. Road works, drainage, &c, will amount to £307,000, whilst work on strategic roads will amount to £255,450. To extend and improve existing aerodromes to meet the requirements of the heavier defence and commercial machines, £77,000 is to be expended in New South Wales.
Expenditure on railway works in Victoria will total approximately £59,000; on roads, drainage, clearing, &c, £279,000 ; on strategic roads, £50,000 ; and on aerodrome extensions, £25,000; whilst the construction of roadways to various defence establishments will cost approximately £50,000.
Of the Queensland allocation, approximately £5,800 is set aside for railway works, principally in order to improve conditions for the change-over at Wallangarra ; £111,000 for roads, drainage, clearing, &c. ; and £100.000 for strategic roads. Extensions to existing aerodromes in Queensland will cost approximately £52,000.
The expenditure on railway work in South Australia will amount to approximately £11,500; on roads, drainage, clearing, &c, £126,000; and on extensions to aerodromes £6,000, whilst an amount of £30,000 has been set aside for works not yet specified.
In Western Australia roads, drainage, clearing, &c, will cost approximately £76,000; and improvements and extensions to aerodromes £41,000; whilst £8,000 has not yet been allotted to any particular proposal.
The majority of funds allotted to Tasmania provide for roads, drainage, clearing, &c, at an estimated cost of £51,000; while extensions to the aerodrome at Flinders Island and King Island are estimated to cost £6,000.
The majority of these works will be carried out by State government instrumentalities under the direction of the Commonwealth Works and Services Branch in each State, and will greatly alleviate unemployment. Some of these works are already in progress. The desire of the Government is to provide as much employment as is possible before Christmas. I would emphasize that expenditure under this grant of £2,000,000 will be spread as much as possible over country areas, as well as the capital cities and larger provincial towns, in order that unemployment relief may be general throughout the Commonwealth. The works to be undertaken will also have a definite defence or developmental value. Whilst many of us will, no doubt, admit that a. certain amount of waste has occurred in connexion with some relief works in the past, this proposed additional expenditure will, I believe, greatly strengthen our defence position. I lay on the table the following paper : -
War Activities of the Government and of the Fighting Services - Ministerial Statement. and move -
That the paper be printed.
Debate (on motion by Senator Collings). adjourned.
Senator McBRIDE (South Australia -
Assistant Minister for Commerce). - by leave - At the outbreak of war, the Government decided to establish an authority to control prices. On the 8th September an order was gazetted fixing the prices of certain goods at the levels ruling on the 31st August. The Government then established a pricefixing branch of the Trade and Customs Department, appointed a prices commissioner, and, in co-operation with State governments, deputy commissioners in the States. The machinery in the States is now in complete working order. Already 160 major commodities and services have been declared, and the Prices Commissioner has fixed maximum prices of these either at pre-war level or at a new level determined by the unavoidable increases of costs due to circumstances largely beyond the control of the Commonwealth, such as (a) increases of overseas prices, (b) increases of shipping freights, (c) increased exchange costs, (d) higher domestic costs, (e) sales tax, customs and excise, (f) increases of prices of Australian exports. The last two are under the control of the Government. Export prices have risen 17½ per cent. This has meant a higher level of prices for material used in Australian industries. It is important to control increases of basic services, such as transport. On the 2nd October interstate shipping companies increased freights by 20 per cent. Action was then taken to gazette regulations for the control of all services. A declaration was made that the service of transporting passengers or goods by sea was subject to price control and the Prices Commissioner fixed freight rates at 10 per cent. above those of the 31st August.
The Government is determined to protect Australian consumers against profiteering, but we cannot insulate our economic system. The Prices Commissioner has fixed the maximum prices of most declared goods in accordance with a general averaging order of the 5th October, under which traders are allowed automatically to adjust the basic price of goods in accordance with unavoidable increases of average cost. Average cost is ascertained by aggregating the cost of old and new stock, and dividing the sum by the total quantity of stock. This enables a trader to finance the purchase of more costly stock. Traders are compelled to keep records in order to justify increases, and this enables the Prices Commissioner to exercise strict supervision over such increases. The Prices Commissioner also reviews profit margins and basic profits. These principles apply to non-declared goods, and where prices have been increased in excess of maximum prices under an averaging order, the goods have been declared and have been subjected to averaging order or specific price determination. In this way it has been possible to spread the influence of price control throughout the whole range of nondeclared goods. In connexion with tea, kerosene, tapioca, bicycles, petrol and paper, increases of retail prices were checked. I am happy to be able to say that it is becoming the practice for traders to approach the Prices Commissioner before raising prices. Where a general averaging order cannot be applied it has been necessary to fix specific maximum prices. This was done in the case of shipments of imported timber. In general, the business community has observed the conditions stipulated, and the system of supervision and inspection has been effective. Thus the retail price index of foodstuffs and groceries for September showed a rise of only . 3 per cent. on the index for August. Rents of shops and houses have also been fixed at the level of the 31st August. Under the National Security (Fair Rents) Regulations authority is given to each State to establish a fair rents board. I lay on the table the following paper: -
Control of Prices and Prevention of Profiteering during the War - Ministerial Statement. and move -
That the paper be printed.
Debate (on motion by Senator Keane) adjourned.
Ministerial Statement:Wool - Wheat - Barley - Apples and Pears - Shipping and Cold Storage.
– by leave - I lay on the table of the Senate, for the information of honorable senators, particulars of the contracts made for the sale of Australian commodities to the Government of the United Kingdom during the war. These contracts provide for the sale of commodities to an annual value of £90,000,000. Sales of dried fruits and canned fruits under contract, and of wheat, barley, and other products, as the opportunity arises, will bring the annual value of sales- to £100,000,000. I take the opportunity to mention some outstanding aspects of the position regarding wool, wheat, and apples and pears.
The negotiations concerning the price of wool were undertaken at a difficult time. During the year ended June, 1939, the average price had been approximately 10½d. per lb. Australian currency, and there was no sound guide to the future. The Government appointed a Central Wool Committee, on which the woolgrowers are represented by Messrs. Abbott, Boyd, and Cole, and consulted the committee in regard to the price negotiations. It was recognized that advantage should not be taken of the position by demanding an unreasonably high price from the United Kingdom Government. At the same time, the Government decided that the year just past could not be taken as a guide. The Prime Minister (Mr. Menzies) took special steps to establish personal contact with the Prime Minister of the United Kingdom, and to arrange for special attention to this commodity, the price of which has such an important bearing, not only on the financial position of the individual grower, but also on the economic prosperity of the entire Australian community. The negotiations were concluded within a comparatively short time, but, during their progress, there were daily telegraphic exchanges between Australia and London, and the High Commissioner was in daily personal contact with British Ministers. The arrangement which resulted from the discussions is very satisfactory. The entire wool clip has been purchased by the United Kingdom Government for the period of the war, and one year thereafter. There is thus no question of market difficulty, or of unsold carry-over, as far as Australia is concerned. The price of10¾d. sterling in the store, equal at present exchange rates to 137/16d. Australian currency, is approximately 3d. per lb. above the previous year’s average, and it will bring an annual income to Australia of £12,000,000 in excess of the wool cheque for 1938-39. Three-farthings sterling per lb. is added to cover the costs from the store to the ship. Moreover, Australia will secure 50 per cent. of the profits accruing from sales of wool for use outside the United Kingdom. The price of wool is arranged in terms of sterling. Should the rate of exchange between the United Kingdom and Australia alter during the operation of the arrangement, such a change would naturally affect the Australian equivalent of the sterling price. Other conditions may also alter, either in the United Kingdom or in Australia, and arrangements have been made for an annual consultation between the Governments of the United Kingdom and Australia with a view to considering whether conditions have so altered as to justify a review of the price. Appraisement of wool is now proceeding steadily, and wool-growers will receive their cheques, in respect of 90 per cent. of the appraised value, within fourteen days of appraisement. The balance of 10 per cent. will be paid at the end of each year. Should the appraisements during the first year prove to have been on the conservative side, there will be a further distribution at the end of the year in addition to the 10 per cent. The total payments to growers during the current year will be 137/16d. multiplied by the total number of pounds of wool appraised. Some growers will get more than 137/16d. and some will get less, according to the type and quality of the wool produced by them. The quantity of wool appraised to date is 710,000 bales. The quantity of wool actually shipped and in course of shipment is 286,000 bales. The estimated additional wool likely to be shipped to the 31st December, 1939, is 466,000 bales. Thus, the shipments to the United Kingdom up to the end of the year will be more than 750,000 bales. Receipts to date of remittances from the United Kingdom are approximately £8,500,000 sterling - the equivalent of over £10,500,000 Australian currency. The scheme is working smoothly. Considering that appraisements commenced on the 9th October, very great progress has been made, and money is circulating rapidly amongst Australian wool producers.
The position regarding wheat is not so fortunate. “Wheat presents a very difficult problem indeed. It is not generally understood why it has not been possible to make arrangements for the sale to the United Kingdom of the entire Australian wheat harvest. The reasons, stated briefly, are -
It is possible that, if the war continues for a long period, existing surplus stocks throughout the world may be absorbed and a better price secured for Australian wheat exports. At present we have to face the unpleasant fact that the world price is low and is likely to remain low in the near future, that markets are and will be difficult to obtain, and that shipping for transport of wheat over long distances cannot be obtained for the mere asking. The difficult problems confronting wheat marketing cannot, therefore, be solved at oresent by Australia or even by the Empire. All we can do is to devise means to sell as much wheat as we can at the best price obtainable, and to store the temporarily unsaleable surplus under conditions which will prevent deterioration, as far as possible. Negotiations conducted with the United Kingdom Government immediately upon the outbreak of war resulted in the sale of 200,000 tons of old wheat in “Western Australia and South Australia at prices which constituted an advance on the prices which had been ruling just before the outbreak of war. The contract for the sale of 50,000 tons of flour to the United Kingdom Government provided a further outlet for wheat and enabled mills to be employed in gristing wheat. These deals satisfactorily disposed of the old crop, although the whole of the wheat and flour purchased has not yet been lifted by the Government of the United Kingdom. “We are now faced with the problem of storage, finance and disposal of the forthcoming harvest, which will probably aggregate not less than 160 million bushels of marketable wheat. The Government is doing its utmost to market this wheat. Negotiations are being conducted with the Government of the
United Kingdom with a view to arranging the sale of the largest possible quantity at the best obtainable price. At present the Government is not in a position to make a forecast as to what the quantity will be or what price will be received for it. Markets will be difficult to secure for the balance of the exportable surplus over and above the purchases by the United Kingdom Government.
Meanwhile the Australian Wheat Board, on which there is a majority of growers and representatives of cooperative organizations, recommended that the Government should acquire the wheat, so that it may be marketed to the best advantage, in the interests of the growers. The Government acted on this recommendation and has made arrangements to finance advances to the producers, in anticipation of the ultimate disposal of the wheat. Arrangements have been made with the Commonwealth Bank to make available to the Australian Wheat Board the necessary finance to enable advances to be made to growers, pending the sale of their wheat, on the following basis, namely 2s. 9d. a bushel for bagged wheat and 2s. 7d. a bushel for bulk wheat, less the freight from rail siding or other delivery point, to port of shipment. These advances are equivalent to approximately 3s. for bagged wheat and 2s. lOd. for bulk wheat f.o.b. ports. Of these advances, the sum of ls. 9d. a bushel for bagged wheat, and ls. 7d. a bushel for bulk wheat, will be paid upon the delivery of the wheat to the agents of the Wheat Board. The balance of ls. a bushel will be paid during February. 1940. Freight charges will be deducted from the second advance. The total finance involved in these advances and other costs associated with the marketing of the crop will exceed £20,000,000. This outlay by the Commonwealth Bank, guaranteed by the Commonwealth Government, will be recouped by moneys representing market realizations and by the proceeds of flour tax collections, whilst, as honorable senators know, in certain circumstances the Commonwealth Government has agreed to provide such additional amount, not exceeding £2,000,000, as may he found to be necessary in order to raise the average realization for marketed wheat to 3s. 4d. a bushel f.o.r. shipping ports. These are, of course, not the maximum liabilities being assumed by the Commonwealth Government. In fact, the uncertainty relating to the remunerative disposal of the harvest may well involve the Government to a much greater degree. It is clear that considerable difficulty will be experienced in disposing of the harvest. The Government realises that it will be necessary for it to carry the financial responsibility of unsold stocks perhaps for a considerable period. The greatest care will, of course, be taken in the storage of wheat, and the Government hopes that ultimately the market returns will recoup the advances now being made.
The marketing problems of barley, and of apples and pears, are referred to in a document which I circulated to honorable senators by post. The Australian Barley Board is now functioning, and the Government has acquired the barley crop. As regards apples and pears, an additional detailed statement is being circulated for the information of honorable senators. The Australian Apple and Pear Board, composed principally of producers, is working actively on the plans to increase the consumption of apples and pears in Australia, and the Government is exploring all possible avenues of oversea disposal, in the form of fresh fruit, canned and dried fruit, and fruit juices. It will be necessary to acquire the whole crop, to make advances to growers, and to put into operation machinery for rapid transport of fruit to consuming centres throughout Australia.
Storage and shipping are important features of the arrangements for the sale of Australian products. A Shipping Control Board has already been appointed to control coastal shipping in Australia, if the need arises for close supervision and control of the cargo requirements of our interstate trade. The same machinery will be available for the control of overseas shipping should such a course be decided upon. The United Kingdom Ministry of Shipping is at present considering its policy in respect of the conduct of the shipping services between the United Kingdom and Australia, and the Commonwealth Government is ready to co-operate fully at the appropriate time. Meanwhile, I am in r:lose and constant touch with the Oversea Shipping Representatives Association, and am arranging for the important export industries to appoint representatives to co-ordinating shipping committees. The object is to ensure that all available shipping space shall be utilized to the best advantage.
The transport of refrigerated- commodities presents a particular problem. These commodities have to be stored on land from the time of their production up . to the time of their shipment, and they require refrigerated space during transport to the United Kingdom. Some time before the outbreak of war, a survey was made, of the refrigerated and cold storage space available on land throughout Australia, and certain deficiencies are now in course of correction. As far as can be judged at present, having regard to the shipping tonnage available, it is anticipated that it will be possible readily to transport overseas the Australian commodities in respect of which contracts have been made. Should the demands on shipping space in various parts of the world become more pressing, the Government’s contact with the United Kingdom Government and the ship-owners is such that the most efficient possible use will be made of whatever shipping is available.
I lay on the table the following paper : -
Sale of Australian commodities to the United Kingdom and other Aspects of War-time Marketing - Ministerial Statement and move -
That the paper be printed.
Debate (on motion by Senator Cunningham) adjourned.
– by leave - Since the first major calamity of the war - the overthrow of the Polish nation, and the partition of its territory by Germany and Russia. - international affairs bearing upon the war may fairly ;be said to have developed unfavorably to Germany. The independent attitude adopted by Italy, the advance of Russia to the Vistula, the ascendancy acquired by Russia in Estonia, Latvia and Lithuania, and, what is of still more importance, over the greater part of the Baltic Sea, can be read only as most grievous and bitter setbacks to Nazi feelings and aspirations.
The decision of the United States Congress to lift the embargo against the export of arms and munitions, and particularly military aircraft, might well prove in the long run a mortal blow to Germany in the war, while the agreement successfully reached between the United Kingdom and France and Turkey is of scarcely less significance.
In the Far East there has been, at least for the time being, a marked easing of the strained relationship which previously prevailed between British and French and Japanese interests. Until the war had actually commenced there was positive apprehension that the Allies might have, even at the outset, to contend against more than one enemy. So far, at least, the only enemy is Germany.
Perhaps of still more moment is the undisputed fact that in this mighty conflict, upon which the Commonwealth has entered in co-operation with the British Empire and France, the weight of neutral opinion, and even strong^ sympathy, is overwhelmingly on our side.
To-day, Germany not only fights alone, but also fights without declared friends. We of the British Empire enter into the struggle with a proved and trusty ally of great military renown; and we enter it, too, with a host of most influential friends in almost every part of the world. The sea routes by which Germany normally receives supplies from the outside world are already closed. Those leading to France and Britain are wide open.
From these relatively happy circumstances, however, it must not be too confidently assumed that the position in an international sense, and with respect to neutrals, will remain unaltered until the conclusion of the war. All that can be said with certainty is that, at the moment, the position is not only favorable to us but is also one which, on all the information possessed by this Government, - and that is, I might interpose, all the information possessed by the Governments of the United Kingdom and France - satisfactory and improving from day to day.
I turn now to the condition of the war as it is developing along the FrancoGerman frontier, and farther north, and in the adjoining seas. In this connexion honorable senators will be interested to hear of the casualties that have so far been reported. At sea, the Allies have lost about 1,900 lives, most of these losses having occurred through the sinking of the Courageous and Royal Oak and merchant ships, and Germany has lost about 500 lives, due principally to the destruction of their submarines. On land, on the western front, the total number of lives lost on both sides would not appear to exceed 4,000. On the eastern front, against Poland, Germany has lost about 10,572 lives, whilst some ‘30,322 have been wounded. It is impossible to estimate Poland’s losses, hut probably these are very considerable as the result of the bombing of civilians. The number of soldiers wounded in Warsaw is estimated at 16,000, and the number of civilians wounded at 20,000. British casualties in the air so far recorded do not exceed 52.
As honorable senators will note, Germany has had two signal successes with its submarines - the torpedoing of the aircraft carrier Courageous and the old battleship Royal Oak. Apart from those two losses, however - and it was never anticipated that the British navy could avoid some important losses - the war at sea has gone to a reassuring degree against the enemy. Its losses of submarines have been quite up to British and French expectations.
On our side, the losses to the mercantile marine, the safety of which is so vital to us here in Australia, have by no means exceeded expectations, and actually have been more than set off by the capture of German tonnage and the charter of new ships completed since the declaration of war.
Moreover, the reduction by destruction of a substantial portion of the enemy’s submarine strength, and the building up of the convoy system, have, during the last few weeks, given a progressive measure of safety to both Allied and neutral shipping. The losses of odd ships by contact with enemy mines need not be too seriously regarded. They are incidental to war.
A little reflection will persuade honorable senators that with Allied shipping scattered as it was at the outbreak of hostilities over the whole globe, some little time passed before the convoy system could be effectively applied. It has not even yet reached its full control, but day by day its protection against the enemy submarines is increasing. A reassuring factor is that the loss of ships which have been in, convoy has been nominal.
There is, however, one consideration which should not be overlooked. At any hour Germany might decide to launch an air attack of great strength, not only upon vital objectives on land in the United Kingdom and France, but also upon allied shipping in convoy, and more particularly in port. This contingency has been fully considered, however, and we may take it that the great encounter, when it comes, will be by no means a one-sided affair.
As to when the German air attack will be made, or as to when the enemy will move with his gigantic armed land forces, I know no more than honorable senators. The offensive lies for the time being with Herr Hitler, and he will strike in his own way and in his own time. The blow when it falls will be on a scale of unprecedented magnitude and violence, but the resistance which will be offered by the French and the British, fighting so far as the Franco-German frontier is concerned, upon the defence of a line of careful choice and prodigious preparation, will be of the most confident kind.
Flooded heavy ground strongly favours the defenders. This is the wettest autumn in western Europe within half a century, and that alone would give pause to the German High Command. It may be, but this is only surmise, that Germany intends to attack by land and air simultaneously and so place the heaviest strain, upon Britain and France.
It would be idle to deny that the concentration upon the most powerful scale of German armies along the Belgian, and particularly the Dutch, frontiers is causing concern. It is assumed that if Hitler strikes through Holland, his objective will be the possession of Dutch ports, which would give him bases for his submarine campaign in closer proximity to allied shipping than those he possesses in German territory to the north. A still more important requirement he would achieve by a successful drive across Holland - where, by the way, he is faced by only four or five Dutch divisions - would be taking-off grounds for his great fleets of fighting aircraft. This type of very high speed machine is not equipped for long-distance flying. Operating as they are now compelled to do from aerodromes upon German soil, these machines could not give to great fleets of German bombers launched over England that protection which the bombers to be effective must have. Operating alone, the bombers would certainly suffer very heavy losses at the hands of British aircraft of fighting types.
Germany has at the moment a substantial superiority in both the number of army divisions and aircraft. The army superiority is perhaps more than set off by the strength of the Maginot Line. One factor should, however, be borne in mind. Provided Germany does not violate the neutrality of Belgium or Holland, it will be able to concentrate its military strength upon a far shorter line than that which must be covered day and night by the armies of France and the gathering forces of Britain. This is because it i3 necessary for the Allies to guard against invasion of France by way of Belgium, more or less by the route followed by the armies of the Kaiser 25 years ago.
Reference to Holland and Belgium makes this an appropriate point at which to refer to the impressive move for the restoration of peace, even at this stage, by the Queen of Holland and the King of the Belgians. Honorable senators are familiar with the reply of Mr. Chamberlain to this overture. In that reply the Prime Minister of the United Kingdom left the door wide open to negotiations, but insisted, and with the approval of the dominions as a whole, that the first step towards peace must be guarantees from Nazi Germany that any peace now contemplated by negotiations must be supported by guarantees of a completely convincing kind. The spoken or written word of Hitler can no longer in itself be accepted by the Allies or indeed by any nation in the world.
The pact between Germany and Russia still remains secret to its parties. When signed, it was heralded by Germany as a great triumph for Hitler and a staggering setback to the Allies. The events which have followed it, however, cannot fail to have caused angry heartburnings in Germany and particularly among the Prussian element. It is a reasonable guess that Russia has, since the signing of the pact, far exceeded its terms.
By its transgressions into, and virtual absorption of, Estonia, Latvia and Lithuania, and its acquisition of a huge portion of eastern Poland, Russia has enormously advanced its strategic position and its general Baltic influence as against Germany. Hitler has, in short, paid a disastrous price for the neutrality of the Soviet, which, we must remember, he had previously invariably declared in violent, language to be the chief enemy of Nazi Germany.
Moreover, Russia has, at least for the time being, apparently denied to him what must have been an almost unresisted conquest of Rumania with its prolific oil supplies and its wide wheat lands.
The position in the Balkans still remains indefinite. Unhappily, a number of these States entertain traditional animosities which are proving difficult to compose even now when they are in the shadow of a positive menace from Germany and a potential menace from Russia. There are, however, grounds for the strong hope that all, or at least a number, of the Balkan countries will come together with the common purpose, first, of preserving their neutrality, and if that becomes impossible, of merging together in a united resistance, with Italy or Turkey - or possibly both - in active support. Here, however, we are in the realm of doubt, speculation, and hope, and it would be folly to engage in a positive forecast of any kind.
The two bright spots in the Mediterranean in recent events are the very valuable alliance with Turkey, and what certainly appears to be a steadily improving relationship with Italy.
As I have said, the tension has gone out of the situation which prevailed for some months between Japan and the United
Kingdom with respect to Tientsin and other concessions and settlement areas in Chinese territory, and to a lesser extent between Japan and France. When Germany linked up with Soviet Russia, it dealt a heavy blow to its prestige with the Japanese. The downright declarations of the United States Ambassador at Tokyo in warning Japan as to the consequences of further interference with American property and rights in China, and also the recent great expansion of American armaments, cannot fail to have a steadying effect in the Pacific generally.
If in this brief survey it appears venturesome to sound an optimistic note respecting international events since the declaration of the war, apart from the tragedy of Poland, I ask the Senate to believe that I do not for a moment overlook the fact that the mighty conflict into which we have entered is only just beginning. The defeat of Nazi Germany will call for all the fortitude and resources of the British Empire and of France. The road to victory will be long and the sacrifice heavy, but it is one which we must tread to a completely victorious end if we are to continue to live in safety and in the enjoyment of those things spiritual, political and material, which individually and in a national sense make life worth living. I lay on the table the following paper : -
External Affairs - Ministerial Statement and move -
That the paper be printed.
Debate (on motion by Senator Collings) adjourned.
Action Taken Since the Outbreakof War: Ministerial Statement.
– I lay on the table the following paper: -
Department of Supply and DevelopmentAction taken since the outbreak of war - Ministerial Statement and ask leave for it to be incorporated in Hansard.
The statement is as follows : -
On behalf of my colleague, the Acting Minister for Supply and Development (Mr. Holt), I desire to give honorable senators an outline, necessarily brief, of the action taken by that department since the outbreak of war.
At the outbreak of war the government munitions factories were filling the requirements of the defence services for the reserve stocks of munitions necessary to place them on a sound footing to meet the first shock of a war, and to enable hostilities to be maintained while the productive resources of the country were being organized. It was intended in the development programme of the time that this objective should be reached by June, 1941. The number of employees was then about 6,000 and the weekly wages bill was £26,000. Generally, the operations were being conducted upon a single shift basis.
Immediately the war commenced, the manufacturing programme was accelerated. In most of the factories, two or three shifts are now being worked, and additional shifts are being established wherever practicable. In the institution of second and third shifts, the necessity for additional supervisory staff and manufacturing plant is a limiting factor. This staff is being engaged and trained, and large orders for machine tools, placed both locally and abroad, are greatly increasing the manufacturing capacity. Since the 3rd September, additional employees directly engaged for munitions factories have numbered more than 2,000, with a. consequential increase of the wages expenditure to £36,000 weekly. Many more have obtained employment through the purchase of machines and materials. One result of the war demand has been that various stores and materials which it would not have been economical to manufacture in Australia in peacetime are now being produced here as the result of negotiations with manufacturers. It is hoped that this will result in the permanent establishment of new industries in Australia.
It will be obvious that the increased productive capacity of the Government’s munitions factories and the associated annexes cannot be given in any detail, but in the ten weeks of war the variety of manufactures has increased greatly, and the volume of output is several times greater than the pre-war figures. That is only the beginning. Factories are still being built. Authorizations already in hand for munitions will exceed £6,000,000, and others have been notified which will bring the total up to £8,000,000 or more. Probably three-fifths of that amount will be spent directly in wages in the munitions factories and annexes, about one-fifth in stores and materials, most of which will also go into wages, and the remainder in overhead expenses and services, such as power and lighting, most of which also will ultimately be expended in wages.
Among the developments in munitions production which might be disclosed is that of a modern and powerful type of anti-aircraft gun. This weapon is being manufactured in quantity at the government ordnance factory, and is rapidly approaching the finishing stage. There is so much confidence in the quality of this product that an order has been received from overseas for a substantial number. We are also making anti-tank guns and trench mortars at that factory. This work is additional to the lighter type of anti-aircraft guns previously manufactured at the factory, of which there is a number now in service.
At the Small Arms Factory, we are making three types of machine guns, including a large order for overseas, and also an extensive range of Lewis gun components. A big overseas order has been placed for rifles also. It is expected that employment at Lithgow, already approaching the 1,0.00 mark, will be appreciably increased during the next few months. Bren gun production is also being accelerated as fast >as possible.
Similar progress is being made in regard to the manufacture of gun ammunition. Our own production, of fuses and other brass components of gun ammunition has been greatly increased; we are also getting assistance from several commercial firms. That also applies to the production of shell and shell forgings.
In all cases where private firms are engaged in the production of munitions components, including those operating armaments annexes, a system of costing is being worked out by. the department in consultation with the Advisory Panel of Accountants. This will ensure that the rate of profit - or the management charge, as it might well be termed - will be kept down to a minimum. This system will be found to meet the undertakings in this regard previously given by the Government. The department maintains for this special purpose a staff of costing experts acting in collaboration with the advisory panel.
I should like to take this opportunity to pay a very sincere tribute to the gentlemen composing the panel, who are serving in an honorary capacity at considerable sacrifice to their own professional and business interests.
At the government projectile factory, no less than 35 different varieties are being manufactured, including aircraft bombs, trench mortar bombs and hand grenades. Several commercial establishments are working on shells and bombs. The explosives and filling factories are particularly active. In some sections, output has been increased to ten times the quantities obtaining a year ago, and production is constantly being increased.
New munitions factories already approved include a second factory for production of cordite and T.N.T. in Victoria, a second small arms ammunition factory in Adelaide, and a second factory at Albury, New South Wales, for filling explosives into ammunition.
For some years we have been receiving moderate orders for munitions from other dominions. We have sold these munitions at prices satisfactory to them and to ourselves, and we have reason to believe that they appreciated the facilities we were able to offer. Not the least gain was the engendering of confidence in the quality of munitions produced by government factories in this country.
A few days ago we received an effective tribute to that confidence through my colleague, the Minister for Supply and Development (Mr. Casey), who advised us from London that he had obtained orders from the British Government for various types of munitions amounting in value to several millions of pounds, with prospects of more to follow.
The filling of these orders will be carried out at various factories in the Commonweal’th and will result in an increase of the number of munitions factory operatives, now standing at 8,000 to about 12,000 within the coming twelve months.
There is every reason to believe that work at munitions factories is carried on under conditions which are appreciated by employees. This, of course, is conducive to harmonious relations and wholehearted co-operation. No better example of this need be mentioned than the action of the girls in the ammunition factory who voluntarily offered to sink, for the time being, their opposition to night shift in order to enable adequate reserves of small arms ammunition to be obtained. The Government appreciates that gesture as an indication of the spirit in which munitions production is being undertaken by the employees.
It was realized some months ago that war conditions would create a demand for tradesmen in metal industries which would be difficult to fill. As the result of a series of meetings of experts and a careful analysis of requirements, it was decided to take steps immediately to increase the number of skilled workers by 500 toolmakers and 2,000 metal tradesmen.
The facilities and staffs of the State technical colleges and schools will be utilized by arrangement with the State authorities concerned. An advisory committee has been appointed, together with a director who will co-ordinate the requirements of the armed services, munitions factories, aircraft construction branch, &c, and will arrange suitable allotment of trainees to the several States.
Tool-making equipment is being purchased, and applications are being invited for tool-maker trainees immediately. The Air Force and Army have already commenced enrolment of pupils at technical colleges, and it is expected that the scheme will shortly enable us to cope with the increasing demands for skilled men.
Armaments annexes have been established in order that the output of ammunition components from the government factories proper may be supplemented to equal the quantities which are estimated to be required. The great bulk of the plant and equipment required is now on band; in some cases it has been or is being installed ; in others it is awaiting the completion of the buildings. Eight of these annexes have been proved and are in a position to fulfil orders, and ten more should be ready for the “ try-out “ of plant by the end of this year.
Acting under the powers conferred upon it by the Supply and Development Act, the department has undertaken a wide survey of Australian industry. A very complete census is being taken of industry and of merchant stocks, the form of which was determined in consultation with the Advisory Panel on Industrial Organization and representatives of individual industry. This will not only enable the Government to determine the productive capacity of the Commonwealth, but will also provide an accurate estimate of the requirements of industry in raw materials for both war purposes and essential civil needs.
The advent of war has, of course, produced a crop of problems connected principally with short supply of materials and commodities, owing either to interruption of the supplies from overseas or to the heavy demands suddenly made to meet the needs of the fighting services. Some dislocation was inevitable, yet, although the burden of work on the staff in my department has been extremely heavy, dislocation has been surprisingly small. The assistance rendered to industry generally has been appreciable and appreciated.
I cannot pass from this subject without expressing the very sincere appreciation of the Government of the work so ably and willingly done by the members of the Advisory Panel on Industrial Organization. In the inspection and selection of workshops for the .establishment of armaments annexes, in the drafting of the industrial questionnaire, and in very many other directions, the ability and experience of these gentlemen, voluntarily placed at the disposal of the Government, has assisted very materially towards the realization of one of the cardinal articles of its defence policy. I refer to the association of private industry with Government instrumentalities in the production of munitions, in such a manner as to secure against any possibility of the growth of a private armaments trade.
In the means adopted to implement this policy, namely, restriction of profits, supervision and control over every stage of manufacture, limitation of private manufacture to unassembled ammunition components and, in the majority of cases, government ownership of plant and buildings, the Government has been supported most ably by these representatives of private industry. In the outcome it has been possible to combine all of the advantages of public ownership of munitions plant with the experience and efficiency of highly developed private industry.
In addition to looking after the needs of our own services, we have received requests for requirements for other parts of the Empire, and wherever it has been within the capacity of the country to make the items available, supply has been undertaken. The requests have been directed principally to foodstuffs and requirements for field and structural engineering work. In some cases quantities despatched have been relatively large. The policy adopted by my department in regard to overseas orders is to ensure that the needs of our defence forces and of the Australian civil population are given precedence. Consistent with these requirements, every assistance has been and will be accorded to other parts of the Empire requiring supplies from Australia. Honorable senators will, of course, appreciate that I am unable to quote specific instances in this regard.
The sudden and enormous requisitions received from defence services to meet war-time requirements necessitated a reorganization of the Central Contract Office.
The Contract Board was reconstituted, and a business adviser, Mr. E. V. Nixon, C.M.G., was added to its personnel. The Contract Board has also had the benefit of consultation with Mr. Norman Myer in regard to textiles and clothing. Mr. Nixon has already given valuable service as chairman of the Advisory Panel of Accountants, and his acceptance of the heavy duties which have been placed on him as an honorary consultant to the Contract Board is deserving of the highest commendation. In certain of its transactions the Contract Board has found difficulty in arranging with industry to produce supplies at rates which the board regarded as reasonable. The board’s aim has been to keep costs at pre-war levels, consistent with unavoidable increases, such as are due to advanced costs of materials. For the period from the 1st September to the 13th November, 1939, the purchases by the contracts organizations of the department represent an expenditure of more than £3,000,000. Whilst the transactions involving the largest expenditures have been arranged by the Central Contract Board, the District Contract Boards in the various States have also placed large orders. Some particular instances may be given of the extent of these orders. Extensive mechanization of the Army has called for the purchase, from various sources, of 4,000 motor vehicles of all types, ranging from heavy lorries and artillery tractors to motor-cycles. The total cost of these purchases has not been determined, but honorable senators will recognize that this is a business transaction on a scale surpassing anything that has ever been attempted in the automobile industry in this country. Contracts have been negotiated for the purchase of huge quantities of clothing and personal equipment, either by the method of impressment or through the normal contract channels.
The first problem was the task of obtaining sufficient quantities of materials for the clothing which was immediately required by the naval, military and air services. Peace contracts were inadequate to meet the needs of the manufacturing programme of war requirements. In regulation woollen clothing alone, 11,000 uniforms were required each week. This, with a margin of safety, necessitated the woollen mills manufacturing a minimum of 60,000 yards of woollen materials weekly. In addition, cloth had to be provided for such items as caps, water bottles, bottle covers, and gaiters. The department, therefore, aimed at a weekly production of 100,000 yards of piece materials, including flannel for heavy shirts and singlets. The number of blankets required amounted to 240,000. Although certain peace-time contracts were in operation, it would have been beyond the capacity of these mills, even if they concentrated their entire plants on defence work, to have produced anything like the quantities of textiles and blankets required. In order to meet the situation, the department convened a conference of representatives of the woollen mills throughout the Commonwealth, with the object of allotting these large quantities of cloths, blankets, &c, to the various manufacturers according to their capacities. At this conference orders were immediately placed for the total requirements. Where mills were current contractors, arrangements were made for them ti increase their output to the greatest possible degree. Arrangements were made for new firms, not previously experienced in manufacturing service cloths, to be assisted by the department’s previous contractors. Weekly delivery rates, and date? upon which contracts were to commence, were fixed. Unfortunately, many of the new firms have not been able to adhere to those dates. In the majority of cases, however, their initial difficulties have been overcome, and indications are that the textile industry will shortly be manufacturing 35,000 blankets and 100,000 yards of woollen piece materials weekly. The gross total of these orders exceeds 1,000,000 yards. In the meantime, large deliveries have come to hand from those firms which had already mastered the technique of producing these supplies.
Arrangements were also made with several of the Australian cotton mills to increase their production of cotton cloth such as drill and jean to approximately 70,000 yards weekly. These materials are used for the production of working dress uniforms and shorts, also for linings and trimmings for the woollen uniforms. The total orders placed for such cotton piece goods approximate 1,000,000 yards.
The next step was to arrange for the materials to be converted into articles of uniform. The total requirements of the combined services aggregate 200,000 woollen uniforms, 120,000 greatcoats and approximately 250,000 cotton garments of different types. As in the case of the woven materials, the department called a conference of clothing manufacturers at which arrangements were completed for the production of woollen garments at the rate of 4,000 greatcoats and 11,000 uniforms weekly. These were additional to large contracts which were in existence for the manufacture of working dress uniform, shirts, overalls and other miscellaneous items. Contracts for clothing have been let with 50 firms, the majority of which have now commenced production. It is hoped that within a very short period the various services will be receiving deliveries at a rate which will not only be sufficient for their requirements but will also enable reserves to be built up against future needs. The total expenditure on clothing alone has been over £600,000.
The board is also purchasing throughout the Commonwealth all requirements of foodstuffs for the three defence services at sea, in military camps, or in Air Force units. These transactions have run into hundreds of thousands of pounds. Large quantities of foodstuffs are also being purchased for shipment to other parts of the Empire.
An urgent requirement in tents for camps was met by organizing the tent manufacturers throughout the Commonwealth.
Footwear orders were recently placed for approximately 129,000 pairs of boots and shoes for the fighting services. Considerable difficulty attended the placing of these orders, owing first, to the dislocation of the hide and leather markets consequent on the outbreak of war, and secondly, to the fact that certain boot and shoe manufacturers in Victoria and New South Wales met and fixed prices for service footwear which were considerably in advance of current quotations. Most of the manufacturers in these two States, when tendering, adhered to the prices so fixed, with the result that not one pair of boots was ordered from New South Wales, and relatively few from Victoria. The price fixed by the manufacturers conference was almost 40 per cent, in advance to the immediate pre-war tenders. Instruction’s were given that this attitude should be rigorously combated, even if it involved the use of our power of factory requisition. Such action, however, proved unnecessary, as we have been able to place orders for the whole of our requirements of 129,000 pairs at an average price of 3s. 3d. a pair lower than that demanded by these manufacturers to whom I have referred. Had we not been able to combat successfully the price rise to which I have referred, the cost of this single item would have been £20,000 greater than the tenders which we have arranged.
Less spectacular than munitions supply perhaps, but certainly of equal importance in the prosecution of the war, has been the work allotted to the civil supply section. Maintenance and, where necessary, control of essential commodities, have occupied a great deal of attention by this section. The department has received from the British Ministry of Supply authority in Australia for priorities for export from the United Kingdom. On its recommendation priority certificates will be issued in the United Kingdom. Already many applications for such certificates have been made and granted.
As soon as an import licensing system is introduced by the Department of Trade and Customs, this department will put into operation a system appropriate for priorities of essential goods from the United Kingdom and elsewhere.
Although the Government has not found it necessary to introduce a system of petrol rationing, steps had already been taken, before the outbreak of war, to prepare a complete scheme for rationing, should circumstances so demand.
Many conferences have been held with representatives of industry, such as timber and paper-making. These have dealt with the provision of locally produced substitutes for imported commodities, as well as the relative importance of different uses of imported . goods. It has been the rule, wherever practicable, to use the administrative machinery of the State Governments to deal with these questions.
The civil supply section has also dealt with a large number of miscellaneous inquiries from manufacturers and distributors in Australia regarding supplies of raw materials and manufactured goods. Threatened shortages of commodities, such as chemicals for manufacturing purposes, furred skins for hat manufacturing, various metal manufactures, including wire, galvanized iron, steel, and the like, have been investigated. In most instances it has been possible to place the inquirers in touch with potential suppliers in order to enable a business to be carried on. Where the goods have to be imported from overseas, detailed inquiries regarding relative urgency have been made before making any recommendations for export permits in the country of origin.
The department has also received many inquiries from overseas for the supply of all kinds of goods produced in Australia. These inquiries have been dealt with, having regard to Australia’s own requirements for defence and civil use.
One of the outstanding achievements of our war effort is to be found in the development of Australian aircraft manufacture. Arrangements commenced on the 1st July for the manufacture of BristolBeaufort aircraft are proceeding satisfactorily. The United Kingdom air mission recommended in March, 1939 -
These recommendations received the approval of the British and Commonwealth Governments. Governments of the States of New South Wales, Victoria and South Australia have agreed to the utilization of the State railway workshops at Chullora, New South Wales; Newport, Victoria; and Islington, South Australia, for the manufacture of details and the production of airframe components to the stage of sub-assembly.
This arrangement necessitated the preparation of sections of these States’ railway workshops as aircraft area workshops. The work has been practically completed in the three States, and the workshops are ready for the installation of jigs and machine tools and other equipment. Arrangements for the construction of the main assembly workshops at Mascot, New South Wales, and at Fisherman’s Bend, Victoria, are in the hands of the Department of the Interior. Work has been commenced in both places and the buildings will be completed according to the pre-arranged schedule related to the production programme.
While the area workshops are being prepared and the construction of new buildings is being proceeded with, shipments of jigs, tools and other equipment and of finished details and raw materials are being received from overseas, the capacity of private engineering establishments to undertake the manufacture of detailed parts is being investigated, and the necessary staff organization set up to permit of the scheme being carried out according to the predetermined plan of production. The aircraft main-assembly workshops at Mascot, New South Wales, and at Fisherman’s Bend, “Victoria, and the aircraft main storehouse at Spotswood will be controlled directly by the general manager of aircraft construction.
In the complete organization which is now being developed, the chief mechanical engineers of the New South Wales, Victorian and South Australian railways, respectively, will act as area controllers under the central organization, and will arrange for the manufacture and subassembly of details and components and the sub-contracting of work to private industry.
The direct and indirect employment of the necessary skilled tradesmen and semiskilled process workers will be a feature of the scheme, and will be of considerable industrial importance to the Commonwealth. Immediately the organization was commenced, arrangements were made for the first party of the specially selected technicians to leave Australia for training in England, and three additional parties have since been despatched, bringing the total up to 80.
These technicians consist of fitters and turners, tinsmiths, coppersmiths, chemists and metallurgists, machine tool operators, planning and progress engineers, stores officer and inspectors. Each party is receiving an average of ten weeks’ training in the works of the English manufacturers. In addition to these technicians, a large number of skilled tradesmen will be required in each State. Both tradesmen and semi-skilled process workers will be trained in each State, and the organization necessary for this training is now being set up. This project will provide employment for about 4,500 skilled and semi-skilled operatives in shops widely distributed over three States.
Whilst arrangements might have been made for the supply from the United Kingdom of the necessary engines for installation in the Beaufort aircraft, the Government has decided to manufacture high-powered aero engines in Australia for installation in the majority of the Beaufort aircraft, and also for other purposes. The necessary arrangements for local manufacture are in train, and provision is being made for deliveries to
De effected in sufficient time to meet the major requirements of the Beaufort manufacturing scheme. A factory is being erected also for the manufacture of propellers for the Beaufort and similar aircraft. Other steps are also being taken to stimulate this new and important Australian industry.
As honorable senators know, a factory at Fisherman’s Bend, Victoria, operated by the Commonwealth Aircraft Corporation, is already in full swing producing Wirraway aircraft. This factory is one of the most modern and efficient of its kind in the world, and will shortly be producing at the rate of six complete aircraft a week. In addition, the company has produced two prototype trainer aircraft of the most modern type, which are now undergoing trials. Shortly the company will be capable of turning out some hundreds of these trainers as part of the Empire scheme for training war pilots.
The Government is embarking with all possible haste on the establishment of an aeroplane-engine factory capable of producing the most modern twin-row aeroplane engines, not only for the Beaufort aircraft, but also for other high-powered defence aeroplanes. The production of aeroplane engines is also being extended to include the manufacture of Gipsy fourcylinder and six-cylinder engines for trainer aircraft. The De Havilland Proprietary Company of Sydney has an order for several hundreds of these light trainer aircraft.
The various sections of the aircraftconstruction programme which I have outlined will provide increased employment for workers in a variety of trades. A preliminary estimate shows that during 1941, when it is in full operation, between 8,000 and 10,000 wage-earners will be engaged in this work.
It is the intention of the Government to make Australia, as far as possible, independent of overseas supplies for the production of all classes of aircraft. That statement also applies to the production of aircraft instruments, negotiations for the manufacture of which in Australia are proceeding.
One aspect which the Government is keeping constantly in mind is the position to be faced at the cessation of hostilities, when there will be a large manufacturing potential in existenec and when small or, at the best, diminishing orders for defence purposes will be forthcoming. The Government feels confident, however, that such a large and highly technical manufacturing potential can, after the war, be devoted to manufactures which have now to be imported, with a consequent transfer of large sums of money to oversea countries. One thing the war will have compelled is the establishment in Australia, on a comparatively large scale, of industries which a year ago were considered to be out of the question but which, once they are established, will prove beyond doubt Australia’s capacity as a manufacturing nation and will add strength to the economic structure of the Commonwealth both during and after the war.
That the paper be. printed.
Debate (on motion by Senator Ashley) adjourned.
The following papers were pre sented : - ‘
Apple and Pear Organization Act - Regulations - Statutory Rules 1939, No. 124.
Arbitration (Public Service) Act - Determinations by the Arbitrator, &c. -
No. 25 of 1939- Amalgamated Postal Workers’ Union of Australia.
No. 26 of 1939- Federated Public Service Assistants’ Association of Australia; and Professional Officers’ Association, Commonwealth Public Service.
No. 27 of 1939. - Professional Officers’ Association, Commonwealth Public
Audit Act - Transfers of amounts approved by the Governor-General in Council - Financial year 1938-39.
Canned Fruits Export Control Act - Regulations amended - Statutory Rules 1939, No. 106.
Commonwealth Bank Act - Treasurer’s Statement of the Combined Accounts of the Commonwealth Bank of Australia and Commonwealth Savings Bank at 30th June, 1939, certified to by the AuditorGeneral.
Commonwealth Public Service Act -
Appointments - Department of -
Civil Aviation - R. S. Robinson.
Health- E. C. Slater.
Interior- W. J. Gibbs, D. V. Gordon,
Regulations amended - Statutory Rules 1939, No. 105.
Customs Act and Commerce (Trade Descriptions ) Act - Regulations amended - Statutory Rules 1939, No. 140.
Dairy Produce Export Charges Act - Regulations amended - Statutory Rules 1939, -No. 141.
Judiciary Act - Rule of Court - Dated 30th October, 1939.
Meat Export Control Act - Regulations amended - Statutory Rules 1939, No. 112.
National Security Act -
Authority to consent to Summary Prosecutions.
National Security (Capital Issues) Regulations - Delegation of Powers of Treasurer (2).
National Security (Enemy Property) Regulations - Appointment of Controller.
National Security (General) Regulations -
Appointments of Advisory Committees (Restriction and detention orders ) (3 ) .
Authority - Public utility undertakings.
Delegation of Powers by Minister - Taking possession of land.
National Security (Monetary Control) Regulations - Determination - Money Orders.
National Security (Prices) Regulations -
Commonwealth Prices Commissioner.
Deputy Prices Commissioners (2).
Declarations Nos. 1-17.
National Security (Securities) Regulations - Notices -
Returns of Securities (2).
Wheat Acquisition Regulations - Appoint ment of State Wheat Committees.
Air Force Act - Regulations amended - Statutory Rules 1939, No. 142.
Australian Imperial Force Canteens Funds Act - Nineteenth Annual Report, for year 1938-39.
Customs Act -
Proclamations prohibiting the exportation (except under certain conditions) of -
Bags, sacks and woolpacks whether new or secondhand of jute hemp or similar substances (dated 7th September, 1939).
Black, galvanized and steam screwed and socketed iron or steel pipes or tubes in sizes not exceeding 3 inches in internal diameter (dated 28th October, 1939).
Flexible shafting and casing therefor (dated 15th September, 1939).
Gold (variation dated 18th October, 1939).
Hides and skins (dated 20th September, 1939).
Notes and gold (dated 13th September, 1939).
Wool, including wool tops, noils and waste (dated 12th September, 1939) .
Regulations amended, &c, Statutory Rules, 1939, No. 92- No. 101, No. 138.
Defence Act -
Defence (National Security - General) Regulations - Prices Orders (4).
Regulations amended - Statutory Rules 1939, No. 93- No. 94- No.111- No. 115 - No. 123- No. 132- No. 133- No. 134 -No. 135- No. 137.
Defence Act and Naval Defence Act - Regulations amended - Statutory Rules 1939, No. 131.
Excise Act - Regulations amended - Statutory Rules 1939, No. 121.
Lands Acquisition Act - Land acquired at -
Archerfleld, Queensland - For Defence purposes.
Ashfield, New South Wales- For Banking purposes.
Bairnsdale, Victoria - For Defence purposes.
Bullsbrook, Western Australia - For Defence purposes.
Busselton, Western Australia - For Defence purposes.
Clunes, New South Wales - For Postal purposes.
Darwin, Northern Territory - For Defence purposes.
Denman, New South Wales - For Defence purposes.
Parafield, South Australia - For Defence purposes.
Port Adelaide, South Australia - For Defence purposes.
Richmond, New South Wales - For Defence purposes (2).
Rottnest Island, Western Australia - For Defence purposes.
Spring Hill, Queensland - For Health purposes.
Townsville, Queensland - For Defence purposes.
Tuncester, New South Wales - For Defence purposes.
Wamoon, New South Wales - For Postal purposes.
National Security Act -
Australian Barley Board Regulations -
Acquisition of Barley-
National Security (Aliens Control) Regulations - Orders -
National Security (Capital Issues)
Regulations - Orders - Exemptions(3).
National Security (General) Regulations -
Advisory Committee Rules.
Defence Impressment Order.
National Security (Prices) Regulations - Orders Nos. 1-31.
National Security (Securities) Regulations - Orders - Exemptions (3 ) .
Regulations amended, &c. - Statutory Rules 1939, Nos.95- No. 960- No. 100- No. 102-No. 103- No. 104- No. 108- No. 109- No.110- No. 113- No. 114 -No. 117- No. 118- No. 119- No. 120 -No. 127- No. 128- No. 129- No. 144 -No. 145- No. 148- No. 147.
Wheat Acquisition Regulations- Orders - Acquisition of Wheat (2).
Naval Defence Act - Regulations amended Statutory Rules 1939, No. 116- No. 143.
Northern Territory Acceptance Act and Northern Territory (Administration) Act-
Ordinances of 1939 -
No. 20- Workmen’s Compensation.
No. 21 - Crown Lands.
No. 22 - Matrimonial Causes.
Darwin Administration Ordinance- 7-Regu- lations (General) amended (3).
Health Ordinance - Regulations amended &c. -
Mosquito Prevention Regulations.
Nuisance Prevention Regulations.
Railway and Mining Camps’ Sanitary Regulations.
Justices Ordinance - Regulations amended.
Mining Development Ordinance - Regulations.
Motor Vehicles Ordinance - Regulations amended.
Petroleum Oil Search Acts - Statement of Expenditure for the period 28th May, 1936, to 30th June, 1939.
River Murray- Waters Act- River Murray Commission - Report for year 1938-39.
Science and Industry Endowment Act - Auditor-General’s Report on the Science and Industry Endowment Fund- for the year ending 30th June; 1939.
Supply and Development Act - Regulations -Statutory Rules 1939, No. 107.
Tractor Bounty Act - Regulations - Statutory Rules 1939, No. 126.
Wire Netting Bounty Act - Regulatious - Statutory Rules 1939, No. 125.
Air Navigation Act - Regulations amended - Statutory Rules 1939, No. 122.
Post . and Telegraph Act - Regulations amended - Statutory Rules 1939, No. 130.
Quarantine Act - Regulations amended - Statutory Rules 1939, No. 139.
New Guinea Act - Ordinances of 1939 -
No. 7 - Police Force.
No. 8 - Appropriation (No. 2) 1938-1939.
No. 9 - Appropriation (No. 3) 1938-1939.
No. 10 - Criminal Code Amendment.
No. 11- Shipping.
No. 12 - Ordinances Interpretation.
No. 14 - Administration Employees’ Com.pensation.
No. 15 - Laws Repeal and Adopting.
No. 16 - Superannuation. ‘
No. 17- Public Service (No. . 2).
No. 19 - Pharmacy.
No. 20 - Poisons and Dangerous Substances.
No. 21 - Police Offences.
No. 23 - Mining.
No. 24 - Petroleum (Prospecting and Mining) No. 2.
NorfolkIsland Act - Ordinance No. 3 of 1939-Mtitor Car.
Papua Act - Ordinances of 1939.
No. 3- Police Offences.
No. 4 - Ordinance Interpretation.
No. 5 - Papuan Antiquities.
No.6 - Customs.
No. 7 - Sea-Carriage of Goods.
No. 9- Customs Tariff.
No. 13 - Criminal Code Amendment.
War Service Homes Act -
Regulations amended - Statutory . Rules 1939, No. 136.
War Service Homes Commission - Report together with Statements and Balancesheet, for year 1938-39.
Senate adjourned at 10.7 p.m.
Cite as: Australia, Senate, Debates, 21 November 1939, viewed 22 October 2017, <http://historichansard.net/senate/1939/19391121_senate_15_162/>.