19th Parliament · 1st Session
The President (Senator the Hon. Gordon Brown) took the chair at 3 p.m., and read prayers.
– I preface my question- to the Minister for Trade and Customs by pointing out that, owing to the method of registration of medical practitioners, it is not permissible for a medical practitioner resident in South Australia -to attend a patient just over the border in “Western Australia, or vice versa. In view of the Government’s intention to introduce a national health scheme, will the Minister confer with the Prime Minister and the Minister for Health for the purpose of having listed on the agenda of the forthcoming Conference of Commonwealth and State Ministers the desirability of introducing uniform laws throughout Australia in relation to the registration of medical practitioners, dentists, nurses, and auxiliary organizations that might be associated with the proposed scheme!
– Personally I think that there is considerable merit in the -substance of the honorable senator’s question, and I shall have great pleasure in referring it to the Prime Minister.
– In view of the fact that, nearly six months have elapsed since the Government promised to introduce a national health scheme and that the people are still paying social services contribution for .the scheme, -will the Government at least give the people free pharmaceutical services until some better scheme can be introduced?
– Since the matter raised by the honorable senator concerns the Minister for Health, I shall be pleased to bring it to his notice, and to request him to furnish an early reply for transmission to the honorable senator.
– I ask , the Minister representing the Minister for Health whether, having regard to the delay that has occurred in implementing a national health scheme and the consequent hardships that aged and chronic sufferers are undergoing, his colleague will consider an immediate free issue of specific, expensive, life-saving preparations such a penicillin, insulin, sulpha drugs, liver extracts, vaccines, and sera, so that desperate cases of illness may be treated properly?
– I shall bring to the notice of the Minister for Health the question that the honorable senator has asked.
– Will the Minister representing the PostmasterGeneral ascertain the reasons for the refusal of the Australian Broadcasting Commission to broadcast the important Foundation Day ceremony which will be held on the Fremantle Oval on the 5th June next?
– I shall be pleased to bring the honorable senators request to the notice of the Postmaster-General.
Senator- GUY. - I preface a question to the Minister representing the Minister for Civil Aviation by pointing out that efforts are being made to re-name the newly constructed aerodrome at Pardoo in Tasmania and to give it some other name which is objectionable to the local residents. I have received a telegram from the local municipal council urging that the name should not be altered from “ Pardoe “, and I ask the Minister whether he will confer with his colleague in an effort to retain the present name?
– The answer is “Yes”.
asked the Minister representing the Acting Minister for Civil Aviation, upon notice -
– The Acting Minister for Civil Aviation has supplied the following answers: -
asked the Minister representing the Acting Minister for Civil Aviation, upon notice -
– The Acting Minister for Civil Aviation has supplied the following answers: -
asked the Minister representing the Acting Minister for Civil Aviation, upon notice -
– The Acting Minister for Civil Aviation has supplied the following answers: -
The Gliding Club of Victoria is an active club, but has not yet joined the federation.
Gliders are not registered with the Department of Civil Aviation, but it is estimated that the total number of gliders with the clubs is approximately 42, including privately-owned gliders operated with the clubs. It is estimated that there are approximately 23 gliders under construction in Australia, half of such gliders being privately owned and most of the private gliders will be available in some way to club members.
asked the Minister representing the Minister for Commerce and Agriculture, upon notice -
– The Minister for Commerce and Agriculture has supplied the following answer : -
The production of jute has not been attempted on a commercial scale in Australia, but a limited number of pilot experiments have been carried out, particularly by the Queensland Department of Agriculture and Stock in northern Queensland. I am informed that the results of these experiments were not encouraging. The Commonwealth Scientific and Industrial Research Organization is actively engaged in fibre research generally. In considering the possibilities of the successful production of jute in Australia, regard must necessarily be had to the economics of production, labour and to the availability of suitable land and water and climate conditions. For the information of the honorable senator it may be added that some thought is being given to the production of jute in New Guinea. Recently the Commonwealth Jute Controller procured in India a quantity of certified jute seed and it is intended that the appropriate Commonwealth and State authorities should confer to consider the planning of experiments with this seed.
– I preface a question to the Minister representing the Minister for Commerce and Agriculture by pointing out that when I refer to disease in potatoes I am not referring to diseases that afflict humans but to diseases which infect root crops. If any overseas potatoes are to be imported into Australia can the Minister assure the Senate that they will be free of disease?
– The answer is “ Yes “..
asked the Minister representing the Minister for Commerce and Agriculture the following questions, upon notice -
– The Minister for Commerce and Agriculture has supplied the following information : -
– In view of statements that have been made in this chamber to the effect that the Hanlon Government had a great victory at the recent Queensland election, can the Leader of the Government place before the Senate any detailed election results for the information of honorable senators?
– Yes. The latest available figures give the LiberalCountry parties 295,652 votes for 31 seats and the Socialist party 280,649 votes for 42 seats. Three electorates containing a total enrolment of 30,376 electors that were won by Country party candidates were not contested by the socialists, and it can be conservatively estimated that the three uncontested seats would have shown an easy majority of at least 10,000 each. It will thus be seen that the Hanlon Government is in power on a minority of about 25,000 of the total votes cast. This reveals the undemocratic and paradoxical position that the socialists are governing the State of Queensland with a majority of eleven seats on a minority of the aggregate votes recorded. For good measure the Liberal-Country parties have won on the average one seat for each 9,537 votes polled whereas the average number of votes cast for Labour candidates in the constituencies which they won was only 6,682.
– In view of the information that the Minister has given to the Senate about the Queensland election results, will he undertake to provide similar information about the South Australian and Victorian elections.
– If the honorable senator wants that information I have no objection in obtaining it for him; but I thought that he, being a South Australian, would have been sufficiently interested to ascertain the election results in that State himself.
– In view of the statement by the Minister for Fuel, Shipping and Transport in Canberra yesterday, that unloading hold-ups in transit sheds on the Sydney waterfront were “lousy”, will the Minister inform the Senate whether those conditions arose as a result of the chats that he had with representatives of the stevedoring companies? Will the Minister direct the attention of the Minister for Health to the conditions that he described as “ lousy “, and request the Minister for Health to take more speedy action to remedy those conditions than he has taken to implement a national health service ?
– Apparently the honorable senator’s question is based on a newspaper report to which my attention has not been directed.
– Can the Minister for Social Services confirm the press announcement that age pensions are to be increased by 5 s. a week and exservicemen’s pensions by an unspecified amount ? Has any consideration been given to the amelioration of the means test, particularly in respect of superannuated public servants and other similar groups?
– Newspaper reports about the size and amount of the increase in age pensions are surmise only. There has been no decision by the Government on the matter yet.
– On the 27th April, Senator Cooke asked whether any farther information was available concerning the activities of a Mr. Russ Ley, who was reported to be offering prefabricated houses for sale to prospective migrants from the United Kingdom who intended to settle in Australia. It will be recalled that the honorable senator first raised this matter on the 1st March, 1950, and a full reply containing the facts, as then known, was given to him on the 2nd March. The Australian High Commissioner’s Office, London, has issued statements with wide circulation through the press, British Government departments,
State Agents-General, Australian banks in London, emigrant friendship circles, the British Legion of ex-Servicemen and to all individual correspondents inquiring about the proposal, warning prospective migrants against investing money in Mr. Ley’s scheme, ot any other housing schemes, without first consulting either Commonwealth officials at Australia House or Agents-General in London representing the various State governments.
– I direct the attention of the Minister representing the Treasurer to the fact that the Monthly Review of Business Statistics reveals that the cost of erecting dwellings during December, 1949, and January and February, 1950, was £140 a unit greater than during the corresponding period in 1948-49. Will the Minister assure the Senate that consideration will be given to the great increase of the cost of home building if and when the Government endeavours to put the value back into the £1 ?
– When the Government’s policy has become effective and living conditions are easier than now, that point, in common with others, will have been covered.
– Will the Minister for Fuel, Shipping and Transport inform the Senate what extra amount of dollar expenditure has been incurred in the purchase of petrol since the lifting of petrol rationing?
– The answer is “ No “.
– Further to my question to the Minister for Shipping, Fuel and Transport, to which, as usual, a negative reply was given, I now ask him whether he will obtain the information sought?
– The answer is, “No”.
– Am I to understand that the Minister refuses to obtain the information?
– I heard the Minister say, “No”, and I cannot force him to give information. Even though the Opposition has a majority in the Senate, it cannot compel a Minister to give information.
– Late last year, before the Chifley Government was defeated, the Commonwealth Bank acquired Ingle’s store, probably the main general store in North Hobart. Since then the business has been discontinued and the property still remains unoccupied and unused, despite the urgent need for building space. Will the Minister ascertain what use the bank proposes to make of the building and when the property will be put to some use? What was the price paid for the property?
– Senator Wright mentioned this matter to me about a week ago. I understand that this property was purchased by the Commonwealth Bank to enable a branch to he established for the convenience of Savings Bank customers in a location where the bank has an extensive business. Vacant possession was offered by the vendors and the property was purchased on that basis. Delay in utilizing the premises is due to the need to prepare plans for necessary alterations to the building and also to the general conditions prevailing in the building trade. The bank intends to use the premises for the purpose for which they were acquired as soon as the alterations have been completed. As a vendor could well object to disclosing of details of a private business transaction, it is not the practice of the bank to announce the purchase price in a transaction of this nature.
– In view of tha statements made by leaders of the present Government more than six months ago that action would be taken to improve Australia’s dollar earnings, will the Minister for Trade and Customs say what has been done to achieve this and in addition to what was already done by the Chifley Government.
– This is hardly a matter into which I can go in detail in answer to a question. I assure the honorable senator that the Government is making a positive approach to the dollar problem. We do not believe that the solution lies in spending less, but rather in earning more dollars, and every encouragement is being given to those who are able to earn dollars for Australia.
– Can the Minister for Trade and Customs say whether it is true that one firm only is permitted to import tinplate from Japan? If so, has a similar procedure been adopted in regard to other goods imported from Japan? If the answers to those questions are in the affirmative, does the Minister agree that in regard to trade with Japan, a dangerous monopolistic tendency is developing in that competition is being prevented? Moreover, is it not most unfair to other traders who are expected to place orders through one firm? Does the Minister deny that under such a system, the Japanese can charge what they like for their goods, and the Australian importer can charge what he likes, without governmental interference?
– I understand that there is a Tinplate Control Board, which does all the buying for Australia and that the present system is the same as that which operated while the Chifley Government was in office.
– When does the Government intend to honour its promise to increase pensions payable to totally and permanently incapacitated exservicemen?
– In accordance with the statement of the present Prime Minister in his policy speech, the subject of war pensions is being investigated. The inquiry is not yet completed, but legislation will be brought down as soon as possible to implement the policy of the Government.
– On the 17th May, Senator Fraser asked me to supply up to date information about the ration of fats, including butter and margarine, that_ the people of the United Kingdom receive, and similar information in regard to Canada, New Zealand, and Australia. The information sought by the honorable senator is as follows: -
United Kingdom. - Butter, 5 oz. per week; margarine, 4 oz. per week; cooking fats, 2 oz. per week.
New Zealand. - Butter, S oz. weekly until the 4th June, when rationing will cease. Margarine and fats not rationed.
Australia. - Butter, 6 oz. per week. Margarine and fats not rationed.
Canada. - Rationing ha’s not operated in Canada for some years.
– Can the Minister representing the PostmasterGeneral say whether his colleague is awa.re that Plympton post office, which is situated in Anzac Highway, one of the main metropolitan highways in South Australia, is an old and out of date structure ? If the Postmaster-General is aware of that, will he give consideration to the erection of a modern post office building in Plympton that will be in conformity with the needs and dignity of the area?
– I shall bring to the attention of the Postmaster-General the question that the honorable senator has asked, and supply him with an answer to it as soon as possible.
PROCEEDINGS of the Senate.
– Can the Minister representing the Prime Minister say whether it is a fact that, as reported by the Australian Broadcasting Commission news service and the daily press, the Prime Minister said during the week-end that Labour senators were harassing the Government and holding up bills in this chamber? If the Prime Minister did make that statement, can the Minister specify any legislation that Labour senators have held up?
– I have not seen a report of the statement to which the honorable senator has referred; but I am sure that, whatever statement the Prime Minister made, it was accurate. Whether he was reported correctly or not I do not know. If the honorable senator does not already know what legislation the Opposition is holding up, any explanation from me would not help him at all.
– Will the Leader of the Government in the Senate say whether it is true that on Friday last nine supporters of the Government were not available to attend the proposed sitting of the Senate? Will the Minister inform me, also, whether their attendance would have facilitated the despatch of Government business?
– I am sadly aware that if some of the members of the Opposition who were idling in the lobbies had entered the chamber, a quorum, made up of honorable senators on both sides of the chamber, could have been formed.
– In view of his answer to my previous question, will the Minister for Trade and Customs inform the Senate of the number of days on which the Commonwealth Bank Bill 1950 was debated in the House of Representatives, where the Government has a majority? Will the Minister indicate how that compares with the few days only that the measure has been debated in this chamber? I point out that that is the only bill that has been received by the Senate from the House of Representatives.
– Offhand, I do not know the number of days on which the Commonwealth Bank Bill 1950 was debated by the House of Representatives. However, if the honorable senator has difficulty in obtaining that information, I shall arrange for an officer to check the records and inform him of the result.
– As the Minister for Trade and Customs has severely castigated the Opposition in this chamber for holding up the child endowment legislation, will the Minister explain why, although that measure was passed by this chamber and referred to the House of Representatives several weeks ago, it has not yet been dealt with by the other House, although the bill was declared urgent when before the Senate?
– Evidently the honorable senator is under a misapprehension in this matter. The bill to which he has referred was not declared an urgent measure within the terms and meaning of the Standing Orders. Furthermore, to say the least, it would be in bad taste for us to criticize the manner in which business is conducted by the House of Representatives.
– I preface my question to the Minister for Trade and Customs by pointing out that during the campaign that preceded the general election in December last, statements were made by supporters of the present Government that the “ Chifley £1 “ would purchase only 12s. worth of commodities. According to recent radio broadcasts the Australian £1 will now purchase only 9s. worth of commodities. Will the Minister inform the Senate when the Government intends to introduce legislation to put value back into the £1, as promised by the Prime Minister in his policy speech in November last?
– As I have mentioned on former occasions, the restoration of the purchasing power of the £1 cannot be achieved merely by legislation. The Government seeks the co-operation of all sections of the people, particularly those with whom honorable senators opposite have a lot of influence. As the honorable senator knows from his experience in this chamber, it is not customary for matters of Government policy to be dealt with by way of question and answer.
– on the 16th May,
asked me a question concerning incentive payments to employees in government munitions factories. The Minister for Supply has furnished the following answer: -
Although much of the work at present being undertaken in Government factories does not lend itself to the introduction of a system of incentive payments, consideration is being given, where the type of production and the rate pf output warrant it, to the means by which a suitable system of payment by result may be introduced.
asked the AttorneyGeneral, upon notice -
– The answers to questions Nos. 1 to 4 are in the affirmative. As was announced in the GovernorGeneral’s Speech at the opening of the Parliament, this Government proposes, in view of the importance of extending and facilitating industrial development, to review and bring up to date Commonwealth legilation relating to patents and trade marks. The appointment of committees to recommend amendments of the existing industrial property laws is now under consideration and I hope to be in a position to announce the members of such committees at an early date.
asked the Minister representing the Minister for Supply, upon notice -
– The report in the Argus of the 16th May has been brought to my notice. An assurance can be given that the Government is actively engaged in investigating all factors associated with maintaining the Australian, shipbuilding industry.
asked the Minister for Fuel, Shipping and Transport, upon notice -
Will the Minister supply the Senate with information regarding the volume and the value of the Commonwealth naval and shipping work done at the Colmslie docks in Brisbane each year since the war during the period of office of the Labour Government?
– The answer to the honorable senator’s question is as fellows : -
The following figures represent the volume and value of Commonwealth naval and shipping work done at Colmslie graving dock, Cairncross, Queensland, in each year since the war : -
asked the Minister for Trade and Customs, upon notice -
What progress has been made with the establishment or erection of a bulk sugar store in the City of Hobart as set out in the Commonwealth and State of Queensland Sugar Agreement?
-The Sugar Agreement Act of 1946 provides -
That the Queensland Government, if and when requested by the Commonwealth Government, shall establish a sugar depot at Hobart, provided that the Commonwealth Government shall not make such a request unless the request be accompanied by evidence proving that a general shortage of sugar has occurred in Hobart which is due to wholesale merchants in Hobart or the Queensland Sugar Board failing to adhere to the present arrangements whereby special reserve stocks of sugar are supplied to and held by such merchants.
Arrangements at present exist whereby wholesale merchants in Hobart carry twice their normal stocks of refined sugar. This would represent three and a half to four weeks’ requirements of retail grocers - approximately the same period for which reserves of refined sugar are carried at mainland refineries. Advice recently received from Tasmania indicates that wholesale merchants and the large manufacturing concerns there are at present carrying ample stocks. Tasmanian wholesale merchants and the Queensland Sugar Board are, apparently, observing the arrangements prescribed by the Sugar Agreement Act concerning reserve stocks of refined sugar in that State. Consequently, the Commonwealth Government has made no request to the Queensland Government for the establishment of a sugar storage depot in Tasmania.
asked the Minister representing the Minister for Immigration, upon notice -
– The Minister for Immigration has supplied the following information : -
asked the Minister for Trade and Customs, upon notice -
– I have obtained the following information for the honorable senator : -
At present newsprint is admitted duty free under by-law provided it was on firm order on or before the 1st January, 1950, and shipped to Australia on or after the 1st January, 1950, but not later than the 31st December, 1950. Primage duty of four per cent, was removed from newsprint subject to the General Tariff on the 8th September, 1949.
asked the Minister representing the Postmaster-General, upon notice -
– The PostmasterGeneral has furnished the following information : -
asked the Minister representing the Prime Minister the following questions, upon notice -
– The Prime Minister has furnished the following information: -
asked the Minister representing the Minister for Commerce and Agriculture, upon notice -
– The Minister for Commerce and Agriculture has supplied the following answers: -
asked the Minister representing the Minister for Commerce and Agriculture, upon notice -
– The Minister for Commerce and Agriculture has furnished the following answers : -
asked the Minister representing the Minister for Commerce and Agriculture, upon notice -
Western Australian flour-millers a higher price for wheat destined for manufacture into export flour than that charged to millers of eastern States, and thereby prevent the natural flow of trade between Western Australia and Malaya and Java?
– The Minister for Commerce and Agriculture has supplied the following answers : -
asked the Minister representing the Prime Minister the following questions, upon notice -
– The Prime Minister has supplied the following answers to the honorable senator’s questions : -
Bill received from House ofRepresentatives.
Declaration of Urgency.
– I declare that the Communist Party Dissolution Bill 1950 is an urgent bill.
Question put -
That the bill be considered an urgent bill.
The Senate divided. (The President - Senator the Hon. Gordon Brown.)
Majority . . . . 12
Question so resolved in the negative.
Motion (by Senator O’Sullivan) proposed -
That so much of the Standing and Sessional Orders be suspended as would prevent the bill being passed through all its stages without delay.
– On behalf of the honorable senators on this side of the chamber I record opposition to the motion that has been moved. The bill under consideration is both an important and a very extraordinary one. The measure is singular in that, having been introduced in a particular form in another place, it has been the subject of some nineteen amendments by the Government itself. Those amendments were not included until a very late hour last night. The bill which has left another place and has now reached the Senate is not yet before honorable senators in its amended form. Honorable senators on this side have not had an opportunity to consider the bill in its amended form. There has been no time for the Opposition in this Senate to give proper consideration to those amendments and to determine the need for further amendments that may be required in this chamber. I want to make it completely plain-
– I rise to order. Senator McKenna said that the bill in its amended form is not yet before honorable senators. I understand that the bill, as amended in the House of Representatives, is available to all honorable senators.
– The important thing is that the bill was not available to honorable senators. The bill has been amended by being printed to-day and is available from the Clerk of the Senate. It was presented to the President a few minutes ago. I repeat that the bill in its amended form is not available for immediate perusal by honorable senators on this side of the chamber.
– Copies of bills never are made available until the secondreading stage is reached.
– That is true.
– Then what is the honorable senator complaining about?
– I wish to make another point clear, namely, that the Opposition in this chamber has no desire or intention to delay the measure. I hear an honorable senator opposite interject, “ Oh, no ? “ I assure him that events will prove his interjection unjustified. The Government should listen to the assurance I have given, and not pre-judge the matter. We have no objection to the second reading of the bill being moved to-morrow, and after the Minister has made his second-reading speech, the Opposition will ask for the adjournment of the debate until the first day of sitting next week. I assume that, if the Government so desires, the Senate will meet on Tuesday next, and we shall then proceed with celerity to consider this important measure, together with the numerous amendments that the Government, in the light of Opposition criticism, and expressions of public opinion, has found it necessary to put forward. We on this side of the chamber are not in a position to embark at a moment’s notice upon the consideration of a measure that has been so heavily amended at the instance of the Government. We may find it necessary to re-draft some of the clauses, and I assume that, as is customary, the services of the Parliamentary Draftsman will be available for this purpose.
It is recorded in the Canberra Times of Saturday last that the Prime Minister (Mr. Menzies), when asked whetherhe thought that Labour senators would delay the Communist Party Dissolution Bill, replied -
That will be their pigeon. If the Labour majority cares to delay the Communist bill it can, but it must remember that its declaration as an urgent bill was voted for by their own party in the House of Representatives.
I draw attention to the report merely in order to say that I do not believe that the Prime Minister made any such statement, because it is completely at variance with the facts. On the 10th May last, the House ofRepresentatives divided on the very same motion as that which we are now considering, namely, that the bill be declared an urgent measure. There was also a division in the House ofRepresentatives on the motion for the allotment of time for the consideration of the various stages of the bill.
– Has the report been contradicted?
– I have not heard of any contradiction. If the Prime Minister made such a statement, it was incorrect ; if he did not, then the editor of the newspaper should publish a correction.
. in reply - I can see no force in the observations of Senator McKenna that copies of the bill are not presently in the hands of honorable senators. Never since I have been in this Senate have copies of bills been placed in the hands of honorable senators until the second-reading stage is reached. This bill has been declared by the House of Representatives to be an urgent measure, and the House of Representatives is fresh from the electorate. I speak subject to correction; but I believe that all parties in the House of Representatives treated the bill as urgent. I want the Senate, also, to treat it as an urgent measure. I believe that it is urgent, and I. think that most honorable senators will agree with me that the matter is most urgent. I merely wish to have an opportunity to place the bill before the Senate; but that can bo done only with the concurrence of the Opposition. “With the co-operation of honorable senators opposite, I would have been able to deliver my second-reading speech on the bill to-night. The sooner I did so, the sooner would the bill be in the hands of honorable senators. I should not have expected Opposition senators to proceed forthwith with the debate. If they wished to sleep on it, and to take up the debate to-morrow I should have been satisfied.
This measure was introduced in the House of Representatives on the 27th April. Much has been published about it in the press, and the bill has been debated in the House of Representatives since the 9th May. To-day is the 24th May. In the circumstances, I am not impressed by the suggestion that the matter should be considered de novo by honorable senators. The subject which we shall discuss when debating the bill has been under discussion in the House of Representatives for over a fortnight. It appears that I shall be prevented from making my second-reading speech to-night, and honorable senators opposite will again be delaying what we, and the people of Australia also, consider to be a matter of vital urgency.
Question put -
That so much of the Standing and Sessional Orders be suspended as would prevent the bill being passed through all its stages without delay.
The Senate divided. (The President - Senator the Hon. Gordon Brown.)
Majority . . . . 11
Question so resolved in the negative.
Bill (on motion by Senator
O’Sullivan) read a first time.
Debate resumed from the 18th May (vide page 2862), on motion by Senator Spooner -
That the bill be now read a second time.
– A somewhat curious atmosphere is being created in the Parliament, and some persons outside the Parliament are endeavouring to lead the people of this country to believe that the members of the Labour party in this chamber have not the right to discuss fully and adequately measures that are presented to the Senate hy the Government, and that in fact their task is merely to put their imprimatur upon those measures and to allow them to pass. It is a novel position for a member of the Labour party in this chamber to be accused of holding up the business of the Senate. My mind goes back to the last Parliament, when there were 33 honorable senators who were members of the Labour party and three who were members of non-Labour parties. Great respect was accorded by the then Government to the three members of the Opposition, and they were allowed to select the times at which they delivered their speeches.
– There were only three of them.
– I realize that, but I remind the Attorney-General (Senator Spicer) that the Labour Government allowed them to occupy more than their proper share of the broadcasting time. If they wished to disseminate propaganda to the people of Australia, we gave them an opportunity to do so when the proceedings of the Senate were being broadcast, so that their speeches, in opposition to the government of that day, could be heard throughout Australia. My mind goes back to a period when the Labour party had a majority in the House of Representatives, but was in a minority in this chamber. I am sure that honorable senators opposite do not want me to remind them of what happened then, when hundreds of thousands of Australians were hungry and when a Labour government was trying to secure the passage through the Senate of legislation designed to alleviate their distress. Honorable senators opposite do not wish me to tell them of the stone-walling tactics to which the members of the conservative parties were then prepared to resort.
The DEPUTY PRESIDENT (Senator Nicholls).- Order! The honorable senator must connect his remarks with the bill.
– I am endeavouring to do so.
– The honorable senator is taking a long time to do it.
– The AttorneyGeneral has said that I am taking a long time to connect my remarks with the bill. I am speaking deliberately, because I believe that the people of Australia should be well informed on this measure. I am trying to show that the present atmosphere has been created in order to stampede the members of the Senate into agreeing to this bill without having given it proper consideration. We were told last week by the Minister for Trade and Customs (Senator O’sullivan) that if we were prepared to allow the measure to pass, we could go home as soon as we had done so. That can be described only as political blackmail. It was a suggestion that if the members of the Opposition were prepared to permit the hill to pass without having considered and discussed it properly, they could then go to their homes, and the Government would be perfectly satisfied.
– That was only a jocular statement.
– I disagree with Senator Maher. I say that the statement was made by the Minister, from his place in this chamber, in all seriousness. Any honorable senator who was present when the statement was made knows that it was not made in a jocular manner.
– It was made with malice aforethought.
– I agree with Senator Collings.
This bill, which will be discussed in the atmosphere to which I have referred, is of great importance to the people of Australia. It is as important as any measure that could come before the Senate. The important fact that emerges from it is that the Government desires that a hoard to control the policy of the Commonwealth Bank shall again be established. [Quorum formed.] In short, the main purpose of this bill is to implement the desire of the Government to establish again a board of private individuals to control the policy of the Commonwealth Bank. This measure will relieve the Treasurer of his responsibility to control the financial policy of Australia. I take exception to it first on that ground. One of the Government’s greatest responsibilities is to control and direct the financial policy of the nation, upon which so much affecting the welfare of our people depends. If it does not do so it may be unable to carry out some of the things it wants to do. For that reason, I disagree with the Government’s desire to reconstitute the bank board. Honorable senators will recall that the previous Government determined that if we were to maintain prosperity in Australia, the first and most important essential was to maintain full employment. That was considered so important that our delegates to the United Nations made a special effort, which I am glad to say waa successful, to convince that organization of the need for the full employment of the peoples of the world. In the past, much of the misery of the world has been caused by unemployment, as a result of which the workers were unable to get sufficient food to keep them and their families in good health. Because we in Australia firmly believed in the .maintenance of full employment, our delegates asked the nations of the world to agree to that policy. I presume that the present Government is trying to carry out that policy.
– I rise to order. I submit that the honorable senator Ls not discussing the bill. The measure before the Senate deals, not with full employment, but with the constitution and functions of the Commonwealth Bank.
The DEPUTY PRESIDENT.- The honorable senator is in order provided that he connects his remarks with the measure under discussion.,
– I intend to connect my remarks with the measure that is being considered by this chamber. I was endeavouring to draw an analogy between what has happened in the past and the present state of affairs. I intend to link those remarks with the purpose of this bill. The former Government, recognizing the importance of maintaining full employment, caused the provision to which I have referred to be written into the Charter of the United Nations. If the present Government wants to adhere to that policy it is neces sary for it to continue to control the financial policy of the nation. In this measure the Government is attempting to pass over to private individuals the right to control the financial policy of Australia. The previous Government, with great courage, decided upon a vast programme of public works throughout Australia. I remind honorable senators that the huge Snowy Mountains hydroelectric scheme will - cost over £200,000,000, and will take about 20 years to complete. During that period there will be no return from the money that will be poured into the venture. Somebody has to find that money. If the Government retains control of the Commonwealth Bank, money will he found for the work to be carried on progressively.
So far, the resources of this country have scarcely been scratched. I recall that about 20 years ago hundreds of thousands of our people were idle, although raw materials were available. Although work such as that now contemplated should have been undertaken at the time, the Government of the day was unable to do so because it did not control the financial policy of the country. In order to pursue a policy of full employment it is necessary that proper control should be maintained over the financial affairs of the nation. That can only be achieved by public expenditure when private expenditure dries up. In the event of hard times recurring, and the private banks wanting to foreclose on over-drafts and put men out of employment, the Government should be prepared to undertake huge public works. The National Works Council was established by the former Prime Minister (Mr. Chifley) to plan a vast programme of public works throughout Australia. Two years ago £1,000,000,000 worth of public works had already been planned by it. As men arid materials become available we should develop the resources of this great country. It is essential that the Government should retain the right to direct Australia’s financial policy. The Government should be in a position to ensure that, from day to day, money will be available to carry on a national undertaking, although it may take 30 years to develop before showing a return.
It is obvious that, by this measure, the present Government seeks to destroy its direct right in this connexion.
It has been’ contended by honorable senators who support the Government that in the final assessment the Parliament will resolve any dispute. The Labour party does not believe that that is an effective state of affairs. It does not believe that that is the type of control that the people’s Parliament should exercise. It believes that the Commonwealth Bank should be responsible directly to the Treasurer of the day. If he lays down a policy the Commonwealth Bank should carry it out. The Opposition will not agree to a board being placed between the Treasurer and the people, whereby the Treasurer would be able to avoid his responsibility by hiding behind that board. I stress that the Parliament should control the finances of the country.
To-day Australia is in dire straits because the supply of coal available to industry is inadequate. It is my good fortune to live close to the northern coalfields. I recall the time when many of the workers in the coal industry were idle. Day after day they could be seen sitting around the streets waiting for work, while the pits deteriorated. Although the nation is now crying out for coal, as a result of years of neglect the pits are in a hopeless state of inefficiency. Many years of intense concentration by successive governments will be necessary before we will be able to get all of the coal that the country needs. If the Government is prepared to establish an authority to win. for Australia the coal that is required that authority will have to be provided with sufficient finance. We must rehabilitate the coal mines of this country, and that task will require the expenditure of millions of pounds. Who is going to provide that money? The colliery proprietors are unable to do so, so that the money must be provided by governments. From time to time the Commonwealth Government and the Government of New South Wales have appointed royal commissions to inquire into the industry, and successive royal commissioners have recommended that those governments should participate in the industry by assuming responsibility for policy, leaving the colliery owners to direct the actual working of the mines. If it is necessary for governments to take over the control of the coal mines in order to rehabilitate them, it is obvious that they must be able to obtain the necessary money to expend on the mines. If the Commonwealth Government can direct the Commonwealth Bank to supply the necessary finance, no difficulty will be experienced, but we do not know what complications and difficulties may arise if the Government is unable because of the existence of an intermediary body, such as the proposed board, to instruct the bank directly to make the money available. Without desiring to traverse once more the melancholy happenings of the depression-
– Once again will not hurt.
– Perhaps it is necessary to repeat these things if Senator Wright is ever to understand them. During the depression people wondered why such a disaster came upon them, but they were told that it was right for private bankers to control the finance and the credit policy of the nation. Now, however, they are convinced that it is the duty of the Government to control those matters, and they will not lightly accept the present Government’s proposal to vest the control of the nation’s financial policy in a board. Over the years vested interests have tried to confuse the people. They have endeavoured to persuade the ordinary individual that banking is a matter upon which he has no right to express an opinion. The press used to urge that the Parliament should not be allowed to control the Commonwealth Bank because parliamentarians might squander the money deposited by the people in the bank.
– So they would.
– Senator Maher confirms what I have just said. Obviously he is one who has not changed his mind, but is living in the old days.
– It is to be hoped that he will not be appointed to the proposed board.
– He would probably be at least as good an appointment as some of the individuals whom- the present Government will appoint. We know the honorable senator, who is not of a bad type, but we are asked to agree to an appointment of a number of gentlemen to the board whose names we do not even know. Notwithstanding that Senator McKenna, on “behalf of the Opposition, asked the Government to furnish a panel of the names from which the appointees to the proposed board will be chosen, we were not given even that information. Furthermore, when the unknown gentlemen are appointed, we do not know what they will do.
– But we know the type of man that will be chosen.
– I have a good idea of the type.
– Perhaps they will be members of the Austraiian Council of Trades Unions.
– The Government could do worse than appoint members of the Australian Council of Trades Unions. However, as I was saying, ten or fifteen years ago the people were led to believe that if the Parliament took over control of the Commonwealth Bank it might be tempted to squander the people’s money and so bring the nation to bankruptcy. Of course, we have since had experience of control by the Parliament of the financial affairs of the country. The Commonwealth Bank has never functioned more efficiently that it has during the past few years, which included the war period, when it has been directly under the control of the Government. Although one would naturally expect that because of the pressure of events during the war period, and the unprecedented nature of the difficulties at that time, the bank and the Government might have made mistakes on financial matters, the fact remains that no serious mistakes were made. The bank has gone from strength to strength, and the national credit overseas never stood higher than it does at present.
– And the bank now has more money “ in the kitty “.
– Senator Clothier has pointed out there was never more money in the bank than there is now. I believe that the people have awakened to the importance of proper control of the bank. They want the Parliament to control the finances of the nation, and they reject the Government’s proposal to interpose some body between the Government and the bank. Therefore, I urge the Government to give careful consideration to this matter before rejecting the amendments which the Opposition has foreshadowed. We are not prepared to permit another bank board to be interposed between the bank and people’s representatives. We say that the Treasurer must take the responsibility for guiding the financial affairs of the nation and for answering to the people for whatever he does. That has been our policy for many years.
In 1945 we took the opportunity to abolish the former hank board and to revert to the system of control by a governor responsible to the Treasurer. At the following election, the control of the bank was made an issue, and the present Treasurer (Mr. Fadden) said unmistakably during that election campaign that its result would be regarded as a vote of the people upon the principle embodied in Labour’s 1945 legislation. Labour was equally emphatic. We said that we had abolished the bank board and that we could not permit a board to be reestablished to control the bank. All honorable senators are aware of the result of that election. We object to the bill because it shelves responsibility, and also because we know from experience what a board is likely to do to the Commonwealth Bank. During the days in which the measure has been debated honorable senators have been told of the history of the Commonwealth Bank, which was established in 1911. They have also been reminded of the fierce opposition that was expressed in those days to the establishment of the bank. As a Labour supporter I take great pride in the fact that the bank was established by a Labour Administration in the face of the most fierce opposition and .scurrilous criticism. In order to give honorable senators some idea of the nature of that opposition I shall read a brief extract from an editorial which appeared in the
Melbourne Argus at that time, in which it was stated -
The -whole scheme is conceived in idiocy.
It constitutes a malicious use of public funds. There is not the slightest justification for it, and its failure is so much a matter of certainty that the whole position will be abandoned after a few months of inglorious experiment.
Of course, even in those days members of the Australian Labour party were accustomed to abuse and vilification. Every effort that has been made to reform our social institutions and to alleviate the hardships of the ordinary people has encountered criticism and opposition. However, to-day, we have the advantage of being able to view the Commonwealth Bank in perspective. After 40 years of successful operation, what has become of the prognostications of failure and the propaganda directed against the establishment of the bank?
I remind honorable senators that the periods of greatest progress of the bank occurred while that institution was under the control of a governor. Very shortly after its establishment, it was called upon to provide the finance for World War I. Having accomplished that great task successfully, the bank went on to make great progress in the early ‘twenties. By that time Labour’s experimental project had so justified itself that the private financial institutions decided that its activities would have to be curtailed. All the talk about the need for free enterprise, the right of unrestricted competition and so on was revived in 1924, when the Commonwealth Bank’s competitors prevailed upon an anti-Labour Administration to hobble the bank. Of course, they feared that if that institution were not restrained, it would put them out of business. So what did they do? Under the leadership of Mr. S. M. Bruce a government of the same political colour as that now in office occupied the treasury bench in this Parliament. In 1924, that government decided to interpose a board between the people and the Commonwealth Bank. The function of that board was to determine the policy of the bank. Like the present administration on this occasion, the Bruce-Page Government concealed the fact that the real purpose of appointing a board was to restrict the activities of the bank. Ostensibly a board was to be appointed because the bank had out-grown its existing form of control and wise direction was needed for this lusty growing infant. Men of experience were required to guide its activities so that it could some day become a mighty institution. Accordingly, the first Commonwealth Bank Board was appointed.
Last week Senator O’Flaherty showed the affiliations that members of that board had with the private banking institutions in this country. He did it very well. Any one who listened to him must have been convinced that the first Commonwealth Bank Board was most responsive to the trading banks and was not very much concerned with promoting the interests of the Commonwealth Bank. I shall not repeat what Senator O’Flaherty said, but I should like to give to the Senate an indication of the kind of men who were appointed to the bank board by the Bruce-Page Government. I shall mention only a few of the names. At that time, as I have said, the bank was making great progress. In fact, its development was so rapid that it was becoming a menace to the private banking system of Australia. The original appointees to the board included John McKenzie Lees, a fellow of the Institute of Bankers, London, a former chairman of the associated banks in Queensland, general manager of the Bank of Queensland and of the Bank of North Queensland. Another was Sir Samuel Hordern, a director of Anthony Hordern and Sons Limited, the Australian Mutual Provident Society, the Royal Insurance Company Limited and other companies. A third was Sir Robert Gibson, who had many connexions with private industry. He held several directorates and, as Senator O’Flaherty was able to show, had been closely associated with the private banks. What was the experience of the bank under that board? Did the members of the board bring to the management of the bank the wealth of experience that was necessary for its guidance? Did they strengthen the bank and make it a more powerful institution? They did not. One of the board’s first acts was to issue a direction to the bank that it was not to seek trading business.
In the course of this debate, many quotations have been made from the report of the Royal Commission on Banking and Monetary Systems. I shall not repeat them now, but they provide ample support for the view that from 1924 onwards, the Commonwealth Bank, under board control, was stultified. As I have said, the board refused to permit the bank to engage in active competition for trading accounts. It is true that the central banking functions of the bank progressed. The savings bank department also expanded considerably, but the bank’s trading activities were deliberately curtailed. All these things come to our minds when we are asked to consider this proposal to re-introduce board control for the Commonwealth Bank, What was the effect on the Australian people of the imposition, through the Commonwealth Bank Board, of the policy of the private banks upon the Commonwealth Bank? A quotation that I propose to make shows clearlyjust what toll the private banks were levying on the primary producers of this country.
– A decent rake-off.
– It certainly was.
– It was an indecent rake-off.
– That is a matter of terms. I recall that one honorable member of the House ofRepresentatives - I cannot remember his name at the moment - spoke of the private banks as highwaymen in a valley levying tribute on all who passed. The House was astounded at the honorable member’s revelations concerning the activities of the private banks. The quotation I propose to make is from a speech made in the House ofRepresentatives by the late Frank Anstey in 1925. Speaking of the administration of the bank under the Commonwealth Bank Board, he said -
The rates charged for financing primary produce began at once to rise, until they had more than doubled; the producers of the 1924-25 season had to pay £7,000,000 in bank charges, as against £3,000,000 for the previous year.
That is to say, in one year the primary producers of this country had to pay more than 100 per cent, extra in bank charges. Believing that the Senate would be interested to hear that figure expressed in more real terms, I have obtained an extract from a speech made in this Parliament on the 4th April, 1935, by Mr.C. L. A. Abbott. Mr. Abbott pointed out that there were then about 70,000 wheat-farmers and approximately 90,000 wool-growers engaged in production in Australia. He said that their total debt was £288,000,000. Interest at 5 per cent, would amount to £14,000,000 a year. Expressed in terms of wheat, out of a crop of 135,000,000 bushels, 60,000,000 bushels would go to meet bank interest rates. Expressed in terms of wool, at the price then offering, in order to earn £7,000,000 representing the interest owed to the banks, the wool of 21,000,000 sheep would be required. This is the service that private bankers claim they have rendered to the farming community. According to the report of the Royal Commission on Wheat, from returns submitted by 452 farmers 32 per cent, had to pay interest charges from l0d. to1s. 9d. a bushel and 61/2 per cent, had to pay1s l0d. a bushel and over. A few years ago a return from 43 farms in one of the principal wheat-growing districts in South Australia disclosed interest charges amounting to1s. 4d. per bushel or 44 per cent, of the total cost. That shows in very real terms what the extra bank rate meant to the primary producers of Australia. So to-day, when the Government comes along with a proposal to restore board control to the Commonwealth Bank, is it any wonder that the Labour party, . members of which have a vivid recollection of the activities of the previous board, are suspicious? When we look back over the years and recall that farmers have had to pay interest charges amounting to 44 per cent, of their total return, small as it was, we believe that we are amply justified in questioning the wisdom of restoring board control.
We are assured that, in the Government’s opinion, it is necessary to have a board. I have searched the Minister’s second-reading speech for good reasons for the Government’s support of board control. The Minister said quite frankly that the restoration of the board was a part of the Government’s policy. It is true that the Government parties have from time to time reaffirmed their intention to re-appoint the board. Superficially that is the reason for this legislation, but I am inclined to look deeper for a motive. If the Commonwealth Bank is making good progress as an instrument of the Government why change the present form of control? Is the Government lacking in capacity or skill to do a particular job? Is the assistance required by the Advisory Council and the Government? In short, is there any valid reason for the Government’s desire to place this institution, which belongs to the people of Australia, under the control of a board instead of a government? Does the Government believe, for instance, that somebody of ability and experience should be brought from overseas to strengthen the control of the bank? So far as I am aware, the Government has no such reason for this proposal. Certainly no such argument has been advanced in support of the bill. We have been told quite flatly that the restoration of the board is part of the Government’s policy. That is not sufficient for the people of this country. As I have said, the bank was making rapid progress until its form of control was changed in 1924 by an administration of the same calibre as that now in office. Board’ control was removed by a Labour Government in 1945. The Commonwealth Bank to-day is the most powerful financial institution in Australia. It is making tremendous strides; it is not able to get sufficient staff for the work that it has in hand; its premises are not adequate for its expanding needs. Yet, at this stage, the Government comes along - a newly elected Government at that - and says, “ We are going to replace control by the Government with board control “. It has not said who the board will be, but has simply told honorable senators that it will again appoint a bank board at a time when the bank has reached the most prosperous period in its history and has no problem that it cannot overcome. When the records of bank boards in Australia are considered, is it right that honorable senators on this side of the chamber should accept completely seven unnamed mysterious men who will be superimposed on the Commonwealth Bank for no good reason ?
In reaching a decision, honorable senators must consider first what happened when a board was previously in charge of the bank’s affairs. Did the board act in the best interests of the people of Australia? Did its members give complete allegiance to the Commonwealth Bank and none to outside interests? The evidence is that they gave allegiance to private interests outside the Commonwealth Bank and did not give their full attention, skill and experience to the bank. Honorable senators on this side of the chamber ask the Government who will run the bank and if a panel of names will be supplied informing honorable senators of the types of men that the Government has in mind for the bank board, their experience and whence they are to be drawn. So far, honorable senators on the Opposition side have been unable to obtain the slightest hint as to the identity of the seven men who are to be appointed. Therefore, honorable senators must make their own judgment, and the only basis that they have is the experience of the past. In the judgment of honorable senators on this side of the chamber the Government will appoint persons of the type who were appointed to the previous board.
In the last general election, the private banking institutions of Australia gave very strong support to the Liberal and Australian Country parties. It is beyond argument that the private banks allowed a great number of their officers to go through every district canvassing from door to door. Those officers told the electors that the Labour party was very bad and that this was their last chance to give the Liberal party a vote because if the Labour party was returned, there would be no more elections. Similar nonsense was spread abroad by the Treasurer (Mr. Fadden). I was reminded of the bogy man and, indeed, I felt like one myself. It seemed to me that mothers should say to their children, “ Look out, the Labour senators will get you “. The private banks spent hundreds of thousands of pounds on behalf of the Liberal and Australian Country parties.
– The Labour party gave the Government supporters the ammunition first.
– That is not true. The ammunition that was used was dumdum ammunition. It was not fair to use it.
– It was banned by international law.
– The Liberal party propaganda should have been banned by international decency.
– Listen to the squealing Why do not the honorable senators opposite accept the decision of the people?
– An honorable senator has suggested that the ammunition was provided by the Labour party. It was not fair tactics to knock on the doors of electors and tell them that if they voted for the Labour party, they would lose their last chance of voting at an election. That was filthy propaganda for responsible men to spread about. During the general election campaign the Liberal and Australian Country parties had to rely to a great extent on the money provided by the private banks and on the bank officers. Is it not a fair judgment on the part of the Labour party to expect that the private banks, which spent hundreds of thousands of pounds for the Government and provided the services of their officers throughout Australia, would claim some return?
– The honorable senator applies the standards of his own party to the Government parties.
– I would hate to drift to some of the standards applied by honorable senators on the opposite side during the election campaign.
– It was a fair campaign. The Labour party got a good hiding and cannot take it.
– I would hate to descend as low as the Liberal party did during the campaign.
– Order ! The. honorable senator’s time has expired.
Motion (by Senator Hendrickson ) put -
That Senator Arnold be granted an extension of time for thirty minutes.
The Senate divided. (The President - Senator the Hon. Gordon Brown.)
Majority . . . . 11
Question so resolved in the affirmative.
– I support the bill, believing as I do that it is one of the most important pieces of legislation that has ever been placed before the Parliament. I very much deprecate the tactics of the Opposition in calling for a quorum when only seven of its own members, out of a total of 34, are in the chamber. It is the duty of Opposition members and of Government members alike to be present in the chamber to transact the business which they were elected to carry through.
Senator Arnold said that the Commonwealth Bank Act 1945 was accepted by the people at the 1946 elections. We do not dispute that, but he did not say that the then Prime Minister (Mr. Chifley) had assured the people that the Government had all the power it needed under the 1945 act. I propose to discuss the Commonwealth Bank Act 1945, and also the Banking Act 194Y. As honorable senators are aware, when the Labour Government refused to submit to the people by referendum a proposal for the nationalization of the trading banks, the people of Victoria were asked to give a decision for the rest of the Commonwealth, and in the State election then being held they decided conclusively against nationalization. During the next two years, the bank nationalization issue was much discussed, and was the subject of important litigation. Therefore, it is interesting to recall that, on the 10th December last, the people of Australia gave exactly the same decision on the issue as did the people of Victoria. That disposes of the suggestion that the decision of the people on the 10th December was influenced by mass hysteria. As a matter of fact, it was a considered and thoughtful decision.
One would expect members of the Opposition to defend vigorously the principle of bank nationalization, seeing that it is the very cornerstone of Labour’s economic policy, but did they defend it in this chamber? They did not. They did precisely what Senator Wright said - they hoisted the white flag. They referred to the constitutional invalidity of the Labour Government’s bank nationalization legislation, but beyond that there has been very little discussion of proposals to nationalize the trading banks. The entire argument of members of the Opposition has centred in the constitution of the Commonwealth Bank Board. Senator Gorton conclusively disposed of the assumption that there is no longer any threat to the private banking system of Australia, or any danger of the development of a State monopoly bank. Strangulation is not a new method of coping with competition, particularly, when applied to private banking. The present Leader of the Opposition (Mr. Chifley) himself stated that it was the intention of the Labour Government, if returned, to give the private banks virile competition. However, we can go back much farther than that. It is on record that, in 1910, before the establishment of the Commonwealth Bank, Mr. Ramsay Macdonald, the well-known socialist, replying to a question asked of him during his visit to Australia, said -
We will enter into such competition with the existing hanks that we will force them out of existence.
I suggest that history has repeated itself. Much of the discussion on this bill has been about the depression of the early thirties, and who was responsible for it. The private trading banks have been charged with having caused the depression and with having done nothing to help the country out of it.
– The royal commission stated that the private banks had to bear some of the blame for the depression.
– I am pleased that Senator O’Byrne has referred to the royal commission, because I, too, propose to quote from its report.
Turning to the question of whether the private banks were responsible for the depression, I point out that on the 6th February, 1931, Mr. Scullin, who was then Prime Minister of Australia, said -
The causes underlying the position confronting Australia are so well known as to need only the briefest reference. The general fall in prices, a movement entirely beyond the nation’s control, has brought about a world depression of unexampled severity. The world depression in itself ranks as a major disaster in most countries. Australia, as a trading country, is bearing a full share of its paralysing effects.
It has also been claimed, unfairly, that the profits of the banks have been excessive and that they assisted to make the years of the depression more difficult. On page 354 of the report of the royal commission it is stated that before 1929 the profits of the trading banks were approximately 11 per cent, on capital, before deduction of tax, and that after 1929 they were 7 per cent, on capital, also before deduction of tax. The report also shows the total profit of the banks expressed as a percentage of total shareholders’ funds. I do not propose to quote the figure for every year with which the report deals, hut I point out that in 1927 it was 8.3 per cent, and that by 1935 it had dropped to 2.91 per cent.
– Those figures relate to disclosed profits. What about undisclosed profits?
– The report deals also with reserves.
The statement of honorable senators opposite that the trading banks refused to assist in the depression years is contrary to the facts. I say in passing that neither I nor any of my family have any connexion with private banks. It is a matter of history that during the depression the private banks adopted, within the limits of their power, an inflationary policy. In 1930 they were lending 99.7 per cent, of their deposits. That was almost an unsafe figure. Therefore, it is not just or true to suggest that the trading banks wilfully withheld help during the depression. The Loan Council adopted a deflationary policy. There are many persons, to-day, even women with a limited knowledge of economics, who believe that the deflationary policy of that period was not a wise one, but it was the policy of the Loan Council. History shows that it was directly the opposite of the policy of the private banks. While the Commonwealth Bank was restricting its activities, the private banks were extending their activities.
I do not wish to be tedious or wearisome, because we have had a lengthy discussion on the subject of banking. I “say, in conclusion, that honorable senators opposite are not the only people who have had experience of the depression. Amongst us there are some who suffered from it. Others thank Almighty God that they did not suffer, but that does not mean that they have no sympathy for those who did. Those of us who have been associated for years with charitable organizations of all kinds, realize only too well the terror that unemployment strikes into the hearts of men and women. I say to members of the Opposition, as I have said before, that it is time we grew up and realized that the responsibility rests with the individual. If all of us were to subdue the greed in our hearts and recognize the needs of others, there would not be depressions, and we would not have debates of this kind. I support the measure.
, - I desire to make it clear at the outset of my remarks that, as a representative of the people, I claim the right to express my views on this very important measure for as long as I am permitted to do so under our Standing Orders, regardless of what Senator Wedgwood or the Bight Honorable Robert Gordon Menzies may think. A reference to Hansard will reveal that for m:.ny years the present Prime Minister (Mr. Menzies) has been granted extensions of time almost every week that the House of Representatives has sat. The right honorable gentleman, in a statement to the press, accused the
Senate of holding up legislation. He could have referred only to this measure, which is the only one that has been received in the Senate from the House of Representatives during the life of this Parliament. If it is right and just for the elected representatives of the people in the House of Representatives to express their views upon measures for as long as the Standing Orders of that chamber will permit them to do so, and also to receive extensions of time, it is also right and just that we should, if we so desire, express our views upon measures for as long as the Standing Orders of this chamber will permit us to do so. I intend to do that, irrespective of whether it hurts honorable senators opposite.
Senator Wedgwood twitted us with not defending the Banking Act 1947. That issue is not before the Senate. If the honorable senator did not know it before, she knows it now. That remark applies also to the legal gentleman from Tasmania who sits on the Government side of the chamber and who, in speaking on this measure, dealt only with socialism, communism and the nationalization of the banks. We agree whole-heartedly with clause 3 of the bill, which provides for the repeal of the Banking Act 1947. We do not oppose that clause. We say, in effect, “ There it is ; you can have it “. That measure was declared by the Privy Council to be largely unconstitutional. If honorable senators opposite believe that we are so stupid as to waste our time by flogging a horse that has been dead for months, they are mistaken.
– In our opinion it is not dead.
– It has been dead for months, and honorable senators opposite know that it has. The reason why they have flogged a dead horse is that they cannot justify the introduction of this bill.
Senator Wright interjecting,
– For the last three years I have tried to get Senator Wright to discuss Labour’s banking policy with me on a public platform in Hobart - his home town - but he has eluded me. He wanted me to go to a little country town, because he was born there. I have been unable to persuade him to debate the subject with me in any of the cities, where the majority of the people live.
– Who is the honorable senator talking about ?
– Senator Wright, the paranoic of the Government. Let me get back to the bill.
Government Senators. - Hear, hear!
– Have any of the honorable senators who have just said “ Hear, hear “ produced a single piece of evidence to justify their contention that a Commonwealth Bank Board would do a better job for the Commonwealth Bank than would a governor? Have any of them produced a single piece of evidence to prove that the Commonwealth Bank Board managed the affairs of the Commonwealth Bank as well as they were managed by a governor ? They have not. Honorable senators opposite do not say “ Hear, hear “ to that statement.
Let us examine the history of banks in Australia under the control of boards. Private banks are controlled by boards of directors, which issue instructions in regard to policy. At one period there were 58 private banks in Australia. Each of them was controlled by a board. The boards were so efficient that the number dwindled to eleven.
– I thought it was eight.
– There may have been one or two later instances of banks going out of business of which I have no knowledge. At the period of which I am speaking, the financial policy of this country was dominated by nine banks. Their boards were so efficient that many other banks went out of existence. If boards are as efficient as honorable senators opposite say they are, those other banks did not cease to exist because of the mismanagement of their affairs, by their boards. Was the number of banks decreased because bankers wished to form themselves into a smaller group and thus reduce friction between the boards? It is not very difficult for banks to control the financial policy of a country when there are only a few to pull together in harness. Honorable senators on this side of the chamber know the history of the Commonwealth Bank, but there are hundreds of thousands of persons who do not know its history or realize the great benefit that it has bestowed upon this country. Having listened to this debate, I venture to say that included among those persons are some honorable senators opposite. The Commonwealth Bank was established in 1911. The measure under which it was established was opposed by the private associated banks more strongly than the banking legislation of the last Government was opposed by the bankers of to-day.
Sitting suspended from 6 to 8 pm.
– In deciding what should be the best system in the future we must have regard to what has happened in the past. During the period of World War I. the Commonwealth Bank, which was then controlled by a governor, floated loans at a cost of os. 9d. per cent., which saved the people of Australia approximately £5,000,000, because the associated banks had been charging £2 7s. Id. per cent, for floating loans. Indeed, before World War . I. they had charged an average of £3 per cent. Primary producers and business men were financed by the Commonwealth Bank to the amount of £437,000,000, without being required to provide gilt-edged security, as would have been demanded by the private associated banks. I emphasize that nobody has ever been granted a loan or overdraft by the private associated banks - which are controlled and run by boards - without lodging giltedged security. At that time, also, the Commonwealth Bank proved of considerable assistance to the shipping industry by providing £3,500,000 for the purchase of ships. Many honorable senators will remember that the private banks left the farmers “ high and .dry “ at that time. In 1920 a depression occurred in the United States of America. At a later stage I shall furnish honorable senators with details in relation to that national catastrophe, in order to demonstrate the difference between board and governor control of great institutions. Suffice it to say at this juncture that that depression was man-made. Subsequently, its effects were felt throughout the world. The opponents of Labour contend that it could not have been prevented. A governor was still controlling the Commonwealth Bank. As soon as the private associated banks applied the “ screws “ by directing their several boards to call in overdrafts and loans from the primary producers, which was the beginning of stagnation in the rural industries, the Commonwealth Bank released an additional £20,000,000 worth of credit to assist the primary producers during that difficult period. That action contributed considerably towards preventing the depression conditions that were evident in the United States at that time, from being felt fully in this country. Shortly afterwards, in 1924, the then Treasurer (Sir Earle Page) was instrumental in having the Commonwealth Bank Act amended, in order to provide for the establishment of the Commonwealth Bank Board. In his second-reading speech on this measure in another place the Treasurer (Mr. Fadden) stated that the present Minister for Health (Sir Earle Page) was one of the greatest Treasurers that this country has ever had. I shall deal with that aspect of the matter later. By the 1924 legislation the control of the Commonwealth Bank was vested in a board, and the governor was dispensed with. Senator Arnold has already very ably described the members of that board and the interests that they represented. Quite definitely they were not interested in the welfare of the general public in this country. By 1926, the Commonwealth Bank Board had become merely a puppet of the private associated banks of Australia, and the bank itself had become no more than a clearing station for the private banks. At that stage the private banks were free to implement whatever policy they desired. They also directed the activities of the Government of this country. One of the first moves made by the private banks after the Commonwealth Bank Board was established was to raise interest rates. The following statement appeared in the Melbourne Sun News-Pictorial of the 13th October, 1924:-
The Bruce-Page Government took the hold step of converting the Commonwealth Bank into a bank for the bankers.
I think even Senator Wright would agree that that newspaper is run by neither Communists nor socialists. In 1929, 1930 and 1931 the effect of the contraction of credit by the private banks was felt very severely by businessmen and primary producers in this country. They called in overdrafts and loans, and their policy of deflation did a great deal to accelerate the onset of depression conditions in this country. I remind the .Senate that the Government of the day was refused credit by the private banks. Had money been made available the Government would have been enabled to keep many of the workers of this country in employment. It was also refused money by the Commonwealth Bank, over which it had no control. Some honorable senators opposite have remarked that a Labour government was in office at that time. Whilst that is correct, I point out that the then government had no power to direct or alter the constitution of the Commonwealth Bank because the Opposition in this chamber numbered 33, against three government senators.
– That is incorrect.
– ‘Although I may be one or two out in my figures, the then Opposition had an overwhelming majority in this chamber. In another place, of course, Labour had a majority. When a measure to deal with finance was brought forward the then Opposition “ stalled “ for ten and a half months.
– The honorable senator is wrong again.
– I am more often right than is the Minister for Repatriation (Senator Cooper). I should advise him to check his facts before interjecting, so that he will not appear quite so stupid in Hansard. Although the Government wanted only £18,000,000 credit, its request was refused both by the private associated banks and the Commonwealth Bank. Yet in 1920, when the Commonwealth Bank was controlled by a Governor, an additional £20,000,000 credit was released in order to avoid a crisis. At that time critics contended that the release of that amount of credit would result in inflation and the bankruptcy of this country. I point out that that did not occur even during the recent war, when £350,000,000 worth of credit was issued for the purpose of the destruction of humanity. Yet £18,000,000 was not provided during the crisis to which I have referred for the uplift of humanity. Surely this incident alone demonstrates the difference between governor and board control of the Commonwealth Bank.
In September, 1931, a conference of all heads of departments and representatives of States laid down an emergency developmental plan. Again the banks refused assistance, and the Government was powerless, because of the 1924 amendment of the banking legislation. The control of the credit of the nation should have remained in the hands of the Government. The only reason that the present Government wants to place the control of the Commonwealth Bank under a board in lieu of a Governor is to avoid its’ responsibilities. It is not game to shoulder the burden of determining the future financial policy of this country. As honorable senators are aware, the financial policy of any country has a material bearing on the economic welfare of its people. I shall refer to the opinions of eminent authorities about the control of a country’s financial policy and credit. Sir Hubert Holden, one of the most eminent banking authorities in Great Britain, in a lecture to students at Oxford University, said -
What brought about the depression? Everybody knows that it was caused by the bankers the world over in following up their old-time policy of calling up overdrafts and advances.
Again I point out to Senator Wright, through you, Mr. President, that it could not be claimed that Sir Hubert Holden was a “ Commo “ or a socialist. In fact, he followed similar lines in politics to the honorable senator. Another significant statement relating to those who control money was made by Mr. McKenna, ex-Chancellor of the British Exchequer and chairman of the Midland Bank, who is reported to have said -
They who control the credit of the nation control the policy of the governments and hold in the hollow of their hands the destiny of the people.
I should mention in passing that Mr. McKenna is not identical with my colleague in this chamber.
– The Bank of England still stands, despite the British socialist Government.
– The honorable senator who has just interjected may not be aware that the Bank of England is still controlled by a board, not a governor. I am not complaining about what the Bank of England has done. However, in the committee stage I shall point out some of the detrimental actions taken by the board governing the Bank of England.
– I repeat that it still stands, although there is a socialist government in power in Great Britain.
– The Commonwealth Bank still stands, also. In its report, the Economic Crisis Committee appointed by the Southhampton Chamber of Commerce, stated -
It is desirable that the administration of financial policy should be vested in a national authority directly responsible to the Sovereign and his people.
In passing, I ask whether the proposed board will he responsible to the Sovereign and to the people, or will it be responsible to the vested interests whom the majority of its members will represent? Because the Government is afraid to disclose the names of the individuals who will be appointed to the proposed board, it is clear that the appointees will represent organizations whose interests will not necessarily coincide with those of the community. Let us see now what the prominent daily newspapers have to say about the Government’s proposal. I shall quote first from the Melbourne Age, which cannot be accused of being a Communist or socialist sympathizer. In its issue of the 25th March, 1936, referring to the decision of the trading banks to increase interest rates on fixed deposits, that organ stated -
If the National Government deliberately excludes itself from all participation in the making or changing of monetary policy obviously it cannot govern except in the secondary degree.
I have often heard honorable senators opposite quoting from the Melbourne Iter aid, which is apparently their political bible, and now, I shall quote from the newspaper, which is not sympathetic towards Labour and cannot be accused of Communist or socialist affiliations. In its issue of the 24th March, 1936, dealing with the same subject, that newspaper stated -
If one trading bank can reverse a financial policy, who controls the financial policy of this country? Evidently the joint policy of thu
Commonwealth Government and the Central Bank can be set aside by the action of one powerful trading bank.
That is perfectly true, as every honorable senator opposite knows. I remind honorable senators now that the Government has not yet told us whether any of the members of the proposed board will be members or employees of the associated trading banks, or individuals who have retired from the service of those banks. They have not even told us whether such persons will be eligible for appointment to the board. Money must serve the people and it must not be allowed to become the people’s master. If the Commonwealth Bank is to be controlled by a board, then that board will become the master of the people instead of its servant. Is it right for the associated trading banks to exercise domination over the Commonwealth Bank through the proposed board? Do honorable senators opposite suggest that it would be in the best interests of the country that a board composed of representatives of the private financial institutions should direct and control the monetary policy of the country, which has such a vital effect on the economic wellbeing of every member of the community?
A great deal has been said by supporters of the Government in defence of the bankers and bank clerks who were paid so well to stump the country against Labour during the last election campaign. Of course, bank employees are free members of the community and they are entitled to exercise their political rights and to canvass on behalf of the antiLabour parties, but I object to the filthy, contemptible lies that they put over. Honorable senators opposite have emphasized that the bank officers were particularly loyal citizens. I shall quote a statement made by a bank official during the recent election campaign. In the course of an attack on the then Labour Administration, he said -
Do you expect us to come back from the war and sit back while skunks, scoundrels and curs run the country?
That statement was made by Mr. J. Breheney, a bank clerk in Tasmania. Let me say to honorable senators opposite that there are no curs on this side of the chamber, a fact which they will realize to their sorrow later on.
Government supporters interjecting,
– Honorable senators opposite can laugh now if they choose, but if they desire it I shall produce an authentic copy of certain statements that were made at a conference of bankers that was held in Melbourne in 1942 when the Government was endeavouring to obtain the co-operation of the banks in an all-out war effort. At that time we had the full co-operation of every organization throughout Australia with the exception of the bank officials.
– From what is the honorable senator quoting ?
– I am not quoting from any document at the moment, but if the honorable senator desires, I can produce some interesting documents concerning this matter and they can be laid on the table. At the conference to which I was referring the then Minister for War Organization of Industry was endeavouring to obtain the co-operation of bankers and their officials in a total war effort so that all available man-power should be released for the prosecution of the war. However, the attitude adopted by the bankers was, in effect: “The longer we delay the better for us and for our officials. If there is any forcing to be done, let the Minister do it, because up to the present very few of our banks have been closed, nearly all our members are still in their jobs and none of them are in that despised labour corps “. Statements to that effect were made by Mr. Laidlaw, secretary of the Queensland ‘bankers’ organization, who is also, I believe, a bank manager. I emphasize now the point of view that he was expressing then, namely, the longer that they could delay giving full co-operation to the Government the better it would be for them.
– I do not think that Mr. Laidlaw is a bank manager, but is the secretary of the Queensland branch of the bank officers’ organization.
– He appeared at the conference as a delegate of the Queensland Association of Bank Officials. I do not know what position he held in his bank. If the honorable senator who has interjected would like me to do so I shall quote from the documents when I speak at the committee stage, and if required, I will lay them on the tatble. “When I do that the honorable senator will be able to read what some of the other officials at that conference had to say about hindering the Government in its war effort. Those are the people who were so loyal and patriotic. Of course, I am not accusing every bank official, but undoubtedly some of them hindered the Government during the war, and it was those individuals who uttered the filthy, lying propaganda to which I have referred during the recent election campaign.
– Tell us about the co-operation that the Government received from the waterside workers in Sydney during the war.
– I will tell the honorable senator about those matters when I am dealing with them. At the moment I am dealing with the banks and their employees.
I shall refer now to the views expressed by some eminent authorities concerning the control of banking and credit, some of whom are held in high esteem by the present Government. Let me quote first of all from an observation made by Professor Copland on the 14th July, 1941. He said-
Banking is more than mere finance; it is a great social function, which should he controlled in the permanent interests of the people.
Under the existing financial control, our “ self-Government “ is a sorry joke, since they who control credit direct the policy of government. Where we, the people, should command, a few individuals do so. Where we elect a body of men, of our own free will, to govern for us, they are themselves governed by these few individuals, who acknowledge no obligation to us. whom we cannot put out of office, and who in most cases are unknown to us.
He was referring then to the former hoard of the Commonwealth Bank which dictated the financial policy of the country, and to the members of the boards of private trading banks which dictate the policy of the banks. He was not referring to the Governor of the Commonwealth Bank, because that official was then under the control of the Commonwealth Bank Board. Honorable senators opposite want to re-establish a board, which will prevent the parliamentary representatives of the electors from having any say in the policy of the proposed board. In other words, that board will virtually control the National Parliament in matters of financial policy. The next authority to whom I shall refer honorable senators is a famous man to whom the present Leader of the Opposition in the House of Representatives (Mr. Chifley) has been likened, much to the displeasure of Senator Wright, who contended that it was deplorable that the leader of our political party should be compared with such an eminent figure. I refer to Abraham Lincoln, who is probably an idol of all honorable senators opposite. Listen to what Lincoln said about money and banking -
Money is the creature of law, and the creation of the original issue of money should be maintained as an exclusive monopoly of the National Government. Such needs can be served by issuing national currency and credit through the operation of a national banking system.
The Government should create, issue, and circulate all the currency and credit needed to satisfy the spending power of the Government and the buying power of consumers. The privilege of creating and issuing money is not only the supreme prerogative of the Government, but it is the Government’s greatest creative opportunity. The people can and will be furnished with a currency as safe as their own Government. Money will cease to be the master, and will become the servant of humanity. Democracy will rise superior to the money power.
– Is that how the American “greenback” was introduced?
– Since the honorable senator has mentioned the American “greenback” I shall now read to him what the money powers of England said in reply to Lincoln’s statement. This” is what the London Times, which is certainly not a Communist or socialist newspaper, had to say -
If that mischievous financial policy which had its origin in the North American Republic, during the late war in that country, should become indurated down to a fixture, then that Government will furnish its own money without cost. It will pay off iia debt and be without a debt. It will have all the money necessary to carry on its commerce. It will become prosperous beyond precedent in the history of the civilized government of the world. That Government must be destroyed; or it will destroy every monarchy on the globe.
That is what a leading British newspaper had to say in reply to Abraham Lincoln. Lincoln’s opponents went further than that. They carried out their threats, or had somebody carry out their threats for them, because that great statesman was assassinated by shooting. I remind the Senate also that when I had the courage to defend a Labour government a couple of years ago on the banking issue, I was threatened with shooting. Apparently, such threats are not confined to men in high positions. Anybody who opposes the swindling racket that has been carried out over the years by the private banks is in danger of being shot.
– The honorable senator is so narrow that no one could hit him.
– If I were narrow mentally, I would not be able to understand the meaning of this bill, but I understand its implications very clearly. After I have explained them, the honorable senator will see what I mean if he himself is not too narrow in the mind.
Clause 5 of the bill states -
Section five of the Principal Act is amended -
by inserting before the definition of “ the Deputy Governor “ the following definition: - “the Board’ means the Commonwealth Bank Board established by this act;”; and by adding at the end thereof the following sub-section: - “ (2.) In this Act, any reference to the policy of the Bank, or to the monetary and banking policy of the Bank, includes a reference to the policy of the Bank, or to the monetary and banking policy of the Bank, as the case may be, in the performance of its functions under the Banking Act 1945 or under any other Act.”’
Clause 7 proposes to insert in the principal act a new section 9, which deals with the establishment and functions of the Commonwealth Bank Board. Proposed sub-section (2.) of that section reads - “ (2.) Subject to this Part, the Board shall have power to determine the policy of the Bank or of the Savings Bank in relation to any matter and to take such action as is necessary to ensure that effect is given by the Bank or the Savings Bank to the policy so determined.
That is quite clear and bears out what the Treasurer (Mr. Fadden) said in his second-reading speech. He said -
In reviewing the 1945 banking legislation, and in the preparation of this bill, the Government has been deeply conscious of its responsibilities to the people, and particularly of the fact that these responsibilities require -
that measures of such great importance should not be approached in a partisan spirit ; and
that the administration of the bank should not be subject to frequent and violent change.
The Government is giving to the Commonwealth Bank Board the power to determine the financial and banking policy of this country, in both its local and overseas application.Who is most likely to make violent changes - a governor who is charged with carrying out the policy of the Government, or a bank board, members of which will represent seven or eight different sections of the community ? I assume that the board will be representative of primary producers, exporters and - I am rather inclined to doubt this - industrial workers. The sectional interests of these people will conflict, and the result will be violent changes in the financial and banking policy of this country. The board will be bound by the decisions of its majority, and I have no doubt that considerable lobbying will be carried on amongst members of the board on behalf of various interests. The board’s ultimate policy is hardly likely to be in the interests of the common electors John Smith and Jim Jones. The interests of the financial institutions of this country will be well represented on the board. That will be a source of violent changes. The very act of reconstituting the board, therefore, is an assurance that violent changes will occur. Such changes are hardly likely to result from administration by a governor because he is not subject to outside pressure, and is not dictated to by people who do not know about banking. As Senator McKenna pointed out, the Government’s claim that members of the board would be experts in banking, and its assurance that representatives of the private banks would not be appointed, are difficult to reconcile. Where will the Government get experts on banking if it is to exclude people with practical banking knowledge and training? Does the Government intend to appoint a board of laymen and train them to be experts in banking while the country suffers from their mistakes as it did when the first bank board was appointed by the “ tragic Treasurer Sir Earle Page? The Treasurer also said in his second-reading speech -
Aa I indicated in my budget speech on the 25th September, 1941, we were faced at that time with the danger that secondary expansion of credit and excessive private bank profits might occur as a result of the use of treasury-bill finance for war purposes. To meet this danger I secured from the private banks a firm understanding that they would co-operate in the institution of arrangements which included -
depositing of their surplus investable funds with the Commonwealth Bank; (&) steps to ensure that excessive profits were not made by the private banks ; and
compliance with an advance policy laid down toy the Commonwealth Bank.
The Treasurer was saying, in effect, that he already had an assurance from the private banks that they would agree to the policy of the Commonwealth Bank Board, whatever it might be. Do honorable senators opposite ask us to believe that the Government has not conferred with the private banks on what the future financial and banking policy of this country will be? Are we expected to believe that the private banks have been so foolish as to give the Government a blank cheque by saying, “ “We shall abide by whatever decisions you make “, without knowing who the members of the bank board are to be? I am confident that the Government knows quite well who the members of the bank board will be, but is afraid to disclose the names publicly. Clearly the personnel of the board has been revealed to the private banks, but is being withheld from the Parliament because the Government has not the courage of its convictions. Is it any wonder that we on this side of the chamber see something sinister in this measure? The Treasurer also said -
We are convinced that responsibility for the determination of monetary and banking policy should be a collective responsibility, and the bill now before the House is designed to give effect to this principle by setting up a Commonwealth Bank Board under the chairmanship of the Governor, and by restoring to the elected representatives of the people the ultimate responsibility for monetary and banking policy.
Can any honorable senator opposite point to any provision of this bill under which the electors will have any say in determining the personnel of the bank board? I submit that there is none and, as the electors clearly are to have no say in the appointment of members of the board, how can the Government claim that the people of this country will have a say in the determination of Australia’s financial policy?
– They have already had their say. They have elected the Government, and the Government proposes to appoint the board.
– In that case the only conclusion we can reach is that the vacant positions on the board will he filled by the Government supporters, because they are the only ones whom the people have had any say in electing. The people of this country certainly have had no say in determining the personnel of the board. The Treasurer further said -
The same principle was embodied in the Commonwealth Bank Bill which was introduced by the right honorable Sir Earle Page, as Treasurer, in 1924. By that act, the control of the note issue was vested in the bank and provision made for a board of eight directors.
Apparently the board is to carry on as its predecessor did. What did the previous board do? One of its first acts was to allow the private banks to draw £31,000,000 from the Commonwealth Bank without providing gilt edge security. Subsequently, the private banks repudiated interest payments on that money, some of which was lent hack to the Government at 5$ per cent, to pay the war gratuity of £6,000,000 to ex-servicemen of World War I. The balance was lent at even higher rates of interest to local governing bodies; yet the private banks got that £31,000,000 for nothing. Goodness knows how much more credit they managed to manipulate through that £31,000,000. That is an example of what we can expect when the new bank board has been established. The Treasurer went on to say -
During the war years, the responsibilities devolving upon the bank and the board were greatly increased. War-time control of banking, exchange control, loan raisings and the financing of various commodity schemes each involved problems of considerable magnitude, and there were many other requirements in the financial field for which it was necessary for the board to make provision. Many of the problems encountered were new to Australia, but under the direction of the board the bank undertook the tremendous responsibilities of war-time finance with outstanding success. The record of the bank during those difficult years is a tribute to the effectiveness of the system of board management as then developed.
What the Treasurer omitted to say was that under war-time legislation the board had no chance to carry out any policy except that dictated by the Chifley Government. The bank board was not putting its own policy into effect during the war. It did what the Government directed it to do after introducing legislation. The Labour Government dispensed with the board and appointed a Governor of the bank who was told the Government’s policy and put it into effect. The only time that the bank board did anything meritorious, it acted on the initiative of the Chifley Government. In his second-reading speech, he said -
The board’s functions will be to determine the policy of the Commonwealth Bank in its central banking and trading activities. The policy of the Commonwealth Savings Bank will also be a matter for determination by the board. In short, the bill provides that the board’s power over policy matters will extend to the performance of all functions of the bank, including those entrusted to it under the Banking Act 1945. It will be the function of the Governor to administer the bank in accordance with the policy laid down by the board.
I invite honorable senators to note that the Treasurer did not say that the bank would he administered in accordance with the financial policy laid down by the Government, but in accordance with the policy laid down by the board, and nobody knows who the members of the board will he. Honorable senators were told also in the second-reading speech that the board would carry out a policy exactly the same as that carried out by the board established in 1924. That was the policy that brought disaster and stagnation to this country and created conditions which led to many suicides.
The Government Whip, Senator Wright, said in the course of his speech -
The Labour majority in this chamber is cowardly to the extreme because it is not game to exert its strength in support of ite policy of 1947.
The honorable senator has accused the Opposition of being cowardly because honorable senators on this side of the chamber would not waste the time of the Senate and of members of the Parliament in flogging a dead horse. The issue has been ruled outside the Constitution by the High Court of Australia and by the Privy Council. Does Senator Wright think that honorable senators on this side of the chamber are stupid enough to pursue something that does not exist? Senator Wright has stated that when he was coming to’ Canberra in the train, he thought that he was coming to a place where senators would deliberate and debate, but when he reached the Parliament he thought- that he had entered a kindergarten. Judging by his statements during the debate on the bill, the honorable senator himself has not been out of the kindergarten very long. He accused honorable senators on this side of the chamber of raising a white flag for a truce. Honorable senators on the Labour side have never hoisted a white flag.
– They have hoisted the red flag though.
– Nor the red flag either. The Minister for Trade and Customs (Senator O’sullivan) referred to the red flag in his interjection. By a strange coincidence, there is a man named N. O’sullivan who is secretary of the Communist party in Hobart, and he has often raised the red flag.
– The honorable senator knows the person to whom he refers, I suppose ?
– I do not know whether he is a relative of the Leader of the Government or not, but I do know that his name is O’sullivan and that he has hoisted the red flag often. I have been prominent in speaking on the banking question in my own State as well as in this Parliament. I have never shirked the responsibility of putting before the people the banking policy of the Government when the Labour party was in office. I challenged Senator Wright to debate this vexed question in the Town Hall in Hobart.
– The honorable senator should be accurate. I challenged him.
– The honorable senator put up the white flag.
– Order ! The honorable senator’s time has expired.
Motion (by Senator Ward) put -
That Senator Aylett be granted an extension of time for thirty minutes.
The Senate divided. (The President - Senator the Hon. Gordon Brown.)
Question so resolved in the affirmative.
During the general election campaign, the bank board was an important issue. I challenged any banker in Tasmania to debate the banking policy of the Labour Government on any platform. All of them “ squibbed “ the issue. The only person who accepted my challenge was not a bank manager. A challenge appeared in the press in which Senator Wright offered to meet me in Devonport to debate the nationalization of the banks. I had not mentioned that subject. I replied to the honorable senator by challenging him to a debate on the Government’s banking policy in the Town Hall at Hobart. He showed the white feather and turned out to be a “ squib “.
In the course of his speech in this chamber the honorable senator accused Senator McKenna of saying that if the Labour party was returned to office, it would attempt to drive through the Parliament a bill to nationalize the banks. Senator McKenna made no such statement. I listened to every word uttered by Senator McKenna and the statement that was attributed to him was manufactured by Senator Wright. Senator McKenna is not so foolish as to flog a dead horse. If Senator Wright can quote the paragraph which he has attributed to Senator McKenna, he is a genius, but he will have to insert it in Hansard because it is not there now. Senator McKenna said that the Labour party had no desire to nationalize all and sundry in industry and in that respect he simply repeated the statement that was made during the general election campaign by the former Prime Minister (Mr. Chifley). Of course, the Labour party has no desire to nationalize industries indiscriminately. The only people who say we have such a desire are those who have been stumping the country from end to end trying to damage the Labour party by telling a pack of lies. I have no wish to delay the Senate longer. Now that I have replied, and have shown what a “ squib “ Senator Wright is, I leave it to honorable senators to say whether the Commonwealth Bank should be under the control of the Governor or a board.
– I hope that I shall not be considered out of order if I address a few remarks to the bill.
– I rise to a point of order. Senator O’Sullivan’s statement is a reflection on the Chair, because he has suggested that the Chair was prejudiced in allowing members of the Opposition to go on speaking even though they were out of order.
The DEPUTY PRESIDENT (Senator Nicholls). - No point of order i3 involved.
– I was amazed to note the inconsistencies in Labour policy, and the extraordinary company in which Labour representatives sometimes find themselves. We frequently hear them vilify the press, and particularly the Sydney Morning Herald; yet to-night honorable senators opposite have agreed most enthusiastically with a leading article published in the Sydney Morning Herald the day after the Treasurer (Mr. Fadden) introduced this bill in the House of Representatives. I am not suggesting that honorable senators opposite are stooges of or are in the pay of, or are doing the work of the Sydney Morning Herald, but their references to the leading article in that newspaper illustrate how political inconsistency can be embarrassing, at any rate to those who are capable of feeling embarrassment. It would save time if legal problems were left substantially to members of the Senate on both sides of the chamber who have had legal training. One honorable senator said that we were wasting time by incorporating in this measure a provision repealing the Banking Act 1947. I suggest to the honorable senator that if he, in a quiet moment, consults with Senator McKenna, he will be put right. The Privy Council merely ruled that the banks could not be nationalized in the way in which the Labour Government proposed to do it, but the decision did not exclude the possibility of writing into the act amendments to enable nationalization to be effected in .some other way. For that reason, we wish to give the people the comforting assurance that the Banking Act 1947 will be wiped off the statute-book. Certain references have been made to circumstances leading up to the introduction of the banking legislation of 1947. I quote from the publication Digest of Decisions and Announcements, and Important Speeches of the Prime Minister, which states that on the 16th August, 1947, the then Prime Minister (Mr. Chifley) said -
Cabinet to-day authorized the AttorneyGeneral (Dr. Evatt) and myself to prepare legislation for submission to the Federal Parliamentary Labour party for the nationalization of banking, other than State banks, with proper protection for shareholders, depositors, borrowers and staff of private banks.
That statement was made on a Saturday, and the day is important, as I shall point out. On the 13th August, the High Court delivered its judgment on the Commonwealth Bank Act 1945 and its decision went against the Government. The finding of the court was published in the press on Thursday, the 14th August, and Cabinet met on the following day, and on Saturday. I quote the following from a report published in the Sydney Morning Herald of the 18th August, 1947 :-
The High Court’s decision was followed by a secret conference in Canberra on Thursday, attended by the Prime Minister, the AttorneyGeneral, Dr. Evatt, and the Minister far Health, Senator McKenna, the Governor of the Commonwealth Bank, Mr. Armitage, the Secretary of the Bank, Mr. Richardson, the Economic Adviser to the Bank, Professor Melville, the Acting Secretary to the Treasury, Mr. G. P. N. Watt and the Assistant Secretary to the Treasury, Mr. Wheeler.
The position arising out of the High Court’s rejection of Section 48 of the Banking Aci was discussed at length and the Prime Minister informed those present of his intention to move for nationalization.
He had the full support of the other Ministers present, and methods of carrying out nationalization were then discussed.
When Cabinet met on Saturday morning other Ministers were unaware of the Prime Minister’s plans, and the question was brought forward as a “verbal addendum”.
Thus, on a verbal addendum, at a hastily convened meeting between Thursday and Saturday, Cabinet reached a decision on a proposal involving the expenditure of £100,000,000, and the employment and welfare of tens of thousands of employees of the great trading banks. Honorable senators will understand, therefore, why we consider it to be important to put our banking legislation on such a basis that it cannot be lightly attacked in that fashion. From the self-styled champions of liberty opposite, we have heard a most vitriolic attack on bank employees because they had the temerity to fight for the preservation of their chosen career.
– They were forced to do so.
– Yes, by the threat of the Labour Government. God forbid that the day will ever come when it will be a crime for a man to fight for freedom, and for his chosen way of life. Honorable senators opposite may sneer, but the bank officers happen to have chosen banking as their career. It is a poor thing for any political party, and particularly for the chosen representatives of the people, to suggest that the bank officers did not have every right to fight during the election campaign for the preservation of what they considered best, not only in their own interests, but also in the interests of the country.
Let us see how far the Opposition and the Government are in agreement on this bill. Insofar as Opposition speakers touched on the bill at all, they all asserted that the Commonwealth Bank was a splendid national institution. From that proposition no one on this side wishes to dissent. 1 admit that the Commonwealth Bank was the conception of the Labour party, but we on this side of the House do not judge the value of legislation according to who initiated it. We judge legislation by the. good or ill that it may do. Thus, we are prepared to give full credit to those who established the Commonwealth Bank, and to those who were responsible for its development until it has become the magnificent financial structure that it is to-day. If any political party were so foolish as to attempt to frustrate or obstruct the Commonwealth Bank, the electors would have no truck with it. We aro keen to preserve the bank, and to promote its development, as is shown by the bill now before the Senate. At the request of the management of the Commonwealth Bank, its capital is to be increased by £5,000,000. Does that suggest that the Government wishes to cramp or confine the operations of the bank? If the bank needs £5,000,000 of new capital now, clearly it needed additional capital before the last election, and while the Labour Government was still in office, but I challenge any honorable senator opposite to point to one statement made before the election that would indicate that the Labour Government had promised to allow the Commonwealth Bank to expand by increasing its capital. However, when the proposition was put before the present Government, we agreed to incorporate in this hill a provision increasing the capital of the bank. If the passage of this bill is unduly delayed by the Opposition, the responsibility will rest upon it for depriving the bank of the needed capital.
As I have said, we are all agreed that the Commonwealth Bank is a great institution, and we all wish to see it flourish in fair competition with the trading banks. Of course, a monopoly in regard to certain matters was conferred on the Commonwealth Bank by the 1945 act, and with that provision it is not proposed to interfere. We must ensure, insofar as we can, that there is no repetition of what is alleged to have happened in 1930, when Mr. Scullin was Prime Minister. Had this legislation then been in operation, the state of affairs which obtained then could not have arisen, because the bill provides that, in the event of a disagreement between the Commonwealth Bank Board and the Treasurer of the day, the matter in dispute shall be decided by the elected representatives of the people. I do not wish to discuss Mr. Scullin’s political life. He has given great service to the country during a long and honorable career. However, if Mr. Scullin was so confident that he was right, and if the Commonwealth Bank Board, the creature of the Parliament, was thwarting the elected representatives of the people, why did not Mr. Scullin go to the country? It has been said that he was not able to put his policy into effect because the .Senate was hostile to his government. I hope that honorable senators opposite will not gain a false impression from that. I assure them that the present Prime Minister (Mr. Menzies) will not permit a hostile Senate to thwart the Government. The mandate that the Government has received from the people will he implemented to the best of our ability, notwithstanding a hostile Senate. That should dispose for all time of the iniquities of the Commonwealth
Bank Board. I agree that it had no right to refuse to accede to a request made by the Prime Minister of Australia; but, in my opinion, a Prime Minister who was confident that he had the people of Australia behind him should have had no hesitation in going to the people upon that issue. I am quite sure that the people would not be party to a board taking control of the financial policy of the country from the hands of their elected representatives. I agree that there should not be a repetition of what occurred during Mr. Scullin’s prime ministership. Under the provisions of this measure, there will be no possibility of the board holding out against the wishes of the government of the day. I am not familiar with the constitution of the Commonwealth Bank Board that was in existence during the period of office of the Scullin Government, but, under this measure, if there is a dispute between the board and the Treasurer, the will of the Government must prevail. Those are the points of agreement.
The first point of disagreement is that, although we say there should be a board of ten, the Opposition say that there should be a board of one. As I have already said, the present position is that a disagreement between the Government and the board of one can be resolved in a hole-and-corner manner, without anybody knowing which side has won, what the fight has been about, or what the effect of the final decision is likely to be. There is no provision in the existing legislation for bringing the dispute and the manner in which it has been resolved out into the light of day so that the people or their elected representatives may know what the dispute is about and have an opportunity to express their opinion upon it. Under the present system of control by a board of one, there is no provision for the ventilation of a dispute between that board of one and the Treasurer or the government of the day. Under the proposed measure, if there is a dispute between the Treasurer and the board, the board will submit its case to the Treasurer and the Treasurer will submit it to the Government. The Government will discuss the board’s case and the Treasurer’s case and then decide how the dispute is to be resolved and what policy is to be adopted. It will not be done in a holeandcorner manner, because within fifteen sitting days after the Government has made its decision, there will have to be laid before each House of Parliament a copy of the order given by the Government, a statement of the Treasurer’s case and a statement of the board’s case.
– It will not be possible to take any effective action under that provision.
– If the Leader of the Opposition (.Senator Ashley) means that the Parliament is ineffective, I disagree with him. I do not think that in a real crisis the majority of honorable senators on this side of the chamber or the majority of honorable senators opposite would blindly follow their party, if that meant the ruin of this country. There have been rifts in political parties before, and I am sure that there will be some again. The Leader of the Opposition has expressed a very poor opinion of the integrity and decency of members of the Parliament if he has suggested that, if the Government were guilty of a flagrant violation of its duties and obligations, they would go blindly along the path of their political interests. I do not believe that they would do so. Under this measure, if members of the Parliament are recreant to their duty to those whom they represent and do not do what is right and just, the public at large will know at least the nature of the dispute between the board and the Treasurer and the manner in which the dispute has been resolved. I believe that the public at large, especially in view of the way in which they expressed themselves last December, are highly intelligent.
In objecting to the establishment of the proposed board, the Opposition has laid itself open to a charge of either gross inconsistency or utter hypocrisy. Honorable senators opposite cannot have it both ways. They have exhibited a keenness and a fondness for boards in many fields of activity.
– Will the Minister tell us what need there is for a board ?
– I shall do so. People who, in their generation, were much more wise and experienced than we, found that boards worked fairly well.
Even the socialist government of Great Britain maintained a board to control the Bank of England after it had nationalized that bank. The Bank of England, the Bank of Canada, the South African Reserve Bank and the Reserve Bank of India each has a board of more than ten members. The board of the Bank of England comprises eighteen members. Considered in the light of the number of members of that board, the proposed Commonwealth Bank Board can be regarded only as a small one. The number of members proposed is not in any way unreasonable. In fact, a board of the size proposed is necessary in order that well-balanced views’ may be brought to hear upon the diversity of matters that must be considered by a central bank.
Let us examine the boards that were established by the Labour party when it was in power. One was the Broadcasting Control Board. Why does the Labour party, having established that board, wish to deny a board to the most vital institution in the economy of this country - our own Commonwealth Bank? A Labour government established the Stevedoring Industry Board. Why did it not make that a board of one? A Labour government established the Australian Shipping Board and the Australian Shipbuilding Board. The present Leader of the Opposition was very fond of boards. He created them like a hen laying eggs. They were his. Trans-Australia Airlines is controlled by a board. Then there is the Public Service Board. I know that some honorable senators opposite are personally interested in boards. There is nothing wrong with that, because the sensible way of conducting a business is by means of a board. As a rule, better results are achieved by the combined wisdom of a board consisting of men with a diversity of views than by the dangerous experiment of one-man control.
Senator McCallum referred to something that is a classic illustration of either the inconsistency or the hypocrisy of the Opposition. I shall read a sub-section of the proposed new section 23 and a provision in a bill that was introduced in 1930 by the late Mr. E. G. Theodore, one of the greatest Treasurers that the Labour party has produced, and then I shall defy honorable senators opposite to say in which measure each of the provisions is contained. One provision reads -
Of the seven members appointed under paragraph (d) of the last preceding subsection, at least five shall be persons who are not officers of the Sank or of the Public Service of the Commonwealth.
The other states -
The Bank shall be managed by a board of directors composed of . . . six other persons who are or have been actively engaged in agriculture, commerce, finance or industry.
The provisions are precisely the same in their effect. I can see the state of confusion that exists among honorable senators opposite. To dispel it, I point out that the first provision that I read is contained in this measure, and that the second one was incorporated in the bill introduced by Mr. Theodore. If it is not asking too much, I should like an intelligent member of the Opposition to explain at some time why the Labour party wa3 keen on the boards to which I have referred, why it was keen on the provision which I read in the bill introduced by Mr. Theodore and why it objects to precisely, the same provision being incorporated in this measure, which is designed to provide for the control and direction of the greatest financial institution in the Commonwealth. One honorable senator opposite has frequently, by way of interjection, shrieked at us and asked why we have not named five members of the board. It was a most unintelligent interjection. How can members be selected for appointment to a board, the establishment of which is provided for in a bill that has not been passed by the Parliament? We do not know what the Opposition will do with this measure. We have gone as’ far as we can go. We have indicated that the members of the present Advisory Council will be appointed to the board, if it is established. It is easy to do that, because they are public servants. As far as the other members are concerned, because the measure has not yet been passed, we cannot appoint them, and I consider that it would be improper to approach any persons until we know a board is to be appointed. However, we have inserted a provision in the bill which should be regarded as a guarantee of our good faith. We have not stated who five of the members of the proposed board will be and I have not the faintest idea who they will he, although I know that they will be selected because of their merit, ability and willingness to serve this country through this great institution, the Commonwealth Bank, but we have inserted a provision under which some persons will be disqualified from membership. Proposed new section 26 reads as follows: -
A person who is a director or employee of a corporation (other than the Bank) the business of which is wholy or mainly that of banking shall not be capable of appointment, or of continuing to act, as a member of the Board.
That is a very sound proposition, which to people with fair, open and decent minds is a sufficient guarantee of the bona fides of the Government that men of experience, drawn from divers sections of the community, will be picked because of their capacity, ability and desire to serve their country through its great national institution, the Commonwealth Bank. I think that I have dissolved, to some degree, whatever criticism there has been against the appointment of a bank board. I have shown how inconsistent it is with traditional Labour policy and the financial policy of other great banks to which I have referred earlier. The Opposition has not stated one reason why there should be control by a board of one, not answerable to the Parliament, but only to the Treasurer, rather than a board of ten, answerable to the elected representatives of the people. I do not think that I can do better than to conclude by reminding honorable senators of the following statement by the Minister for Social Services (Senator Spooner) - it seems a long while ago now - during his second-reading speech, which epitomized the position -
The importance of monetary policy has frequently been stressed in Parliament and the fact that it has a significant effect upon the welfare of the people has been fully recognized. Although it is easy to fall into the error of thinking that monetary policy can cure all economic ills, it is nevertheless true, as the Prime Minister pointed out in his policy speech, that great financial decisions, if they are wrong, are wrong on so vast a scale as to injure many thousands of people. We therefore believe that such decisions should not be made by one man either in the bank or in the Government. We are convinced that responsibility for the determination of monetary and banking policy should be a collective responsibility, and the bill now before the
Senate is designed to give effect to this principle by setting up a Commonwealth Bank Board under the chairmanship of the Governor and by restoring to the elected representatives of the people the ultimate responsibility for monetary and banking policy.
I support the bill.
– So much has been said about this matter already, and every avenue has benn so thoroughly explored, that it is very difficult for one to mention any phase of this very important subject without being guilty of repetition, which is unsavoury to all listeners. I shall not be guilty of anything like that. I have a very painful recollection of my own experiences during the depression in the thirties.
– I understood the honorable senator to say that he did not intend to be repetitious.
– I have listened to the debate on this measure to-day without interjecting even on one occasion. However, if honorable senators opposite choose to interject whilst I am addressing the chamber I shall, subject to the indulgence of the Chair, answer interjections rather than risk the points raised escaping my notice subsequently.
Up to the time of the depression I had been an artisan, and, thanks in no small measure to the financial genius of my wife, I had a credit balance of assets over liabilities of over £2,300 when the effects of the depression were first felt in this country. After the depression had continued for about two years I was called in by the bank manager, who had decided to investigate my account. He said to me, “ I think you are all right. You would be at least fifty-fifty”. I said, “Does that mean that I am broke? “ He said, “ Brutally speaking, it does “. I said, “ You have broken the- news to me very pleasantly. I am quite prepared to sequestrate my estate rather than run into debt. Apparently I have lost all of the equity that I had. I do not want to be in debt, either to the bank or to anybody else He said, “ I would not do that if I were you, because your property will probably appreciate “. I said, “ I would be happy if I thought that my property would appreciate as rapidly as your interest will compound, but I do not think that it will, and therefore the blood is on your head. Anything that comes undone in the scheme of things will be your responsibility. I consider that my debts of honour should come first. So far as any further debts that I may incur either to the bank or anybody else are concerned, I should advise you to cut your loss in the way that I have had to cut mine “. For two years and nine months during that period I was without a job. I blame the bank board, which controlled the Commonwealth Bank at that time, and a hostile Senate, in no small measure for that state of affairs.
– Can the honorable senator say why the matter was not referred to the people by referendum?
– I am quite prepared to answer any reasonable question asked by way of interjection. I repeat, that I blame the board that then controlled the Commonwealth Bank, as well as the hostile Senate, because when conditions were at their lowest ebb and an attempt was made to float a fiduciary issue of £18,000,000 for the purpose of staving off from the people of Australia the effects of the world-wide depression, Labour’s wishes were thwarted. An honorable senator claimed this afternoon that Labour was then in power. That was not so; although Labour was in office it was not in power. The position then was the reverse of the state of affairs to-day.
– The only change that the honorable senator did not like was from the Government benches to the Opposition side of the chamber.
– When the honorable senator who has just interjected has been a member of this chamber for a little longer he will probably accumulate some political wisdom.
– If I do, I shall let the honorable senator have some.
– I have frequently been by-passed in this chamber. I repeat that an attempt was made to float an £18,000,000 fiduciary issue, for the purpose of assisting the farmers and the primary producers generally. We know that currency circulates so rapidly that a little money will go a long way in certain circumstances. It was proposed to circulate £12,000,000 for the benefit of the primary producers, and the remaining £6,000,000 for the benefit of industry. It was considered that if that had been done - and it would have been done but for a hostile Senate which took the. business out of Labour’s hands - the people of this country would not have felt the effect of the depression so severely.
I remind honorable senators that the transcontinental railway, from Port Augusta to Kalgoorlie, was built with a new note issue of £67,000 circulating rapidly. There was a paymaster at one end of the workers’ train, and the men could buy their requirements from a canteen situated in the centre of the train. Any money that they had surplus to their requirements was usually lodged in the bank at the rear of the train. Only £63,000 of the issue to which I have referred was used. Several thousands of pounds was not even circulated. It is therefore easy for honorable senators to imagine what would have been the effect of the circulation of £6,000,000 at that time. It i9 possible that the depression would have passed by this country. Honorable senators on the Government side of the chamber have eulogized not only the Governor of the Commonwealth Bank, but also his advisers. I have waited patiently for a supporter of the Government to explain why, when everything is apparently going swimmingly, it is necessary to tamper with the administration of the Commonwealth Bank. The Minister for Trade and Customs (Senator O’sullivan), despite his power of analysis due to his legal training, failed to advance one reason why the administration of the bank should be interfered with. He claimed that the old bank board - the one of which I have complained - had no right to defy the then Prime Minister of this country. The Minister stated that the Bank of England is controlled by a board of ten members-
– The Minister said that the Bank of England was controlled by a board of eighteen.
– I may be in error; the Minister may have been referring to the Bank of Canada. However, I point out that there is no analogy, because the population of Australia is only about 8,250,000 compared with a population of 44,000,000 in Great Britain. Furthermore, the Bank of England has full and complete control of all of the banking institutions in that country. No private banking is conducted in Great Britain, where banking has been nationalized. He said that we had nothing to fear, and asked how anything could possibly go wrong by having five “ additional “ members on the proposed board. I did not come down in the last shower, and I have been knocking around in this world long enough to become reasonably sophisticated. I know, therefore, that it would be simple enough to sack the present Governor of the Commonwealth Bank and to replace the other four “ official “ members of the board with a group of “ yesmen “ and get them to do just what the Government wanted. The Minister, in the course of his remarks, quoted passages from two measures, which only served to confuse the matter. I wanted to interject to clear up my doubts, but I realized that if I did so I should probably be called to order. I had occasion only last week to interject when a particularly challenging statement was made by a Minister, but I was informed by the Chair that I must remain silent and that I was not entitled to disturb the harmony of the chamber. On that occasion I was going to ask the Minister for Trade and Customs whether he proposed to conduct a guessing competition in connexion with the selection of appointees to the proposed board, and if so, whether such a competition would be legal. We have to be very careful about such matters these days.
Senator Grant referred to the early operations of bankers. I know a little about banking, and I remind honorable senators, now that in its initial stages banking was nothing more than usury. In fact, it was out of banking practices that the word “ usurer “ was coined. The early bankers operated from countries on the shores of the Mediterranean and their operations extended into Persia. Produce was carted by caravan to Persia and the caravans returned laden with other merchandise to the Mediterranean countries. Most of the traffic was directed from Lombardy. In the course of their journeys between Lombardy and Persia many of the caravans were robbed by marauding Arabs, and not only the produce which they carried but also precious stones which had been received in payment for previous consignments, were stolen. Because of those occurrences the merchants conceived the idea of allowing payments to be made in the form of credits, instead of requiring payment to be made by the consignees to the caravaneers. In that way merchants in Lombardy accumulated large numbers of credit notes from traders in Persia who owed them money. These credit notes were exchanged for valuables, and as time went on and the system of trafficking in credit notes increased, the business of discounting the credit notes for gold came to be monopolized by a small group of individuals. That was the beginning of modern banking. To my mind, banking has always been a huge joke, and I have been the victim of that joke. Banking operations carried on by private individuals have produced more trouble than any other enterprise in which man has indulged. In the United States of America scores of banks have gone “ broke “ overnight and tens of thousands of people have been ruined because of the defalcations of bankers in that country. Those who own the means by which I live virtually own my life, and since I live by money, which is the means of exchange, those who control money and credit control me, just as they control every other working man. I know also, of course, that the banks have exercised vicious pressure on corporations at different times. All honorable senators know about the Guernsey experiment. The bank that was concerned in that incident was frustrated by the people of Guernsey, who printed the “greenbacks”. Some honorable senators opposite may have read The Amazing Argentine, which was published by Foster Fraser in 1913. In that book, Fraser indicated that the people of Argentina, and particularly the citizens of Buenos Aires, were extravagant, which reminds me that about the same time the people of New South “Wales were accused of being extravagant. The people of Argentina, who desired to beautify their national capital, sent two representatives to Europe to select ornaments for their national capital, and they chose two massive bronze gates in Venice, which were shipped to Argentina. The Government of that country then endeavoured to borrow £13,000,000 to pay for the bronze gates and other treasures for their capital city. They were told that they could not have the money. Whether they had heard of the Guernsey incident I do not know, hut they decided to print a lot of “greenbacks”. They were then informed by the various states of Northern and Southern America that the notes would not be honoured, to which they replied that they were not concerned, because the Argentinians realized that the traders in those states had to transact business with them, and they decided that the only legal tender which they would recognize was their own notes- The consequence was that the Argentinian bank notes were taken into currency, and the merchants and bankers of North and South America ultimately accepted them at their face value. Later the notes were withdrawn and destroyed after they had served their purpose. That is an example of how the bankers, the usurers of North and South America, tried to stifle the people of Argentina and to prevent them from realizing a very laudable ambition.
I have been a student of economics long enough to realize that Labour had to expect a fight when it attempted to nationalize banking. The opponents of the nationalization of banking conveniently forgot that in. England, Canada and New Zealand the banks had been nationalized for some time. As I have already said, I was not so foolish as to expect that any burglar who has “ cracked a crib after biding his time, would drop his loot without a fight. As we socialize the various utilities, and as we nationalize or socialize the banks-
– That is a dead horse !
– Oh, we might resuscitate it - I speak for myself. Personally, I believe that banking is a national utility and should not be used in the interests of any group of individuals.
– Why have they not nationalized banking in England?
– They have.
– Only the Bank of England has been nationalized.
– But all the other banks hold their charters from the Bank of England. I am endeavouring to touch upon aspects of this matter that have not yet been referred to in the debate, and that is a somewhat difficult task. Of course, those who follow me will find it even more difficult. We can all be justly proud of the operations of the Commonwealth Bank, which, as I have said, financed the building of the TransAustralian Railway. It also financed Australia’s part in World War I. Unfortunately in those days the private banks were permitted to subscribe to war loans, and they waxed fat on the proceeds. However, in World War II., from 1941 onwards, the private banks were not allowed to subscribe to. war loans. During World War I., the private banks in the United Kingdom made £990,000,000 out of the travail of the British people. They also issued a loan to the State of Victoria. The then Premier of Victoria, Mr. W. Watt, wanted to “ raise the wind “ as he termed it, but he found that he could not get all the money that he wanted on the home market. He went to the then Prime Minister, Mr. Andrew Fisher, and asked for assistance. Mr. Fisher sent for the Governor of the Commonwealth Bank, Sir Denison Miller, and ascertained that the ready funds of the bank were insufficient to provide £1,000,000, but that £500,000 could be provided if Mr. Watt could get the remaining £500,000 elsewhere. Mr. Watt went on the loan market for the remainder. He had to pay a procuration fee of £30,000, and then had to accept” a loan of £93 in each £100. The interest charged was 4^ per cent. By contrast, the total cost of raising the £500,000 from the Commonwealth Bank was between i per cent, and 1 per cent. That made a great impression on my mind at the time. People have since learned to rely on the national bank. It is the people’s bank, and should not be tampered with. The Minister for
Social Services has claimed that the Government has a mandate for this legislation. That claim has been made in respect of every measure that we have discussed. Candidly my opinion is, that the Government has a mandate to pay child endowment in respect of the first child in every family and to ban the Communists. Some honorable senators opposite apparently do not realize how the banking business of a world can be juggled. As far back as 1896, the worlds’ currency was estimated at £3,000,000,000. Strangely enough, only last week-end I ‘ read that the figure to-day is approximately the same. According to the economist Keynes the world’s wealth in 1896 was £13 trillion. I do not know just how much £13 trillion is. I believe that the figure consists of the numerals 1 and 3, and then an endless string of noughts, It is beyond my comprehension, and I think beyond the comprehension of any one in this chamber. However, the point is that the world’s currency has not increased since 1896, whereas the world’s wealth must have multiplied several hundredfold. According to Keynes the world’s currency backing for its wealth was less than 2£ per cent, in 1896. What it is now I cannot imagine.
I believe that the proposed Commonwealth Bank Board will be apt to create a depression if a depression is desired. I agree wholeheartedly that one thing for which the Prime Minister has a mandate, is to put value back into the £1. If he uses the Commonwealth Bank Board as unwisely as it was used prior to the last depression, he will put value back into the £1 by putting thousands of people on the dole. Should that happen, the things that money can buy will become cheap, but money itself will become dear.
– Does the honorable senator think that we all want to enter into a poverty competition?
– Perhaps I have a poverty complex, but I have always been able to smile. I doubt whether honorable senators opposite can do that. I do not know whether the depression reached the north of Queensland, which, I understand, is the home of the honorable senator who has just interjected, but I know how severe it was in the southern States. I knew what it was to walk around the streets day after day not knowing where the next shilling was to come from. Thousands of people were in an even worse plight. As a result of those experiences, I am prepared to fight as long as I have breath in my body to prevent a recurrence of depression conditions. I see in this proposed bank board some thing that may bring another depression within easy reach.
While an honorable senator on this side of the chamber was speaking earlier in this debate, Senator Guy, who frequently says something ridiculous, said by interjection that Mr. Scullin, while he was Prime Minister, had re-appointed Sir Robert Gibson to the Commonwealth Bank Board. At that stage, I, too, was tempted to make an interjection, but refrained from doing so. I said earlier while Mr. Deputy President was in the chair, that I had sat all day without once interjecting.
– I congratulate you.
– I knew that you would. However, as I have said, I was sorely tempted to interject on that occasion and tell the Senate how it was that Sir Robert Gibson was re-appointed. I have the deepest respect for Mr. Scullin, but frankly I do not think that while he was Prime Minister he understood either the people or the finances of this country as well as they are understood by Labour’s most recent Prime Minister (Mr. Chifley). At the time of Sir Robert Gibson’s re-appointment, Mr. Scullin was due to leave for England. I do not know whether I am disclosing an inside story, but I was at the telephone in Sydney when certain information came through. Mr. Scullin had given an assurance to caucus that the re-appointment of Sir Robert Gibson would not be considered until the party has been consulted. Two days before Mr. Scullin was due to leave, we found that Sir Robert Gibson had been re-appointed.
– That is what I said.
– The honorable Senator did not disclose the reasons for the re-appointment. Mr. Scullin was thoroughly under the thumb of banking interests in the United Kingdom, and they told him by cable that his chances of raising money in that country - he was seeking money for the whole Commonwealth - would be definitely improved if he re-appointed Sir Robert Gibson.
I realize that other honorable senators wish to speak in this debate, and I do not propose to delay the Senate much longer. Again I urge the Government to let well alone. I cannot imagine the Labour party permitting this bill to pass in its present form. The Government will have to climb down on its proposal to re-appoint the Commonwealth Bank Board. I believe that when something is running quite well it should be left alone. I warn the Government that unless it is prepared to meet the Opposition in regard to the proposal to re-appoint the Bank Board, our hitter experience over the years has been such that we are determined to defeat the bill. I have no fear of a double dissolution. The real fight might come on the Communist issue or on the question of putting value back into the fi. I am pleased to have had an opportunity to participate in this debate. Honorable senators will agree that I have refrained as far as possible from covering ground that has already been traversed by other speakers. I exclude, of course, those matters to which I referred in reply to interjections or in contradiction of Senator O’Sullivan’s wrongful conclusions.
– I support the bill. I listened with interest to Senator Large and I congratulate him on his speech. He managed to travel around the world without saying anything about the bill at all. He claimed that this Government was in the same predicament as the Scullin Government was in 1929 - in office but not in power. This Government believes that it is in power and will not allow itself to be treated as the Scullin Government was treated by a hostile Senate, without having the courage to go to the people. We have heard a lot from Senator Large and other Opposition speakers about the depression of 1929-32. They have all said that the Labour Government, which was then in office but not in power, was not permitted to borrow £18,000,000 from the Commonwealth Bank. The Government had the remedy in its own hands. It could have sought a double dissolution and gone to the people. I was pleased to hear the Minister for Trade and Customs (Senator O’sullivan) say tonight that if this hill were defeated, the Government would have sufficient courage to go to the electors to get a mandate to pass this legislation in its present form.
– The honorable senator is not a gambler, is he?
– No, we would win. I do not think that the Scullin Government would have won in 1929. This bill has been introduced to repeal the Banking Act 1947.
– No. That is not necessary.
Sen r,tor SCOTT- It is necessary. Before the 10th December, 1949, members of the Labour party toured the country saying that the banks could never be nationalized because the proposal had been ruled invalid by the High Court of Australia and the Privy Council. The opinions expressed by Labour party supporters then do not coincide with statements made by honorable senators in this chamber. Last week Senator O’Byrne said - 1 am prepared to say that I shall live to see the day when the hanks are nationalized. I am a young man and I have no fear that I shall live long enough for that. The present measure, however, is just one of the early skirmishes in the battle for nationalized control of the country’s finances.
Senator O’Byrne went on to say that bank nationalization would follow as surely as night follows day.
So the nationalization of banking is not a dead horse. If the electors had returned the Labour Government to power in December, I have no doubt that banking, which is one of the principal industries of Australia and has done so much to develop the country, would have been well on the way to nationalization. The policy of the Communist party is to nationalize or socialize the means of production. Both Lenin and Stalin have been quoted as saying that the first thing that a government should do if it seeks to nationalize the means of production, distribution and exchange is to get control of the money of the country. The Labour Government set out on its plan to get control of the means of production throughout Australia, and its method was to nationalize the banks. Fortunately, it did not succeed, and the present Government was returned. It will ensure that nationalization of banking will not be achieved without a referendum.
The Labour Government spent about £200,000 fighting the case against the banks. That money was found by the people of Australia despite petitions signed by hundreds of thousands of electors that were sent to the Prime Minister of that day, Mr. Chifley, and members of the Parliament asking the Labour Government to conduct a referendum before it nationalized the banks. Those petitions were refused and the country had to foot a bill for £200,000.
Two important provisions in the bill that is now before the Senate are the proposal to set up a Commonwealth Bank Board and the powers to be granted to that board. Those are the two points that are most vigorously opposed by honorable senators on the Opposition side. Senator Large has said that the Government cannot find one reason why the control of the Commonwealth Bank should be shifted from the Treasurer to a bank board. Honorable senators on this side of the chamber believe in the management of big industries and institutions by boards. They believe that it is a fallacy to have one man in control of a wonderful institution such as the Commonwealth Bank. They propose to create a board which will consist of ten members. Five of those members are known to honorable senators and five others are to be appointed, but this bill must be passed by both Houses of the Parliament first. There is no reason to believe that those members will disrupt the bank. Their task will be to help the bank to further the interests of the people of Australia.
One would think that honorable senators on the opposite side of the chamber alone favoured the Commonwealth Bank’. I believe that the Commonwealth Bank has done a great service to the people of Australia and that it is the duty of this Government to ensure that the bank is allowed to function as well as, or better than, it has done in the past. I believe that a board will help the bank to function more in the interests of the Australian people than it has done during the last four or five years. Honorable senators on the opposite side of the chamber have favoured control by the Treasurer, but governments and Treasurers come and go. On the 10th December one Government fell and, fortunately, a new Government that would look after the interests of the Australian people was elected. A board would ensure continuity of purpose in looking after the interests of the people. That cannot be achieved with one-man control.
It is proposed to appoint a board to run the bank or define its policy. The Governor will have a vote and a casting vote. Therefore it would make no difference to the functions of the board if the five members to be appointed were Labour supporters. The Governor would also be the chairman of the Commonwealth Bank Board and the set-up is entirely different from that which existed before. ‘ Most honorable senators on the other side have opposed a board because they believe that it did not function previously in the best interests of the bank. I believe that every honorable senator on this side of the chamber is of the opinion that the board was not a success under the previous administration because the chairman of the board was not the governor of the bank. Having the Governor of the bank as chairman of the board will make all the difference. He will be in touch with affairs from day to day. He will advise the board what the bank is doing and if any alteration is needed, the board will be able to put it into effect. Under the previous arrangement, the chairman of the Commonwealth Bank Board had nothing to do with the management of the bank. He merely issued instructions.
The Labour party appears to be against the creation of boards. In 1949, the then Prime Minister (Mr. Chifley) was asked in another place how many Commonwealth boards were functioning under the Labour Government which had then been in office for about eight years. The right honorable gentleman’s reply was that there were 157 boards in operation and the titles of them were given. In another question, the right honorable gentleman was ashed how many boards had been appointed since February, 1948, and his reply was -
Eight boards, committees, &c, have been appointed, viz. -
Army Stores Accounts Adjustment Board.
Australian Broadcasting Control Board.
Commonwealth Fire Board.
Defence Forces Retirement Benefits Board.
Defence Research and Development Policy Committee.
Railways Local Industrial Boards (one in Melbourne and one in Sydney).
Local (Boot Trades) Committee (Tasmania).
The Labour party is against a board to control the Commonwealth Bank but during its term of office it had under its control 157 boards. Honorable senators who support the Labour party are “jumping down the Government’s throat “ because it proposes to appoint a board. There is no sincerity in the statements of honorable senators opposite on that point. Only two other countries do not have boards to control their banks. One is Spain and the other is Russia. . Honorable senators opposite apparently want to follow the line of Franco and Stalin by putting the control of the Commonwealth Bank in the hands of one man. The Bank of England has a board and the central banks of a number of European countries operate under a similar system. The board that is proposed in this bill would be subject entirely to Parliament. If it ran amok or did anything that was against the interests of the people of Australia, the Parliament could ask for a statement of the board’s activities. If there was any disagreement between the Treasurer and the board, he could ask for a statement to be given to the Parliament which could then consider the statement in its entirety and direct the board to take appropriate action. “Within fifteen sitting days of those instructions being given, the relevant papers dealing with the dispute must be placed before the members of both Houses of the Parliament. The Government proposes that the Commonwealth Bank shall be placed under the control of a board which, in turn, will be under the control of the Parliament. No better arrangement could be devised.
Honorable senators have said that the trading banks caused the depression. That is not so. There will always be economic depressions while prices for our export commodities fluctuate. The depression which began in 1929 was world-wide. Because the price of our export commodities fell, the banks did not have so much money to advance. Banks are able to advance only the money which they receive on deposits. For instance, if someone deposits £2,000 with a bank, that bank can lend it out again to someone else at a slightly increased rate of interest. In bad times, less money is deposited with the banks, which, in turn, have less money to advance. In order to prevent depressions, prices of primary products should be stabilized, and that is the policy of the present Government. There are at present in operation a wheat stabilization scheme, and a butter stabilization scheme, and the Government proposes to stabilize the wool industry, also. If that is done, those persons who are now getting 6s. and 7s. per lb. for their wool will be able to call upon a stabilization fund to tide them over the worst of a depression. I agree that the Commonwealth Bank will play a big part in cushioning the effect of any future depression. We know much more about central banking than we did in 1929, and the Commonwealth Bank possessing this knowledge and directed by a board, will be able to do much to protect the country from the worst effects of a slump. I ask honorable senators to accept this bill, and to allow the Commonwealth Bank, in conjunction with the trading banks, to continue helping enterprising people to exploit the resources of this great nation for the benefit of our own people, and in order to produce much-needed food for Great Britain and other countries. I commend the bill to the Senate, and hope that it will be passed in its present form.
.- I am opposed to the bill in its present form, because it would not be in the best interests of the people. Banking is of great national importance, and must be placed under national control if the people are to enjoy the benefits of democracy. No government can ensure the maintenance of a proper standard of living for the people unless it controls all banking. In times of economic stress, private trading banks are a menace to the nation. I should like the Banking Act 1947, which provides for the nationalization of the trading banks, to remain in force.
– It is a dead horse.
– It is not dead so far as I am concerned, although I realize that it cannot be put into operation because of the decision of the Privy Council. I also realize the people are not ready for nationalization of the banks, but they will be. Some day they will realize - and it will not be long now - that the insidious propaganda of the trading banks was designed, not to safeguard the standard of living of the people, but to safeguard the profits of the banks. I know that honorable senators opposite have a. pay-off to make to the banks, and that this bill is the first instalment. The banks spent hundreds of thousands of pounds to help the present Government into office, and they expect a return for it. The Commonwealth Bank .Board which it is proposed to appoint would be a shield behind which the Government could shelter. The board would gradually whittle away the rights of the Commonwealth Bank until it was finally brought under the control of the private banks, as happened once before. That cannot be permitted. History shows that the bloodsucking usury practised by private banks has been the- cause of wars. Banking conducted for profit has been practised irrespective of the degradation caused to human beings.
I propose to touch upon the history of banking in order to show why private banks, and bank boards, have earned historical censure. Unless banking is made a national enterprise, conducted without profit for the benefit of the people, banks are nothing more than lending institutions .like pawn shops, and should be so designated, with the three balls over their porticoes. There is nothing elevating about private banking which, for the most part, thrives on the misfortunes of the people. Neither is there anything national about it. and the only big thing about it is the profit it makes. _ Senator Maher. - The breweries make bigger profits than the banks.
– Yes, and they leave a better taste. I shall now discuss the foundation of the present banking system. In 1694, Charles Montagu, a commissioner of the Treasury in England, found that it was impossible to raise sufficient money by taxation to meet the budgetary expenses of the year. Money had been lavishly expended by William III. in the wai- to prevent his beloved Netherlands from being overrun by the French. So Mr. Montagu decided to adopt the proposal made to him by William Paterson that he allow certain persons to advance money on loan to the government. The persons who advanced the money formed themselves into a company called the Bank of England, which was placed under the control of a board of directors.
– Before that, William Paterson was a pirate.
– - Yes, and he continued to practise his profession. The subscribers lent money for the destruction of life, and ev-r since then banks have lived and prospered mainly by the spilling of blood.- It is interesting to note that the wealthy Whig merchants of the day lent their money at a substantial rate of interest, and that the newly constituted Bank of England was placed under the control of a. governor, a deputy governor and a board of twenty directors who, of course, had to be shareholders. I assume that the Commonwealth Bank Board, which is to be appointed by the present Government, will have on it government nominees who will be shareholders in the private banks, at least indirectly. Senator Guy twitted me with being behind the times in opposing the appointment of a Commonwealth Bank Board. I now refer the honorable senator to 1694, when the Bank of England was controlled by a board. Our move for a governor who is directly responsible to the Government must be a move ahead of and not behind the times. The Bank of England functioned successfully and tided England over many difficulties, but in order to do so it had always to rely upon the backing of the government of the day. At its inception, the bank made the vital mistake of confining its activities to those of a central bank and not establishing branches throughout the country.
The government of the day also made a vital mistake when it did not forbid trading companies to engage in banking business, which, in many instances, led to disaster. Those two mistakes permitted the pernicious thing that we know as the private banking system to arise. If those two mistakes had not been made, we would not have had to fight the private banks in our time to ensure that they did not endanger the welfare of the ordinary person, the central banking system would have been under the control of the Government many years ago, and the Labour party might not have been in existence now. The Labour party was founded because the down-trodden masses were being exploited by the banks for the profit of the banks. It may be said that that is an exaggeration, but it must be remembered that industrialists are run by the private banks just as certainly as Labour will continue to fight for the good of humanity.
The Bank of England, for the first twenty years of its life, financed the war of the Spanish Succession. Naturally, its shareholders, who were few in number, lived very well on that blood spilling. It is interesting to note that, even at that early stage, the young hank altered the course of history. Its right to endure was linked with the interests of the wealthy Whig party of that day. If the Stuarts had regained the Throne of England, the wealthy directors of the bank would have found themselves holding a very empty money bag. When Queen Anne died, they installed a Hanoverian successor.
– A very good thing, too.
– They had to find somebody to be a scapegoat, but it has turned out very well, because our present line of kings is descended from the House of Hanover. Such is the might of money. In 1720 the first result of an uncontrolled banking system and lack of control of speculation by the government was seen. The people of that time saw what we saw during the time of the Wall-street crashes - misery, want and suicide. When the South Sea Bubble, as it was called, burst, private trading banks like the Swordblade Company went bankrupt.
It may be that, but for the activities of the private banks, that fiasco would not have occurred. It was the Bank of England, the central bank, which under pressure from the Government, relieved the situation, but once again it had to be bolstered up by the government of the day.
– How did the Government bolster it up ?
– If a bank has the backing of the Government, it can carry on. That is what we want - a hank backed by the Government and not by private financial interests. During the next 70 years the wealth of England, owing to the expansion of that country overseas, increased rapidly, as did that of the Bank of England, especially when it had charge of the national debt, which once again increased very rapidly because of a war. The bank went on from strength to strength, but during all those years there was a mushroom growth of private banking concerns, whose sole motive was gain. The history of their activities is a sad and sorry one. It has been proved that on many occasions in war both sides have been financed by the same bank. That happens even to-day. It will be seen why the private trading banks, behind their seemingly pleasant exteriors are, to my mind, just bloodsuckers, living on the misery of the people in both war and peace. I want to see a national bank, conducted for the good of the nation and divorced from the profit motive.
– What is wrong with making a profit?
– The profit motive is the cause of many troubles in the world to-day. I want to see a national bank which will enable this country to continue to grow and expand without huge profits being paid to shareholders either here or overseas. With a bank of that kind, we should make the progress that we want to make, and we should not have booms and depressions, as we have had in the past. It is the money manipulators who must be banned.. If lotteries are banned, why should not stock exchanges, which are nothing more than gambling dens made respectable, be banned also? The Commonwealth
Bank, under its present administration, is gaining momentum. We must not impede its expansion or endanger the fulfilment of its pur- pose.Wecannotpermitaboardto limititsefficiencyoritsexpansion.I suspect the motives of the present Government, especially when I think of what it is doing in relation to the Commonwealth line of steamers and the shares of the private banks that were acquired by the Commonwealth, and of what it may do in relation to Trans-Australia Airlines in the not far distant future. This Government has a “ pay-off “ to make, and I do not want it to hide behind the facade of the Commonwealth Bank Board. It would be quite easy for the Government, through the Treasurer, to say when asked why a policy of restriction was being imposed upon the Commonwealth Bank, that it was the policy of the bank board, which worked with the least possible government interference and knew its own business. Now, the Treasurer if he desires to repay his supporters must come out into the open, and if he does so he will receive the censure of the people at a not far distant date.
I desire to refer to the actions of the banks during the last general election campaign. It will take me a long time to say what I wish to say about that. Therefore,I ask for leave to continue my remarks.
– Is leave granted?
Leave not granted.
– I shall say a few words about the action of the banks and the bank “ boys “ who went out during the last general election campaign with the object of defeating the Chifley Government. I must admit that they did quite a good job. It has been said that some of them were forced to go out, and that may be so, but those who went out on those missions were paid for doing so. I have very little time for them, because they did what they did either for personal gain or, as we discovered in Tasmania, for political gain. Many of them were Liberal candidates in the Tasmanian election-
– That is a free right.
– I agree that it is a free right. But they went around the countryside telling lies. Of course they were not the only ones who did so. However, we kept our propoganda on a decent level. In the township of Latrobe they visited many people, mostly the aged. One of them knocked at the door of a friend of mine, and after introducing himself asked, “ Haveyou any money in the bank.” My firiend replied, “ Only a few pounds “. He then said, “ If the Labour party is returned to power it will take that money from you “. He then asked, “ Do you own this little home ? “ When my friend replied that he did, this individual said, “ The Labour party will take it from you if it is re-elected”. Another person who was living in the house called out “ Three cheers for Chifley”. The man then went away quietly. Persons who took part in a campaign of that time are not worthy of much consideration. Although they were fighting for their jobs they would have received jobs equally as good in the Commonwealth Bank, with better pay and conditions. The Bank Officers Association at present has an application before the court to improve the conditions of its members, in order to bring them in line with the standard of conditions of employees of the Commonwealth Bank. I hope that the Government will listen to reason in this matter and reverse its decision to amend the 1945 legislation. Personally, I like to avoid strife. I am afraid that if the Government pursues its intention to amend that legislation it will have a lot of strife on its hands. As I have said before, I should not like honorable senators opposite to vacate the government benches on such a flimsy pretext, because I am very keen to study the methods by which they propose to restore value to the £1-
– But we cannot get any information about the Government’s proposed method of doing so.
– I seek leave to continue my remarks.
Leave not granted.
– I repeat that I sincerely hope that the Government will reconsider its decision in this matter.
I should advise honorable senators opposite to press for a reversal of that decision at their next party meeting.
– The banks would not allow them to withdraw it.
– The banks are not very pleased with what they will get in this bill.
Honorable senators interjecting,
– I wish that honorable senators on my right would not constantly interject. I am trying to hear what Senator Cole has to say. Too many interjections only make a farce of the proceedings.
– I am keen to see this country progress. By the 1945 legislation the activities of the Commonwealth Bank are controlled by a governor, who is a man that understands banking and can follow a policy that will ensure the progress and expansion of Australia. I fear that the members of the proposed bank board, representing sectional interests, would quarrel among themselves in an effort to secure the best for those interests. For instance, sheepfarmers may be appointed to the board. Although they fully appreciate their own interests, they may know little about banking. We must consider what shall be best for the benefit of the majority of the people of this country. Honorable senators on this side of the chamber should like the Government to abandon its petty outlook and display more vision in its legislation. Honorable senators opposite would be well advised not to worry about what they have to- pay back to banks for their help during the election campaign. They should concentrate on legislation that will develop Australia into a true nation. To a large extent such development will depend on the banking system in this country. This is a wealthy country, and could be developed very successfully. The Government should concentrate on affairs of a national character, rather than on legislation to reconstitute the Commonwealth Bank Board.
Debate (on motion by Senator Courtice) adjourned.
Motion (by Senator O’SULLIVAN agreed to -
That the Senate, at its rising, adjourn to to-morrow, at 11 a.m.
– 1 move -
That the Senate do now adjourn.
In so doing. I inform honorable senators that the Government will ask the Senate to sit on Friday morning of this week, and probably on Tuesday, Wednesday, Thursday, and Friday of next week.
– I wish to refer to a matter of great importance, particularly to the unfortunate persons that it concerns. Several weeks ago I asked the Minister representing the Minister for the Navy a question in relation to the payment of pensions to the widows of the victims of the Tarakan disaster. As honorable senators will remember, there was a tragic loss of life as a result of an explosion on that vessel in Sydney Harbour on the 26th January last. Eight men lost their lives, seven of them being members of the Royal Australian Navy. Three of them were married men, two had children, and the widow of another expects a child in August. When those widows applied for war widows’ pensions they were informed that they were not regarded as war widows, despite the fact that the death certificates in relation to their husbands stated that the men had died on active service. That is an astounding state of affairs. At the time of the disaster the Minister for the Navy (Mr. Francis) assured the relatives of the victims that everything possible would be done for the survivors. In fact all possible at that time was done for them. In his reply to my question the Minister stated that the widows of the victims could not be regarded as war widows, because the relevant provision applied to members of the naval forces only up to the 3rd January, 1949, when to meet peace-time conditions they were brought under the provisions of the Commonwealth Employees’ Compensation ActUnder that legislation a widow receives £1,000 with £50 for each child. To take the case of a widow with four children under the age of sixteen years, I point out that with her civilian widow’s pension, child endowment allowance and so on, she receives £4 10s. a week. However, if she were classified as a war widow she would receive £7 5s. a week, which is £2 15s. a week more, and would mean a great deal to a woman placed in those unfortunate circumstances. Because of the low purchasing power of money to-day even a monetary grant of £1,000 would not greatly assist a widow. Furthermore, the loss of £2 15s. a week would amount to £1,000 in seven years, so that after that time the widow would be left with children who would still probably be under the age of sixteen years. In any event, all honorable senators know that £1,000 will not purchase a home or a business to-day. Therefore, I ask the Minister representing the Minister for the Navy whether something cannot be done to remedy the position of the widows of the victims of the Tarakan disaster. When I asked why the death certificates carried the endorsement “Died on active service “ I was told that the endorsement was made because of the provisions of the Defence (Transitional Provisions) Act 1946-49, which is in force until the 30th June, 1950,- or until a state of peace is declared. Technically, we are still at war. No peace treaty has been signed, and, therefore, I maintain that the men who were killed when the explosion occurred were killed on war service. They were taking hazards that they would not have been taking had they been in ordinary civilian employment. The nation owes a duty to the widows and children of the deceased men which all our pious platitudes cannot dispose of. I was told that the addendum to each of the death certificates was made so that probate of their estates could be granted. Since the deceased were young men it is not likely that they would have had much opportunity to make financial provision for their wives and children, so that placing the addenda on the death certificates has no practical value whatever. According to yesterday’s press there are, unfortunately, 24,412 war widows who are receiving the benefits of repatriation. Apart from monetary compensation, war widows and their families also receive, quite rightly, a number of additional benefits, including their free medical treatment and certain educational facilities. As I have already pointed out the victims of the tragic accident were engaged on duty at the time of their death and while we were still technically at war. I point out that the victims had a probable expectation of life of a further 40 to 50 years. The nation owes a debt to their dependants, and I do not think that it would hurt our economy if their widows were added to the list of war widows.
– I was pleased that Senator Tangney commenced her remarks by stating that my colleague, the Minister for the Navy (Mr. Francis), had handled the aftermath of the tragic disaster in a very sympathetic way. I also know that the matter has given him a good deal of personal worry and that he has done everything he possibly can to help the unfortunate dependants of the victims of the disaster within the limits of the legislation and of his statutory duty. Whether it be right or wrong, the fact remains that the benefits of the Australian Soldiers’ Repatriation Act do not apply to those unfortunate individuals. As the honorable senator stated, they are covered by the Commonwealth Employees’ Compensation Act. The statutory position is, I may say in passing, the result of an enactment of the previous Government. However, I would not like honorable senators to think that I am endeavouring to introduce a party political atmosphere into this matter. I do not know the circumstances at first hand, but I should imagine that when the war ended a deadline had to be drawn somewhere, and the previous Administration, in its wisdom, selected some particular date. The consequence is that those who are now members of the armed services are in the same position as are members of the ordinary civil departments. In other words, the officers and ratings of Tarakan are treated in the same way as members of the staff of the PostmasterGeneral’s Department or of the Department of Trade and Customs would be treated. Within the limits imposed by that statutory obligation, the Minister has. done all that he can do. The relatives of the men who lost their lives have been paid the cash equivalent of the furlough leave to which the deceased were entitled, they have received the deferred pay of the deceased, and - reading between the lines - I think that the Minister has turned a blind eye to the calculations of the exact period of leave to which the deceased were entitled. Their unfortunate families have been paid the amount of all allowances to which the deceased were entitled, so that they should not be in want. Speaking subject to correction, I believe that the statutory compensation of £1,000 has already been paid to the widows, together with the sum of £50 in respect of each child, and they are now entitled to social service benefits. Each widow concerned is entitled to a pension of £2 7s. 6d. a week, plus child endowment, and she is also entitled to a pension notwithstanding that she may have a home or possesses assets up to a value of £1,000, and irrespective of whether she receives an income of £1 10s. a week. There is, admittedly, a difference between the amount paid to war widows and that paid to the widows of ordinary civilians. However, that difference is bridged, to some degree as the honorable senator has said, by the amount of compensation paid. I have recited the facts at some length because I know that the matter has given my colleague, the Minister for the Navy, considerable concern. However, the honorable senator may rest assured that I will bring her representations to his notice, and I am sure that he will give them every consideration.
– It has been stated in the press that the Minister for the Army intends to raise 4,500 recruits for the Australian Army in the United Kingdom. I should like the Minister representing that Minister to inform me whether every endeavour was made to recruit Australians for the Australian Regular Army before it was decided to seek recruits overseas. I should also like to know whether suffi-. cient inducement has been offered to Australians to join the armed forces. Will the Minister inform me whether it would not have been wiser to invite young men of suitable type to migrate to Australia, and then, if they were agreeable, to join the Australian Regular Army? Will the Minister also say whether this is not a scheme to recruit on army outside Australia for the purpose of breaking strikes that occur in this country in the future ?
Question resolved in the affirmative.
The following papers were pre sented : -
Commonwealth Public Service Act -
Appointment - Department of Labour and National Service- J. C. Lowson.
Defence Forces Retirement Benefits Act -
Defence Forces Retirement Benefits Board - First Annual Report, for period ended 30th June, 1949.
Lands Acquisition Act - Land acquired for -
Defence purposes - Devonport, Tasmania.
Department of Civil Aviation purposes -
Postal purposes - Burnie, Tasmania.
Seat of Government AcceptanceAct and Seat of Government (Administration) Act- Ordinance - 1950 - No. 2 - Building Operations Control Repeal.
Senate adjourned at 11.26 p.m.
Cite as: Australia, Senate, Debates, 24 May 1950, viewed 22 October 2017, <http://historichansard.net/senate/1950/19500524_senate_19_207/>.