House of Representatives
18 September 1928

10^th Parliament · 1^st Session

THELATE SENATOR THOMAS GIVENS
ASSENT TO BILLS
QUESTION
- MEDICAL EXAMINATION OF MIGRANTS
QUESTION
- ALLEGED MUTINY ON H.M.A.S. BRISBANE
QUESTION
- CANBERRA BRICKS
QUESTION
- AUSTRALIA HOUSE
QUESTION
- NATIONAL INSURANCE
QUESTION
- COMMOWEALTH BANK
QUESTION
- STATE REPATRIATION BOARDS
QUESTION
- FEDERAL CAPITAL COMMISSION CONTRACTS
QUESTION
- GEOPHYSICAL SURVEY
QUESTION
- TOBACCO CULTURE
QUESTION
- ABRAHAMS TAXATION CASE
QUESTION
- DEVELOPMENT AND MIGRATION COMMISSION
QUESTION
- PRICKLY PEAR
INTERNATIONAL CANCER CONFERENCE
- Radium Treatment
DISTRIBUTION OF RADIUM
QUESTION
- FEDERAL CAPITAL COMMISSION
QUESTION
- PEANUTS
OUTLAWRY OF WAR TREATY
- Paper
PAPERS
INCOME TAX ASSESSMENT BILL 1928
- Second Reading
QUESTION
- BUDGET, 1928-29
HOUR OF MEETING
ADJOURNMENT

MEDICAL EXAMINATION OF MIGRANTS

Mr WATKINS:
NEWCASTLE, NEW SOUTH WALES · ALP; FLP from 1931

-I should like to know from the Prime Minister which authority, Commonwealth or State, is responsible for the medical examination of migrants before they leave Great Britain to come to Australia?

Mr BRUCE:
Minister for External Affairs · FLINDERS, VICTORIA · NAT

– The recruiting and medical examination of assisted migrants are the responsibility of the Commonwealth Government.

Mr WEST:
EAST SYDNEY, NEW SOUTH WALES

– In view of the fact that our police and hospital records show that our mental hospitals and institutions for the treatment of tubercular patients are being flooded with recent arrivals in Australia, will the Prime Minister state whether the examination of migrants is purely a medical one, and will he cause information to be forwarded to Great Britain that will guard Australia against a recurrence of the state of things that now exists?

Mr BRUCE:

– I suggest to the honorable member that his statement that our hospitals, mental and tubercular, arc being flooded with assisted migrants is extremely reckless, and that he would have been better advised had he asked whether I could have a statement prepared showing how many of these people have been received into such institutions. I assure him that he is entirely wrong in making such a sweeping statement. Unfortunately, there have been cases in which the medical examination in Great Britain has apparently not detected latent disease in would-be migrants, but the examination is the strictest possible, and, furthermore, inquiries are made into the characters of those who are brought out to Australia as assisted migrants.

Mr WATKINS:
NEWCASTLE, NEW SOUTH WALES · ALP; FLP from 1931

– A case has come under my notice in which an assisted immigrant who. has been only two years in Australia is now practically in the last stages of consumption, and is anxious to return to his people in the Old Country. I should like to know whose responsibility it is to give effect to his wishes ?

Mr BRUCE:

– If the honorable member will bring under my notice the particulars of the case to which he has referred, I shall have inquiries made, and ascertain exactly what are the facts.

page 6770

QUESTION

ALLEGED MUTINY ON H.M.A.S. BRISBANE

Mr BOWDEN:
PARRAMATTA, NEW SOUTH WALES

-I should like to know from the Acting Minister for Defence if there is any truth in the report that has been made public, that trouble occurred on H.M.A.S. Brisbane during its recent visit to Hawaii, and that one of the stokers was sentenced to three months’ imprisonment; also whether there is any truth in the allegation that the crew of the Brisbane were not allowed to land at Hawaii?

Mr MARR:
Honorary Minister · PARKES, NEW SOUTH WALES · NAT

– On the 14th September, the honorable member for Lang (Sir Elliot Johnson) asked me a question relating to the report referred to by the honorable member, and the reply which I have had prepared will answer the honorable member’s question. The honorable member for Lang asked whether there was any foundation for the disquieting newspaper statement concerning an alleged mutiny on H.M.A.S. Brisbane during the recent trip to the Cook Centenary Celebration at Honolulu, and I informed the honorable member that I had called for a report on the matter. I have now received the following telegram from the commanding officer : -

No foundation whatsoever for disquieting newspaper reports concerning alleged mutiny on Brisbane. First information of any supposed discontent was received from Sydney newspapers. Cruise was particularly arduous and involved great deal hard work which was very well carried out by everybody. Officers andmen of Brisbane very much resent wild and unfounded statements which have appeared in the press.

page 6770

QUESTION

CANBERRA BRICKS

Mr GREGORY:
SWAN, WESTERN AUSTRALIA

– Is the Minister for Home and Territories aware that whereas in Melbourne bricks cost £31s. per 1,000 to the Government and £3 3s per 1,000 to the public, they cost £6 5s. per 1,000 in Canberra at the kiln ? Will the Minister make investigations to see if some reduction cannot be made in the price of bricks in the Federal Capital Territory so that homes may not cost as much in future as they have cost in the past?

Sir NEVILLE HOWSE:
Minister for Health · CALARE, NEW SOUTH WALES · NAT

– I shall have the necessary inquiries made immediately.

page 6770

QUESTION

AUSTRALIA HOUSE

Mr BRENNAN:
BATMAN, VICTORIA

– I desire to ask the Prime Minister a question relatiug to the cost of the upkeep of Australia House as compared with the cost of Canada House in London, and perhaps in explanation I may be excused for reading the following paragraph from last night’s Melbourne Herald -

Statistics nowshow that whereas it costs Canada only 335,000 dollars (£16,750) a year to run Canada House in London, it costs Australia over 3,000,000 dollars (£150,000) to run Australia House in London. Australia House has a staff of 341, Canada House a staff of 148. And Australia has but a population of six millions, compared with nine and a half millions for Canada.

I ask the right honorable gentleman whether he will correct this paragraph if it is incorrect, or if it is correct, justify the increased cost of Australia House compared with that of Canada House?

Mr BRUCE:
NAT

– I have not seen the newspaper paragraph which the honorable member has read, and before answering the question I should like to see it in order to ascertain the basis on which the comparison is made. In any case the honorable member will have ample opportunity to discuss the question when the Prime Minister’s Estimates, which include the maintenance of Australia House, are under consideration in committee.

page 6770

QUESTION

NATIONAL INSURANCE

Mr A GREEN:
KALGOORLIE, WESTERN AUSTRALIA · ALP; FLP from 1931; ALP from 1936

– I ask the Treasurer what will be the cost of administration per head of all insured persons under the scheme outlined in the National Insurance Bill, first through approved societies, and secondly through the Government Department?

Dr EARLE PAGE:
Treasurer · COWPER, NEW SOUTH WALES · CP

– The consolidated revenue will bear no share of the cost of the administration of the National Insurance Scheme. The contribution of1s. a week by the employer and employee will cover the whole cost of the benefits and administration.

Mr A GREEN:
KALGOORLIE, WESTERN AUSTRALIA · ALP; FLP from 1931; ALP from 1936

– In the case of approved societies?

Dr EARLE PAGE:

– Yes.

page 6771

QUESTION

COMMOWEALTH BANK

Mr E RILEY:
SOUTH SYDNEY, NEW SOUTH WALES · ALP

Has the department in charge of the Geophysical Prospecting Survey yet decided where Dr. Broughton Edge and his party will first proceed with their work?
If so, what locality will be first examined?
When will the work be proceeded with?
Has Dr. Broughton Edge yet considered the claims for early examination of the large auriferous and other metalliferous areas of Western Australia?

Mr BRUCE:
NAT

– The replies to the honorable member’s questions are as follow : -

Yes.
An examination by electrical methods of an area at Anembo, near Captain’s Flat, New South Wales, lias just been completed. An area at Gelliondale, Gippsland, Victoria, ib being studied by gravimetric methods.
See answers to 1 and 2.
Yes. The closest touch has been maintained with the various State geological surveys by those in charge of the work. Full details of likely areas in Western Australia have been furnished to Mr. Edge and to the Geophysical Executive Committee controlling the work. The matter has also been discussed verbally with representatives of the Western Australian Department of Mines and Geological Survey.

page 6771

QUESTION

TOBACCO CULTURE

Dr NOTT:
through Mr. Manning

aske the Prime Minister, upon notice -

Whether the tobacco cultivated and the great possibility for expanding the tobacco industry in North Queensland has been investigated by the Commonwealth Director of Tobacco Culture?
Whether the Commonwealth Director of Tobacco Culture has been advised by the Australian tobacco manufacturers that samples of leaf grown in Mareeba and contiguous area in North Queensland meet all the requirements in regard to quality, and is equal if not superior to the imported leaf?

Mr BRUCE:
NAT

– The replies to the honorable member’s questions are as follow : -

Such tobacco as was produced last year in North Queensland was grown experimentally by the Australian Tobacco Investigation with the agreement of and in conjunction with the Queensland Department of Agriculture, and is under the direct supervision of the Direction of Tobacco Investigations. Further experiments are being conducted this year in connexion with the investigation as to the suitability of North Queensland for the growing of tobacco of the quality desired by consumers. The results of last year’s preliminary work are encouraging, and fully justify further and extended experimentation for the production of a certain type or types of tobacco.
The Director of Tobacco Investigations has not been so informed. It is hoped, however, that finally production from various areas will lead to the supply of the different types, qualities, and grades of leaf tobacco adequate to form the basis of a comprehensive domestic and export business.

page 6772

QUESTION

ABRAHAMS TAXATION CASE

Mr GARDNER:
ROBERTSON, NEW SOUTH WALES

asked the AttorneyGeneral, upon notice -

Whether the Government of Western Australia made any agreement with the Messrs. Abrahams with reference to payment of income tax evaded, and penalties?
If so, what was the date of the agreement, what amount was agreed to be paid to the Government of Western Australia, and what were the terms of the agreement?

Mr LATHAM:
Attorney-General · KOOYONG, VICTORIA · NAT

– The replies to the honorable member’s questions are as follow : -

Yes. The agreement was made between the Taxation Commissioner for Western Australia and the Messrs. Abrahams through their attorney under power.
The agreement is dated 3rd October, 1927. The amount agreed to be paid to the Government of Western Australia was £78,000 with £2,000 costs and the terms were substantially identical with the terms of the agreement made on 26th September, 1927, between the Commissioner of Income Tax for the Commonwealth and the Messrs. Abrahams through their attorney under power, except that the Commonwealth agreement contained terms providing for legal proceedings which were not contained in the Western Australian agreement.

page 6772

QUESTION

DEVELOPMENT AND MIGRATION COMMISSION

Mr BRUCE:
NAT

– On the 14th September, the honorable member for Batman (Mr. Brennan) asked the following question, upon notice -

What is the total number of employees of the Development and Migration Commission?
What was the number of such employees at the end of each half-year during the operations of the Commission ?

I am now in a position to furnish the following information : -

page 6772

QUESTION

PRICKLY PEAR

Mr BRUCE:
NAT

– On the 13th September, the honorable member for Capricornia (Mr.Forde) asked the following question, upon notice -

What was the estimated acreage under prickly pear in (a) Queensland, (b) Now South Wales, (c) other States, in 1908, 1918, and 1928?
What is the total annual expenditure on research work in connexion with prickly pear, and how much is provided by the Commonwealth and each of the States concerned?

I am now in a position to furnish the following reply: -

The Council for Scientific and Industrial Research advises that “ the acreage under pear “ naturally depends on where the line is drawn between infested country, and country containing so few pear plants that for all practical purposes it may be considered noninfusted. Various authorities, in their estimates, have drawn this line in different places, and hence discrepancies occur in the figures for “ acreage under pear “, that are put forward from time to time.

The following figures are representative: - 1908.- Queensland, 12,000,000; New South Wales, 2,000,000. 1918.- Queensland, 20,000,000; New South Wales, 2,200,000. 1928. - Queensland, 50,000,000; New South Wales, 8,500,000.

It is pointed out that the figures for 1928 are recent estimates, and probably include much more lightly infested areas than those of the previous years.

Other States. - No data available, but the total infestation is very light.

The chief research work is being undertaken by the Commonwealth Prickly Pear Board. As from the beginning of the present financial year, the annualvote of the board will be £18,000 per annum, made up of contributions of £9,000 from the Commonwealth and £4,500 each from the States of Queensland and New South Wales. The results obtained by the board to date have been particularly encouraging. Several varieties of insects fatal to pear have been established in such large numbers that already the annual increase of the pear, estimated some years ago at 1,000,000 acres per annum, is claimed to have been stopped. So encouraging have been the results that, in order to intensify the operations of the board before local parasites or predators, unusual climatic conditions, outbreaks of disease, &c.,might combine to exercise a delaying or nullifying effect on the good work of the insects which have been already introduced, the contributing parties have just agreed to increase their contributions by 50 per cent. Up to the beginning of the present financial year, the annual vote of the board was £12.000 per annum.

page 6773

INTERNATIONAL CANCER CONFERENCE

– On the 14th September the honorable member for South Sydney (Mr. E. Riley) asked me the following questions’: -

Is it a fact that Colonel Thomas, a member of the Federal Capital Commission, has been receiving an allowance for being away from his home town while he has had his furniture stored in a residence in Canberra?
If so, for how long was this residence used as a store for Colonel Thomas’ furniture, and was rent paid for the residence so occupied ?

I am now able to furnish the honorable member with the following information : -

Yes. The honorable member is referred to an answer given by me on the subject to the honorable member for Melbourne on 30th August, 1928, Barnard, page 6200.
I am advised by the Federal Capital Commission that the furniture has been stored for a period of approximately six months in one of the cottages which the Commission, up to the present, has not been able to let. No charge has been made for such storage.

page 6774

QUESTION

PEANUTS

Sir NEVILLE HOWSE:
NAT

– On 14th September, the honorable member for Wide Bay (Mr. Bernard Corser) asked the following question : -

With regard to the application of the Queeusland Peanut Board for permission to introduce peanuts into Australia for seed purposes: - (a) What action has been taken by the Commonwealth Health Department; (b)Has any reply been received from the Queensland Department of Agriculture and Stock, to the letter from his department of 1st August last, and, if so, what is the nature of such reply?

I am now in a position to supply the honorable member with the information he desires : -

Permission was granted for the importation of half a ton of peanuts from the United States of America, subject to the following conditions: -
1. The Queensland Department of Agriculture to assume responsibility for the importation and arrange with the Department of Agriculture in the United States of America to secure seed as free from disease as possible.
2. The seed on arrival to be grown in one area under quarantine.
3. The growing plants or harvested seed not to be distributed until examination shewed that no important disease had been introduced with the imported seed.

These conditions were communicated (by letter) to the Under Secretary, Department of Agriculture, Queensland, and to the Secretary, Queensland Peanut Board, on 1st August.

The Under Secretary, Queensland Department of Agriculture, replied on 28th August that, after full consideration of all the circumstances, the board was not desirous of accepting the permission for the importation of seed peanuts on the conditions prescribed.

page 6774

OUTLAWRY OF WAR TREATY

Paper

Mr BRUCE:
NAT

– I have from time to time laid upon the table certain documents relating to the negotiations prior to the signing of the Outlawry of War Treaty. I now lay upon the table three further documents: - (1) A note dated 23rd June, 1928, from the United States of America Chargé d’Affaires in London to the Secretary of State for Foreign Affairs; (2) A note dated 18th July, 1928, from the Secretary of State for Foreign Affairs to the United States of America Chargé d’Affaires in London; and (3) a note dated 18th July, 1928, from the Secretary of State for Foreign Affairs, on behalf of the Commonwealth Government, to the United States of America Chargé d’Affaires in London. These complete the documents relating to the negotiations.

page 6774

PAPERS

The following papers were presented : -

Postmaster-General’s Department - Particulars of provision for buildings on Loan Estimates, 1928-29.

Renunciation of War - Further Documents relating to the Proposed Treaty.

Commonwealth Bank Act-Regulations Amended - Statutory Rules 1928, No. 94.

Lands Acquisition Act - Land acquired at Cook, South Australia - For Defence purposes.

Railways Act - By-law No. 48.

Seat of Government Acceptance Act and Seat of Government (Administration) Act - Ordinance of 1928 - No. 19 - Church of England Property Trust.

War Service Homes Act - Land acquired in New South Wales at - Albury, Glen Innes.

page 6774

INCOME TAX ASSESSMENT BILL 1928

Second Reading

Debate resumed from 11th September (vide page 6579), upon motion by Dr. Earle Page -

That the bill be now read a second time.

Mr SCULLIN:
Yarra

.- This is a bill to impose new taxation, and, by means of machinery amendments, to close a number of loopholes in the act. The Treasurer, in his budget speech, said that he was not proposing any increase in taxation, but that statement cannotbe reconciled with the fact that this bill proposes that £300,000 of new taxation shall be raised from life assurance companies. It is true that there is to be no increase in taxation upon the comparatively well-to-do, but the Treasurer is roping in hundreds of thousands of people who hitherto were exempt from income taxation. The loop-holes that are to be closed have been discovered by financial experts, most of whom represent large companies. This closing up of loopholes in the income tax legislation is a proceeding with which we are now becoming familiar. Loth as I am to say, “ I told you so “ I cannot help reminding the Treasurer that many of these loop-holes by which people who should pay taxation are escaping their obligations have been pointed out by honorable members on this side from year to year. The effect of these evasions is that other people pay more, because if Parliament enacts legislation imposing taxation according to the individual’s ability to pay and some persons by sharp practice, even though it be legal, escape their fair obligation, others must pay more than their share in order to make good the loss. Most of the clauses may be more properly discussed in committee, but I propose to examine briefly some of the principles that are affected by the bill.

In my judgment the taxation of life assurance companies is inequitable. Life assurance is a provision made mostly by breadwinners for their dependants or for their old age, and because of it the obligations of the Commonwealth and the States are made lighter. For example, the Commonwealth Government saves a certain amount that it otherwise would have to pay for old-age pensions, and the States escape some of the provision they would have to make for widows and children. Therefore the taxation of life assurance companies does not commend itself to me and should not commend itself to this national Parliament. Under the Income Tax Assessment Act the premiums paid to life assurance companies up to £50 may be deducted from income: and this Parliament has thus recognized that provision of this kind, whether the assurance be for large sums or small sums, entitles the taxpayer to a concession. And I remind the House that this deduction is allowed to those who have taxable incomes of not less than £300 a year. Thus we encourage this form of thrift. But the bill is a negation of that policy, because a tax upon life assurance companies is a tax upon the policy-holders, and makes taxable hundreds of thousands of persons who are now exempt from Commonwealth income taxation. We should face this issue honestly. If this Parliament believes that small incomes should be taxed let us openly and frankly say so by a straightout amendment of the Income Tax Assessment Act, instead of adopting this indirect and underhand method. This tax is estimated to yield £300,000 per annum. Mutual life assurance companies are to be taxed on the net income derived from the invested funds of the companies ; those funds represent mainly the premiums paid by the assured. Non-mutual companies are to be taxed on the same class of income and upon any other income which they may distribute to their shareholders or add to their paid-up capital. Taxation of the dividends of shareholders in a non-mutual company is as equitable as the taxation of shareholders in any other company, and to it there can be no objection, but when we tax mutual companies we are placing an impost, not upon the dividends paid to shareholders, but upon the bonuses members receive; alternatively, we are increasing the premiums to be paid by those who have established mutual benefit societies to provide for their old age or dependants. According to the Taxation Commissioner’s report, 225,000 persons pay Commonwealth Income Tax. According to the statistics, there are in Australia over 800,000 holders of ordinary life assurance policies, and about 1,300,000 holders of industrial policies, or a total of over 2,100,000 policyholders. Allowing for some persons holding more than one policy, it is safe to assume that there are approximately 2,000,000 persons in Australia holding life assurance policies.

Mr Maxwell:

– In mutual and nonmutual assurance companies?

Mr SCULLIN:

– There are not many non-mutual companies. Thebulk of the life assurance companies are conducted on a mutual basis. .

– Yes ; but, becausehe has not an otherwise taxable income, he does not receive a rebate. Parliament has provided that a tax of1s. is applicable to incomes of £1,000, but the man receiving £100 pays at an even higher rate than the person who receives £1,000 a year. This system is unfair, and cannot be justified. We have been told that we ought not to impose a heavy company tax because it would prevent small investors from placing their money in public companies. Do we encourage them by imposing a tax such as this? Under the present system, those with a substantial income derive benefit, whilst those with an income which would not otherwise be taxable are penalized. The remedy is simple. In imposing taxation we should treat companies and proprietors on the same basis, and after certain allowances have been made, all profits should be deemed to have been distributed. Taxpayers should pay taxation on the profits of the shares they hold in a company.

– If the honorable member invested one-half of his allowance it would be capitalized, but it would not be exempt from taxation on that account.

There may be some virtue in reinvesting a certain portion of one’s income ; but, should it warrant exemption from the payment of a just share of taxation? The mere fact that a sum has been capitalized before the taxpayer receives it, does not alter the position.

Mr Maxwell:

– But in the one case he has no option.

Mr SCULLIN:

– But he is just as well off. As a shareholder he can exercise control. The persons who derive the greatest benefit from this practice are those who hold a controlling interest in a company, and elect to deal with their profits in this way, in order to evade taxation. Family companies are being formed to-day for the express purpose of evading the taxation which otherwise would be imposed upon the members of the company as individuals. There is no sound argument in favour of the exemption of bonus shares from taxation. A distribution of bonus shares is tantamount to a distribution of profits, and the full rate of income taxation should be paid by the individuals who receive them.

Under section 21 of the act one-third of the profits may be placed to reserve, and pay the company rate of1s. in the £1. I believe that by a judgment of the courts a distribution of bonus shares has been held to be a distribution of profits. If that is the case, the shareholder should pay according to the income he has received. He does not now do so. The Commissioner of Taxation can require the distribution of two-thirds of a company’s profits. As a distribution of bonus shares is regarded as a distribution of profits, if one-third is distributed in the form of bonus shares, only one-third more need be distributed. The effect has been that shareholders of companies have paid tax at the individual rate upon only onethird of the total profits, and thus have evaded to the extent of at least two-thirds of their income the taxation that this Parliament considered it had imposed upon them. This amendment of the law seems to provide a remedy for that defect.

Mr Maxwell:

– What happens in regard to the remaining one-third ,

Mr SCULLIN:

– One-third is placed to reserve ; a second third is distributed in the form of bonus shares, and pays at the company rate of ls. in the £1; and the balance is taxable at the full rate for individual incomes in the hands of the shareholders; whereas it was intended that at least two-thirds should be taxed at the full individual rate.

Mr Maxwell:

– In future, the shareholders will be liable to the full rate with respect to two-thirds.

Mr SCULLIN:

– That is the object of this amendment. My argument is that when profits are distributed, whether in the form of cash or bonus shares, the full rate should be paid by the individual shareholders. An illustration of what has happened is given in some notes which have been carefully and well prepared by the department. In the case of a company whose profits for a year total £15,000, the Commissioner can demand that two-thirds be distributed. If that sum of £10,000 were followed into the hands of the shareholders, the rate applicable to those shareholders as individuals would be charged. But the practice has been to distribute £5,000 in the form of bonus shares. That being considered a distribution of profits, the company has had to distribute only an additional £5,000. Therefore, out of a profit of £15,000, the full income tax rate has been paid on only £5,000, whereas it was intended that it should be paid on £10,000. According to the department, cases of that kind are becoming common. The remedy proposed would appear to a layman to meet the position; but I shall not venture to prophesy that that will be the result. I shall await events before concluding that it is effective.

– On a pro rata basis, D is in a much more fortunate position than C. Let us assume that £6,000 represents one-third of the profits of each. C would pay upon that sum a tax of £1,000, while D would only pay £300. Or, let us suppose that a man’s total income derived from a proprietary business amounted to £6,000, and that another man during the same year earned a similar income, made up of £4,000 in cash and £2,000 in bonus shares. The first man would pay £1,000 in taxes, whereas the other would pay taxes amounting to £100 on the bonus shares, and another £500 on the £4,000 cash, making a total of £600. Thus, on the same amount of income one would pay £1,000 as against £600 paid by the other. I mention these supposititious cases to point out that the method of taxation is unjust, in that men in receipt of the same amount of income, but derived from different sources, do not pay the same amount in taxes, and that it offers inducements to taxpayers to evade taxation. In many instances profits distributed as bonus shares can be sold at their face value; yet the tax on them is fixed at the ordinary company rate. That is a generous concession to persons with big incomes.

– I agree that it is not income, and should not be taxed as such. It is, however, taxed as income.

Most of the remaining clauses have been included in this measure to give effect to the intention of Parliament in the past and to safeguard the revenue. I shall probably have more to say regarding some of them when the bill reaches the committee stage. I shall not do more now than refer again to the principles I have mentioned - the taxation of life assurance companies, the exemption of bonus. shares, and the inequitable system of giving a rebate of company tax to those in receipt of taxable income, and not to those who otherwise have no taxable income. The gravamen of my charge against this measure is that it brings into the field of taxation 1,500,000 persons who otherwise would not be in receipt of taxable incomes, while at the same times it reduces the rate of taxation in the case of persons with taxable incomes.

Mr FENTON:
Maribyrnong

.- No doubt the innate modesty of the Leader of the Opposition (Mr. Scullin) precluded him from taking full credit for the views he has expressed in this House from time to time regarding those who escape income taxation. Had the Treasury accepted the honorable member’s advice, the year might not have ended with a deficit.

I intend to oppose strenuously any attempt to impose taxation on life assurance policies, which I regard as one of the most cruel forms of income taxation ever brought before a Parliament. This bill proposes to levy taxation on nearly 2,000,000 persons who at present are exempt from - income taxation. Among the -poorer section of .the community are many widows and children who hold life assurance policies. The Treasurer, in his attempt to remedy a deficit which would not have existed had there been a proper control of the country’s finances, now seeks to exact taxation from these people. Yet not long ago the honorable gentleman sought to exempt from taxation some of the wealthy companies in the country. It is true that the assets of the life assurance companies amount to approximately £350,000,000, but their liabilities are almost as great. The total value of the policies issued by Australian life assurance companies amounts to approximately £300,000,000, an average of about £150 each. Do honorable members stand for income tax being levied on about 1,750,000 of the poorest persons in the community ?

Mr Parkhill:

– It is done every day through the tariff.

Mr FENTON:

– I warn honorable members opposite that persistence in such a policy will injure the party to which they belong.

Mr WEST:

-I should not worry about that. t

Mr FENTON:

– I agree with the honorable member that the removal from office of the present Government would be in the best interests of this country, nevertheless, I shall not assist to place legislation of this kind on the statute-book. I merely warn honorable members opposite of the danger confronting them in the hope that, in an attempt at selfpreservation, they will refuse to pass such iniquitous legislation. The latest returns available show that the life assurance societies have invested 55 per cent, or £60,000,000, of their capital in bonds issued by Government and public bodies; £25,000,000, or 20 per cent., has been lent in mortgage on town and country properties ; while 10 per cent., or £10,000,000, has been lent to policy holders. ‘During the war the Government was glad to receive from them many handsome contributions to the war loan. In the time of their country’s need, these companies as sisted the Government, and by lending money on mortgage in the case of town and country properties, they have done much to develop the country. They have also assisted their policy holders during periods of financial stress by making them advances on their policies, with the result that many of them have been enabled to earn sufficient incomes to make them liable for the payment of income tax. The existing income tax legislation provides that income not derived from trading for profit or gain shall not be taxed. I have it on the best authority that the words “ profit or gain “ do not apply to life assurance societies in .England. The Privy Council has decided that mutual assurance companies are not conducted for profit or gain, that the bonuses distributed by them are merely a return to the policy holders. Many illustrations could be given of the benefits conferred upon the community by these societies. A life asurance policy taken out by a bread-winner is of inestimable value to his dependants in the event of his death. It frequently happens that some of the money received from it is reinvested by the widow, for herself and her children in order that later they may be, to some small extent, provided for. In my opinion, it is reprehensible that the Government should even contemplate taxing such investments. This national Parliament should do its utmost to encourage thrift of this description; but legislation like this will altogether discourage it. On the 15th September, the Melbourne Argus referred to this proposal in the following terms : -

Trading companies only pay taxation on their net profit. With life offices of the mutual type the only thing corresponding to net profits is their surplus, or the excess of receipts over payments. The proposal is not to tax the surplus, but to take the gross interest income and impose taxation upon it, although the amount received from that source is far in excess of the amount of any surplus. Taking seven of the principal life offices, their interest income is about £7,000,000, whereas their annual surplus is only £5,500,000. If the organizations were concerns trading for profit, and as such distributing profits among their shareholders, they would only have to pay on £5,500,000.

Either the Treasurer has been led into a grave error in proposing this amendment, or else he has been reduced to desperate straits to obtain a little extra money to meet the deficiency in the public accounts. Whatever may- be said in favour of the taxing of the £5,500,000 of annual surplus - and little or nothing can be advanced in support of even that proposal - every one must agree that it would be entirely wrong to tax the interest income of these companies of £7,000,000.

If the proposal of the Government he approved, these beneficient institutions will be taxed on an amount which has no relation to profit much more heavily than a brewing company is taxed. Seeing that an ordinary trading company pays only ls. in the £1 on its trading profits, there can be no justification whatever for imposing a considerably heavier tax upon any interest bearing income which is greatly in excess of the surplus distributed. The particulars, that I have given on this subject have been supplied to me by Mr. E. J. Starke, the general manager of the National Mutual Life Association, who is recognized as one of the greatest life insurance actuaries in the world. His remarks merit the most earnest consideration. The income of the mutual life assurance companies is made up of the aggregate contributions of the poorer classes in the community. If we could make a careful investigation into the position, we should discover that countless self-denials and many privations are suffered by these people to pay their premiums regularly. They have to deny themselves not only many luxuries, but also some necessaries of life, in order to meet their payments promptly. I can speak with some personal knowledge of this subject. I well remember that in the days which immediately followed the bursting of the land boom in Victoria hundreds of people had to forfeit their life insurance policies, because they could not meet the payments on the due date. Many hundreds of others underwent most severe trials in order to scrape together the few shillings required to keep up their payments. To a lesser extent that is always happening. It is shameful that such thrift should be considered by the Government to deserve taxation. This is no time for mincing words. I assert that it will be to our lasting and utter shame, as members of this Parliament, if we permit the Government to impose this taxation. If the Government considers that this is a suitable field from which to obtain taxation, it should make the matter one of policy at the coming election. That would be the fair and reasonable thing to do. Certainly we should not be asked in the dying hours of the Parliament to enter upon an entirely new field of taxation.

I plead with the Government to withdraw this objectionable clause, and if it is returned after the election to reintroduce the subject if it then thinks fit. If the Treasurer is not willing to accept this proposal I hope that honorable members generally will defeat the clause when the vote is taken upon it.

Mr GREGORY:
Swan

.- Seeing that some honorable members have been travelling almost all the time since Friday, I ask the Treasurer to defer consideration of the bill in committee until to-morrow, to give us an opportunity to study the amendments a little more closely. “While I have no desire to relieve any section of the community of taxation which should legitimately be imposed upon it, I have a great objection to the inclusion in taxation measures of retrospective provisions. They are dangerous, and liable to operate very unfairly. Earlier this year I moved an amendment to another taxation bill with the object of providing that taxation should be imposed upon incomes derived by Australian residents from capital invested outside of the Commonwealth. I contend that it is much more desirable that we should encourage people to invest their capital within the country than elsewhere; but by taxing income derived from investments within the Commonwealth and exempting from taxation income derived from investments outside we are practically inviting people to invest their money abroad. I should have been prepared to move a similar amendment to this bill but for the undertaking of the Prime Minister that the whole subject was being carefully investigated. A few nights ago the right honorable gentleman stated that the Government had not quite determined its attitude upon the subject. Seeing that the most careful investigation is necessary before the incorporation of such provisions in our taxation legislation, I am quite prepared to give the Government every opportunity to complete its inquiries. Consequently, I do not propose to move an amendment of that nature to this bill. I hope, however, that next year Parliament will deal with those who, with the object of avoiding taxation upon their incomes, consider it expedient to make their investments abroad. This enables them to avoid paying a single sixpence towards the expenses of government, although in many cases they have made the bulk of their wealth from their investments here.

Mr PARKHILL:
Warringah

. - The Treasurer (Dr. Earle Page) said, in his second-reading speech, that the aim of the Government has always been to keep our taxation law as simple as practicable. I am curious to know what the Treasurer regards as involved, if he considers that our taxation law is simple. Personally, I fail to appreciate its simplicity. It appears to me to be based on “ catch as catch can “ rules, with the Taxation Commissioner having the option to make additional regulations to suit himself. When by a perfectly legitimate interpretation of the law, anybody obtains any advantage, the Taxation Commissioner sets to work to nullify that advantage by introducing further restrictive laws of a retrospective nature. I join with other honorable members in offering my strongest objection to the, retrospective principles contained in this bill, although they probably concern mainly the accounting periods and rebates. I await with interest the Treasurer’s explanation in committee on the matter.

It is most regrettable that our taxation system cannot be simplified. Instead, amendments are added to the original act, every year, and it is becoming so involved that the average person has not the slightest chance of understanding it. As a result he has to seek the advice of professional accountants and taxation experts, who are paid ever increasing fees to interpret the law. This adds to the general cost of taxation. I commend to the Treasurer the following extract from Adam Smith’s The Wealth of Nations -

The tax which each individual is “bound to pay ought to be certain, and not arbitrary. The time of payment, the manner of payment, the quantity to be paid, ought all to be clear and plain to the contributor, and to every other person. Where it is otherwise, every person subject to the tax is put more or less in the power of the tax-gatherer,….. The uncertainty of taxation encourages the insolence and favours the corruption of an order of men who are naturally unpopular, even where they are neither insolent nor corrupt. The certainty of what each individual ought to pay, is, in taxation, a matter of so great importance, that a very considerable degree of inequality, it appears, I believe, from the experience of all nations, is not near so great an evil as a very small degree of uncertainty.

Although I do ‘ not agree entirely with some portions of that extract, it expresses generally the sentiments of a very large section of the business community regarding the taxation to which we are subjected. I object strongly to retrospective clauses and to the ever increasing power that is given to the Commissioner of Taxation. It must be realized that the taxpayer and the tax-gatherer are as wide apart as the poles. The taxpayer ie perfectly entitled to take advantage of any loopholes in the taxation act, and, while it is but right that the Government should stop such leakages it is immoral to make the operation of the new law retrospective. I take strong exception to the wording of paragraph b of proposed new sub-section 2b of section 21, of the principal act which reads - where the Commissioner is satisfied that the company has withheld information or has furnished incorrect or misleading information for the purpose of avoiding tax in an ordinary assessment or under this section.

Power should not be given to the Commissioner to determine whether certain things were or were not done. I wish it understood that I refer to the Commissioner of Taxation quite impersonally. The legal rights of every taxpayer should be preserved. They should not be take, away by a provision of this description, which permits of no appeal from the finding of the Commissioner. There are half a dozen similar provisions in the bill which are calculated to make the administration of the taxation law of Australia tyrannical and arbitrary in character. That is not a proper condition of things, and I intend, when we reach the committee stage, to ask the Government to take further cognisance of that aspect of the matter.

Mr LATHAM:
AttorneyGeneral · Kooyong · NAT

– I rise, not to deal with the amendments proposed in the bill, but to make some comments upon the remarks of the honorable member for Warringah (Mr. Parkhill) on the desirability of simplicity and certainty in taxation. It would be very easy to introduce a simple scheme of taxation if the endeavour of this Parliament to make taxation fair and equitable were abandoned. It would be very easy to abandon the endeavour to tax dividends from companies fairly and in proportion to the income of the person who received them. If that endeavour were abandoned, there could be a company tax, and also a tax on individuals. But, from the beginning, the purpose of the Commonwealth Income Tax Assessment Act has been to charge income tax on dividends in relation to the income of the person who receives them. If honorable members examine the amendments proposed in this bill they will find that nearly every one of them is due to the policy of this Parliament of refusing to adopt the principle of taxation of dividends at their source. If that were done, we should have a relatively simple method of income taxation. But honorable members will recognize that such a change would involve the abandonment of a principle, and a step which would probably meet with their strenuous opposition. That is the main excuse for the complexity of our system of income taxation. There is another reason for it, which was admirably illustrated by one of the suggestions made by the honorable member for Warringah, that is the endeavour of the Government to be fair to all taxpayers, as evidenced by abundant provisions for lodging objections and appeals. Not only is there an appeal to the Supreme Court and the High Court, but provision is also made for a review’ of assessments by a Board of Review. The Board of Review has, generally speaking, been placed by this Parliament in the position of being able to override any determination of the Commissioner of Taxation. All those appeals increase the complexity of the system, and its expense to the taxpayers, but they are demanded by the taxpayers themselves. Our system would be much less expensive if everything were left to be determined by the -Commissioner, but, naturally enough, that course would be objectionable to many taxpayers. It is impossible under an act based upon the principles to which I have referred, to obtain the sweet simplicity of the period of Adam Smith - when conditions of society were so different from those of the present day that the taxgatherer was a person naturally regarded as open to corruption. It is very desirable that taxation should be simple and certain. Taxation becomes certain when the assessment has been issued, but it is impossible, in these modern days of complex business arrangements, for taxation to be at once certain, simple, and fair.

The honorable member for Warringah called attention to paragraph b of proposed new sub-section 2b, of section 21 of the principal act, which very well illustrates some of the principles to which I have referred, and suggested that there should be an appeal to a court from the decision of the Commissioner. If this provision is adopted by the House, its only effect will be that a company will pay tax according to the true facts. If what the Commissioner thinks to be the true facts are not the true facts, a company cannot be charged on them. To substitute a provision to insist that a court must first be satisfied that information was withheld, would really increase the expense to the taxpayer, and would not confer any benefit on him in the final result. It would merely introduce another element of complexity into what the honorable member has described as an already sufficiently complex act.

Mr Scullin:

– In any case, provision is made for an appeal against the determination of the Commissioner.

Mr LATHAM:

– That is so. The company is taxed only on the true facts, and to provide an appeal in this instance from the opinion of the Commissioner that the company has withheld information would merely add another complexity and increase still further the expense of what certainly must be admitted to be an already complicated piece of administration.

Sitting suspended from 12Ji5 to 2.S0 p.m.

Mr A GREEN:
KALGOORLIE, WESTERN AUSTRALIA · ALP; FLP from 1931; ALP from 1936

.- Previous speakers have dealt with various aspects of the amendment of the Income Tax Act as proposed in this bill. I intend to deal with the failure of’ the Government to take action in the interestsof the gold-mining industry. No longer ago than July last, the Prime Minister (Mr. Bruce) was in Kalgoorlie, and a definite promise was made by him that assistance would be given to the industry. This promise applied particularly to prospectors. On 2nd July a report appeared in the press of a deputation representing the whole of the local governing bodies on the eastern gold-fields, and also the Chamber of Mines, which waited on the Prime Minister. The Mayor of Kalgoorlie briefly summed up the case for the industry in the following words : -

He could speak from his knowledge of the gold-fields of this State for over a period of 30 years. It was now very difficult to get the right type of men for prospecting. It was not that they could, not get men of equal calibre to those of the early days, but the unfortunate position arose that where the prospector, backed up by syndicates or business men, found a property, he, if it were marketable, might get a certain cash consideration and the balance in paid-up shares upon which the Federal Taxation Department claimed a tax upon face value. This would strip him of all reward for his labours.

The definite reply given by the Prime Minister was -

He would give the subject of exempting the prospectors his immediate attention. The general question was one of assistance to the mining industry generally.

Thus it is clear that a definite promise was made by the head of the Government to give immediate attention to the matter. We now have a bill under which it is proposed to tighten up the Income Tax Act in some directions, to deal with persons who have found a loophole in it, and have escaped taxation; but as the Government has made no attempt to carry out its promise to exempt prospectors, I charge it with neglect in that matter. I have no desire to . impute motives - that would be a poor way of defending an argument - but I have no hesitation in saying that if the gold-mining districts of Western Australia had been represented in this House by a member pf the Country party, the pact Government would have given this industry help similar to that received by the producers of canned fruits, doradillo grapes, butter, and similar commodities. Primary producers say that taxation of the people in the interests of the local manufacturers is all very well, but if the primary producer is not to receive assistance the Country party cannot be expected to stand behind a government that advocates protection. Not only has this Government ‘failed to give the promised relief to the gold-mining industry, but it has also allowed an impost upon it to be continued. The position of this industry is as unenviable as it is unique. In 1914, at the beginning of the late war, the price of every commodity except gold rose. The price of gold remained stationary. Gold being the medium of exchange the world over, the price could not have gone up for any considerable period. During the war, a bonus was paid on gold, and for a certain time the industry secured assistance to the extent of £3,000,000 from that source ; but the price of fine gold to-day is £4 4s. Hid. per oz., the same as it was in 1914. The prices of mining commodities and Other goods necessary for the development of the industry, however, have increased by 100 per cent., and notwithstanding this fact the present Government continues to tax the industry. Prior to the war, no Federal tax was imposed on the proceeds of gold-mining, but when the cost of mining commodities doubled the Government saw fit to place this burden upon the industry. Can one wonder that the industry is now at such a low ebb? Its progress depends entirely upon the discovery of fresh fields. One is often asked why further discoveries are not made. Is the desire that was evinced by the’ old prospector to discover gold missing from the present generation? Gold is found in a new country because of the appearance of outcrops which are readily observed; but in various parts of known auriferous areas there may be in nature’s grip below the overburden hundreds of millions of ounces of the precious metal. Up to the present time no means have been invented of locating this hidden wealth except by what might be called “ blind stabbing.” Drilling has to be resorted to, and some mining companies in Western Australia have bored several miles in their efforts to discover ore shoots. The Government should not tax prospectors on their earnings as is done at’ the present time. A prospector may spend the best years of his life, eking out a bare existence through being backed to the extent of £1 or 30s. a week. With’ that small assistance he. is prepared to go out, it may be, for years in the hope that eventually he will discover payable gold. Prospecting is a passion with a man of that type. The Federal

Treasurer, through the Taxation Department, says to such a prospector, “Although you have been working for ten years to discover gold in payable quantities, although previously you have had no reward, although . you have shown indomitable spirit, and although in your old age you are at long last now in a position to reap the reward of your industry, this Government, which is supposed to stand behind private enterprise, seeks by way of taxation a high percentage of your income, small as it is relatively when compared with the large number of years over which your labours have been spread.” I protest against that treatment, because it is most inequitable. The Government has utterly failed to honour its promise to assist the prospectors. If I were a member of the Treasurer’s party, however, I feel that I should not have to go back to my constituents and say that the rewards given to other primary producers had been denied to the mining industry.

Let us consider what is said, by those who hold no particular brief ‘for the goldminers. The Development and Migration Commission, at the instance of the Government, investigated the conditions in the industry. I remember the time when the Minister for Home and Territories brought in a bill that was to work wonders for prospectors, and the Government said it considered the measure most necessary. I refer to the Precious Metals Prospecting Act, which was passed at the beginning of 1926. The sum of £40,000 was set aside to enable assistance to be given to prospectors ; but little benefit was derived from the measure, because, taking the Northern Territory and all the States together, only £4,000 was devoted to this industry, which was said to be in a. parlous condition. The Development and Migration Commission’s report contained the following remarks : -

The fundamental difference between the goldmining industry and most other industries is’ that gold mining deals with wasting assets, whereas other industries deal more with continuing or building assets. All’ mines by their very nature must have a beginning and an end. Every ton of ore extracted from a mine brings the undertaking just that much nearer to the end of its life, for ore in a mine is not replacable, and once the ore is gone the asset is gone. This fact should weigh when matters relating to taxation are under consideration.

Obviously a mine should not be taxed in the same manner as a continuing industry. The more vigorously a mine is worked the sooner it comes to an end. The opposite is the case with continuing* industries.

Prospecting of the old type, where men with gold-dish and shovel wandered afield in search of wealth, has practically passed the days of its usefulness, excepting in areas still unexplored. Future prospecting in Australia, to be productive, must be on a more extended scale where a number of men equipped with plant can undertake preliminary development work. Small prospecting organizations may be formed to carry on such work, and it appears desirable from the point of view of the industry, that such organizations should fall within the scope of the term “bona fide prospector.”

The Commonwealth Commissioner of Taxation at the instance of the Treasurer reaches out into those practically undeveloped portions of Australia and by means of harassing taxation prevents them from being developed in the only way possible - by the discovery of minerals. The area in Australia, devoted to the production of cereals, of butter and of grapes is relatively small. The fate of hundreds of thousands of square miles of country in the interior of Australia, and this is particularly true of Western Australia, depends upon the development of the known mineral resources. Unfortunately this Government, by its taxation proposals is interfering with that development. Apparently it is determined to exact from prospectors the last shilling of the small reward which they may look for in the development of this vast hinterland. I protest strongly against the Treasurer’s taxation proposals as regards the mining industry. The Government should take steps to redeem the promise of .the Prime Minister so that the gold-mining industry would receive fair treatment. I regret that the Treasurer has not seen fit to treat the goldmining industry in the same way that he has treated the butter or wheat producers, the growers of doradillo grapes and other sections of our primary producers. I trust he will agree to an amendment in the bill to provide for it.

Dr EARLE PAGE:
Treasurer · Cowper · CP

– One or two points have been raised during the second-reading debate to which I desire briefly to reply; the remaining matters touched upon would, I suggest, be better dealt with in committee. In the first place the honorable member for Warringah (Mr. Parkhill) referred to the retrospective character of the bill. I point out that the retrospective features of this legislation are practically limited to those clauses which deal entirely with the question of the accounting period. Honorable members will recall that in my second-reading speech I pointed out that as the result of a judgment by Mr. Justice Lowe, of the Victorian Supreme Court Bench, the accounting periods agreed upon between the Commissioner and various undertakings, whose financial year does not correspond with that of the Commonwealth, could not be followed in future for the purposes of determinations under section 121, and that confusion would result if this position were not met. Accordingly there is in clause 4, a provision, which will apply retrospectively to all such determinations that have been made under the law as it stood. Confusion will thus be obviated. Apart from that matter and the averaging of incomes, which must go back to 1923, the provisions of this bill deal generally with the assessments for the current year, so that there is no reason to suggest that this measure is retrospective in the ordinary sense of the word.

The second point with which I wish to deal relates to the taxation of life assurance companies. There appears to be some confusion in the minds of honorable members who have dealt with this matter. I think it is a fact that almost from the time when income tax was first levied upon the people by the States, life assurance companies have been subject to this form of taxation by the State Parliaments, and so far as I” have been able to discover, no objection has ever been raised to it by members of any party of any of the State Parliaments. It is only when the taxation laws of the Commonwealth are being brought into line with those of the States that we hear these objections;

The following are the bases of State taxation : -

New South Wales. - Income from real property mortgages, less proportion of total expenses in New South

Wales obtained by using ratio of taxable income to total income.

Victoria. - Thirty per cent of “premium income” (ordinary department). Fifteen per cent, of “premium income” (industrial department).

South Australia. - Portion of the surplus divisible amongst policyholders which the Actuary certifies to be attributable to South Australia.

Tasmania. - Twenty per cent, of “ premiums received.”

Queensland. - Twenty-five per cent, of “premiums collected during the year” (ordinary department). Fifteen per cent, of “premiums collected during the year “ (industrial department).

Western Australia. - “Interest on investments,” less a deduction for expenses.

– Yes; but under the present law the tax is 3s. in the £1. Under the English system there is provision for a rebate; but that is entirely opposed to the principle of our legislation, so that if we are to go back to that system, we shall have to recast the whole of our taxation machinery. I do not think the time is opportune to do that.

Question resolved in the affirmative.

Bill read a second time. In committee: Clause 1 agreed to. Clause 2 -

Section 4 of the principal act is amended. . . .

by omitting the definition of “Partnership “ and inserting in its stead ….

Partnership ‘ means an association of persons carrying on business as partners or in receipt of income jointly, and includes a trust created by any person in respect of any income or income-producing assets under which the relatives by blood, marriage or adoption of that person are entitled to the whole or any part of that income or of the income derived from those assets, and which in the opinion of the Commissioner was created for the purpose of relieving that person from any liability which would have arisen under this net if the trust had not been created, but does not include a company;”.

Mr DUNCAN-HUGHES:
Boothby

– This clause, which deals with the definition of partnership, and must therefore be read in conjunction with clause 17, provides, in effect, that a “partnership “ includes a trust created by any person under which his blood relatives are entitled to the whole or any part of the income derived from the assets, and which, in the opinion of the Commissioner, was created for the purpose of relieving that person from any liability which would otherwise have arisen, but does not include a company. It is practically impossible to detach the definition clause from subsequent clauses. At any rate I mention clause 17 to illustrate my point to the committee. Under that clause the partnership would be assessed as if it were a single person without regard to the other partners. This raises two questions ; first, whether this procedure is fair ; and secondly, who is to determine whether this state of affairs has arisen? The Treasurer, in his second-reading speech, dealt generally with this question, as indeed he did with the bill, and he said that it was a common practice for a person who owned a great deal of property to form it into a family partnership, in which certain members of his family had interests, and that, he .contended, meant that the person concerned would not pay as much as if he had not formed the partnership. I ‘personally cannot see anything reprehensible in that. The true test of the question seems to bo whether the income from the property under the new arrangement is really passing to the other members of the family.

Mr Maxwell:

– Whether the person concerned was dummying?

Mr DUNCAN-HUGHES:

– Yes, and I suggest that it is grossly unfair if an individual who makes an arrangement under which his family are partners with him, and pays the whole of the income or any part of it to them, is to be regarded under this definition clause, in conjunction with clause 17, as if he alone were the proprietor of the whole of the property. That aspect of the case seems, to me, to require some rebuttal. If a portion of the income derived from the property is being paid to the other members of the family, it is not being paid to the person in question, and it would be very unfair to expect him to pay the whole of the assessment on the property, which would, almost inevitably, be assessed against him at a higher rate than would be the case if the other members of the family were also assessed. I should say that it would be most natural, if such a family partnership were constituted, for the head of the family to retain some powers of management over the estate, because he would, in practically every instance, be the man who could manage it to the best advantage and derive the greatest return from it. So long as the proceeds were going to the members of the family, I cannot see why he alone should be assessed. He would become the chairman of directors - if I may use the term - of this partnership, and why should he be assessed as if he were the actual owner of the property? If on the other hand the partnership were formed into a company, he would be fairly entitled to become the chairman of directors of that company. That brings me to my second point. I should like to have some assurance from the Attorney-General with regard to these words, “ and which ‘ in the opinion of the Commissioner ‘ was created for the purpose of relieving that person from any liability which would have arisen under this act if the trust had not been created.” As the honorable member for Warringah (Mr. Parkhill) said this morning, those words frequently appear in the bill. They appear, for instance, in clause 7, which states - “Provided that profits which have, ‘ in the opinion of the Commissioner,’ been properly applied.” They are also to be found at the end of that clause, “shall be determined by the Commissioner, whose determination shall not be subject to objection.” They are to be found twice in clause 9, and also in clause 15. I do not even suggest that I have exhausted the list, but it will be clear from what I have said that the words appear fairly frequently in the bill. What I wish to ascertain definitely from the Attorney-General is whether those words exclude a matter from coming from the Commissioner’s opinion for re-hearing before some other board of review or court. It would appear to be perfectly clear that so far as the end of clause 7 is concerned there is no intention of allowing any appeal at all, because it says that the matter shall be determined by the Commissioner, whose determination shall not be subject to objectiou. This question should be made perfectly clear, particularly in the interests of the general public, because I think that one of the general objections in relation to clauses of this kind is against the Commissioner having power to determine a matter of his own volition without appeal to any one. That position is, obviously, undesirable. Needless to say, I am not criticizing the present Commissioner or any future Commissioner that may be appointed. But the Commissioner of Taxation is, by the nature of things, one of the parties to a dispute, and the general public is naturally reluctant that one of the parties to a dispute should also be constituted the umpire, and that, in fact, his opinion in the matter, which after all is only his opinion and which conceivably might be wrong, should not be liable to be appealed from and overriden by some hoard of review or court. If the Attorney-General replies that in every case where the words “ in the opinion of the Commissioner “ or some similar words are used in the bill, there does, in fact, under the original act as amended by this bill exist an appeal to some other authority, so that the taxpayer may always feel that he has a further court of appeal other than the decision of the department with which he is at the moment at dispute, then my objection in respect of the second point that I have raised falls completely to the ground, with the exception of the latter part of clause 7, which clearly states that the Commissioner’s determination shall not he subject to objection. I do not think that I have wasted the time of the committee by raising this point, because it should be clearly stated for the benefit of the general taxpayer that the existence of the words “ in the opinion of the Commissioner “ in the body of the bill in no way limits an appeal from the opinion of an individual, who after all is one of the parties concerned, to some outside body of appeal.

Mr LATHAM:
AttorneyGeneral · Kooyong · NAT

– The honorable member for Boothby (Mr. Duncan-Hughes) has raised two points in relation to the clause before the committee. The clause defines partnership to include certain trusts. Section 29 of the act provides that the general rule is that a partnership shall not be assessed in respect of its income, but that the partners shall be separately assessed in respect of their shares of income taken from the partnership together with any other income that they may have. The second sub-section provides that in the case of a partnership between husband and wife as to which the Commissioner is of opinion that the partnership was entered into for the purpose of relieving the husband or wife or both, from any liability which would have been incurred under the act if the partnership had not been formed, then the partners shall be assessed as a single person without any separation of interests. In that case the tax would be chargeable at a higher rate. That is already the law of the land. Now it has been found that that provision is being evaded iD two ways. In the first place trusts instead of partnerships have been created. The distinction between a trust and a partnership may sometimes be difficult to draw, but it is possible by apt and skilful conveyancing methods to establish a trust which has the same business effect as far as the sharing of income is concerned, as a partnership, but which does not amount to a partnership, because the beneficiaries under the trust are not carrying on business in common with a view to profit, that being the ordinary definition of partnership. Accordingly, “ partnership “ is defined in clause 2 of the bill to include what may be called “family trusts.” The existing section 29 refers only to husbands and wives. That section is being evaded by making a trust, not between husband and wife, but between a father and son, or a father and daughter. It is proposed to stop that sort of thing by the new clause. I have dealt with the two ways in which the existing legislation is being evaded, first by making a trust instead of a partnership, and secondly, by arranging a trust or partnership, not as between husband and wife, but between father and son or father and daughter. That is the reason for the modification of the law, but, in each case, the provisions will be limited by a requirement that the Commissioner must be of opinion that the partnership was entered into for the purpose of relieving the person from liability to pay tax. While the honorable member for Boothby was speaking, it seemed to me that he was not paying sufficient attention to this provision, namely, that there must be an intention to evade taxation, and it rests with the Commissioner to determine whether or not that intention is present.

Mr DUNCAN-HUGHES:
BOOTHBY, SOUTH AUSTRALIA · LP; NAT from 1925

-hughes. - Would not the form of the partnership relieve a person from a certain amount of taxation as a matter of course?

Mr LATHAM:

– No, not necessarily. In the case of a father and son who determine to enter into a partnership, and start a business as partners, no question of evasion could arise. But it would arise if the father had been carrying on a business for many years, and then took his son into partnership. It must then be determined according to the circumstances of the case whether it is a bona fide partnership, whether the father’s purpose was to give his son a share in the business and to make a career for him, or to relieve himself of liability to taxation. It is sometimes very difficult’ to determine what is the real purpose of such a transaction, but unless some endeavour is made to deal with it by law, it is certain that many serious attempts will be made to evade payment of the tax. To determine in what cases this purpose is present it is necessary to refer the matter to some authority. This clause provides that it shall he determined by the opinion of the Commissioner. The words used are - . . which in the opinion of the Commissioner was created for the purpose of relieving that person from any liability. . . .

The honorable member for Boothby asked whether the Commissioner’s opinion was final and conclusive. In this case it is not. I refer the honorable member to section 44 of the existing act, which provides for the powers of a board of review. Section 44 states -

The Board of Review shall have power to review such decisions of the Commissioner, Assistant Commissioner or Deputy Commissioner as are referred to it.

Sections 50 and 51 give the taxpayer the right to request the Commissioner to refer assessments to a board of review, and impose on the Commissioner the duty of referring the assessments when such a request is made. Section 44 provides that the act - for the purpose of revising such decisions shall have all the powers and functions of the Commissioner in making assessments, determinations and decisions under this act.

Honorable members will observe that the functions and powers of the board of review are not limited to the functions and powers of the Commissioner in making assessments, but that, in reviewing assessments it has all the powers of the Commissioner of arriving at decisions. Under section 21 of the act, the Commissioner has power to determine whether a sum, or a further sum not exceeding a certain limit, could reasonably have been distributed by a company to its shareholders. The board of review reviews such determinations of the Commissioner upon the assessment being referred to it. Section* 28 furnishes another example of the same sort of thing. The section is in these terms -

When any business which is carried on in Australia is controlled principally by persons resident outside Australia, and it appears to the Commissioner that the business produces either no taxable income, or less than the ordinary income which might be expected to arise from that business- then the persons carrying on the business in Australia may be assessed in a certain way. It will be noted that the words used are “when it appears to the Commissioner “ that certain facts exist. The board of review, therefore, will be reviewing the opinion of the Commissioner when he says “ it appears to me that so and so has happened.” There is no appeal, technically and strictly, from the Commissioner’s opinion as such, but there is a right to have an assessment reviewed by a board of review. The Commissioner must refer an assessment to the board of review if requested. When it comes before the board of review, that body has the same power to arrive at decisions as the Commissioner had originally, and may form its own opinion regarding the matter as to which the Commissioner originally formed an opinion.

Clause, verbally amended, and, as amended, agreed to.

Clauses 3 to 5 agreed to.

Clause 6 -

Section sixteen of the principal act is amended by omitting from the first proviso following sub-paragraph (iii) of paragraph (b) all words from and including the words “ the amount “ and inserting in their stead the words “ the member or shareholder, except where the member or shareholder is a company, shall, where the rate of tax payable by him on income from property does not exceed the rate of tax paid or payable by the company, be entitled to a rebate in his assessment of the additional amount of tax due to the inclusion of the dividends, bonuses, profits or shares in his assessment:”.

Amendment (by Dr. Earle Page) agreed to -

That the words, “ except where the member or shareholder is u company” be omitted.

Clause also verbally amended, and, as amended, agreed to.

Clause 7 -

After section 10a of the principal act the following sections are inserted….. “ 10c. Where a taxpayer claims that …. or for any other reason whatever, income is derived partly from sources outside Australia, the question whether any, and if so what part, of the income is derived from sources outside Australia shall bc determined in accordance with the regulations, or, if there is no regulation applying to the case, shall be determined by the Commissioner, whose determination shall not be subject to objection.”

Mr DUNCAN-HUGHES:
Boothby

– The rapidity with which this bill, admittedly intricate, is passing through the committee is another indication of how impossible it is for honorable members to become familiar with all its details. We have had only a few days in which to study the measure. I wish I could give the Government that credit for trying invariably to simplify taxation legislation, which the Treasurer claimed in his opening remarks, but it seems to me that since I entered Parliament our taxation law has steadily become more difficult each year, until now very few honorable members would like to answer an examination paper upon it. We are becoming more and more dependent on this subject, on the opinions of experts outside, and the very fact that the bill is brought before us, as these measures generally are, in the closing days of the session, makes it more difficult for honorable members to discuss it armed with anything like expert knowledge, for such is not immediately obtainable. In his opening remarks the Treasurer said that a widespread practice had arisen, of private companies, which had been formed for special profit-making schemes and the distribution of the profit among shareholders, going into liquidation before any profit, had been distributed. In other words, the company is formed, the profit is made, the company goes into liquidation and pays over its assets to the shareholders, and they are exempt from income tax. One does not wish to defend that practice where it is obviously carried out with a desire to avoid the payment of income tax, but it seems to me that at least one distinction can be made which is not clearly made in the proposed new section 16b. Most of us .are chiefly familiar with companies which go into liquidation and do not pay 20s. in the £, and I should like to have it clearly set out in the bill that so long as not more than the paid-up face value of shares is distributed to the shareholders, no claim can be made in respect of income tax. It seems to me that the first amount to be paid, up to the face value of the shares, ought to be regarded as capital and not income. In this connexion 1 notice again that the words “ in the opinion of the Commissioner “ appear once or twice. I take it, of course, as the Attorney-General has explained in regard to a previous clause, that there will be an appeal to the Board of Review, but personally I cannot see any utility in the retention of the words “in the opinion of the Commissioner.” The proviso -

Provided that profits which have, in the opinion of the Commissioner, been properly applied to replace ti loss of paid-up capital. would be equally effective if it read -

Provided that profits which have been applied to replace a loss of paid-up capital.

That the word “ not “, last line, proposed new section 10c, he omitted.

Mr GULLETT:

– The Government’s proposal will be exceedingly unpopular with taxpayers generally. I have sufficient faith in the tax-gatherer to leave the matter in his hands, but the average taxpayer is not so convinced of his impartiality. He does not believe in being subject to impositions in respect of which he has no right of appeal.

Amendment negatived.

Clause agreed to.

Clause 8 (Taxation of companies).

Dr EARLE PAGE:
Treasurer · Cowper · CP

– I move -

That proposed new sub-sections (5) and (6) be left out with a view to inserting in lieu thereof the following: - “ (5) For the purpose of ascertaining the taxable income of a company the principal business of which is life insurance there shall be excluded from the assessment the following amounts -

all premiums received in respect of policies of life insurance and all considerations received in respect of annuities granted and all income derived from any source whether in or outside Australia which, apart from the provisions of this sub-section, would not be included in the assessinent, and all expenditure exclusively incurred in gaining those premiums or considerations or that income; and

the part of the expenditure incurred in the general management of the business of the company (but not including any expenditure exclusively incurred in gaining or producing the income included in the assessment) which bears to that expenditure the proportion which the sum of the premiums, considerations and income mentioned in paragraph (a) of this sub-section bears to the total income of the company derived from any source whether in. or outside Australia.”

– That is so.

Amendment agreed to.

Mr SCULLIN:
Yarra

.- I ask the committee to reject this clause for the reasons which I and some other honorable members gave during the second-reading debate. It has been argued that some of the States impose this taxation. But surely we are not obliged to follow a bad example. Many protests have been made against the States imposing this taxation, for it really penalizes those who are attempting to make some provision for the uncertainties of life and for old age. It may be argued also that this taxation is justifiable because we tax people on their savings bank interest. The reply to that argument is obvious. The only savings banks depositors who are taxed are chose who are in receipt of an income of more than £300 per annum. If we agree to the taxation sought to be imposed under this clause we shall tax a great many people whose income is considerably below £300 per annum. Our income tax legislation also exempts from taxation premiums paid upon life insurance policies up to a maximum of £50. If the object of this proposal is to increase the revenue, it would be far better for us to remove the exemption from taxation of premiums. It has been pointed out that these life insurance companies handle money from nearly 2,000,000 people. There are more than 2,100,000 policies in force. Allowing for the holding of more than one policy in some cases, the income of the companies would undoubtedly come from nearly 2,000,000 different persons. I submit, therefore, that we are seeking to tax well over 1,500,000 persons whose incomes are below the statutory exemption, and we are doing it by a subterfuge. The honorable member for Warringah (Mr. Parkhill) said this afternoon that we were imposing indirect taxation of this description through our Customs Department. Insofar as we are taxing commodities solely to obtain revenue that is true. Some customs duties are imposed chiefly for revenue purposes. I am not speaking at the moment of the taxation on luxuries. Many of our alleged protectionist duties are really revenue duties. I have never supported these to any great extent, though I am an ardent protectionist. We should not attempt to impose this taxation by an underhand method.

Mr Maxwell:

– The honorable member should not call it an underhand method ; it is indirect, it is true.

Mr SCULLIN:

– I did not mean to suggest that it was underhand as between the Government and the Parliament, but it is certainly underhand as between the Parliament and the people. The honorable member for Maribyrnong (Mr. Fenton) pointed out this morning that we are attempting to “rope in” more than 1,500,000 persons who are at present exempt from taxation. I object to that being done, and ask the committee to vote against the clause.

Mr FENTON:
Maribyrnong

– I was under the impression at first that the amendment to this clause, to which we have just agreed, removed some of the vital objections to it; but I can see now that that is not so. I have a very strong objection to the taxation of life insurance companies which are operating on the mutual principle. The Leader of the Opposition has effectively replied to the argument of the Treasurer that savings bank depositors are taxed. He has indicated clearly that there is no analogy between that practice and this proposal. Savings bank depositors are only taxed upon the interest they receive from their deposits if their income from all sources exceeds £300 per annum. We have, roughly, 4,500,000 savings bank depositors. It is estimated that we have 250,000 income taxpayers. It will be seen, therefore, that 4,250,000 savings bank depositors are at present exempt from taxation. Many holders of small life insurance policies are also at present exempt from taxation because their total income does not exceed £300 per annum. But if we agree to this clause we shall oblige them to pay taxation, simply because they are endeavoring to provide for their old-age, or for a rainy day. We exempt from taxation payments up to £50 made as premiums upon life insurance policies, and also superannuation payments, because it is regarded that they are a form of thrift that should be encouraged. For the same reason contributions to friendly societies are properly exempted from taxation. In these circumstances it would be cruel for us to agree to this clause. The ex-Commonwealth Statistician, Sir George Knibbs, made some interesting remarks on this subject when addressing the shareholders in the Colonial Mutual Life Assurance Society recently. He said -

What all thosewho belong to a mutual society would do well to keep in remembrance is that the whole profits belong to the policy holders, and are distributed among them, in which respect it differs fundamentally from a proprietary company, and that is really the great advantage which we have in Australia, that our large companies generally are mutual and not proprietary.

Sir George Knibbs is quite right in that contention. The same distinction was made by the Privy Council itself, when an attempt was made to encroach upon the funds of the policy holders of Great Britain. In a notable case, Rex v. Styles, the Privy Council held that mutual life assurance companies are not formed for profit or gain, and that, therefore, their earnings did not come within the province of taxation. I hope that the Treasurer will relent in this matter. If the honorable gentleman penalizes the £7,000,000 which has been earned by insurance companies from investments, he will take £850,000 per annum from the policy holders. The Treasurer may claim that it will represent hut a few shillings from each individual policy holder, but over a period of ten years that extra taxation will amount to £3,500,000, which will be a noticeable additional burden upon those who receive small wages, and are endeavouring to provide for old age and a rainy day. One of two things must happen. Either the insurance companies will reimburse themselves by increasing their rates, or the bounties paid to policy holders will be reduced. I strongly disapprove of the raising of interest. Our insurance companies have done splendid work in investing their money in this country. They have advanced £10,000,000 to people engaged in rural pursuits, £25,000,000 to those desiring to build or purchase homes, and have invested something like £60,000,000 in war and other loans. The effect of this legislation will recoil upon the heads of its* originators, and it is almost certain that another Parliament will repeal it in the near future. I feel confident that the 2,000,000 policy holders concerned will have something to. say in the matter, as there is an important principle involved. I shall vote with my leader to have deleted every provision in the bill which adversely affects insurance companies, and I hope that we shall have the support of honorable members opposite who have definite views on the subject. The Treasurer is becoming more and more a law unto himself, a law almost like that of the Medes and the Persians, unalterable. I hope that the division on this clause will disillusion the honorable gentleman.

Dr EARLE PAGE:
Treasurer · Cowper · CP

– It does not follow because 2,000,000 policies have been issued by insurance companies that 2,000,000 different persons are insured, as many people take out several policies. The same remark applies to savings bank accounts. The honorable member for

Maribyrnong (Mr. Fenton) stated that there are 4,500,000 savings bank accounts in Australia, but it does not at all follow that there are 4,500,000 depositors. Therefore, the number of people whom this taxation will affect indirectly will be very much less than was claimed by the honorable member.

The Leader of the Opposition (Mr. Scullin)said that there are two alternatives to the proposal to tax insurance companies. I think that the honorable member agrees that it is necessary to collect additional revenue in order to continue the policy of this Government in regard to old-age, invalid and returned soldiers’ pensions, advances to the States, and the ordinary departmental work. But he suggested that it would be preferable to increase the general rate of taxation, or to reduce the amount of deduction for insurance premiums paid, which is now £50.

Mr Scullin:

– I do not advocate that, but I argued that it would be more equitable to do that than to introduce the present proposal, which will impose additional taxation on people least able to pay it.

Dr EARLE PAGE:

– In any case, those are two alternatives that would have to be seriously considered if this proposal is abandoned, because it is essential that we should obtain sufficient to balance our budget, which disclosed an estimated surplus of only £13,000.

It is suggested that this is a measure of taxation affecting low-salaried people. Unfortunately, we have an example of such taxation, not only in our customs revenue, but also in the taxation of joint stock companies. In many cases the shareholders of these companies have only small incomes, but they are, nevertheless, taxed through the comp’any tax. Many do not earn sufficient to receive the advantage of the statutory exemption of £300, so that they do not receive any real concession from the existing taxation law.

Mr Scullin:

– I pointed that out earlier in the day.

Dr EARLE PAGE:

– It is impossible to rectify that inequitable state of affairs.

Mr Scullin:

– And now the Government is adding to the burden.

Dr.EARLE PAGE. - If we did not grant these exemptions we should increase the total amount of tax obtained from taxpayers generally. The allowance of £50 probably removes thousands of people from the. incidence of taxation, as it brings them below the £300 statutory exemption. If the £50 allowance were removed, it would very materially influence a large number of low-paid individuals. It is suggested that if this legislation is passed, and the proposed tax enforced, the immediate effect will be an increase in insurance premiums. I pointed out this morning that this tax would be paid out of the returns from investments which have been hypothecated for the purpose of meeting the liabilities of the various companies. The benefits given in return for premiums have been based on a 3½ per cent. or 4 per cent. valuation, and will be adhered to, the new taxes being met out of the surplus after paying that 3½ or 4 per cent. I admit that this may possibly lead to a slight diminution in the amount of bonuses paid.

Nobody has advanced an explanation why no protest has been raised in the States against this innovation. I have conversed with a man who controls a very big insurance company, and it has been admitted that an anomaly has existed that has been intensified by the issuing of loans free of taxation to insurance companies. Those companies have enjoyed greater returns because many of their investments have been free from federal taxation. The amount that will be collected as the result of this legislation will not be so large as that collected from the insurance companies as a result of State legislation. I contend, therefore, that they will not be penalized unduly, and I urge the committee to agree to the Government’s proposal.

Mr COLEMAN:
Reid

– I shall not deal with this proposal at length, because I believe that taxation of this description can be best dealt with by the constituencies. Undoubtedly, the tax is an imposition on thrift and frugality. Thebroad principle on which it is opposed from this side ofthe chamber is that the policy of the Government is that of greasing the fatted pig. During its term of office, its indirect taxation of all descriptionshas increased, and has borne very heavily upon the basic wage-earner. On the other hand, it has made taxation remissions which have greatly benefited the recipients of big incomes. When it assumed office in 1922 the income tax payable on a taxable income of £1,000 was £43, while it is now £30, a remission of £13. The income tax then payable on a taxable income of £2,000 was £134, while it is now £94, a remission of £40. That payable on a taxable income of £5,000 was £695, and is now £489, a reduction of £206, while the income tax payable on a taxable income of £10,000 was £2,452 on the 30th June, 1922, and is now only £1,725, representing a remission of £727. The Government, therefore, has no justification for attempting to impose additional taxation on people who are earning only a small wage, and who are compelled, by economic necessity, to insure against risks, and to provide for their future. On the other hand, there is every justification for protesting against this further imposition on the basic wageearner, when the wealthy of the community have secured such enormous remissions of taxation from this Government.

Mr GARDNER:
Robertson

.- I think that honorable members are all agreed as to the value of the work of the mutual societies. I was interested in the concluding remarks of the honorable member for Reid (Mr. Coleman), who suggested that the Government had done nothing to reduce taxation generally or to lessen the tax levied on those whose incomes are small. I remind the honorable member that an all-round reduction has been made, that the exemption has been raised so that the incomes of thousands who were previously included are not now taxable, and also that the child allowance has been increased.

Referring to the principle that the Leader of the Opposition (Mr. Scullin) has espoused in this debate, supported by other honorable members opposite, we know quite well that taxes are often passed on, and it is impossible to make sure that the burden falls on the shoulders of those intended by Parliament to bear it. Eor instance, the city land taxes are largely passed on to the public. A large proportion of the taxes levied on incomes is also passed on to the public, the bulkof whom are wage earners. No complaint is heard on that score, and, therefore, the Opposition appears to be straining at a gnat and swallowing a camel. So far as the mutual societies are concerned, it seems to me that if the bonuses were reduced the biggest policy holders would certainly suffer most, and the hardship imposed upon the small policy holders would be infinitesimal. If 2,000,000 contributors were taxed to the extent of £300,000, it would, mean an average of about 3s. per head. Those who hold the larger policies in the mutual societies would bear practically three-fourths of the burden imposed by the proposed tax, and therefore the impost upon the remaining contributors would be inconsiderable. Remembering the cost of Australia’s policy of protection, a tax that might not amount to 3s. in the case of the average small policy holder, and iu some cases might be only a fraction of ls, cannot be reasonably objected to. The tax proposed to be levied on the mutual companies is really a tax on profit that has been invested. We cannot escape from the principle that whatever tax is levied in a direct form, the burden is not usually borne by those who pay the assessment bill, but is passed on to the small Consumer. I have no hesitation in supporting the clause.

Mr MCGRATH:
Ballarat

– I am surprised that the Government has proposed this increased taxation. I read in the budget speech that it had no intention to increase taxation in any way. The right honorable member for Balaclava (Mr. Watt) has made reference to the “trust to luck” budget, and has mentioned that it contains no proposal to increase taxation. Now the Treasurer comes along with a proposal to tax the most thrifty section of the community, forgetful of the fact that only a year ago he gave the wealthy section the benefit of a reduction in taxation.. In the dying hours of this session, the Government proceeds to impose an additional tax on those who can least afford to bear such a burden, and who should be encouraged in their thrift. Let me remind the Treasurer that in 1917-18, the indirect taxes amounted to £2 13s. Id. per head of the population, and in 1926-27 to £7 2s. 6d. Direct taxes in 1917-18 amounted to £2 5s. 8d., and in 1926-27 to £2 10s. 2d., making a total of> £4 18s. 9d. in 1917-18, and £9 12s. 8d. in 1926-27. Side by side with that alarming increase there has been a decrease in the taxes imposed on those who can best afford to pay them. The form of taxation under consideration was imposed for the purpose of meeting the expenditure caused by the late war. The patriots of this country were prepared to undertake any responsibility of that kind to ensure the succeess of the war, but now that safety has been secured this tax has been continuously on the decrease. We now have a proposal to increase by about £300,000 per annum the burden of the poorest members of the community. The honorable member for Robertson (Mr. Gardner) need not talk about the wealthy policy holders in the mutual societies, because most of the members hold policies ranging from £200 to £400.

Mr Gardner:

– What would be the cost to each member on account of a reduction in bonuses sufficient to meet this taxation?

Mr McGRATH:

– No matter whether the premiums were increased, or whether the bonuses were reduced, the members of the societies would be taxed just the same. This is a contemptible way in which to treat persons of thrifty habits who make sacrifices in order to provide for the future. The present Government is living up to the name it has earned as the rich man’s Ministry. In the dying hours of the session it panders to those who live in wealth and luxury, while the poor and thrifty section, who cannot organize to protest against this form of legislation, have to submit to an unjust impost. If the Government had brought down a proposal to increase the tax levied on those with hig incomes, restoring a law that obtained a year or so ago, those concerned would cause a lot of trouble to the Ministry, because they supply the party funds of the Nationalist party. I realize that the Government has the necessary numbers to carry this proposal; but the issue will he revived before the electors. The sooner the election is held the better it will be. I have heard it suggested that the Government proposes to ask honorable members to sit next week. That may suit the Government’s game. Personally, I advocate brief debates and a few divisions on important subjects, so that the earliest possible appeal may be made to the people. The Opposition will probably be defeated on this clause, but I hope that early next year the Labour party will have an opportunity to rescind this provision.

Question - That the clause, as amended, be agreed to - put. The committee divided.

AYES: 27

NOES: 14

Majority . . . . 13

AYES

NOES

Question so resolved in the affirmative.

Clause, as amended, agreed to.

Clause 9 (Taxation of company where distribution not reasonable).

Mr LATHAM:
AttorneyGeneral · Kooyong · NAT

– This proposed amendment of section 21 is made retrospective by clause 22. Therefore, it is proper that some special information with regard to it should be given to the committee. Difficulties arising out of the interpretation of section 21 were brought before the Supreme Court of Victoria recently in the Kellow-Falkiner case. Section 21, as honorable members know, enables the Commissioner of Taxation to prevent what has been regarded as an evasion of the act in connexion with the distribution of income by a company. Under this section the Commissioner has a right to determine whether a sum or further sum, not exceeding an excess of two-thirds of the taxable income of a company over any amount distributed by it to a number of its shareholders, should reasonably have been distributed by the company. Section 21 is introduced by the words - “Where in any year a company has not distributed to its members or shareholders at least two-thirds of its taxable income, . . .

Honorable members will note the words, “ in any year.” In a later provision the Commissioner has to make a determination in respect of a financial year, and it has been held that he must apply his mind to the taxable income derived by the company during a financial year, that is to say, during a period ending on the 30th June of each year. Under section 32, it is permissible for the Commissioner to accept returns for a period known as the accounting period, other than a period ending on the 30th June. The accounts of many companies cover such other periods. Some concerns forward returns to the Commissioner for a period ending, let us suppose, on the 30th September, and it has been the. custom of the department to regard such returns as representing income derived during the preceding year ending on the 30th June. The act has been administered in that way, and no difficulty has arisen. Hundreds, possibly thousands, of assessments have been made on that basis. Now, however, the point has been taken that under section 21 the Commissioner must consider whether a company has, during a period of twelve months ending on the 30th June, distributed a reasonable portion of its income. It is impracticable for him to do that in the case of a company whose accounting period ended on the 30th September. I think I am right in saying that these accounting periods have been accepted by the Commissioner in lieu of the period ending on the 30th June, at the request of the companies concerned. But because the Commissioner, for the obvious convenience of the business of a company, has acceeded to the request, it now appears that section 21 is inoperative. This is one of the difficulties with which this amendment deals. It is proposed to make the amendment apply during the whole of the period of the history of section 21. In the circumstances this is proper, because, as I have explained, the differing accounting periods have been accepted by the Commissioner at the request of the companies concerned in lieu of the period of the financial year ending 30th June. But there is a further point. It is necessary under the same section for the Commissioner to consider what profits could reasonably have been distributed during some period of twelve months, and it has been held in the Kellow-Falkiner case that the Commissioner must apply his mind to the distribution that could have been made by the company during the twelve months, whether for the period ending 30th June, or some other period. As honorable members are aware, as a general rule the accounts of a company are kept in such a way that only when the financial year is over is it possible to consider whether a distribution of profits could have been made in the year by way of dividends. In some cases a company declares an interim dividend in the course of the year; but the general practice is to make up the accounts, ascertain the profits and distribute the dividend in the beginning of a new financial year. As I have stated, the court has held that the Commissioner must apply his mind only to such distribution of income as could reasonably have been made in the twelve months in which the profits have been derived. This again is an entirely new point. There is no meritorious substance in it at all. It arises out of the technical wording of the section. If now an alteration were made in the law, a large number of assessments would be declared to be invalid. The object of the first sub-clause now before the committee is to put this matter right.

Mr PARKHILL:
Warringah

– The view I wish to emphasize is that whenever there is reference in a bill to retrospective legislation, the business community assumes that its effect will be more far-reaching than is apparent on the surface. If, however, the term in regard to these particular clauses is to be interpreted as stated by the AttorneyGeneral and the Treasurer. I’ shall be perfectly satisfied.

Clause agreed to.

Clause 10 (Taxation of a mining company).

Mr A GREEN:
KALGOORLIE, WESTERN AUSTRALIA · ALP; FLP from 1931; ALP from 1936

.- In my second-reading speech I protested against the taxation proposal as applied to mining companies, and I regret that the Treasurer (Dr. Earle Page), in his reply failed to indicate whether the Government intended to honour the promise of the Prime Minister (Mr. Bruce) that prospectors would be exempt from taxation. In reply to a deputation which waited on him in Kalgoorlie on the 2nd July last, the Prime Minister stated that the representations made would be brought before the Treasurer at the earliest possible moment. This is the first bill introduced since then to deal with taxation. The gold-mining industry, is in a parlous condition. The Development and Migration Commission, which made an inquiry into the industry, stated that its position was entirely different from that of any other primary industry in the Commonwealth. Prior to the war the price of gold was £4 4s. 11½d. per fine ounce and the industry was free from taxation. The price of gold is the same to-day, but there has been -an increase of 100 per cent, in the cost of the materials necessary for carrying on the industry. Gold-mining in Australia has become decadent, not because there is no more gold to be discovered, but because the price of the commodity has remained stationary whilst the cost of production has increased by 100 per cent. As a result, practically no men are going out to search for gold. We are all familiar with the gambling instinct that prompts a number of men to band together and “ grubstake “ a prospector. It is safe to say that there has not been a return of 10s. for every 20s. expended in equipping prospectors for this work.

Mr Watkins:

– Not 5s.

Mr A GREEN:
KALGOORLIE, WESTERN AUSTRALIA · ALP; FLP from 1931; ALP from 1936

– Probably the honorable member for Newcastle is right. If this enterprising spirit in a mining community .is not to be entirely destroyed, relief from taxation must be given by the Government. It is iniquitous to levy taxation on a man who finds gold after perhaps ten or fifteen years’ work, during which time he may have had practically no income.

Mr Gregory:

– And his capital in the company may he represented in shares.

Mr A GREEN:
KALGOORLIE, WESTERN AUSTRALIA · ALP; FLP from 1931; ALP from 1936

– As the honorable member for Swan has interjected, the prospector may get as his reward for a find 5,000 shares in a company and only £1,000 in cash, and the Government will levy taxation upon the market value of shares which, in a few months, may be worth nothing. Thus it is possible for the cash reward obtained by a prospector to be greatly reduced.

Dr EARLE PAGE:
Treasurer · Cowper · CP

– I regret that, in my reply to the second-reading debate, I did not refer to the points raised by the honorable member for Kalgoorlie (Mr. A. Green), but I intimated that a number of matters mentioned by certain honorable members could better be dealt with in committee. The specific point raised by the honorable member should have been discussed on clause 5. This provision is inserted in the bill because a special deduction made in respect of ordinary companies has now been made general, so there is no longer a necessity to retain paragraph d of section 22. Some years ago the Government decided to exempt the gold-mining industry from income taxation altogether. It made a number of concessions to prospectors, and gave a certain measure of assistance to the industry by ‘special grant, but the concessions from this grant can only be obtained as a result of applications from the State Governments concerned.

Mr A GREEN:
KALGOORLIE, WESTERN AUSTRALIA · ALP; FLP from 1931; ALP from 1936

– Yes; but to the extent of only £4,000.

Dr EARLE PAGE:

– That is a matter for the State Government. All applications and any complaints about them should be made to that body. Regarding the position of prospectors, let me say that before I visited Western Australia some two or three months ago I answered certain letters on this subject, and in my replies I pointed out that no prospector would be charged income tax on the sale of his leases unless he were trafficking in them. The point really that has to be considered by the Taxation Department is whether the prospector has taken up his claim for the purpose of working it, or merely for the purpose of selling it at the earliest possible moment. If, in the opinion of the department, he is a bona’ fide prospector, he is free of income taxation. When I was in Western Australia, this question was not raised, and I therefore took it for granted that it had been completely answered by the statement made by the Treasury and the taxation office. If it is felt that the position is not sufficiently covered, I am quite prepared to insert an amendment in the bill when it is before another place, to exempt specifically from taxation the proceeds of the sale of a mining proposition which has been prospected and worked by a field prospector; but it is considered that the backer who is making his living in trafficking in leases should not be exempt.

Mr A GREEN:
KALGOORLIE, WESTERN AUSTRALIA · ALP; FLP from 1931; ALP from 1936

– What does the Treasurer mean by field prospector?

Dr EARLE PAGE:

– The man who is doing the actual work of prospecting. It would be quite easy to differentiate between the field prospector and the man making his living by buying and selling leases. If necessary, I am quite prepared to have a clause drafted to ensure that prospectors shall be exempt from taxation.

Mr GREGORY:
Swan

.- I do not think that the announcement of the Treasurer is at all compatible with his previous statement that all persons interested in prospecting except those making a living in trafficking in leases would be exempt from taxation. I wish to endorse the remarks of the honorable member for Kalgoorlie (Mr. A. Green) concerning the difficulties experienced in the gold-mining areas. The report of the Development and Migration Commission on the gold-mining industry contains an appendix showing the price of gold over a period of years, and with the exception of a short period when there was a premium given on a sale of gold, the price has remained stationary. Before the war it was £4 4s. lid. an oz., and to-day it is the same ; but at the same time there has been an increase in the cost of living and in wages of nearly 100 per cent. Is it any wonder that to-day, notwithstanding the ‘ wonderful latent resources and the enormous auriferous and metalliferous areas of this country, we have difficulty in trying to develop it? I know that under this bill it is practically impossible to improve the position other than to give effect to the definite promise that the definition of prospector shall include a person who. assists prospecting other than a- trafficker in leases.

Dr Earle Page:

– I am quite prepared to accept an .amendment if the honorable member can suggest a means whereby a differentiation can be drawn between the trafficker and the man who is doing the actual work of prospecting.

Mr GREGORY:

– When I was in Perth the other day I was asked to take up a share in a syndicate. I took up a £10 share fully paid-up. Other shares were paid up to £5. About 50 other persons, including the late manager of one of the big mines of Western Australia, took up shares. By collecting money in this way we are able to send men outprospecting. The idea is to assist the gold-mining industry on the understanding that those who are giving the assistance shall be free from taxation on the sale of any leases. I have never made a penny out of the assistance I have given to prospectors. In the early days I was associated with mining companies, but they did not traffic in leases. The company promoter would come along and say “I shall- arrange to give you £1,000 in cash and £5,000 or £7,000 paid-up £1 shares in a company that we are going to form.” The usual charge was 6d. or ls. each for the application and the allotment. The agreement provided that no shares were to be placed upon the market until the expiry of six months. As soon as the company was started, taxation would be demanded. I do not know the position to-day. In the early days I read in the Kalgoorlie newspapers of men who went insolvent rather than pay the tax that was demanded of them. I know that taxation was imposed upon the shares that I received. At that time we had the promise that those who were associated with prospecting should, in the event of a sale, be exempt from taxation. I stress that point to show that we should do everything within our power to encourage men to go out prospecting. I have known men to prospect for fifteen or twenty years before striking a good show, and no one deserves success more than that class of man. Something should be done to exempt from taxation the man assisting in prospecting. I do not think that the broker or company promoter should escape taxation in any shape or form. Only a few days ago I sent to the Treasurer a letter from the Income Taxpayers’ Association, asking for certain information on this subject. If he will promise to give exemption- under this clause as I have suggested, I can assure him that the people on the gold-fields will be exceedingly thankful.

Mr A GREEN:
KALGOORLIE, WESTERN AUSTRALIA · ALP; FLP from 1931; ALP from 1936

.- The bill should contain a definition in regard to trafficking in leases. The Treasurer seems to have a wrong impression concerning the backers of prospectors. There can be found in any gold-mining community working men and men in small businesses who are prepared to putaway £1 a week of their wages with the ultimate object of backing prospectors. It is done more in the sporting spirit, because it has been shown that for every £1,000 expended in that way not more than £500 has been returned. It is not an ordinary business proposition. Under these circumstances why should these backers be treated as speculators or company promoters? The question oftrafficking should be investigated. I am. sure that if the Commissioner of Taxation visited Kalgoorlie and interviewed the workmen and shopkeepers there he would return satisfied that they could not be considered as “ bucket-shop “ men or men out to make large profits at the expense of others. The men in Kalgoorlie and other mining towns cannot be put in that category. If they were to withdraw their support from the prospectors there would be little prospecting carried out in Australia to-day. The day of the prospector going out alone with a few pounds’ in his pocket is past. There are few outcrops to be seen. He must get below the overburden which hides the gold from view. The Treasurer pointed out that the Precious Metals Prospecting Act was framed with the idea of assisting prospecting. We know very well that no State can obtain benefits under that legislation until the whole of its vote for prospecting has been expended. That is no way to assist the industries. In two and a half years only £4,000 out of £40,000 has been expended in this way. That clearly shows that the position in respect of prospecting has improved but little. At present the sword of Damocles is suspended above those who are anxious to encourage the gold-mining industry. If they expend their small savings in backing a prospector and have the good fortune to obtain some little return for the investment, they know not at what moment the whole of it will be absorbed by way of taxation. This Government would do well to introduce an amendment to remove this anomaly.

Mr COOK:
Indi

.- I have much pleasure in supporting the remarks of the honorable member for Kalgoorlie (Mr. A. Green) and the honorable member for Swan (Mr. Gregory). Their request should be given careful consideration by the Treasurer. There is no doubt that the prospector is entitled to more assistance than he is at present receiving. I am glad that the Treasurer has promised to draft an amendment with a view to inserting it in the bill when it is before another place. I am prepared at all times to support any legislation the object of which is to assist the gold-mining industry.

Clause agreed to.

Clauses 11 to 21 agreed to.

Clause 22 (Application of act).

Mr GREGORY:
Swan

.- Will the Treasurer inform the committee whether there is anything of a retrospective nature in any of these amending clauses ?

Dr EARLE PAGE:
Treasurer · Cowper · CP

– There are retrospective provisions in clauses 4 and 9, and in part of clause 19, but all such provisions deal merely with the accounting period already referred to by the AttorneyGeneral.

Clause agreed to.

Title agreed to.

Bill reported with amendments ; report, (by leave) adopted.

Bill (by leave) read a third time.

Sitting suspended from 6.7 p.m. to 8 p.m.

page 6811

QUESTION

BUDGET, 1928-29

In Committee of Supply: Consideration resumed from 13th September (vide page 6724) on motion by Dr. Earle Page -

That the first item in the Estimates under Division 1. - The Parliament - namely, “ The President, £1,300 “ be agreed to.

Mr SEABROOK:
Franklin

. When speaking on Thursday last I pointed out that one reason for the drop in our export of jam from 44,000,000 lb. in 1919-20 to 2,300,000 lb. in 1926-27, was the fact that Australian jam manufacturers were not getting sugar at world’s parity. A greater reason is the extra cost of manufacture brought about by the increased rates of wages awarded by Arbitration Courts. It is the duty of the Commonwealth Government to see that the agreement entered into with the Queensland Government is so policed that the jam manufacturers of Australia can get their sugar at world’s parity. That I am supported in this contention by Mr. Berchdolt, a member of the Sugar Board, is proved by the following : -

It seems to us that Mr. Berchdolt’s figures fully support the attitude we have adopted all along. With Belgian refined sugar being quoted at £15 17s.6d. per ton c.i.f. Australian port, why is not the present export price to the Australian manufacturer based upon this figure? As you will notice, the present rebate is on the basis of £12 15s. per ton, which makes our sugar cost £1711s.8d., and if our sugar was supplied to us as it should be on the f.o.b. European port value, we would then only be paying £15 17s. 6d. less the freight to Australia, or say about £14 per ton, and that, mark you, is a price for refined sugar, not for mill-white sugar.

– They receive lid: per lb., and they actually lost £d. per lb. on the 7,000 cases exported. But that trade helps the growers. The Government has repeatedly refused the request for a bounty, and I am unable to understand its attitude, having, regard to the fact that it has granted bounties on the export of dried fruits and wine. This differential treatment is manifestly unfair. The Development and Migration Commission, in its latest report, says -

At the request of the Board of Trade, the apple-evaporating industry of Tasmania is also being investigated.

Last year the commission sent to Tasmania two mcn, who spent a fortnight in investigating the evaporating industry. Their work could have been done in one day. They reported to the commission, and subsequently the chairman, with a staff of about five, went to Tasmania and conferred with the evaporators. After talking for some time, he asked them if they could stabilize the, industry if granted a bounty of 2d. a lb. I was present, and replied “ Yes, just as the peach industry has been stabilized ; it is still receiving a bounty.” The Board of Trade recommended that a bounty be not granted to the evaporating industry. Further representations were made to the Development and Migration Commission, which again sent two men to the island to further investigate the subject. That is the way in which the funds of the commission are being frittered away. This industry can be stabilized only by granting a bounty. The apples are shipped in 28-lb. boxes, at a price of 6d. per lb. f.o.b. To make 6 lb. of dried fruit, the evaporator has to use 50 lb. of green apples, for which the grower receives ls. If the bounty were granted to the evaporators the grower would receive 2s. a bushel for his apples; 7,000 cases represent 35,000 bushels, worth to the grower, at ls. a bushel, £1,750. But there is no reason why the export trade should not- be three times the present volume, and 21,000 cases would represent 105,000 bushels of green apples, or a return to the grower of £5,250. If a bounty were granted the green apples would be worth to the orchardist £10,500. With the Australian market and a potential market abroad, the evaporating industry is capable of helping the growers considerably and stopping the present colossal waste of a primary product throughout Australia. I hope that the Government will reconsider the advisability of assisting this industry, and remember that no State has a greater claim than another for a bounty on exports.

I have been unable to understand the Government’s reason for reducing the grant to Tasmania from £378,000 to £220,000. The Development and Migration Commission was asked to investigate the facts, but the Government has not carried out its recommendations. The commission’s last report states -

The recommendations contained in the commission’s first interim report for the expansion of the Agricultural Department were communicated by the Commonwealth Government to the Premier of Tasmania in May. 1027. The recommendations were wholly adopted by the Tasmanian Government, and effect has been given to them to a large extent in the financial year 1927-28. The cost has been defrayed by an allocation from the surplus which it was anticipated would be realized in that year as a result of Commonwealth financial assistance.

The commission recommended that the surplus should be used to finance the scientific bureaux that have been established in Tasmania, but the Treasurer has flouted that advice, and deducted the amount of the anticipated surplus from the Commonwealth grant. Other costs imposed upon the State Government by the commission, amounting to £29,600 for the current financial year, have been deducted. So far as I can see, the people of Australia are getting no benefits from the operations of this commission. Its annual report recommends that the Government of Tasmania should spend £105,600 over five years on topographical surveys of the mineral and forest areas of the State. What is the use of costly mineral maps when there is no mining in the country because of the cost of production? The honorable member for Kalgoorlie (Mr. A. Green) said this afternoon that the cost of winning gold is more than its value, and that is true of other minerals also. Why should we waste money on elaborate surveys and costly maps when the mining is finished, and timber mills are closed down? I am beginning to wonder whether it is worth while to continue the commission. Another illuminating paragraph from its report reads -

At the instance of the commission, tests on the utilization of Tasmanian apples for cider and apple brandy manufacture are proceeding at the Agricultural and Horticultural Research Station, Long Ashton, Gloucestershire, England, where a report dealing generally with the utilization of surplus apple crops is also being prepared.

For the last 30 years cider, as good as can be made in any part of the world, has been produced in Tasmania. The future of this industry, as of others, depends upon the development of markets, and the commission could more profitably turn its attention to that subject than to merely writing futile reports. Its references to the fat lamb industry are equally fatuous. The export of fat lambs would be a good trade if the Tasmanian people were producing enough meat for their own consumption, but they import approximately £100,000 worth of meat each year. Growers know that they can get for their lambs only from 15s. to 20s. at the freezing works, as compared with from 25s. to 30s. in the ordinary saleyard. In those circumstances, they are not likelyto take their stock to the freezing works until they supply the home market ; they will sell in the best market. The report of the commission on that subject was made, some time ago, but, although the freezing chambers are in existence, I have yet to learn that they have opened their doors for the reception of fat lambs. This body of experts dealt also with the berry fruits industry, and suggested the growing of strawberries for Brisbane. We know from experience that when they arrived there they were rotten. I devoted four nights to reading a huge typewritten report by the commission on unemployment; in my opinion, it was the greatest rubbish ever committed to paper. I cannot understand how any intelligent men could imagine that the recommendations in that report would provide a solution of the unemployment problem. The commission’s effort in that direction was a sheer waste of time. It is significant that in none of its reports has the commission referred to the Arbitration Court, the Navigation Act or the tariff. Those are creations of the Government, and the commission must not criticize them, although they are the principal causes of unemployment.

I wish to refer to the Tasmanian gram, in connexion with which a recommenda-tion appears in the report of the Development and Migration Commission. It reads -

It is the opinion of the Commission that Tasmania will require Federal financial assistance for some years to come, and it is recommended that subsequent to the 30th June, 1928, the amount of such assistance should be fixed at a definite sum per annum for five years thereafter. This period is suggested as the minimum period in which a fair judgment of the efficiency of the remedial measures can be made, and its adoption would enable definite plans to be developed under stable conditions.

What has the Government done? It has reduced the grant to a minimum and proposes to pay the amount for only one year, although the commission recommends that, in order to permit the Tasmanian Government to prepare and carry out a proper developmental scheme, it should be paid for at least five years. The Government in reducing the grant to the extent it has is not acting in accordance with the recommendations of the commission or the wishes of the Tasmanian Government. We were informed by the Treasurer that the grant would be £205,000, but we find that after provision has been made for certain expenses incurred by the Agricultural Bureau, the amount has been reduced to £183,000. The report of the commission is to the effect that the cost of this work should have been paid out. of the surplus revenue which the Government, up to this year, has had under its control.

– I shall deal with that phase of the question in a moment. The Bombala is now making a fortnightly trip between Hobart and the mainland, although the Tasmanian people previously had the benefit of a weekly service. When the Riverina, which was lost some time ago, was in the trade, a weekly service for the carriage of cargo and passengers was conducted. The Riverina, which was suitable for the trade, was 24 years old, and the Bombala is also 24 years old. When the Riverina was running between Sydney and Hobart she went right down the Huon and loaded 30,000 to 40,000 cases of fruit; but the shipping company have now two cargo boats picking up this trade, which leaves the passenger vessel without any cargo. If the company were to take off one of those cargo vessels, the regular vessel would be able to pick up 30,000 to 40,000 cases of fruit weekly. It is unfair to say that the service is not paying when it is conducted in that way.

– There are six GOal mines in Tasmania which are now supplying practically the whole of the coal requirements of that State. If the price of Newcastle coal is reduced by 5s. a ton, the price of Tasmanian coal will have to be reduced accordingly. It is now 10s. a ton below the price of New South Wales coal. A further reduction of 5s. a ton will necessitate the closing of Tasmania’s coal mines, thus adding to the number of unemployed. In to-day’s newspapers we read that the directors of the Wonthaggi coal mines in Victoria are of the opinion that a reduction of 5s. a ton in the price of Newcastle coal will mean the closing down of their mine. Queensland supplies her own coal requirements, including gas coal. A bounty on New South Wales coal will affect the coal industry in Queensland as well as in Victoria and Tasmania. A reduction in the price of’ coal might be a good thing for the consumer; but if its effect is to close down a number of mines, the cure will be worse than the disease. Before granting a bounty on coal produced in New South Wales and exported, the Government should consider its effect on the coal-mining industry in other States. For the unsatisfactory position of the coal industry in New South Wales! the miners are solely to blame. Frequent strikes, stop-work meetings, and short hours have made it impossible for the mine-owners to sell coal at reasonable rates and make a profit. The seriousness of the position will be realized when we reflect that the South Australian Government is importing coal from England at 7s. a ton less than it can be obtained from Newcastle. There -have been more strikes among the coal miners in the Newcastle district than in any other industry in Australia.

Mr E RILEY:
SOUTH SYDNEY, NEW SOUTH WALES · ALP

– That is not true.

Mr SEABROOK:

– It is. I hope that the Government will give further consideration to this matter before paying any bounty on coal.

Mr BRENNAN:
Batman

.-The honorable member for Franklin (Mr. Seabrook) knows much about many things, but he specializes in apples. I feel certain that he is conversant with the whole of the apple industry from the time that the fair one, in fig leaves, condemned us all because of a bite of a golden pippin. I do not propose to follow the honorable member and his special grievances which he seems to enjoy so thoroughly, and under which the little island State is supposed to labour. Many suggestions have been made to overcome Tasmania’s difficulty. I, myself, made one when I interjected that Tasmania should be pushed over and joined to Victoria. The honorable member for Franklin, no doubt, will not take the suggestion seriously.-

I regret that the Treasurer is, presumably for good reasons, at present out of the chamber, for it is his duty to sponsor the budget now under discussion. I should like to congratulate him on something. I cannot congratulate him on his budget, or on his deficit; but I may be permitted to congratulate him upon his political longevity. It appears that he has established a record in point of time as Treasurer of the Commonwealth. When a man reaches advanced and venerable years, and others begin to congratulate him as successive anniversaries of his birth arrive, they do so with good will and enthusiasm; but in such circumstances it is not considered good form to remind him of his misspent youth. I therefore congratulate the Treasurer, with reservations, but without any painful - references - political, of course - of the kind I have mentioned. I congratulate him further upon the cheerfulness with which he accepts the kicks as well as the ha’pence incidental to his high office.

It is due to the committee and to my constituents that I should say something on the subject of financial geniuses mentioned by the Prime Minister. The right honorable gentleman paid the Leader of the Opposition (Mr. Scullin) a high compliment when he said that he had a flair for finance and an aptitude for figures. The Prime Minister could not have been more complimentary if he had been reciting the honorable member’s obituary. Although I am naturally a little envious at these compliments being paid to my honored Leader, I cannot deny the soft impeachment; he has indeed a flair for finance and an aptitude for figures. Then there is the right honorable member for Balaclava (Mr. Watt) who quite unexpectedly, was brought into the picture by the Prime Minister. It appears that by common consent he is a financial genius. At least, he was a financial genius by common consent until the Prime Minister, in a moment of pique, called upon him to choose between being either politically dishonest or not a financial genius after all. If we were called upon to make an invidious choice in this matter, I do not think that my decision would be such as to impair the reputation of the right honorable member for Balaclava as a financier. Nor must the honorable member for Henty (Mr. Gullett) be left out of the picture. I do not know whether he is a financial genius this year, but undoubtedly he was one when the last budget was presented by the Treasurer.

Mr E RILEY:
SOUTH SYDNEY, NEW SOUTH WALES · ALP

– The elections are too near for him to be a financial genius this year.

Mr BRENNAN:

– The time is probably inopportune for a further exhibition of that financial genius which the honorable member displayed last year, when he described the Treasurer as “ The most tragic Treasurer we have ever known.” As a Victorian - though in no parochial spirit, but solely in the interests of Australia - I desire to refer to the southwestern portions of the Melbourne metropolitan area. It is dreadful to think that in those strongholds of Nationalism two financial geniuses - one at a safe distance and with a long gun, the other at close range - should make attacks upon the Government they discriminatingly support. I tender my sincere sympathy to the Government in the circumstances. It may be said that we have five financial geniuses to reckon with in this chamber - the Leader of the

Opposition (Mr. Scullin), because the Prime Minister says so; the Prime Minister himself, because he undoubtedly thinks so; the right honorable member for Balaclava (Mr. Watt), because I have proved him to be so ; the honorable member for Henty (Mr. Gullett), because his last year’s speech is still hanging on the wall ; and last, but by no means least, the Treasurer himself, who is a financial genius ex officio. Federal Treasurers do not grow on every bush; they require years of training in the administering of anaesthetics and a knowledge of dissection, including vivisection. In addition, a successful Treasurer in the present Government needs to know something of the methods of resuscitating the apparently drowned. In concluding this little essay on financial geniuses, I may be permitted to add that I am not one.

One feels a little timorous about approaching the budget seeing that the Prime Minister has laid it down that it is most unfair to make a charge without advancing excuses. I can only plead that I belong to an older and severer school which flatters justice and puts mercy through a strainer. The Prime Minister doubtless would have adorned, if he had only followed, the law. He would have become familiar with the methods adopted by prosecutors, which are to state the charge with clear, crude, sometimes almost brutal clarity, then to call evidence in support of the charge, and to leave it to the unhappy person in the dock, with such aid as he may be able to secure, to make his defence and to put forward any facts that he can think of by way of mitigation. When the Prime Minister was being scorched the other evening by my honored leader, he appeared to forget for the moment that he and the Treasurer were - in a purely political sense - in the dock, one of them being charged as a principal and the other as an accessory before, after and in the middle of the facts.

Not being a financial genius, as I have already modestly admitted, and as the honorable member for Angas (Mr. Parsons) has graciously granted, I listened very attentively to the Prime Minister. I had already listened to the honorable member for Yarra (Mr. Scullin). I should have listened to the Treasurer hut for the untimely intervention of Nature’s soft nurse which prevented, me from doing so ; but the Treasurer may rest assured that I read his speech and that I nearly know it off by heart. Therefore, not as a genius but as a common juryman, I may be permitted to form some opinion on the facts. I know, of course, that jurymen sometimes disagree, but so also do judges, and so do financial geniuses. The Prime Minister pained me and roused doubts in my mind when he was discussing the speech of the Leader of the Opposition by referring to what he was pleased to call “ alleged facts.” There is a nasty implication in that word “ alleged.” Sometimes it simply means, in. legal phraseology, “stated but not proven “ ; but, judging by the manner in which the Prime Minister used the expression I think there was an innuendo in it that some things had been put forward as facts which were really not facts. That, at all events, is how I interpreted it. I was surprised, therefore, upon a careful review of my leader’s speech and a reconsideration of the Prime Minister’s, to find that none of his facts, as facts, were challenged. It is true that causes were challenged, inferences were disputed, and conclusions . denied. All those things were done with tremendous verbosity by the Prime Minister; but the facts as put before the public by” the Leader of the Opposition remained and still remain entirely unimpaired.

I shall restate the position very shortly. The Prime Minister himself said that the Government had inherited in 1922 a surplus of £7,400,000, and that at the end of the present financial year there was a deficit of £2,600,000. He added that the Leader of the Opposition had said that notwithstanding that the Government had come into office when there was an overflowing treasury it had “ frittered away “ the whole of the surplus and involved the country in a deficit. The Prime Minister said that the Leader of the Opposition had made that statement, and up to that point he admits that what he said is true. There can be really only one word in dispute in the whole sentence, and that is “frittered.” I unsuccessfully searched through the speech of the Leader of the Opposition to find any reference to the word. I thought it was an inapt term to apply to the spending of millions of pounds. You cannot be said to fritter away £14,000,000 by spending it at a rate of £7,000,000 at a time. The word is quite inappropriate when used in that sense. You may cart away £7,000,000 in a lorry or move it with a tractor, but to speak of frittering it away in such circumstances is to be guilty of an absurd misuse of language. That i§ the only point, I suggest, up to this stage on which there is any disagreement between the Prime Minister and the Leader of the Opposition. We may, perhaps, attribute to unpoetical license the use of the word “ fritter “ in these circumstances by the Prime Minister.

The right honorable gentleman went on to say that the Leader of the Opposition “might at least have given the people the facts.” I suggest that there is another innuendo here that my leader gave something as facts which unquestionably were not facts. What are these facts that he might have given? The Prime Minister said that £7,500,000 was spent in debt reduction, £7,400,000 on naval construction, £350,000 in scientific and industrial research, and large sums in aviation, geophysical surveys, prospecting for oil looking for precious minerals, and so on. What the Prime Minister doubtlessly intended to say was that the Leader of the Opposition ought, in mercy, to have given these excuses. But it is a difficult thing to give convincing excuses, and that, after all, is not the peculiar province of the prosecutor, but rather of the defendant. Let us, to use a familiar phrase of the Prime Minister, “ make the position perfectly clear.” We do not deny that the Government has spent this money. On the contrary, we affirm that it has done so. To that extent we are in entire agreement. We do not suggest that the money has been hidden in a cave in expectation of a rainy day that might come after the election, nor that anything of that sordid character has been done. We admit that the money has been spent.

Mr Scullin:

– And the Government’s defence is that it has spent it.

Mr BRENNAN:

– That is so. We have stated the financial position of the country in all its dreadful nakedness. It remains for the Government to make its defence or provide its explanations. The Prime Minister, when speaking from the other side of the table the other night, said that we would have the country believe that this money, had been’ spent, and that there was nothing to show for it. And this from the gentleman who has a flair not for finance, but for facts! On the contrary, we have gone to some trouble to show where the money has gone. We shall go to a little more trouble to show it still more clearly before the budget debate concludes. We shall also show that a great deal of it has gone where it should not have gone. The facts, from which there is no escape, are that at the end of June, 1923, there was an accumulated surplus of £7,500,000, and at the present time there is a deficit of over £2,500,000. In other words, the Government has slipped £10,000,000. That is not a poetic fiction, but a fact. Let us state the national debt figures in some detail, as officially supplied by the Treasurer’s department. The following table excludes debts on account of the States, but includes debts on account of the Federal Capital Commission, and the figures are, as at the 30th June each year: -

In other words we have not only slipped £10,000,000 in our revenue, but we have also slipped £14,200,000 in our public debt. These incontrovertible facts are alarming, and I suggest that the Government and its supporters should direct their attention to them instead of arguing all around them. Surely it is right that we, as an Opposition, should endeavour to focus attention on the outstanding fact that the finances of Australia are drifting seriously.

It must not be taken for a moment that while we admit that this money has been spent we approve of the manner in which the bulk of it has been used. There is the expenditure on defence, for instance, to which the Prime Minister grandiloquently says “ we are committed “ and on which we have spent over £7,000,000. We say that much of this money has been inexcusably wasted. The honorable member for South Sydney (Mr. E. Riley) dealt effectively with this subject the other night. I assert definitely that, in view of the present world situation, there is no justification whatever for the expenditure of millionson cruisers. It must not be taken for a moment that the Labour party approves of the lavish expenditure of this Government, which should be responsible, but which is evidently most irresponsible. It has been said that a certain amount of money has been spent in industrial research. We should like to have convincing proof that, in the present state of the public finances and the imperative need for economy, this expenditure can be justified. We are now looking for results. It may be that the expenditure on geophysical surveys of which the Prime Minister says so much may be justified at some distant date. It may be that the money spent in searching for oil will also be justified some day. It may be that the Prime Minister will be able to justify the use of his Aladdin’s lamp in looking for precious stones. But the burden of proof in all these matters rests upon him, and we wait in vain for him to discharge it. It is a matter for regret that the Prime Minister should have called to his assistance in defending the position the youngest recruit in this Parliament, the honorable member for Martin (Mr. G, Pratten). While it is a rule, and I think a good rule, not to challenge the maiden utterances of a new member, it is hardly playing the game for the Prime Minister to take shelter in the immunity from criticism which a new member enjoys. It is not quite fair to the new member. Since we are invited to discuss it, let rae say that I thought that the speech was characterized by modesty, simplicity, and, above all, by brevity, and especially upon the last quality I tender him my hearty congratulations. I think that the honorable member will be the very last to claim for himself the attributes of a financial genius, but it is likely that he does know something of finance from his association with business matters. The Prime Minister, with warm approval, quoted the honorable member as saying that when a wellmanaged company experiences a temporary setback it falls back on its reserve funds and uses them until conditions improve. It is interesting to read just what the honorable member for Martin (Mr. Graham Pratten) did say. Speaking of the Government, he said -

Because of the deficit it does not contemplate the curtailment of its programme. It has not called upon its shareholders, the people of Australia, to increase their contributions; but proposes to adjust its organization to meet the existing conditions, and relies on the huge resources of the Commonwealth to enable it to recover next year.

It will be noticed that the Prime Minister’s version of the unfortunate illustration of the honorable member states that a well-managed country will fall back upon its reserve fund in times of emergency. That is exactly what Australia should have done. It has “experienced years of phenomenal prosperity. Money has poured in through the customs in almost uncountable millions. Where has that money gone? I have shown that our public debt is increasing, that the Government has a deficit, and that now, after all those years of phenomenal, unexpected, and almost unbelievable revenues, the Government is unequal to the situation. At the very first breath of disaster it is budgeting for a deficit of £2,600,000. The honorable member for Martin suggested that we should rely on the huge resources of the Commonwealth. T shall put to the honorable member a comparison which, I am confident, he will understand. Suppose that this hypothetical company of which he spoke possessed a pastoral lease, and that over a long series of years it had had substantial and amazing profits such as have been enjoyed by the Commonwealth Government. Suppose,too,that on the sixth year, through “temporary” misfortunes to which reference has been made, the company found itself with a deficit. What would the shareholders say of their chairman of directors, if in his report, he stated, “ Gentlemen, it is true that we have had a setback. It is true that our profits for the last five or six years have been collected and are dissipated, and that we have a large overdraft. But I ask you, gentlemen, to rely with confidence on the boundless possibilities of this splendid property upon which your sheep are running”? That would be precisely a parallel with the case instanced by the honorable member for Martin. The analogy of the honorable member was unfortunate, because it brought out, and the Prime Minister was foolish enough to accentuate it, the fact that our surpluses have been dissipated, and that there is no reserve to offset our reckless expenditure.

It is worth remarking too that, apparently, our setback is not altogether temporary, for the Treasurer is cheerfully budgeting for another and similar deficit. More than that, the figures of receipts and” expenditure and customs receipts that are available go to show that the next deficit will be greater than the Treasurer is anticipating, and for which he is budgeting. The Prime Minister curries favour confidently with his friends by saying that it is most undesirable to increase taxation. The right honorable gentleman even made the suggestion, which was palpably influenced by the imminence of the general election, that we of the Labour party entertain, the’ sinister intention of retrenching the public service. That, of course, is too absurd to pursue further. While I agree with the Prime Minister that it is undesirable to increase general taxation, I suggest that it is even more undesirable, to be falling into debt, and at the same time remitting taxation to those best able to bear it. Notwithstanding our financial difficulties, the position of the public debt, and the increase in taxation generally, this Government has thought fit to placate its best-placed critics by remitting £400,000 to the richest landlords of Australia. While taxation is undesirable and unpleasant, I warn those honorable members who are supporting the Government that if that state of affairs continues, either additional heavy taxation or bankruptcy is inevitable.

Having dealt with the statements which he attrbuted to our Leader, and having made innuendoes in keeping with them, the Prime Minister said that we had made no suggestion dealing with the problem. I am not here to defend the Leader of the Opposition, as he would not desire it,, and I am certain he does not require it. But

I think that that was about the most audacious thing that the Prime Minister said in a more than usually audacious speech. Those who have some recollection of the history of budgets in Australia will remember that, during the discussion on the budget last year, the right honorable gentleman rose to answer the representatives of Labour and, disposing of our criticism in a large way said, “ Let them come down to details and show us what savings they propose to make. How are they going to cut down the expenditure? How are they going to balance the finances ?” The right honorable gentleman admitted that the balance of trade was bad, that our public debt was increasing, and that all that we had said was true. Yet he asked what we were going to do about it. The responsibility, for the moment, did not rest upon us to answer that question in detail but, in anticipation of a similar question on this occasion, the Leader of the Opposition, having made a general survey of the financial position of Australia, came down to details and drew attention to a long series of items of expenditure, which he called upon the Government to explain and justify, if it could. We still call upon it to justify and explain those items - if it can. The items related to only one of a number of departments, and totalled at least half a million. The Prime Minister, in reply, said, “ As to these matters of what he called petty detail that the Leader of the Opposition has gone into, and after all they amount to less than £1,000,000, I shall deal with them in due course when we are dealing with the several departments.” The right honorable gentleman did not make his original challenge when the estimates of a department were under review, but during the general discussion of the budget. He was answered in a debate on the general discussion, yet we still await details and justification for the expenditure connected with his own department. We suggest that the right honorable gentleman might reasonably be expected to understand his own department; we do not ask him to explain the expenditure of all the departments - whose expenditure runs into a great deal more than £1,000,000. The Prime Minister postponed the matter until a later date, and perhaps in the early hours of the morning; just when we are getting ready to “fold our tent like the Arabs, and as silently steal away.”

It is curious that when dealing with what he termed petty details, the right honorable gentleman had another complaint about our leader. He said, that that gentleman, in talking about the balance of trade, had quoted figures of such enormous dimensions that they almost staggered the imagination. They did stagger the imagination of the Prime Minister, and between his staggered imagination from figures that are too large, and his contemptuous disregard of figures that are too small, there remains a great deal to be explained by the Treasurer, the greatest of our financial geniuses. I shall quote the words of the Prime Minister in order toillustrate his attitude on the big subject of imports and exports, in respect of which he said that the Leader of the Opposition spoke in figures of such magnitude as to stagger the imagination. They are as follows -

In dealing with the customs tariff, he again took a point which he has often taken, and which has become very nearly an obsession with him; he said that any increase in our imports would inevitably indicate that the country was going back. The honorable member should remember that the prosperity and wealth of Australia have been increasing in recent years, and that even in countries which are highly protected, when prosperity increases, requirements increase concurrently. Even a country which is providing the greater part of its requirements by its own production, will in such circumstances increase its importations from other countries. The greater the prosperity of a country the greater its imports will be, because as its wealth increases its requirements are augmented. Therefore, that part of the honorable member’s criticism did not cause me the slightest anxiety.

There is much in that statement that is remarkable as being a mixture of the obvious and the absurd - obvious, of course, in the sense that if we have not prohibition the greater our prosperity the greater our imports will be. Taken in an absolute sense, that will probably be so. When trade is active and money abundant it is very likely that imports will show an increase; but the absurdity lies in the assumption that that states ment of the case has any important bearing on the point under consideration. It is not a question of the volume ofimports except in its very important relationto the volume of exports. So far from it being true that the Leader of the Opposition had said that any increase in the imports would inevitably indicate that the country was going back, I have heard my leader half a dozen times say in this chamber something entirely different. He has pointed out, not that the fact of the imports being greater than the exports in any particular year indicated financial instability - that might occur in an individual year and even for two years - but, as the lessons of history prove beyond doubt, that when we have conditions prevailing under which the imports exceed the exports over a long series of years this usually end in disaster. Not only does history prove it to be so, but every sound economic theory supports it. That, of course, is the answer in that regard to the Prime Minister.

The right honorable gentleman blended comedy with tragedy a little in connexion with our sinking fund, about which the Treasurer and the Prime Minister are both exceedingly self-complacent. When the .right honorable gentleman was dealing with the sinking fund I was inspired by a member of the Opposition to interject that the Government had floated more loans than it had sunk. The Ministerial forces, then ranged in full numbers behind the Prime Minister, were most concerned that I should not succeed in getting in my interjection. With one voice,, like trained choristers, they endeavoured to prevent the obvious retort to .the Prime Minister’s contention regarding his blessed sinking fund, namely, that he had floated more than he had sunk. The fact, of course, is that, notwithstanding its reduction of the public debt by the sinking fund, the Government has on the whole increased the public debt. There is no mystery about that. It is on record, and is not open to dispute. Therefore I marvel that a responsible man at the head of the Government should claim credit for’ the amount by which the public debt has been reduced by the sinking fund. In truth and in fact the public debt has been increased, in the aggregate. This tremendous public debt under which we groan was. incurred in comparatively abnormal times. It . is a legacy of the war, and having been produced under war conditions it is nothing less than disastrous that it should be continued progressively to the bad in normal and even in prosperous times, and in days of peace. That is the position as we present it to the country.

One contention of the Prime Minister to which I might make reference before I conclude is that the Government had sunk the debt for which it had nothing to show, and had incurred new debt in connexion with certain reproductive works. He instanced the post office. That is rather an illusory consolation when faithfully examined. Let me take an illustration which may again appeal to the honorable member for Martin and other honorable members whose private affairs are not regulated by millions but by much lesser sums, and whose unhappy lot it is occasionally to ‘have to raise money on more insignificant security than the whole assets of the Commonwealth of Australia. Let us suppose that an honorable member has a loan upon a part of hia estate. It is a grazing proposition, and for some reason or other is not producing very much. His banker calls attention to the fact that he has another area on which he is growing wheat fairly successfully and making profits. It is very likely that the banker will either insist on the mortgaging of the wheat-producing area, or at least will suggest that the mortgage be transferred to the better, asset. If, on the mortgage being so transferred, the profits from the wheat farm are used for the purpose of reducing the overdraft, and improving the owner’s position generally, so much to the good; but if no such progress is made, and the overdraft is increased from year to year, the owner will have gained nothing at all by transferring the loan from that part of his securities which is producing revenue to that part which is producing very little. That, at all events, is how the matter appears to me when reduced to its elements.

I still ‘have a number of things to say that are applicable to various parts of the budget on which I had intended to speak in this general discussion, but if I may conclude without profanity in the words of one who said, “ You cannot bear them now,” I would say to the committee that, perhaps, it cannot bear them now; at all events, I shall leave them for another occasion. I have endeavoured to assist in focussing attention upon things that really matter in connexion with the finances of Australia. Other speakers on this side have availed themselves of a similar opportunity. We have endeavoured to disperse the clouds that obscure the outstanding facts about which there should be no dispute hwatever, and which are not only disquieting, but positively alarming. After six years of unparalleled prosperity, Australia finds itself with a deficit, without reserves- and with its public debt mounting from year to year. We must grapple with this situation. The Government has had years in which to justify itself, and it has failed to do so. The final evidence of its failure is in the budget. If Ministers can justify themselves before the electors as the financial administrators of this country, then the electors are much more easily gulled than I imagine them to be.

Mr WATSON:
Fremantle

– I have been twitted in many quarters upon my long silence. There are several reasons, and at least two important ones, why I have refrained from participating in the debates in this chamber. One is that I am a diffident speaker under all conditions. I find it extremely difficult to address honorable members in this chamber. I do not know that anything I could say would be of national importance;, but I desire to express my exact thoughts so far as lies in my power. There is no reason why I should camouflage my opinions in any way. So far as I can see, I am on my political deathbed, and sometimes I think I can hear the political death rattle in my throat. Possibly as I proceed with my remarks other honorable members will hear -a similar sound.

Mr Brennan:

– Is it political suicide?

Mr WATSON:

– No.; but I cannot help myself. I entered this House as a political neophyte, and I still regard myself as one, and my position has been such that political life has been made rather difficult for me. I wish to place on record my appreciation of the fair treatment that has been extended to me by every honorable member. If I have failed in any way it is due wholly and solely to myself. Ministers, members, and heads of departments have all treated me with courtesy and consideration, and if -I shortly come to the end of my political career I shall always retain pleasant recollections of my personal association with honorable members. Of course, on the other hand, I realize that I may not die politically. The press, also, has been fair to me, because, after all, most sections of the press are saturated with party virus. I could say something frightfully nasty about a certain newspaper in my own State, but I do not intend to spoil my record. I have never uttered one bitter word about any one since I have been a member of this House, and I wish to preserve that record a little longer. I may, perhaps, be permitted to relate an incident which has some bearing upon what I propose to say. I well remember the first political speech which I tried to make from a public platform in Fremantle. I have to confess that it was a most miserable attempt. I am afraid that I completely lost my bearings, and talked a lot of rubbish. Naturally, I went home in a most miserable frame of mind, and concluded that I was the biggest fathead that had ever appeared on a public platform. But next morning, to my surprise, the journal to which I refer, in commenting upon my meeting, said something like this : - “ This man has a very pleasant way of speaking. His matter is good. As a matter of fact, he is a fine speaker, and also a great personality.” I concluded that the reference was satirical, until I noticed that a later comment referred to me as semiparty and said that I was certainly anti-Labour. I was an independent Liberal. I took the trouble to inform the newspaper that although I was not opposed to party politics based on principle and policy, I was against machine-made party government, and that I had ‘ no party leanings, that is, as party politics are understood in this House to-day. I then discovered that the writer of the comments concerning my political character had made a mistake, and that, after all, I was not the great man that I had been declared to be. From that day to this I have . been, according to the journal in question, the biggest fool in Fremantle. I could say a lot of nasty things about that newspaper, but I will not do so. I am content that the people of Fremantle, with whom I have lived for over 30 years, completely vindicated me, and trusted me the whole of the way. Actually, they gave me a free charter, a blank cheque. My one regret is that I have not, by way of public service, been able to fill in the cheque for a greater amount, and in that way justify more fully the trust which they have reposed in me. I should like the people to know that, had it been in my power to do anything for Australia or for Western Australia, no sacrifice on my part would have been too great. However, holding the views which I do - I do not suggest that necessarily they are right - it was utterly impossible for me to render that public service to the electors in Fremantle and to the people of Western Australia and Australia that I should have liked to give. I regret this very much, but if ever the opportunity comes I shall be prepared, and shall not hesitate to sacrifice myself in their interests.

Having made this explanation, I feel that the way is now clear for me to say what I think about the budget. I do not propose to discuss it at any length. From my point of view, the great array of figures contained in the Treasurer’s statement, the subtle deductions, the close analysis, the excuses, and the promises, are not what the people of Australia want. If you are in a bog and feel yourself sinking deeper and deeper, you will not feel that you are being helped very much if your friends on firmer ground come along and deliver you a lecture on, say, the latest system of logarithms. What you want most of all is a stout rope thrown to you by means of which you may be hauled out of the bog. That is what Australia wants to-day. I am notsaying one word against the Treasurer’s budget. It may be an honest attempt to present the facts of our present financial position. But this budget, like other budgets of recent years, both Federal and State, is remarkable more for what it conceals than what it reveals. It reminds me of the attitude taken up by a quack doctor. I have no desire to say anything disrespectful of the medical profession, the members of which I hold in the highest esteem ; but I suppose we all have had some experience of quack doctors, and speaking of this budget, and having in mind the simile that presents itself to me, I am reminded of the interview which conceivably might take place between a man with a sore toe and a quack doctor. The latter, when summoned to administer relief, probably would look profoundly wise and say something like this - “Ah! you are suffering from a lesion of the metatarsal joints in a pedal extremity!” The. person with the sore toe would then think along these lines, “ What a wonderful man he is ! How profound is his knowledge ! I have been carrying this foot about with me all my life and I never knew that I had one of those things in it!” But, unfortunately for him, the toe is still sore, and so he applies to the “ quack “ for relief. Then the “ quack,” still looking profoundly wise, sits down to write a prescription in dog Latin. This again impresses the man with the sore toe. He feels that it is all so wonderful that the prescription must have in it the necessary curative properties. Unhappily he is disillusioned when he finds that the application of the remedy specified affords him no relief, so, presently he begins to doubt the soundness of his judgment as to the profundity of the knowledge of the “ quack.” In the end, he is compelled to resort to the remedies used by his poor old mother. He applies a bread poultice, or possibly a linseed meal poultice, and a cure is effected. There is no doubt that the people of Australia fully appreciate the wonderful array of figures in the Treasurer’s budget, as well as the deductions, the explanations, and the analysis of figures by the several honorable members who have contributed to the debate. But I think that Australia is saying - “My head is aching .and my feet are sore, and I want so much to get relief. I have tried all these remedies before, and they have never cured me, so I am beginning to doubt whether they will on this occasion. I have a wonderful estate, full of natural resources, and only a small number of people to maintain. I have no less than thirteen boards of directors and nearly 700 members on these boards. These men are continually pouring out rivers and oceans of oratory, of invective, criticism and advice. They are all telling me what

I should do to be cured. Their, talking makes the Tower of Babel look like an anthill. But my head is still aching, and I am wondering if, after all, I shall not have to look to the simple remedy of honest work and fair dealing among my people to cure me.” Until Australia gets that, all the governments in the world will have no effect on her destiny. Let me quote figures showing the position of Australia to-day ; but before I begin I wish to make it plain that I am not a pessimist. I believe that Australia will rise above all her troubles. She will solve all her difficulties, and will ultimately become the standard bearer in the march to a better and more complete civilization than history records. Thatwill happen when her leaders are so placed that they can inspire us with a clearer and truer conception of national life and duty; but not until then. Nearly every honorable member believes that I have a rooted and eternal objection to .party politics. That is hardly true. I always have believed that we should be better governed under some system of proportional representation that would give the people an opportunity of expressing their desires, and some system of elective ministries under which ministers would be responsible to Parliament and Parliament directly responsible to the people. I have no objection to party government, based, as in the early days I understood it to be, on policies and principles that are almost forgotten to-day. Now I hope that I have made my position plain. I. have been consistent in my attitude. Not that I say that consistency is a virtue. Sometimes it is a weakness and a fault. I have never deviated from my opinion, and I have had no reason to do so. The following is an extract from one of my first political speeches.

Mr West:

– When was it made?

Mr WATSON:

– In 1914. It readsIn my opinion the present system of political control has no relation to what has been for many years known as the party system, lt appears to me to have begun its active life in about 1911, and has developed into a purely mechanical machine system, depending for its life on sectional or class hatred, in. which independent thought and action can have no part.

– I was not; I voted against the bill. The ostensible purpose of the measure was to compel both parties to honour the terms and conditions of awards. Apparently, the view of the Government was that until that time only the employers had been compelled to obey the awards, the workers doing so only when it suited them, and at other times flouting the decisions of the court. Undoubtedly, that had happened in some cases, but one must look at the matter from the workers’ point of view also. They say, and say rightly, that even though the employers may not commit overt breaches of awards they are dishonouring the spirit of them all the time. Although the Arbitration

Court fixes the wages and conditions of employment, it has no power to fix the values of commodities; consequently, any apparent gain from an increase of wages is taken away from them again through the increase in the prices of commodities. Thus the worker is placed in the position of a dog chasing his tail. If he gets an increase of 2s. 6d. a week, that amount will be passed on to the community, and the chances are that he will be required to pay a little more in excess prices than he has gained. The wage-earner’s standard of values is the amount of necessaries and comforts he can provide for himself and his family. And it matters very little to him whether the provision of them costs £1 or £10 a week, but these are the inalienable rights of every decent Australian citizen. Under present conditions, the effective wage is less than it was in 1911. My own firm operates under thirteen different awards, and I know that the effective basic wage today is less than the standard wage was before the war. In 1911 the standard wage of a shop assistant was £3 a week; to-day it is £4 12s. Frankly facing the facts, I could see no advantage in legislating to compel parties to obey the letter of awards when the employers could not be made to obey the spirit of them. We know that the spirit of awards is being broken by employers every hour of the day, and there is no means of preventing them from breaking it; indeed, many of them are obliged to increase their prices when costs are raised, and by a system of combination they can do that in greater ratio than the increase in wages awarded by the court. I hold, also, that a criminal law cannot be successfully and satisfactorily applied to industrial matters any more than a policeman can successfully intervene in a matrimonial tiff. His interference only widens the breach between the parties and hastens the divorce proceedings.

The TEMPORARY CHAIRMAN (Mr Watkins:
NEWCASTLE, NEW SOUTH WALES

– The honorable member may not discuss a matter that has been already decided by this Parliament.

Mr WATSON:

– I understood that in the budget debate honorable members may discuss any subject.

The TEMPORARY CHAIRMAN.The honorable member may not now dis cuss an act passed by this Parliament. I have allowed him some latitude, but he cannot continue in that strain.

Mr WATSON:

– I wished to explain my reasons for voting against the Arbitration Bill, and as I have had a wide experience, I thought my remarks would be of interest to the people. However, I need not refer again to any specific piece of legislation. The time has gone by when the wage-earner can be treated as a chattel to be used only for the purpose of adding to the wealth and comfort of others. At one time he may have had the humble idea that the Almighty had created him to be subservient to his masters, do his job well, and look for his reward in the next world. But to-day he says, “I am a human being, with the same longings and aspirations as the biggest magnate in the land. I came into the world in the same way as he did, and I shall go out in the same way, and I do not see why my struggle for some of the good things of life on the short journey from the cradle to the grave should prejudice my chances in the hereafter.” Yet there is a tendency on the part of some people to consider the wage-earner a chattel. We cannot promote industrial harmony by the display of force any more than we can produce wealth by wielding a golf club or a billiard cue. Industrially we cannot compel the best class of workman to do what he does not want to do. It is difficult to prevent good men from doing what they want to do, and it is hard to prevent men from stopping others from doing what they themselves will not do.

The best way to get an Australian to do a thing is to make him want to do what you want him to do, for once a good Australian wants to do a thing he is going to do it, do it quick, and do it well. I learned that in my young days, when I was in charge of a job in Melbourne, and I quite inadvertently hired Sandy McDonald. After I put Sandy on I discovered that he was what was known then as a red-hot social revolutionary. I was in a quandary, but I soon discovered that Sandy was completely master of the job, both technically and practically. It was most important for me to make good, or I should lose my job. I realized that if

I could get Sandy going he was likely to he of great assistance in helping me to hold the job, so I sidled up to him and said, “ They say that you are one of these socialists, Sandy.” He glared at me and replied that he was. “ That’s strange,” said I, “but in a way I am one, also.” “You!” he retorted, “why, you are a capitalist’s pimp; you’re no socialist.” I said, “Yes I am, Sandy, and seeing that we are both freaks in our own way, don’t you think we could make up and get along pretty well together?” But Sandy would have none of me. I remembered reading somewhere how a chap managed an impossible wife by letting her manage herself, so I decided to try it on with Sandy. I let him feel that he was boss both of himself and to an extent of me, too. Before long, Sandy had “ taken hold of things,” and it was great to have him coming along and pointing out how we could improve on this or how we could get over that difficulty. He was one of the best mates and the ablest workman I ever had. Of course, I did not let him know that he was helping me to hold my job, but I fancy he knew, and I believe he was glad. There are scores of thousands of Sandy’s in Australia. They are like the wild mustang of the desert, bred and matured in nature’s wide expanses, every fibre of their being pulsating with freedom. They chafe at control, they jib at coercion; but, once you get them headed right they are all initiative, enterprise, and resource, and all determination and loyalty; but somehow we are getting them headed all ways - or, maybe, we are leading them all wrong. Australians have proved their worth in every field of life’s activities; in sport they have been supreme; in the air and under the water; as inventors and scientists, they have held their own; and on the battle-field, when death was the dread issue, they have not failed their country.

There is a good deal more that I could say upon this phase of our industrial life, but I shall reserve any further comments I have to make until some such future occasion.

Progress reported.

page 6832

HOUR OF MEETING

Motion (by Mr. Latham) agreed to -

That the House, at its rising, adjourn until to-morrow, at 11 o’clock a.m.

page 6832

ADJOURNMENT

Waterfront Dispute : Summonses against President andSecretary, Melbourne Branch Waterside Workers Federation.

Motion (by Mr. Latham) proposed -

That the House do now adjourn.

Mr SCULLIN:
Yarra

.-! do not usually trespass upon the time of honorable members at this hour of the night, but I make no apology for doing so upon this occasion, because I intend to raise what I regard as an urgent and important matter. I have received from the Premier of Victoria, a communication stating that yesterday afternoon summonses were served upon the President and the Secretary of the Melbourne Branch of the Waterside Workers Federation of Australia, for offences alleged to have been committed against the Commonwealth Arbitration Act with respect to the working of the Karoola and the Lutana. To my knowledge the Premier of Victoria worked unceasingly during the whole of last week to effect a settlement of the dispute on the waterfront, which lasted less than a week. I also was not idle; and other men whoare connected with the industrial organizations of the Australian Labour party worked tirelessly to restore peace in the shipping industry.

Mr Brennan:

– And successfully, apparently.

Mr SCULLIN:

– Their efforts proved successful, because on Saturday afternoon a resolution was carried by a large majority of the delegates who had assembled in Melbourne from all parts of Australia, affirming that the men should be instructed to resume work; and advice to that effect was sent out. Yesterday morning the president and secretary of the Melbourne branch of the Waterside Workers Federation conveyed that instruction to their members, who resumed work that afternoon.’

Mr Maxwell:

– What is the charge?

Mr SCULLIN:

– I understand that these officials are charged with having done something in the nature of inciting or encouraging men to refrain from working the Karoola and the Lutana. The summonses were received by them subsequently to their having advised the members of their branch to resume work.

That advice was acted upon, and the men are still at work. There is practically no trouble in Victoria at the present time. There is a slight hitch in the negotiations with the Port Phillip stevedores, but it is hoped that that will be overcome tomorrow.

Mr Maxwell:

– Who issued the summonses ?

Mr SCULLIN:

– They were issued on the authority of the Commonwealth Attorney-General. The Premier of Victoria has informed me that he is very greatly perturbed, because he is interested in’ the preservation of industrial peace in his State. He and the industrial leaders had almost effected a settlement of the trouble when this firebrand was throw into the arena. It may upset the whole of the arrangements that have been come to. I want to know what was the motive behind this action of the Government.

I may be told in plausible language, by the Prime Minister (Mr. Bruce) or the Attorney-General (Mr. Latham) that the law has been broken, and that it is the duty of the Government to uphold it. In anticipation of such a rejoinder, let me make two observations. The first is that, under the criminal code of this country, no crime has been committed, and the second is that the laws which we passed to deal with industrial matters were originally designed to prevent and settle industrial disputes, not to promote them. If peace is desired in industry, those summonses ought not to have been issued. If the instruction to issue them was sent out before the decision to resume work was arrived at, they should be withdrawn immediately. If, on the other hand, it is not peace that is wanted, I can conceive of nothing surer to create prolonged trouble than this action of the Government.

I ask, in all seriousness, what is the intention of the Government? Last Tuesday night I heard the Prime Minister emphasize the seriousness of the threatened outbreak, which, he said, by interrupting the transport services on the waterfront, would aggravate unemployment, prevent the export of our produce, and intensify the existing financial position. The trouble would be no less serious than it threatened to be a week ago, if it should break out afresh. I suggest that this Government should join with the Government of Victoria in its efforts to bring about and maintain industrial peace. If the Federal Government cannot do any better than has been done in this case, it should stand aside and leave the matter in the hands of persons who are likely to achieve more fortunate results. In the existing circumstances I cannot describe this action of the Government as other than foolish, provocative, and unjust. There is no warrant for it. Any law designed to prevent or settle industrial disputes cannot be upheld or made popular, or even win the respect of the decent members of a community, if its penal provisions are put into force as they have been in the present instance. There is only one course for the Attorney-General to take, if he earnestly desires to preserve industrial peace upon the waterfront and to promote it where it does not exist. It certainly exists to-day in Victoria and New South Wales. If he does not wish to nullify what has already been done, he should withdraw these summonses and retreat from the foolish position that has been taken up.

Mr BLAKELEY:
Darling

.- I also desire to protest against the action of the Government in having summonses served upon officers of the Waterside Workers Federation in Melbourne. I am sure it “was with feelings of heartfelt rejoicing that the people of Australia - I except the Government - hailed the peace that was in sight in connexion with the trouble on the waterfront. Having had a fairly long experience on the waterfront, I know something of the questions in dispute, and I can say that the waterside workers have a definite grievance against a judge of the Arbitration Court. Court.

Mr Manning:

– They always have.

Mr BLAKELEY:

– The honorable member has never been a wharf labourer. If he had spent four or five years on the wharfs of Australia he might be a little more broadminded in his attitude towards the working class. It says a great deal for the waterside workers that they are able to concentrate upon principles and to accept what they ought not to have accepted because of their desire to preserve industrial peace. This Government has consistently refused to assist in the preservation of industrial peace in Australia; but on every possible occasion it has wielded the big stick in the shape of the penal sections of the Arbitration Act, the Crimes Act, or the Immigration Act. Some of those provisions, of course, have proved to be a fiasco. In its determination to precipitate industrial trouble, which is so necessary to the creation of a political atmosphere favorable to itself, the Government has gone to lengths that are not only tragical, but also disgraceful. The history of the Government’s latest action has been traversed briefly by my leader (Mr. Scullin). Every honorable member is aware that in the principal ports the position is quite satisfactory. In Queensland and Western Australia the men, smarting still under the indignities to which they have been subjected, have not yet accepted the instructions of their conference. What has this Government done to induce those men to decide to resume work? They have the capacity to think, and they can distinguish right from wrong. To-morrow morning when they read of this vindictive action of the Government they will conclude that they have been justified in refusing to accept work. The people of Australia may well ask, “What is the intention of the Government; what is behind this move?” Is it that once again, in an endeavour to save itself from disaster, the Government is doing everything possible to cause an industrial dispute in Australia, as it did in 1925? Is that the Government’s intention? If it is not, one can only conclude that the summonses were issued by irresponsibles Under instructions from irresponsibles. If the action of issuing summonses by the Commonwealth Government was not meant to create industrial trouble, it must have been taken by irresponsibles. I refuse to believe that the Government is irresponsible in industrial disputes. In the past this Government has wielded the “ big stick,” and apparently it will continue to wield it. It is doing everything possible to exploit the waterside workers of this country. It works hand in hand with a section of the community which is adopting a similar policy. Indeed, one wonders whether there is some sinister understanding between the two. I refer to the ship-owners, who, in no desire to end the trouble, have told the waterside workers that while they remain on strike at one port, the ship-owners will refuse to meet them in conference. The attitude of the Government and the shipowners is not that of men desiring peace. One cannot dissociate the present trouble from the forthcoming election on the 17th November.

Mr LATHAM:
AttorneyGeneral · Kooyong · NAT

.- The history of this matter is not unknown to honorable members. In December of last year a noovertime strike, arranged by the Waterside Workers’ Federation, took place. The alleged justfication for that strike was that there was undue delay by the Arbitration Court in hearing the claims of the federation. An order was made by the court, the result of which was that the men returned to work upon their giving an undertaking to obey any award which might be made by the court in the future. An award, to come into operation on the 10th September, 1928, was made. Before that date the Waterside Workers’ Federation, after much propaganda in the press and otherwise, arranged a conference to consider whether its members would obey the award. The conference was held, at which a resolution was passed declaring that the federation repudiated the award as pernicious and vicious. It was announced that the resolution was carried unanimously. When that happened it would have been proper for the Government to take action at once. Instead, it waited in order to allow considerations of reason, commonsense and honour to a promise given to prevail. But the Waterside Workers’ Federation repeated daily its challenge to the law and to the Parliament which made it. The issue was clear - whether an award obtained by a body of employees at their own request and which, in addition, they had promised in advance to obey, was to be obeyed, or whether, if it displeased them, they were to be at liberty to dispute it and hold up the trade of Australia. The matter remained in that state for about a week. On Saturday morning last, application was made, by my instruction, after full consideration, to the Chief

Judge of the Arbitration Court for liberty to institute a prosecution of the federation under section 6 of the Arbitration Act, whch was enacted in 1904 and has remained on the statute-book ever since. Alternative charges are being laid under section 6a, which was enacted in 1920 and has remained continuously on the statute-book. There then occurred a withdrawal of the resolution of repudiation of the award in these terms -

That, in the opinion of the conference, no good purpose can be served by preventing members from presenting themselves for employment under Judge Beeby’s award, as the resolution repudiating theaward has served its purpose for the time being. To persist with it any further would be detrimental to the best interests of the federation, as a whole, by preventing negotiations with the shipowners, and thereby endanger the members of the federation with reprisals.

– The Government has a responsibility to the people of Australia to administer the laws which this Parliament has made as their representatives. That responsibility is discharged by the institution of a prosecution in such serious circumstances as now present themselves. The matter is now before the courts, upon which the responsibility of judicial decision depends.

Question resolved in the affirmative.

House adjourned at 11.21 p.m.

Cite as: Australia, House of Representatives, Debates, 18 September 1928, viewed 22 October 2017, <http://historichansard.net/hofreps/1928/19280918_reps_10_119/>.

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House of Representatives18 September 1928

THELATE SENATOR THOMAS GIVENS

Mr SPEAKER:

ASSENT TO BILLS

QUESTION

MEDICAL EXAMINATION OF MIGRANTS

Mr WATKINS:NEWCASTLE, NEW SOUTH WALES · ALP; FLP from 1931

Mr BRUCE:Minister for External Affairs · FLINDERS, VICTORIA · NAT

Mr WEST:EAST SYDNEY, NEW SOUTH WALES

Mr BRUCE:

Mr WATKINS:NEWCASTLE, NEW SOUTH WALES · ALP; FLP from 1931

Mr BRUCE:

QUESTION

ALLEGED MUTINY ON H.M.A.S. BRISBANE

Mr BOWDEN:PARRAMATTA, NEW SOUTH WALES

Mr MARR:Honorary Minister · PARKES, NEW SOUTH WALES · NAT

QUESTION

CANBERRA BRICKS

Mr GREGORY:SWAN, WESTERN AUSTRALIA

Sir NEVILLE HOWSE:Minister for Health · CALARE, NEW SOUTH WALES · NAT

QUESTION

AUSTRALIA HOUSE

Mr BRENNAN:BATMAN, VICTORIA

Mr BRUCE:NAT

QUESTION

NATIONAL INSURANCE

Mr A GREEN:KALGOORLIE, WESTERN AUSTRALIA · ALP; FLP from 1931; ALP from 1936

Dr EARLE PAGE:Treasurer · COWPER, NEW SOUTH WALES · CP

Mr A GREEN:KALGOORLIE, WESTERN AUSTRALIA · ALP; FLP from 1931; ALP from 1936

Dr EARLE PAGE:

QUESTION

COMMOWEALTH BANK

Mr E RILEY:SOUTH SYDNEY, NEW SOUTH WALES · ALP

Dr EARLE PAGE:CP

QUESTION

STATE REPATRIATION BOARDS

Mr COLEMAN:REID, NEW SOUTH WALES

Sir NEVILLE HOWSE:NAT

QUESTION

FEDERAL CAPITAL COMMISSION CONTRACTS

Mr McGRATH:BALLAARAT, VICTORIA

Sir NEVILLE HOWSE:NAT

QUESTION

GEOPHYSICAL SURVEY

Mr A GREEN:KALGOORLIE, WESTERN AUSTRALIA · ALP; FLP from 1931; ALP from 1936

Mr BRUCE:NAT

QUESTION

TOBACCO CULTURE

Dr NOTT:through Mr. Manning

Mr BRUCE:NAT

QUESTION

ABRAHAMS TAXATION CASE

Mr GARDNER:ROBERTSON, NEW SOUTH WALES

Mr LATHAM:Attorney-General · KOOYONG, VICTORIA · NAT

QUESTION

DEVELOPMENT AND MIGRATION COMMISSION

Mr BRUCE:NAT

QUESTION

PRICKLY PEAR

Mr BRUCE:NAT

INTERNATIONAL CANCER CONFERENCE

Radium Treatment

Sir NEVILLE HOWSE:NAT

DISTRIBUTION OF RADIUM

Sir NEVILLE HOWSE:NAT

QUESTION

FEDERAL CAPITAL COMMISSION

Sir NEVILLE HOWSE:NAT

QUESTION

PEANUTS

Sir NEVILLE HOWSE:NAT

OUTLAWRY OF WAR TREATY

Paper

Mr BRUCE:NAT

PAPERS

INCOME TAX ASSESSMENT BILL 1928

Second Reading

Mr SCULLIN:Yarra

Mr Maxwell:

Mr SCULLIN:

House of Representatives
18 September 1928

Mr WATKINS:
NEWCASTLE, NEW SOUTH WALES · ALP; FLP from 1931

Mr BRUCE:
Minister for External Affairs · FLINDERS, VICTORIA · NAT

Mr WEST:
EAST SYDNEY, NEW SOUTH WALES

Mr WATKINS:
NEWCASTLE, NEW SOUTH WALES · ALP; FLP from 1931

Mr BOWDEN:
PARRAMATTA, NEW SOUTH WALES

Mr MARR:
Honorary Minister · PARKES, NEW SOUTH WALES · NAT

Mr GREGORY:
SWAN, WESTERN AUSTRALIA

Sir NEVILLE HOWSE:
Minister for Health · CALARE, NEW SOUTH WALES · NAT

Mr BRENNAN:
BATMAN, VICTORIA

Mr BRUCE:
NAT

Mr A GREEN:
KALGOORLIE, WESTERN AUSTRALIA · ALP; FLP from 1931; ALP from 1936

Dr EARLE PAGE:
Treasurer · COWPER, NEW SOUTH WALES · CP

Mr A GREEN:
KALGOORLIE, WESTERN AUSTRALIA · ALP; FLP from 1931; ALP from 1936

Mr E RILEY:
SOUTH SYDNEY, NEW SOUTH WALES · ALP

Dr EARLE PAGE:
CP

Mr COLEMAN:
REID, NEW SOUTH WALES

Sir NEVILLE HOWSE:
NAT

Mr McGRATH:
BALLAARAT, VICTORIA

Sir NEVILLE HOWSE:
NAT

Mr A GREEN:
KALGOORLIE, WESTERN AUSTRALIA · ALP; FLP from 1931; ALP from 1936

Mr BRUCE:
NAT

Dr NOTT:
through Mr. Manning

Mr BRUCE:
NAT

Mr GARDNER:
ROBERTSON, NEW SOUTH WALES

Mr LATHAM:
Attorney-General · KOOYONG, VICTORIA · NAT

Mr BRUCE:
NAT

Mr BRUCE:
NAT

Sir NEVILLE HOWSE:
NAT

Sir NEVILLE HOWSE:
NAT

Sir NEVILLE HOWSE:
NAT

Sir NEVILLE HOWSE:
NAT

Mr BRUCE:
NAT

Mr SCULLIN:
Yarra

Mr FENTON:
Maribyrnong

Mr GREGORY:
Swan

Mr PARKHILL:
Warringah

Mr LATHAM:
AttorneyGeneral · Kooyong · NAT

Mr A GREEN:
KALGOORLIE, WESTERN AUSTRALIA · ALP; FLP from 1931; ALP from 1936

Dr EARLE PAGE:
Treasurer · Cowper · CP

Mr DUNCAN-HUGHES:
Boothby

Mr LATHAM:
AttorneyGeneral · Kooyong · NAT

Mr DUNCAN-HUGHES:
BOOTHBY, SOUTH AUSTRALIA · LP; NAT from 1925

Mr MAXWELL:
Fawkner

Mr LATHAM:
AttorneyGeneral · Kooyong · NAT

Mr PARKHILL:
Warringah