House of Representatives
6 December 1938

15th Parliament · 1st Session



Mr. Speaker (Hon. S. J. Bell) took the chair at 10.30 a.m. and read prayers.

page 2697

QUESTION

NATIONAL INSURANCE

Mr HOLLOWAY:
MELBOURNE, VICTORIA

-In view of the many protests made against putting the National Health and Pensions Insurance Act into operation, will the Prime Minister discuss with the Cabinet the necessity for postponing the operation of the act, until the people have had an opportunity to vote upon the scheme? By way of explanation I draw the attention of the right honorable gentleman to the fact that I have received a letter from the town clerk of Williamstown as follows: -

I forward herewith copy of resolution carried at the last meeting of my council relative to the National Health and Pensions Insurance Act 1938- “That this council condemns the National Health and Pensions Insurance Act, demands its repeal, and the substitution of a non-contributory social insurancescheme.”

Mr LYONS:
Prime Minister · WILMOT, TASMANIA · UAP

– The Government does not intend to postpone the operation of the act. The Treasurer will submit proposals to the Parliament to-morrow which will indicate the definite character of the Government’s intentions.

page 2698

QUESTION

LOSS OF AIR LINER KYEEMA

Mr ROSEVEAR:
DALLEY, NEW SOUTH WALES

– Will the Prime Minister state whether the special tribunal which is inquiring into the cause of the loss of the air liner Kyeema has yet forwarded its report to the Government? In view of the desirability of informing the Parliament as soon as possible as to the cause of the disaster, will the Prime Minister table the report to-day?

Mr LYONS:
UAP

– 1 understand from the Minister for Civil Aviation that the report has just been received. When the Government has had an opportunity to peruse it, its contents will be made public; I hope that this will be done within a few hours

page 2698

QUESTION

MAIL STEAMERS : ARRIVAL SIGNAL

Mr PRICE:
BOOTHBY, SOUTH AUSTRALIA

– This morning I received a letter from the Secretary to (lie Adelaide Chamber of Commerce in which the following passage occurs -

Iti the. past, when tha mail-boats’ schedules were not so rigidly adhered to as they are to-day, it used to he the practice to hoist a flag on the Geneva! Post Office to show that the English mail-boat had passed a certain point. This acted as an advice to business houses thai a mail would shortly be in, and was of obvious advantage. Lately a certain amount of inconvenience has been caused by the irregular arrival times of air mail from England and overseas -

Mr SPEAKER:

– Order ! The object of a question is to elicit information, not to supply it.

Mr PRICE:

– I was pointing out that inconvenience is caused by the fact that flags are not now hoisted on the Adelaide General Post Office. Will the Postmaster-General have the matter investigated, and docs he not consider that some such signal as the hoisting, of a flag to murk the arrival of an English mail would be of great value to the business people of Adelaide and to the citizens generally?

Mr ARCHIE CAMERON:
Postmaster-General · BARKER, SOUTH AUSTRALIA · CP

– I shall investigate the matter, and furnish the honorable member with a reply later.

page 2698

QUESTION

PRICE OP BREAD

Mr CURTIN:
FREMANTLE, WESTERN AUSTRALIA

– Can the Prime Minister inform the House as to the retail prices of bread to-day in each of the capital cities, including Canberra, and is it a fact that, in some of the capitals, the retail price is in excess of 6d. a 2-lb. loaf? If this be so, what steps does the Government intend to take to adhere to the undertaking given to this Parliament that the maximum price would not exceed 6d. a 2-lb. loaf?

Mr LYONS:
UAP

– The States fix the prices of flour and bread, the responsibility of the Commonwealth being confined to a collection of the excise tax in the manner prescribed, plus, of course, the- fixing of the price of bread in the Australian Capital Territory! I am informed that the price to-day in New South Wales is 5½d. a 2-lb: loaf over the counter. That price, I understand, was proclaimed last evening. In Victoria, the price, delivered, is 5^d., but that price has not yet been proclaimed, nor has the Queensland price yet been proclaimed. In South Australia thu prices are 5d. over thi; counter and 5 Jj. delivered. No advice has yet been received as to the prices in Western Australia and Tasmania.

Mr HOLT:
FAWKNER, VICTORIA

– Will the Prime Minister take prompt action, by way of letter or otherwise, to direct the attention of the heads of the various State governments to the amendment moved in this House by the honorable member for Watson and accepted by the Government, providing that, where a State has not taken steps adequately to protect the consumers of flour and other wheat products against excessive prices, the GovernorGeneral may suspend payment of money collected under the wheat legislation?

Mr LYONS:

– My advice is that the governments of the States are already in possession of that information.

Mr WARD:
EAST SYDNEY, NEW SOUTH WALES

– In view of the fact that the immediate effect of the legislation imposing an excise tax on flour has been an increase of the price of bread I ask the Prime Minister whether the Government intends to adhere to its decision not to grant an increase of old-age, invalid, and war pensions in order to meet the increased cost of living?

Mr LYONS:

– The honorable member for East Sydney knows perfectly well that invalid, . old-age and war pensions were fixed on the present basis without relation to the cost of living, and have always been so fixed, except for the years immediately preceding the last fixation, when the cost of living Was taken into account. The pension was raised to the present figure of £1 a week without consideration of the cost of living.

Later :

Mr WARD:

– Can the Prime Minister inform me what action the Commonwealth Government now proposes to take in connexion with the regulation of bread prices in order to give effect to assurances contained in the speeches delivered by Government supporters when the bill imposing an excise tax on flour was passing through this Parliament?

Mr SPEAKER:

– The honorable member may not at this stage refer to speeches made on that bill-

Mr WARD:

– In view of the assurances given by the Government that the effect of certain recent legislation would not be an increase of the price of bread, I ask the Prime Minister what action the Commonwealth Government now proposes to take to prevent the exploitation of the Australian public, by interests which have brought about an increase of the price of bread in certain States, of from Id. to 1-Jd. a loaf.

Mr LYONS:
UAP

– I have already replied to a similar question, asked by the Leader of the Opposition.

Mr WARD:

– The answer was not satisfactory. The price of bread has been increased.

Later :

Mr PRICE:

– I draw your attention, Mr. Speaker, to the fact that question No. 10 upon notice for to-day standing in my name, relates to the price of wheat and bread. I nsk whether, under the Standing- Orders, questions without notice may be asked on subjects dealt with in questions upon notice for that day?

Mr SPEAKER:

– The question referred to by the honorable member relates to past prices of wheat and bread, not to future prices.

Mr BEASLEY:
WEST SYDNEY, NEW SOUTH WALES

– Will the Prime Minister be good enough to communicate with the various State governments and ascertain what action they propose to take to regulate the price of bread, and will he lav on the table of the House their replies? I understand that an undertaking was given at the wheat conference held recently, that action would be taken to prevent an increase of the price of bread.

Mr LYONS:
UAP

– I have already given all available information with regard to this matter. I shall be glad to make further inquiries.

Mr Beasley:

– I suggest that the Prime Minister should communicate with the State governments to ascertain if they propose to take legislative action.

Mr LYONS:

– The States have already taken legislative action in anticipation of the Commonwealth legislation.

Mr Beasley:

– I refer to bread prices.

Mr LYONS:

– I shall obtain any further information available on this subject.

Mr CURTIN:

– Will the Prime Minister say what action he proposes to take to fix a maximum price for bread, of not more than 6d. a loaf, in the territories under the jurisdiction of the Commonwealth ?

Mr LYONS:

– If the honorable member will put his question on the notice paper I shall deal with it in regard to all territories. The position in the Australian Capital Territory is that before the imposition of the flour tax bread was 6d. a loaf. The price has been kept at that figure largely because of competition between the bakers of Queanbeyan and Canberra. It is proposed to ask the Government of New South Wales to apply its price-fixing machinery to the Australian Capital Territory.

Mr LANE:
BARTON, NEW SOUTH WALES

– In view of the claims that the excise duty on flour was imposed arbitrarily by the Commonwealth Government without consultation with other governments will the Prime Minister undertake to have the tax revised with a view to reducing it and so enabling bread to be sold at a cheaper price?

Mr LYONS:

– Commonwealth legislation on this subject is complementary to legislation passed by the State parliaments.

page 2699

PRICE FIXATION UNDER PATENTS LAW

Mr GREGORY:
SWAN, WESTERN AUSTRALIA

– I draw the attention of the Attorney-General to a circular which was distributed this morning.

It has no date, or address on it, and it contains no signature, but it repeats the allegation that, before leaving England, the Attorney-General gave a promise to certain manufacturers that he would introduce a patents bill under which manufacturers could fix their prices. Has the attention of the Minister been drawn to this circular, and could some action be taken to prevent the circulation among members of statements which are, apparently, entirely devoid of truth.

Mr MENZIES:
Attorney-General · KOOYONG, VICTORIA · UAP

– My attention has not been directed to this matter since I last made a statement concerning it. I gather from the honorable member that the latest circular is anonymous, and, in my experience, statements contained in anonymous letters are invariably untrue.

page 2700

QUESTION

INVALID AND OLD-AGE PENSIONS

Mr GANDER:
REID, NEW SOUTH WALES

– In view of the statement by the Attorney-General that anonymous letters invariably contain untruths, will the- Treasurer instruct the Deputy Commissioners of Pensions in the various States not to take notice of such letters?

Mr CASEY:
Treasurer · CORIO, VICTORIA · UAP

– I shall discuss the matter with them.

page 2700

QUESTION

ROYAL AUSTRALIAN AIR FORCE

E lung ton Report.

Mr WHITE:
BALACLAVA, VICTORIA

– Considerable publicity has been given to the Ellington report on the Royal Australian Air Force which contains a certain amount of criticism of the administration and efficiency of the force. Will the Minister for Defence lay on the table of the House, or let the public know, the answers to the criticism? It may be that the answers have been made known, but I have not been able to trace them. Will this information ‘be supplied before the forthcoming parliamentary recess, and will as much publicity be given to the answers as to the criticism?

Mr STREET:
Minister for Defence · CORANGAMITE, VICTORIA · UAP

– The Cabinet has not yet had an opportunity to consider the report in detail, but the position has not altered during the last month. As soon as the report has been considered, appropriate action will be takes-

Later:

Mr WHITE:

– The Minister did not seem to understand my question. The Ellington report was given considerable publicity three months ago. The Government received certain replies to its criticisms a month ago. I wish to know whether the Minister will disclose these replies to the public? Does he consider it fair t,o the members of the Royal Australian Air Force that they should remain under censure?

Mr. -STREET.- I. have nothing further to add to my previous reply. Cabinet has not yet had an opportunity to consider the Ellington report. I shall certainly not attempt to forecast the action it will take after it has considered it.

page 2700

NEW GUINEA

Activities at Lae - Alleged Illtreatment of Natives.

Mr GREEN:
KALGOORLIE, WESTERN AUSTRALIA

– According to information that has reached me from Lae, New Guinea - “ Things are beginning to look busy here at the moment.” I am also advised that “ The new town plan is designed like a spider’s web.”

Mr SPEAKER:

– Order ! In asking a question, the honorable member should not make that statement himself, nor quote anybody as having made it.

Mr GREEN:

– ‘Surveyors are busy on hills upon which it is proposed to build a residency. Will the Minister in charge of External Territories inform the House as to the meaning of these activities ?

Mr HARRISON:
Minister without portfolio, administering External Territories · WENTWORTH, NEW SOUTH WALES · UAP

– The Government has given no instructions whatever to the Administrator of New Guinea with regard to the layout of Lae. Any action there has no doubt been taken in an endeavour to provide a town planning scheme for Lae, but this has no bearing on the decision regarding the capital site. I shall obtain information on the matter and supply it to the honorable member later.

Mr JAMES:
HUNTER, NEW SOUTH WALES

– Is the Minister aware of the enslavement of the natives of New Guinea, and the exploitation of these unfortunate people by the white planters and others to such a degree that the natives are paid only 10s. a month in addition to their keep, which consists of sweet potatoes, and that in some cases they have been flogged to death?

Mr SPEAKER:

– Order ! The honorable member is not in order in so forming his question that it contains an imputation.

Mr JAMES:

– But it is perfectly true !

Mr SPEAKER:

– The honorable member must not ask a question conveying an imputation.’

Mr JAMES:

– Is it a fact that one plantation owner in New Guinea received ten years’ imprisonment for flogging a native to death in 1931, and is the Minister aware that the Legislative Council of New Guinea recently rushed through an ordinance forbidding natives from laying complaints against other residents, anybody listening to such complaints being considered to be causing discontent among the natives?

Mr SPEAKER:

– Order ! That also is an imputation which should not be embodied in a question.

Mr JAMES:

– Is the Minister aware that a person named Wallace has been summoned under the recent ordinance?

Mr HARRISON:

– I ask the honorable member to place his questions on the notice-paper.

page 2701

QUESTION

ESSENDON AERODROME

Mr HOLT:

– Will the Minister for Civil Aviation indicate to me the nature of the decisions reached at the conference on civil aviation held in Melbourne yesterday, especially as they affect improved facilities at the air port at Essendon and also seaplane facilities?

Mr THORBY:
Minister for Civil Aviation · CALARE, NEW SOUTH WALES · CP

– The conference at Essendon was attended by representatives of the Civil Aviation Department, the Victorian Main Roads Board and the municipalities and shires, the interests of which were affected by the variation of the roads plan for the extension of the aerodrome. It had nothing to do with the seaplane base and did not concern itself with aviation matters in general.

page 2701

QUESTION

HOBART POST OFFICE

Mr MAHONEY:
DENISON, TASMANIA

– Has the PostmasterGeneral been informed that in order to provide additional storage space for the Hobart Post Office it has been necessary for the Department to rent premises near-by? If that is so, does it not afford sufficient evidence to justify him taking immediate steps to make additional storage space available at the post office itself?

Mr ARCHIE CAMERON:
CP

– I believe storage space has been obtained in an adjacent building, but that does not, in itself, justify any further building operations at the Hobart Post Office.

page 2701

QUESTION

SYDNEY POST OFFICE

Mr PRICE:

– Will the PostmasterGeneral inform, me whether it is a fact that the Government proposes to spend £500,000 on the Sydney Post Office? If so, is this one of the urgent defence works which the Minister expects to be put in the list for New South Wales?

Mr ARCHIE CAMERON:
CP

– I am giving a complete reply to-day to a question about the Sydney Post Office asked by the honorable member for Wide Bay (Mr. Bernard Corser). If the honorable member for Boothby (Mr. Price) will read it he will obtain the information he desires.

page 2701

QUESTION

WHEAT SALES IN THE UNITED KINGDOM

Mr WILSON:
WIMMERA, VICTORIA

– According to a report which appeared in yesterday’s issue of the Sydney Sun, American wheat traders have taken advantage of the removal of the preference granted by the United Kingdom in respect of dominion wheat to make large sales of wheat to British merchants. Will the Minister for Commerce take steps to safeguard the interests of Australian wheat-growers on the British market so that they may continue to secure a reasonable proportion of the business offering?

Sir EARLE PAGE:
Minister for Commerce · COWPER, NEW SOUTH WALES · CP

– During the last six or seven years the proportion of sales of Australian wheat on the British market has been almost stationary, because of the special quality of our wheat. I think our proportion will be maintained this year.

page 2702

QUESTION

QUESTIONS WITHOUT NOTICE

Mr LYONS:
UAP

– I ask honorable members to postpone until to-morrow any further questions they may wish to ask without notice, or else to put their questions on the notice-paper.

page 2702

ASSENT TO BILLS

Assent to the following bills reported : -

Flour Tax (Wheat Industry Assistance)

Assessment Bill 1938.

Flour Tax Bill 1938.

Flour Tax (Stocks) Bill 1938.

Flour Tax (Imports andExports) Bill 1938.

Wheat Tax B’ill 1938.

Wheat Industry Assistance Bill 1938.

page 2702

SALES TAX EXEMPTIONS BILL (No. 2) 1938

Mr CASEY:
Treasurer · Corio · UAP

– Pursuant to leave which I obtained on the 7th October, I bring up the bill for an act to amend the Sales Tax Exemptions Act 1935-1936 and move -

That the bill be now read a first time.

Mr Curtin:

– I rise to order. Is it competent for the Treasurer to move this motion at this stage, Government business having been called on?

Mr. SPEAKER (Hon. G. J. Bell).I did call on business of the day, but the Clerk has not read the order of the day. If the Leader of the Opposition persists in his objection the Treasurer cannot proceed with this bill at this stage.

Mr Curtin:

– I have no wish to obstruct business. I waive my objection.

Question resolved in the affirmative.

Bill read a first time.

Second Reading

Mr CASEY:
Treasurer · Corio · UAP

by leave - I move -

That the bill be now read a second time.

This bill replaces the bill with the same title, which was introduced to Parliament and reached the second-reading stage on the 28th June last, but which owing to lack of time was not. proceeded with before Parliament rose on the 30th June.

The measure merely repeats the provisions of the former bill except for a few drafting improvements and the inclusion of two further provisions to rectify anomalies.

I am able to say of this bill, as I said in my second-reading speech on the previous bill, that it is almost entirely a validating measure and that its general purpose is to obviate the necessity to collect sales tax, in some cases retrospectively, where, in the circumstances, it would be manifestly unfair to do so.

The bill seeks, first, to validate certain exemptions authorized by the Government in anticipation of this amendment of the law ; and, secondly, to remove any doubts as to the validity of certain exemptions administratively allowed. The other provisions of the bill are of minor importance and consist mainly of corrections of a few inadvertent errors and omissions which occurred inthe drafting of earlier legislation.

The exemptions authorized by the Government in anticipation of this bill are provided for by clause 3, paragraphsb, c, e, j. h,l and v, which is new item 131. The goods affected are, shortly -

Clause 3b. - Certain piping.

Clause3c. - Salad dressing (dry).

Clause 3c. - Invalid carriages.

Clause 3j. - Goods for State public libraries.

Clause 3h. - Construction materials and plant for State authorities responsible for the bulk handling of grain.

Clause 3l. - Brasslights and other goods similar to leadlights.

Clause 3v. - Imported goods bequeathed to Australian residents.

The provision in clause3k was not in the former bill. I assure honorable members that these are all cases in which the taxation of the goods affected would result in glaring anomalies.

The validation of doubtful exemptions administratively allowed is provided by clause 3, paragraphs g. h, i, q,l, u, andv which is new item 132.

The goods affected are, shortly -

Clause 3g. - Window price tickets, &c., hand produced.

Clause 3 h, i. - Certain printers’ equipment comparable to equipment already exempt.

Clause 3q. - Aids to manufacture produced by registered processors.

Clause 3t. - Spare gear for ships.

Clause 3u. - Spare gear for ships.

Clause 3v. - Equipment for the manufacture of taxable goods which become the property of the manufacturer’s customers.

The provision in clause 3q was not in the former bill.

The drafting corrections are contained in clause 3, paragraphs d, m, n, o, p, r, and s.

Only two other matters are dealt with by the bill:-

Clause 3a brings the definition of “ aids to manufacture “ in the act into line with the amended definition made on the 23rd December, 1936, in the sales tax regulations and will ensure uniform application of the exemption of “aids to manufacture “ as ‘between registered and unregistered persons.

Clause 3f re-expresses the exemption of books and printed matter to exclude from exemption advertising publications of a kind originally intended to be excluded by the specific exclusion of “ advertising matter.” There is very considerable doubt as to the proper legal interpretation to be given, not only to the expression “ advertising matter “ but also to the whole item and the exceptions therefrom. It is hoped that the amendment, which is not retrospective, will result in the avoidance of costly litigation.

If requested, I shall give a full explanation of any or all of the amendments when the bill is in committee. I should like honorable members to appreciate that, with minor exceptions, the bill does not seek to extend or curtail the sales tax exemptions which are at present actually being allowed but is designed merely to give a legal footing to the understanding of taxpayers and consumers as to what is covered by the existing exemptions.

To sum up, subject to the minor exceptions mentioned, the bill will merely validatewhat is actually being done at present for the benefit of taxpayers and the public. No fresh liabilities will be imposed and no new exemptions will be granted except for validation purposes. I would therefore ask honorable members not to look upon the bill as a proper occasion for the pressing of claims for further exemptions. In dealing with every sales tax exemptions measure intro duced since 1933, honorable members have been good enough to take my word that experience in the early years of the sales tax proved that the acceptance of requests for exemptions on the floor of the House was fraught with a great deal of danger to the public. On this occasion, however, as on all previous occasions, I assure honorable members that any requests they may make for further exemptions will be carefully noted and examined for consideration on some future occasion when the time is opportune to grant further relief from sales tax by way of exemptions.

Mr Jolly:

– How far will the bill affect the revenue?

Mr CASEY:

– Not at all.

Mr CURTIN:
Fremantle

.-I do not propose to ask for the adjournment of the debate. Although on the face of things this bill is brought up today for the first time, it has already been before the House during the present session and the Treasurer (Mr. Casey) has already delivered a second-reading speech in explanation of it. But soon after we met in this period he moved that the order of the day be discharged from the notice-paper. Why he did so, I cannot understand, unless it was for the purpose of enabling him a second time to deliver a second-reading speech on the same bill. On a cursory reading of this measure I can see no difference between it and the bill which we previously had before us.

The bill validates the practice which the department has evolved in dealing with the sales tax which leaves so much to departmental rulings. I find no occasion to object to the making clear by statute of matters which probably would have been confusing to deal with legislatively until the department had worked out the formula necessary to deal with the complications incidental to the incidence of sales tax. There is only one aspect of this bill which honorable members may wish to consider. I find myself in an invidious position in regard to it. Honorable members may desire to press the Treasurer to increase the list of exemptions, and this bill does give them an opportunity to endeavour to do so. Seeing that last week, under a separate measure we included in the list of commodities subject to sales tax, a basic food which was previously exempt from sales tax, and imposed what is equivalent to a sales tax of 77 per cent, on that basic food, I find myself in a most invidious position, inasmuch as I could not ask for exemptions from a sales tax of 5 per cent. I. agree that we should validate the practice followed by the department. This bill removes any doubt as to the obligation of the department to tax retrospectively. That appears to be a desirable thing to express in law rather than in departmental rulings and interpretations of what is the wish of Parliament. In these circumstances I regard this as a necessary piece of machinery in respect of sales tax legislation and agree that itis the proper procedure. But I am unable to yield .to the temptation to press for additions to the list of exemptions for the reasons that I have given. Whether the House is prepared to go on with the bill or not is a. matter of indifference to me.

Mr LANE:
BARTON, NEW SOUTH WALES · UAP

.- I think that honorable gentlemen will agree with me that it is very difficult to understandjust what is to be done under this measure.

Mr Casey:

– Move, then, that the debate be adjourned.

Mr LANE:

– There is too much of the “ trust me “ attitude when legislation is brought up in this Parliament.

Mr Casey:

– I am not asking that honorable gentlemen trust me.

Mr LANE:

– The honorable gentleman has already asked that honorable members take his word that certain things are being done. I submit that a great deal of legislation which is introduced is phrased in such a complicated form that it is beyond comprehension. I think that legislation should be expressed in a more simple way. For instance clause 3 sets out -

The schedule to the Sales Tax Exemptions Act 1936-1836 is amended -

by omitting the definition of “aids to manufacture “ and inserting instead the following definition : - “ ‘ aids to manufacture ‘ means goods for use by a manufacturer of goods . . .

A long list follows. In my opinion alongside that long list there should be printed in italics the definitions which it is proposed to omit from the principal act. It requires a tremendous amount of work for honorable gentlemen to check what is being done in this bill with the original act. It would require a lawyer to understand much of the legislation which is placed before honorable members, but, if the Treasurer adopted my suggestion, the position would be made clearer. At present few of us realize what the Treasurer and the Taxation Department are asking Parliament to do. Before we are asked to do anything we should be told exactly what we are being asked to do.

Debate (on motion by Mr. Brennan) adjourned.

page 2704

COMMONWEALTH BANK BILL 1938

Second Reading

Mr CASEY:
Treasurer · Corio · UAP

.- I move-

That the bill be now read a second time.

The amendments of the Commonwealth Bank Act proposed in this bill are largely concerned with implementing the recommendation of the Royal Commission on the Monetary and Banking Systems to the effect that a mortgage bank should be established to provide better facilities for fixed and long-term lending. Opportunity is also being taken’ to carry into effect certain other recommendations of the banking commission which relate to the constitution of the Commonwealth Bank, and to make a number of other amendments of a more or less minor- character of the Commonwealth Bank Act.

Mr Holloway:

– They would be minor !

Mr CASEY:

– Recommendations of the commission dealing with the regulation of banking in general, and the strengthening of the Commonwealth Bank as a central bank, will be dealt with at a later stage. I ask the honorable member for Melbourne Ports (Mr. Holloway) to absorb that statement.

Mr Curtin:

– That means another bill ?

Mr CASEY:

– Yes. This bill is confined to such matters as affect the Commonwealth Bank. It does not in any way deal with the trading banks.

I propose to explain first, in brief outline, the intention of the clauses dealing with the establishment of a mortgage bank. The royal commission found that there was some lack of facilities for fixed and long-term borrowing upon land and improvements. Loans on real property are made in New South Wales by the Rural Bank, and in other States by savings or state banks and agricultural banks. The principal sources for loans of this type, however, are such financial institutions as assurance companies, trustee companies, building societies, trustees and private lenders, and the evidence before the commission disclosed some reluctance on the part of many of these non-governmental institutions to lend money in rural areas. This reluctance appears to be based on the following grounds: -

  1. that it is expensive and difficult to supervise the securities in towns and districts far removed from the office of the lender ; and
  2. that if the borrower fails to meet his obligations, there may be difficulty in realizing on the security.

Many country borrowers have, on this account, to resort to accommodation by way of overdraft from the trading banks or pastoral finance companies. Such overdrafts are nominally repayable on demand, but, in many cases, they are granted with the knowledge that they may not be fully repaid for several years. Hence they are, in effect, long-term loans. The interest rates on such overdrafts vary generally according to the trend of interest rates. The uncertainty of the term, the possibility that the borrower may be called upon to repay part or whole of the loan at any time, and the lack of certainty as to the interest rate to be charged from time to time, render this method of financing long-term capital requirements unsuitable in many cases to country industry.

Mr Nock:

– It is unstable.

Mr CASEY:

– Yes. The Government feels that the commission has uncovered a defect in our credit machinery as it exists atpresent. By filling in the gaps left by the existing lending authorities, it, hopes not only to remove possible hardships from borrowers, but also to effect a cheapening of credit by erecting a suitable organization that will be equipped to undertake business for which private organizations do not fully provide. The Government feels that its objective can be best achieved by setting up a mortgage bank designed both to accommodate individuals directlyand to supplement the resources of certain existing institutions that already cover part of the field of fixed and long-term lending. The bill is intended, therefore, to supplement existing facilities and; to fill in certain gaps in the service provided by existing lending organizations. It is not our intention to duplicate facilities where these are already satisfactorily provided.

For such a mortgage bank to function effectively there are three conditions that should be satisfied -

  1. The bank should have experienced, efficient and economical management.
  2. Capital should be obtained as cheaply as possible.
  3. The bank should be able to borrow and lend at reasonable rates of interest.

The banking commission suggested the following ways in which such a bank could be established: -

  1. By a trading bank, or by several trading banks conjointly, as a separate unit of their business;
  2. by a new company, with capital provided by the public ;
  3. by an institution, the capital of which would be provided by a government, the Commonwealth Bank, the Commonwealth Savings Bank, or State Savings Bank or State Bank.
  4. by capital provided partly by any of the institutions named and partly by private investors.

The Government is of the opinion, however, that the proposed institution could most adequately fulfil the conditions necessary for its success if it were established as a department of the Commonwealth Bank, on the lines indicated in this bill. The reasons for this view are that the Commonwealth Bank is not dominated by motives of profit; the personnel of its board includes men well acquainted with rural industry and its requirements ; thebank has gained valuable experience through the working of its Rural Credits Department, which has advanced more than £66,000,000 against the security of primary produce. Moreover, the Commonwealth Bank has already throughout the Commonwealth many branches through which business of this type could be conducted economically. This is an important consideration, and one that will affect the ra’tes of interest at which it will be found possiblp to make loans. The department will be able to commence business with a minimum of delay, and as its capital will be provided by the means proposed in the bill, it should be enabled to provide long-term financial accommodation at satisfactory rates. Further, the Commonwealth Bank, because of its strength as an institution, and its status as a government instrumentality, is in an unrivalled position to obtain capital cheaply through its ability to offer impregnable security.

Under the proposals contained in the bill, a Mortgage Bank Department of the Commonwealth Bank will be established. The Mortgage Bank will function as a separate department of the bank, and in all major respects will be kept distinct from other departments, although conducted under the same management. As with other specialized departments of the bank, the Mortgage Bank will have a special function apart from that of the General Bank Department, and it is desirable that it should be kept distinct.

Another major provision of the bill is that the capital of the Mortgage Bank Department, which will not exceed £4,000,000, will consist of the following amounts : -

  1. One-third of the profits of the General Bank Department of theCommonwealth Bank.

    1. An annual sum of £100,000 from the profits of the Note Issue Department of the Commonwealth Bank.
    2. One half of the profits of the Mortgage Bank Department itself.
Mr Anthony:

– Where will the other half of the profits of the Mortgage Bank Department go?

Mr CASEY:

– The other half will go to the Mortgage Bank Department’s reserve fund.

The percentage of the profits mentioned will, it is anticipated, provide about £220,000 every year. In order to furnish additional funds for the purposes of the Mortgage Bank Department, it is proposed that -

  1. The Commonwealth Bank may make advances to the Mortgage Bank Department up to a total of £1,000,000.
  2. The Commonwealth Bank may also raise moneys for the purposes of the Mortgage Bank Department by issuing debentures or stock secured on the general assets of the Commonwealth Bank. The outstanding amount of these securities is not to exceed six timesthe amount of the capital of the Mortgage Bank Department at the time of the issue of the securities.

These proposals mean that, at the end of the first year, the Mortgage Bank Department will be in a position to obtain funds amounting to about £2,500,000. These funds may be increased each year by a total of nearly £1,600,000, until they reach a final total of £29,000,000. Payment of principal and interest on debentures or stock issued by the Commonwealth Bank for the purposes of the Mortgage Bank Department is guaranteed by the Commonwealth under section 56 of the Commonwealth Bank Act. This guarantee reinforces the guarantee provided by the proposal to secure the debentures or stock on the general assets of the Commonwealth Bank. Together, the two guarantees should give to the debentures issued for the purposes of the department an excellent market, and enable the bank to borrow advantageously. The amendments proposed in clause 23 of the bill will exempt the interest on these securities from State income tax unless it be declared, with the approval of the Commonwealth Treasurer, to be so liable in the prospectus of the issue. Under the proposed amendments, transactions in these securities will also be exempt from stamp duty, or any other tax of the Commonwealth or of a. State. They will also, under Section 58a of the act, be securities in which trustees, executors, or administrators may invest trust moneys.

With all these advantages, securities issued for the purposes of the Mortgage Bank Department should find ready acceptance at reasonable rates of interest ; and these rates, taken in conjunction with the contributions from the profits of the general bank and the Note Issue departments, should permit loans to be made to borrowers on favorable conditions.

The Mortgage Bank Department may make loans -

  1. to individuals on the security of a mortgage over land in Australia granted or primarily used for farming, agricultural, horticultural, pastoral or grazing operations ;

    1. to societies approved by the Treasurer on the security of a mortgage over land in Australia, or on the security of the interest held by a society in such a mortgage;
    2. to such authorities of the Commonwealth or of a State as are approved by the Treasurer.
Mr White:

– Will an individual citizen have direct access to the bank, or must, he approach it through a building society ?

Mr CASEY:

– The honorable member is anticipating; I shall deal with that point presently.

It is not intended that the benefits provided by the Mortgage Bank Department shall be restricted to primary producers. Whilst the chief emphasis of the commission’s recommendation was laid on the difficulties of providing long-term capital for primary producers, the provision of funds for housing is also important. The facilities already provided in the latter field are, however, greater than those provided in respect of loans to primary producers.

Mr Francis:

– Are struggling now sccondary industries provided for in this bill?

Mr CASEY:

– No.

In making loans, it is proposed that the department shall deal directly only with primary producers, in respect of mortgages on land used primarily for the purposes that I have indicated.

Mr Fadden:

– What about co-operativo societies ?

Mr CASEY:

– There is some question as to whether they come within the legal definition of persons.

As I have said the intention of this bill is to supplement - not to supplant - existing institutions. So far as primary production is concerned, the Mortgage Bank Department will also be empowered to lend to governmental instrumentalities already established to assist the primary producer; but, in order to carry out the intentions of the bill, loans may be made to such authorities only on the condition that the proceeds are lent to individuals on the same general conditions as those on which the department will lend directly to its individual customers. These instrumentalities will also be able to make loans for the purpose of city and country house-building out of the funds provided by the Mortgage Bank Department.

In order that there shall bo no undue interference with the operations of other existing institutions already catering for house-building, it is proposed that any further assistance for this purpose shall be given by making loans only through approved societies. These approved societies will thus be placed in aposition to continue and to expand the facilities that they at present offer to the public.

Loans may be made by the bank to individuals and approved societies:

  1. On the security of a first mortgage, unless the loan is to be used to discharge an existing mortgage, or the prior mortgage is to. the bank or some governmental authority;
  2. up to an amount not exceeding two-thirds of the capital value of the property on which the loan is secured ;
  3. for periods of from three to 35 years;
  4. on such additional terms and conditions, for example, rate of interest, and terms of repayment, as the Commonwealth Bank approves.

Loans may also be made to approved societies on the security of their interest in mortgages which satisfy the requirements already mentioned. The types of land which may be mortgaged consist, broadly, of estates in fee-simple, and various kinds of leasehold and conditional purchase tenures held from the Crown. As these are too numerous to set out individually in the bill, the types to be accepted as security must be left to the discretion of the Commonwealth Bank.

If the Mortgage Bank Department is to ‘be of lasting benefit, it is essential that it shall be conducted on sound business lines. The Government believes that the needs of borrowers will .be best served by empowering the Mortgage Bank Department to provide loans at reasonable rates of interest on first-class security, rather than that it should undertake business which, because a greater degree of risk is involved, will require higher rates to be charged. The requirement as to first mortgage and the limitation of advances to two-thirds of the capital value of the land are in consonance with the usual policy of other institutions dealing with this type of business. A sum not exceeding two-thirds of the capital value of the land is the most that can safely be advanced if the difficulties which have previously been experienced by institutions of this character are to be avoided. This provision means that the borrower must have an equity of at least one-third in the property on which money is to be borrowed from the Mortgage Bank Department. A reduction of the permissible equity would tend to encourage speculative demands for land, and might endanger the financial stability of the department.

No special provisions have been included in the bill to enable the department to make self-amortizing loans. This is a matter which can be safely left to the discretion of the department, which, no doubt, will provide for loans of this class in suitable cases.

The aim of the department will be to render financial aid and advice to sound borrowers rather than to make large, profits. In this way, it is hoped to give real assistance to the community, in directions in which existing facilities may be inadequate, and at the same time to preserve the department as a financially sound and stable institution.

Mr Beasley:

– Will a man who is already doing business with another bank bc permitted to transfer it to the Mortgage Bank Department?

Mr CASEY:

– That will be a matter of arrangement between him and the bank with which he is already dealing.

Mr Scullin:

– Will the Commonwealth Bank Board- follow its present policy of refusing to take business away from the private banks?

Mr CASEY:

– I cannot commit the Commonwealth Bank in this connexion. It is fully aware of the desire of the Government, and it will be furnished with a copy of my speech.

Mr Holt:

– The Treasurer has already said that this legislation may replace overdrafts.

Mr White:

– Is it a fact that a metropolitan borrower will not have direct access to the Mortgage Bank Department, but must approach it through an approved building society?

Mr CASEY:

– Yes.

Mr Fadden:

– Will co-operative societies come within the scope of the term “ aPproved societies “ ?

Mr CASEY:

– I think so, but I should like to consult the Attorney-General before being emphatic on that point.

Mr Lane:

– What about farming on a co-operative .basis?

Mr CASEY:

– I have already referred to that subject.

The proposals for the creation of the Mortgage Bank Department make necessary certain consequential amendments to the existing Commonwealth Bank Act. I shall refer briefly to the more important of these in the order in which they occur in the bill.

Clause 20 proposes a re-allocation of the profits of the General Bank Department of the Commonwealth Bank, by providing that one-third of those profits shall be paid to the capital account of the Mortgage Bank Department. Under the act as it stands at present, onehalf of the profits of the bank is placed to the credit of the Bank Reserve Fund, and the balance is paid into the National Debt Sinking Fund. It is proposed that the proportion now placed to the credit of the Bank Reserve Fund shall be reduced to one-sixth, until such time as the aggregate capital of the Mortgage Bank Department amounts to £4,000,000. When this aggregate is reached, the Bank Reserve Fund will again receive one-half of the profits of the General Bank Department.

Clause 23, to which I referred earlier, proposes to free from stamp duty or any other tax imposed by the Commonwealth or a State, debentures or inscribed stock certificates, and documents relating to the purchase, sale, transfer, or transmission of, or to the payment of interest on, such securities issued for any purpose of the Comonwealth Bank. It is also proposed that interest derived from such securities shall not be liable to State income tax unless the interest is, with the Treasurer’s approval, declared to bo so liable by the prospectus relating to the issue. These provisions are intended to place debentures or inscribed stock issued by the Commonwealth Bank in the same position as bonds and inscribed stock issued by the Commonwealth Government.

It is provided in clause 23 that the Savings Bank Department shall be authorized to invest its funds in debentures or inscribed stock issued for the purposes of the Mortgage Bank Department. The Savings Bank Department is already empowered under the act to invest its funds, inter aiia, in securities of this type issued for the purposes of the Rural Credits Department, and it is obviously desirable that the scope of its possible investments should be extended to cover securities issued on account of the Mortgage Bank Department. As I have already mentioned, these are guaranteed by the Commonwealth Government in addition to being secured upon the general assets of the Commonwealth Bank.

Clause 4.0 of the bill proposes that part of the profits of the Note Issue Department should be contributed towards the capital of the Mortgage Bank Department. The act as it stands at present provides that, after payment of the expenses chargeable to the Note Issue Department, the balance of the profits shall be paid to the Commonwealth Treasury. The proposed amendment provides that an annual sum of £100,000 shall be paid from this balance to the Mortgage Bank

Department, until such time as the aggregate capital of the Mortgage Bank Department amounts to £4,000,000.

I now turn to the clauses which deal with certain other recommendations of the Banking Commission. Recommendation 2 suggested that the directors, other than the Governor and the Secretary to the Treasury, should be appointed for a terni of six years instead of seven years as at present, that one should retire each year, and be eligible for re-appointment, and that provision should be made that no director shall continue to hold office after reaching the age of 70 years. The Government has carefully considered this recommendation, and proposes to secure the ends sought by the royal commission in a slightly different way. After due consideration, it has come to the conclusion that it would be unwise to reduce the term of office from seven to six years, as this would tend to prejudice the stability and continuity of the bank’s policy. It also considers that it would be preferable for Parliament not to bind itself rigidly to a 70-year age limit, but rather to give weight to the commission’s opinions when making individual appointments. It is possible that there may be exceptional cases in which the services of a director, even though over 70 years of age, would be of very considerable value to the hoard. In general, however, the Government expects that this part of the recommendation will be implemented by the good sense of those responsible for making appointments in the future. The Government favours, however, the recommendation so far as it relates to the securing of an annual rotation in appointments to the board. The commission attempted to achieve this, by suggesting- reduction of the term from seven to six years. The Government believes that it can be better secured by the appointment of an additional director, and in clauses S and 9 it makes proposals to that effect.

In drafting the changes incorporated in clause 9, the Government has endeavoured to deal with this matter in a fair and impartial manner, and to avoid any suggestion of taking advantage of the proposed changes for political purposes. While the clauses are necessarily rather complicated, I would ask all honorable members to study them carefully as a whole, and to notice that certain alterations have been made solely for the purpose of securing the introduction of the annual rotation system. The details of the proposals can be better explained in detail in committee. In brief outline, however, clause 8 provides for the appointment of a further director, whilst clause 9 makes certain, slight changes of the dates on which existing appointments expire, and adjusts the terms of several future appointments in order to secure as far as possible the regular occurrence of one vacancy a year. It will be seen that, with the exception of 1944, in which two vacancies must occur, the effect of the changes proposed in clause 9 will be to secure the occurrence of a vacancy on the 31st December of each year commencing with 1940. The annual rotation of appointments will then continue indefinitely in the future.

After full consideration, the Government does not intend to accept recommend at. ion 3 of the banking commission which suggests the removal of the limitation on the field of choice of directors. It does propose, however, to act upon recommendation 4, which proposes that the Board of Advice in London should bo made permissive instead of mandatory. This is secured by clause 10. Occasion may also be taken to draw attention here to the minor amendments made in clauses 1.1 to 14 inclusive. These involve no questions of principle, and have been included mainly to facilitate the work of the board.

Recommendation 16 suggested that, in the public interest, the Commonwealth Bank should take control of the affairs of any bank which is unable to meet its immediate obligations, and should be given any additional powers which it may require for this purpose. The Government has decided to accept this recommendation, and even to go beyond it by giving the Commonwealth Bank power to secure information, additional to ‘that provided by ordinary banking statistics, in cases where the condition of a trading bank is such that it may sooner or later be involved in difficulties.

As the failure of one bank to meet the demands of its creditors may seriously threaten the stability of the whole bank-

Mr. Casey ing system, it is essential for the Commonwealth Bank to know whether any trading bank is pursuing a course which may involve it in difficulties. It is therefore desirable that the Commonwealth Bank should be in a position to obtain from any bank, in certain circumstances, such information as it requires for this purpose. Accordingly, clause 5 provides, in the first place, that the Governor of the Commonwealth Bank may require a bank, when its liquid assets, including Loudon funds arid government securities, have fallen to less than 20 per cent, of its deposit” liabilities in Australia, to supply him with information relating to its financial stability. If the information be not supplied, the Commonwealth Bank may appoint an officer to investigate the affairs of the defaulting bank. Secondly, if any bank informs the Commonwealth Bank that it is unable to meet its obligations, or if it suspends payment, the Commonwealth Bank may appoint an officer to investigate its affairs, assume control of the bank, or appoint a person to administer its affairs or a liquidator to wind it up. Should amalgamation appear to both parties to be the best solution, no additional powers are necessary, as the Commonwealth Bank already has power under section 7a of the act to enter into an arrangement for the acquisition of the business of another bank.

The other clauses of the bill do not warrant detailed explanation at this stage. They may be conveniently referred to under the following headings : - “ Provisions affecting the Savings Bank “. These are contained in clauses 25 to 30. Clause 25 has already been dealt with in part. Paragraph (a) of the clause merely redefines the term

Government securities “ already referred to in the principal act. Clause 26 provides for the calculation of interest on savings bank deposits on the 31st May, instead of the 30th June, in order to facilitate the organization of the bank’s work, and to allow it to balance its accounts more rapidly at the end of the year. The remaining clauses are designed to improve the act in minor respects which experience has shown to be desirable. “ Offences in relation to notes These are dealt with in clauses 45 to 51 which embody mainly formal amendments, designed to remove certain ambiguities and to make clearer the original intention of the relevant sections of the existing act. “ Provision for the issue of inscribed stock as well as of debentures”. Eleven clauses scattered through the bill provide for. the addition of the words “ inscribed stock “ before the word “ debentures “. The bank already possesses power to exchange debentures for inscribed stock, but to operate under this authority would involve the unnecessary and wasteful expedient of first issuing debentures and then changing them into inscribed stock. This matter will become of more importance when the Mortgage Bank Department i3 functioning. “Repeal of provisions now out of date”. Clauses 6, 41, 53 and 60 merely provide for the removal of dead wood from the existing act. “ Alterations to annual balance sheet, audit, &c. “. When the Commonwealth . Bank commenced business in 1913, it was the practice of all banks to make up halfyearly balance sheets, and the Commonwealth Bank Act naturally laid down the same requirements for the Commonwealth Bank. ‘ For some time past, however, the other banks’ have been making up their balance sheets only once a year, and this practice is now followed by all the Australian and English banks. It is now proposed that the Commonwealth Bank should fall into line with this general practice, thus avoiding the heavy and unnecessary work of producing an additional balance sheet on the 31st December of each year. Clause 17 provides that inspection and audit shall be yearly instead of half-yearly, and clause IS provides that the board shall prepare a balance sheet at the 30th June in each year instead of at least twice in each year. Clause 24 provides that the net profits of the Savings Bank Department, shall bc allocated each year instead of each half-year. Clause 19 provides for the repeal of the section which requires the preparation, of a statement of the combined accounts of the Commonwealth Bank and the Commonwealth Savings Bank. The affairs of the bank are indi cated quite clearly by the separate statements of account provided for under other sections of the act. “ Other proposals “. Clause 15 makes certain minor amendments of the provision relating to loans to officers of the Commonwealth Bank, with the object of bringing the act into conformity with present-day banking practice. In addition to making loans to officers for homebuilding, the bank will be empowered to lend limited sums to officers in special circumstances. Most of the other amendments are designed either to clarify the existing act, or to make changes of a minor character which experience has suggested to be desirable. Opportunity is also being taken to renumber the sections of the act.

The Government considers that this measure is the best that could be’ designed to fill the needs that it is intended to meet. It is particularly difficult to legislate in the sphere of mortgage banking, as the field is already covered partially by existing organizations. As I have said earlier, the Government has no desire and no intention to supplant or to compete with such of these organizations as are supplying satisfactory service.

Mr Nock:

– But charging interest at too high a rate.

Mr CASEY:

– Maybe. Rather, our desire is to encourage these institutions, and to offer direct service, only where they are unable to supply it.

Mr Curtin:

-. - Does not the honorable gentleman think it is time that the Commonwealth Bank competed with or supplanted bodies that are charging too high an interest rate?

Mr CASEY:

– It would not be in the public interest to dry up the existing supplies of mortgage money. To this end it is proposed that the Mortgage Bank Department shall make loans directly to individuals in eases where it is necessary to provide the desired facilities, and, at the same time, assist in supplying approved societies and other instrumentalities with some part of their loan requirements. In both cases it is proposed that the Mortgage Bank Department should operate at the lowest rates of interest consistent with the adoption of sound financial methods. The Government, however, has no intention of withholding assistance from credit-worthy individuals who, through no fault of their own, may be without adequate facilities for obtaining credit. I feel sure that this bill will solve the problem of filling up the gaps in the long-term credit supply with a minimum of disturbance and with a maximum of effective assistance in those directions where it has been proved to be necessary. It will also provide many necessary and desirable alterations of the constitution and functions of the Commonwealth Bank as it exists at present. I commend the bill to honorable members.

Debate (on motion by Mr. Curtin) adjourned.

page 2712

NEWSPRINTING PAPER BOUNTY BILL 1938

Second Reading

Debate resumed from the 2nd December, 1938 (vide page 2622), on motion by Mr. Perkins -

That the bill be now rend a second time.

Mr BARNARD:
Bass

.- I desire to associate myself with other honorable members who have given their support to this measure. The manufacturing of newsprint should be a most important industry in Australia, and I welcome this bill because it is a step in the direction of making Australia economically self-contained, as well as of bringing about the decentralization of industries. During the regime of the Scullin Government, consideration was given to the establishment of a newsprint manufacturing industry, and at that time two separate and rival organizations were interested in the project; As the honorable member for Franklin (Mr. Frost) pointed out, there had been for a number of years an experimental plant operating at one end of the island, while investigations were being conducted in the opposite, or north-western, end by a separate organization. This proposal has been exhaustively investigated by the Tariff Board which, in the course of its report, slates -

The company proposes to proceed by three principal stages of construction and development, each of which will entail an outlay of approximately £1,250,000-

the erection of a mill, with one machine capable of producing 27,000 tons of newsprint annually, with a mechanical pulp mill capable of furnishing 75 per cent, of the pulp required. In addition, the general services, such as wharf and mechanical handling equipment, roads and vehicles, water supply, &c, will be provided.

That is the first instalment. In the second stage, when the enterprise is under way, the estimated output per annum will be 45,000 tons. The report sets out the various interests concerned in the proposal, and points out that, at one stage, certain newspapers were strongly in opposition. The report states -

The parties represented do not oppose the establishment of any Australian industry which can be founded- with economic benefit to Australia, but they believe that the proposal with regard to the newsprint industry in Tasmania is entirely speculative and that any possible benefits will be far outweighed by the penalties and burdens imposed on the newspaper industry.

No one desires to see heavy imposts placed on newsprint. Honorable members on this side of the House would oppose any proposal likely to place in the hands of certain interests power to crowd out of industry rivals operating in a small way. That aspect of the matter was discussed fully by the ex-Minister for Trade and Customs (Mr. White) in a statement reported in the press on the 25th September, as follows: -

The Government has decided to grant the measure of assistance recommended by the Tariff Board to the new industry but proposes to give this assistance by means of bounty without fluty unless the price of newsprint fall’s materially below present-day levels. No additional duty to that at present in force will be imposed unless the c.i.f. and e. price (plus primage) of imported newsprint is less than £15 a ton.

As the result of that statement, those interests which were opposed to this scheme because they feared the price of newsprint would be increased, or that it would be made impossible for them to obtain supplies, withdrew their opposition. There are many independent newspapers in Australia rendering valuable service to the public, and it is the duty of the Government to see that justice is done between them and the powerful interests associated with this industry.

While it is true that newsprint has not yet been produced in Australia in commercial quantities, those who have been conducting experiments are convinced that it can be done. So confident is the

Government of Tasmania in the success of the venture that it has bought shares in the company to the value of £250,000. I trust that this measure will be passed by the House, and that the new industry will be as successful as we all hope.

Mr MAHONEY:
Denison

– I congratulate the Government upon at last bringing in the necessary legislation to establish a newsprint manufacturing industry in Australia. I am, of course, particularly pleased ‘ with the proposal because the industry is to be established in Tasmania. Paper of various kinds to the value of £3,000,000 is imported annually into Australia. If we were able to produce 100,000 tons of newsprint each year to a value of £1,500,000, employment would be found for thousands of workers. It is estimated that when this industry is in full production employment will be provided for at least 800 persons. Moreover, the Government of Tasmania now proposes to proceed with a hydro-electric scheme in Butler’s Gorge, and the work will provide employment for 1,000 men for two or three years.

This legislation will enable an Australian newsprint manufacturing industry to be established free from the constant danger of extinction by the competition of the powerful cartel associated with the big newsprint combine in Canada. Efforts have been made in the past to establish a newsprint manufacturing industry in Australia, but always they have failed because the newspapers were able to make such favorable contracts with the Canadian suppliers that the local enterprises would be unable to compete.

This is not the first attempt which has been made to establish the industry in Tasmania. Some years ago, a company was formed, which leased from the Government a large area of forest land in the southern part of the island. Unfortunately, it was not a bona fide enterprise ; it was merely engaged in share hawking throughout Australia, using the natural resources of Tasmania as the bait.

When I was a member of the Tasmanian Parliament, I supported a measure which granted a request by the company now proposing to undertake the manufacture of newsprint for leases of timber areas. I was a little afraid that the company would not fulfil the undertakings it then gave, but, to-day, I am satisfied on that point. The fear has been expressed that this company will, at the first opportunity, increase the price of paper. I suggest that this legislation is twelve months too late ; it should have been introduced long ago, particularly as the rapid development of the new industry may be adversely affected by the present unsettled international situation. During the Great War, the price of paper went up to £80 a ton, and it is not unreasonable to assume that should another conflict arise the price of this commodity will be similarly affected. As we require considerable supplies of paper for the manufacture of munitions, we shall, in such circumstances, have further cause for regret that this industry was not established twelve months ago. These facts emphasize the necessity for proceeding with the project as quickly as possible. The new industry will create a great amount of employment. ITo doubt some of the other States would like to have seen it established within their boundaries, but Tasmania is more than entitled to this industry because in the past it has received comparatively little benefit as the result of our protectionist policy. Furthermore, this will be the first industry of any magnitude established in that State with the assistance of this Government. I congratulate the Government of Tasmania on its earnestness in connexion with the project. As the honorable member for Bass (Mr. Barnard) has pointed out, it has agreed to contribute £250,000, although it will be under no obligation to advance one penny of that sum until the company has expended £500,000 on. the undertaking. I understand that that is the arrangement entered into by the Government of Tasmania. Another very important and favorable aspect of this industry is that it will not involve the exploitation of any section of the people. It is not an industry which affects, for instance, the bread and butter of the community, and it will not increase the price of any of the necessaries of life. For these reasons, any argument that government assistance to this company will enable it to exploit’ any section of the people is unfounded. The point has been made that the company will enjoy practically a monopoly. In my view it appears to be essential that any company in pioneering an industry of this kind must be given a monopoly. In this instance, however,’ the company is representative of newspaper interests which will be the largest users of the commodity produced. I have discussed this measure with a representative of that section of the newspaperowners who are not financially interested in the project, and he has informed me that they are quite satisfied with it. He said to me, “We have no opposition to offer to the pleasure; we are prepared to accept it, and we hope that the industry will be quickly established”. I emphasize that once it is established this industry will need to be encouraged, and will be entitled to as much protection as any other Australian industry. It docs not appear that substantial profits will be made during the first few years. In any case the arrangement provided for under this measure for the payment of a bounty at so much a ton on the newsprint produced will last for only four years. Consequently, at the expiration of that period, this legislation will again come up for review by this Parliament. I am confident that by that time the industry will be soundly established. I hope that the measure will have a speedy passage in order that those interested in the project may be enabled to push on with their work as quickly as possible.

T shall support the amendment which the Deputy Leader of the Opposition (Mr. Forde) has forecast with the object of providing that all employees engaged in this new industry shall, right from the outset, be paid award wages and enjoy award conditions. The Commonwealth Conciliation and Arbitration Act should be amended to provide that all employees and employers engaged in the establishment of industries of any kind which have not been cited in application to the court should automatically be covered by existing awards. Under the amendment forecast by the Deputy Leader of the Opposition, a union official need only notify the Registrar of the court, that in this new industry, members of his union were not covered by an award, and the Registrar would thereupon notify the employer concerned ‘ that he had been brought under existing awards. This difficulty could also be overcome by the making of a common rule, but most of the unions prefer the first method. Such a provision is necessary in order to prevent an employer in a new industry from carrying on for a considerable time without observing award rates of pay and conditions. That practice leads to unfair competition. Whether or not an industry is dependent on government assistance in order to be’ enabled to carry on, it should be covered by Arbitration Court awards. For these reasons, I hope that the Government will give favorable consideration to the proposal embodied in the amendment forecast by the Deputy Leader of the Opposition. As one who has had considerable experience as a union organizer in the building trade, I know that employers in new industries are all too prone to exploit their employees in the way I have indicated. Very often many months transpire before such employers can be cited as respondents to existing awards covering work of a similar kind. If the Government is sincere in its desire to protect the workers in this industry, or in any other industry, and to abolish unfair competition, it will adopt the amendment forecast by the Deputy Leader of the Opposition. Through the bounty on newsprint the community will contribute considerably towards the cost of establishing this industry, but we must remember that the benefits to be gained easily outweigh that cost. This industry will provide much additional employment, and, ultimately, the money now Sent overseas in the purchase of newsprint will be retained in this country. We shall never be able to solve the problem of unemployment except by establishing secondary industries, particularly industries which will enable us to reduce our purchases from those countries which buy least from us. Although I am a little disappointed that it does not safeguard the interests of those workers who will be engaged in the new industry, I wholeheartedly support the bill.

Mr FRANCIS:
Moreton

.- A new and important industry will be established as the result of this legislation. It will be a basic industry, which will obtain all of the raw material it needs in this country. Even though it will require vast quantities of our timber, we need have no fear that those resources, as the result of this added demand, will be in danger of being exhausted. The importation of largo quantities of newsprint has an adverse effect upon our trade balance. The raw material at our disposal should be utilized to produce newsprint to meet the local demand, provide employment, and assist the development of Australia -generally. Until recently, newsprint was manufactured only from softwoods, but, in consequence of exhaustive and successful experiments, it can now be manufactured from hardwoods of which there are large quantities in various parts of Australia. (Quorum formed.] I pay tribute to those who, since 192S, have persistently tackled this problem and have now overcome the extraordinary difficulties, because, in doing so, they have made possible tho establishment of a valuable Australian industry. Tasmania, which has largo quantities of suitable timber and is able to produce electrical current at a comparatively low price, will be able to play a very important part in establishing the newsprint industry, the success of which now appears to be assured. I understand that between £3,000,000 and £4,000,000 will be expended before the industry is firmly established in Australia, and that producing units will eventually be conducted in three States where production can be carried on economically. In the past, it has been the practice to establish most of our industries in New South Wales or in Victoria, but the establishment of this industry in Tasmania will assist decentralization. I congratulate those responsible for establishing the paper industry at Burnie at a cost of over £1,000,000, without assistance from this Government.

Mr Frost:

– Newsprint is not being produced at Burnie.

Mr FRANCIS:

– That is so, but paper is produced without assistance by means of a bounty.

Mr Curtin:

– Newsprint is admitted free under the British preferential tariff.

Mr FRANCIS:

– It is not protected to the same degree as other industries are protected, but a bounty is to be paid for a period. I direct the attention of tha

Minister (Mr. Perkins) to the fact that, in 1937, and again in May of this year, the Tariff Board strongly recommended that there should be a reduction of tho general tariff from £4 to £2 a ton. As this subject was dealt with at length in previous reports, and is also mentioned in the latest report, I should like to know why the Government has not given effect to the recommendations of the board in this respect.” The Government has been silent. Those concerned, particularly proprietors of country newspapers, are becoming irritated and annoyed.

Mr Gregory:

– The proprietors of country newspapers say that they will be at a great disadvantage.

Mr FRANCIS:

– Yes. Why should they be placed in such an unsatisfactory position? -In dealing with the subject, the Tariff Board said -

The references to landed, costs have been chiefly confined to newsprint at present imported, duty free, under the British preferential tariff. The duty of £4 per ton on newsprint imported under the general tariff practically excludes all competition from nonEmpire countries. A reduction of the general tariff rate of £4 a ton to £2 a ton was strongly urged hy Australian newspaper interests during tlx; main paper inquiry in 1930. Sir Keith Murdoch then pointed out that the extreme margin thus provided offered an opportunity for British and Canadian interests to increase their prices. At the present inquiry, Mr. Caldwell, representing the Joint Committee of Tariff Revision, submitted figures to show that the c.i.f. price of Scandinavian newsprint was £3 15s. below that quoted from the Empire countries. This quotation may not bc indicative of the difference in world prices for newsprint from Empire and non-Empire countries but the position remains, as the board pointed out in its report of the 25th March, 1037, viz., the excessive margin of £4 invites price fixing to the detriment of Australian consumers.

I direct the attention of the Minister to the concluding words of that paragraph. The excessive margin is causing a good deal of anxiety in the minds of those newspaper proprietors who are not in the combine. Those controlling country newspapers in Queensland - there are some in my electorate - are particularly anxious to know why the excessive margin of £4 should be permitted, as it does invite price fixing to the detriment of Australian consumers. On previous occasions I have asked the Minister and his predecessor why effect has not been given to this recommendation, but a satisfactory reply has not been received. The Tariff Board’s report continues -

The Board lias already explained in its report of the 25th March,. 1937, that this margin is subject to negotiation between the Australian Government and the governments of the United Kingdom and Canada. The. Board still holds the view that this preferential margin is much wider than is justified and is liable to bo abused.

If the preferential margin is wider than is justified and is liable to be abused, why has the Government not taken up the matter with the governments of the United Kingdom and Canada and made a recommendation to this Parliament on the matter? The report continues -

It may prove that a reduction of this preferential margin would force a reduction in the landed cost of Empire paper and thus necessitate greater insistance by means of a bounty. However, it would be better that this should be so than the calculation should be based upon a price made possible under cover of an excessive preferential margin of duty. The Hoard re-affirms its view that the preferential margin of duty should be limited to £2 a ton.

Why has that recommendation of the Tariff Board not been acted upon? Generally speaking, I do not favour a reduction of duties, because I believe in adequate protection being afforded to Australian industries, but I should like some information on the subject of this bill. I suppose that the Minister will say that the duties decided upon at the Ottawa Conference have to bc adhered to. But surely some departure could be made from the duties then agreed upon by the contracting governments. Will this Government make strong representations to the British and Canadian authorities in order to see if some adjustment can be made in this respect ? The present system is most unfair, particularly to the proprietors of country newspapers. If a variation were made in the direction suggested by the Tariff Board, those who are not members of the combine would be treated more fairly. I should like the newsprint industry to be launched in a more satisfactory manner than is now proposed; but I am glad that there is a prospect of our hardwood timbers being used to manufacture first-class newsprint under conditions satisfactory to those concerned. I am particularly anxious, however, that, some explanation be given concerning the excessive margin of £4, which must bc to the detriment of Australian users. I congratulate those responsible for launching this new industry and wish them every success.

Mr CURTIN:
Fremantle

– I am rather surprised that the honorable member for Moreton (Mr. Francis) should have raised the subject of general tariff duties on a bill in which no provision is made for the imposition of a duty or the reduction of a duty. I have always taken a great interest in this subject, and have been anxious to see the newsprint industry established in Australia. I had personal experience of the great difficulties with which those controlling small Australian newspapers had to contend when it was impossible to obtain newsprint at other than exorbitant prices. At that time Canada was not in a position to supply the Australian market, and Scandinavian manufacturers were willing to do so.

Mr Francis:

– I know that those are the facts.

Mr CURTIN:

– Another consideration is the technical difficulty of providing newsprint in Australia at the present time. It would be unfair to restrict the small independent newspaper proprietors to the choice between purchasing the Australian product at a higher price or paying a. higher duty’ on newsprint which, at present, they can obtain duty free from Canada. Speaking as one who has had practical experience with the smaller indentors of newsprint over a period of years, I tell the honorable member for Moreton that, notwithstanding the figures which interested parties may have submitted to the Tariff Board, it would be cheaper for the proprietors of small newspapers in Australia to import from Canada free of duty than it would be to import newsprint from Scandinavia, even if the duty were reduced to the figure recommended by the Tariff Board, because the Scandinavian mills have never sold directly to the Australian user of newsprint. They have always sold through indent firms, acting as agents for British importers of Scandinavian newsprint. Indent houses in Australia under freetrade conditions were really monopolies for the purchase and distribution of newsprint from abroad.

Mr Gregory:

– Prices were lower under those conditions.

Mr CURTIN:

– So were world prices generally. That is an aspect which the honorable member for Swan appears to have overlooked.

This bill meets objections which . I might have had in view of the recommendation of the Tariff Board. I am sincerely glad that the Government has not given effect to the recommendation of the board, which was that an import duty be imposed. The honorable member for Moreton complains that the Government did not adopt the recommendations of the board with regard to the rate of duty to be imposed on foreign newsprint, but I understood him to say that he is pleased, that the Government lias not given effect, to the board’s recommendation for an import duty, out of the proceeds of which the bounty would be paid, because it would add to the working costs of all newspaper organizations in Australia - those small competitive enterprises which the merchants exploit against the larger newspaper organizations. Under this proposal, the cost of establishing the newsprint industry in Australia, will be borne by the Consolidated Revenue Fund. If in future years it asks for a protective duty, we shall be able to deal with that application on its merits. Evidently the honorable member for Swan fears that once the industry is established, there will be a case for an import duty to protect it.

Mr Gregory:

– Yes.

Mr CURTIN:

– That fear may be justified, but the possibility is not, to me, more objectionable than is the absolute prohibition against the importation of potatoes from New Zealand.

All Australian industries get legislative action or - and this is not so good - administrative policy in terms of legislation, to help them meet competition from overseas, and members of the Country party must acknowledge, surely, that primary producers enjoy the larger measure of the incidence of the protectionist policy of the nation. There is no question about that. “When we take into account duties imposed on the impor tation of primary products, Commonwealth bounties, and the quarantining or prohibition measures, -including those imposed by State governments under health measures; I venture the opinion, with great respect and as one coming from a primary-producing State, that the primaryproducing industries of Australia are, at the present time, getting the greater share of the benefits of what I term the Australian settled policy, which is to use the fiscal power of the Commonwealth to encourage the establishment of industries in this country. I agree with that policy, because I believe that without industries this country would have no hope of increasing a population or of maintaining the safety of the present population. I support the- bill because it meets the problem in a way which I think is desirable, namely, it places the burden on the whole of the taxpayers and not upon the users. Furthermore, it meets the function of the smaller newspaper organizations which are at present carrying on a rather difficult struggle against their more powerful competitors.. They will still be able to get the Canadian newsprint free of duty a little cheaper in the long run than the cost to them of Scandinavian newsprint even at the reduced rate of duty suggested by the Tariff Board.

Mr Francis:

– They are all in the combine.

Mr CURTIN:

– That is the reason for my support of the bill, and it f ortifies my contention. I am glad, honestly glad, that the Government does not regard itself as merely a legislative register for the decisions of the Tariff Board.

Mr Francis:

– I agree with the honorable member.

Mr CURTIN:

– The Tariff Board was never intended to be a tariff-making instrumentality. The intention always was that the board should examine the evidence relating to existing or proposed new industries, and advise the Government as to the rates to be imposed, and that the Government should submit its. proposals to Parliament. Parliament should determine whether or not reports of the Tariff Board should be adopted.

Mr Francis:

– That has always been my view.

Mr CURTIN:

– Yet the honorable gentleman complained a few moments ago, that a recommendation of the Tariff Board, which is not relevant to this bill, had not been adopted by the Government. I rose merely to say that the fundamental recommendation of the board in connexion with this industry has not been carried out by the Government, and that that is my reason for supporting the measure.

Mr BEASLEY:
West Sydney

– I impress upon the Government the necessity for action to ensure that undertakings, given by interested parties before the Tariff Board, are’ carried out in their entirety.. I agree that Parliament should do all that is possible to assist the development of secondary industries in the smaller States. I say this, having in mind Commonwealth grants from time to time to the smaller States, rendered necessary because of disabilities which claimant States have suffered under federation. Taking the long ‘ view, I think that the more we can help the smaller States to he self-contained, the less will be the need for monetary grants from the Commonwealth to assist them in the future. The value of- the newsprint industry to Tasmania from this standpoint, therefore, cannot be overestimated. The aspect of the proposal at this stage that concerns me mostly is its probable influence on unemployment. The more employment that is provided by State activities through the establishment of new, or the expansion of existing industries, the greater will bo the revenue of the States and the less the need for Commonwealth aid. Tasmania is in the fortunate position that -its hydro-electric system should make possible the satisfactory development of a number of industries, and the Tasmanian Government in assisting this venture i3 endeavouring to do the best it can fully to develop and exploit the resources at its disposal. -But, as honorable members have gathered, I am somewhat troubled about the undertakings given by the interested parties, outside the Government, in connexion with the develop ment of this new industry. When tho Tariff Board was making its inquiries certain specific promises were made with reference to the number of persons who would bo employed by the industry in its initial stages, and the amount of capital to be invested. I am anxious that those undertakings shall be honoured to the full. This Parliament should insist on the observance of any promises made to the Tariff Board. At the moment I am not in a position to say what action the Tasmanian Government has taken or intends to take to safeguard the interests of employees of this industry, “including the matters to which I have referred, but I imagine that it has not been idle. Nevertheless, it is, I think, advisable to mention the matter. When the Newnes shale industry was before this Parliament w-e were told that in its initial stages so much capital would be expended, and it would give employment to a certain number of men. I arn not satisfied that those undertakings have been observed. I therefore submit that this Parliament should insert in the bill the necessary safeguards. I have in mind the attitude of former governments in connexion with the Commonwealth Government’s investment in Amalgamated Wireless (Australasia) Limited.

Sitting suspended from 1.2.^5 to 2.15 p.m.

Mr BEASLEY:

– Prior to the suspension I was referring to the representation of the Commonwealth on the directorates of Amalgamated Wireless (Australasia) Limited, and Commonwealth Oil Refineries Limited, with a view to ensuring that the policy agreed upon in this Parliament in connexion with the conduct of those undertakings is given full effect as far as the power of its representative can impose it. I believe that to be a good idea. Although many honorable members may feel disposed to criticize both of these undertakings, the fact is undeniable that by reason of this direct representation on the boards which control them. Parliament has an opportunity to inform itself exactly as to what is being done, and from time to time to question any departure from the original intention. Tho report of the Tariff Board dealing with the newsprint industry states that it is estimated that in the initial stage the number of employees on the payroll will be: J.u the bush, 116; at the mill, 134; and in connexion with communications, 20; making a total of 266 men, the payment to whom will aggregate £70,000 per annum. In reply to a question during the course of the inquiry, one witness stated that it was expected that during the period of eighteen months to be occupied in the construction stage, apart from the erection of the plant, an average of about 2-50 men will be employed. It was also claimed before the board that in regard to the production of newsprint only the employment would be; In the hush, 320 men, earning £75,000 per annum; at the mill, 450 men, earning £120,000 per annum; and on communications, &c, 80 men, earning £18,000 per annum ; a total annual wages payment of £213,000. The report states that this represents direct employment and that the circulation of the money so expended will result in considerably increased employment in other industries and services. We all expect that the provision of employment in this particular venture will necessarily lead to the expansion of other undertakings which depend upon it. Generally, from the standpoint of the State as a whole, these results, if they can be achieved, will be welcomed, and I would not say one word which might militate in any way against their being realized. I merely express at this stage the sincere hope that the undertakings given will be carried out, and that all the things anticipated in the Tariff Board’s report will be accomplished. I want to feel certain that the Government will keep an eye on the venture. I have already said that it will be particularly to the interest of the Government of Tasmania to do so; but at the same time it is as well that the parties who will control the venture should understand that this Parliament expects them to live up to the assurances they gave when appearing before the Tariff Board in support of the claim for a bounty or other form of assistance. I take it that the Parliament to-day will agree to grant assistance because of the undertakings given, and particularly I have in mind the matter of employment. I wish the venture well, as would every Australian wish well any enterprise tending to develop Australia, particularly the smaller States, which can promote secondary industries peculiar to their own circumstances. Perhaps the Minister, in his reply, may be able to assure me that his department will closely watch the annual development of this venture, and from time to time advise the Parliament as to whether or not the assistance granted is» being devoted to the- object desired. If the undertakings given are observed in their entirety, we shall have cause to be satisfied at having assisted the development of another important secondary industry in Australia.

Mr PERKINS:
Mona.ro- Minister for Trade and Customs · Eden · UAP

.- in reply - I wish, on behalf of the Government, to thank honorable members of the Opposition for their support of this measure. It is gratifying to* note that it has the unanimous approval of this House. That being the case, we can confidently expect it to be regarded with favour outside of this Parliament. The Prime Minister (Mr. Lyons), in hi3 capacity as honorable member for Wilmot, has been mainly responsible for the introduction of this proposal which is about to be consummated, and I am pleased to say that every honorable member from Tasmania has rendered the utmost assistance to my predecessor and myself in connexion with it: I pay a tribute to the honorable member for Balaclava (Mr. White), who had most to do with the preparation of this measure, as well as that relating to radiators. A new Minister has to pick up as best he may the threads of proposals left incomplete by his predecessor, and to him is given whatever measure of credit or blame that may attach to them. In this case I am pleased to say that a popular step has been taken.

The honorable member for West Sydney (Mr. Beasley) may rest assured that adequate safeguards will attend the payment of this bounty. If he reads the bill he will find that the department has gone to particular trouble to make sure that such will be the case, and that the bounty will have to be earned before it is paid. We have every confidence in the integrity of those who control the company. Their bona fides are established by the capital invested in the concern.

The honorable member for Moreton (Mr. Francis) made an extensive reference to the matter of duties. It is true that the Tariff Board recommended the imposition of duties; but in that respect the Government has made a departure, not because it withholds from the board credit for the work it has done - the board laid a foundation on which it was possible for the Government to build - but because it was necessary tobring forward an improved proposal, for the reason that the original one met with opposition, both from those who are in the company and from those who are outside it. The bill in its present form has practically the unanimous approval of all parties. It will be remembered that opposition was expressed not only by the users of newsprint both in the company and outside it, but also by thousands of employees in the industry, who presented a petition against the imposition of a duty on the ground that it would mean the loss of their employment. That the bill has met with general approval is due to the fact that the suggestion for the imposition of duties was not proceeded with.

The honorable member for Moreton also referred to the mention in the report of the Tariff Board of the reduction of tho duty of £4 a ton on foreign newsprint. That matter does not arise under the bill. The preference of £4 a ton is the subject of an agreement between Great Britain and Australia and Canada and Australia, and the question of reducing that margin of preference is a matter for negotiation with the countries concerned.

The principal objection to the bill has been voiced by the honorable member for Darling Downs (Mr. Fadden). In the first place, he referred to the fact that the Tariff Board, in making its recommendation, had omitted to take into account certain landing charges on imported newsprint. I assure the honorable member that the Tariff Board had this fact well in mind, and omitted these landing charges because’ the locally-made newsprint will be sold ex ships’ slings at the Australian port of delivery, that is, exclusive of landing charges. Therefore, if we were to add landing charges to the cost of imported newsprint, we should similarly have to add them to the cost of the Australian product, and one would offset the other.

Secondly, the honorable member connected the newsprint buying pool with the manufacturing project which this measure is designed to assist. I am in a position to say that the newsprint buying pool relates to imported newsprint and was not organized primarily to assist the Tasmanian scheme as he claimed. Furthermore, the newsprint buying pool, dealing as it does with imported newsprint, has no connexion with the bill now before the House. The honorable member set out to claim that the buying pool had resulted in a rise of the price of imported newsprint to the Australian market. I can state that this matter, “upon which the honorable member spoke at some length, was thoroughly investigated by departmental officers, who examined the form of contract under the buying pool, and investigated the circumstances which led up to the creation of that pool. This examination and investigation showed that -

  1. Owing to a depressed market, Canadian and British manufacturers were selling below cost of production.
  2. These manufacturers got together with a view to securing remunerative prices.
  3. The principal newspapers of Australia entered into contracts -

    1. in order to avoid a possible shortage of newsprint, and to prevent overseas manufacturers from charging unduly high prices to the Australian market; and
    2. In order to secure adequate supplies under seven years’ contracts at a price which was linked up to the New York price, thus avoiding an excessive price to the Australian market.
  4. Negotiations were also instituted in respect of freight, and a rate of £1 17s. 6d. a ton sterling was secured, whereas shippers were pressing for a freight rate of up to £2 10s. sterling. The buying pool’s contract also does away with the agency charge previously payable.
  5. Every newspaper was invited to join the buying pool, subject to the payment of a proportionate share of the preliminary expenses of the pool, which would amount to about 3d. a ton.
  6. Several newspapers, which wished to preserve freedom of buying, have signed up seven-years’ contracts outside the buying pool. These newspapers will have to pay the agency charge of 5s. sterling a ton, which would have been saved under the pool. At the same time, they have expressed no objection to the buying pool.

I am convinced that the buying pool is a legitimate business deal which concerns the newspapers of Australia and has no connexion with this manufacturing proposal.

The Deputy Leader of the Opposition (Mr. Forde) asked that I give the assurance that a great deal of trouble had been taken in framing this measure. I assure the honorable member that the Government gave more detailed consideration to this measure, and to the interests of all parties likely to be affected by it, than has been given to any other individual industry for very many years. The Government’s concern for the interests of newspapers outside the group responsible for the promotion of the newsprint undertaking has been given tangible expression in the fact that it ruled out the suggestion of the Tariff Board for the financing of the bounty payments wholly from the proceeds of a duty on imported newsprint.

Question resolved in the affirmative.

Bill read a second time.

In committee:

Clauses 1 to 7 agreed to.

Clause S (Bate of Bounty).

Mr CURTIN:
Fremantle

.- I draw attention to proviso (a), that “if a duty of customs, other than primage duty, is charged on imported paper admissible under the British preferential tariff, the rate of bounty payable in accordance with this section shall be reduced forthwith by an amount equivalent to the rate of duty of customs “. The very principle of this bill is that the bounty shall be paid out of the Consolidated Revenue, and it is therefore implicit in it that we shall not create a fund for the bounty by way of duty imposed upon imported newsprint. The paragraph which I have just quoted means that, if the Minister for Customs to-morrow placed on the table a tariff schedule imposing a duty on newsprint, the bounty would be reduced accordingly. I am inclined to think that what would happen is that the Treasurer, in a period of financial difficulty, would be disposed to urge the Government to impose a duty. The bounty would be reduced accordingly, but the income from importations would be so increased that in fact the bounty could then be paid, certainly out of the Consolidated Revenue, but really as the result of the Consolidated Revenue having been aided by the income from the duty on imported newsprint. That is a state of affairs which this bill certainly does not contemplate. I do not want to expose the Treasurer to any such temptation. The committee, in order to safeguard the future, should leave the financial dilemma to the Treasurer to correct, instead of trying to correct it now. We should leave out proviso (a), which 1 have quoted. This would mean that, even if the Minister for Customs increased the duty on imported newsprint, the bounty would still have to be paid at the present rate, and, if the Government wished to make a change, it would have to submit an amending bill to Parliament. Such a measure would, I take it, give Parliament a much earlier legislative consideration of the matter than would be the case under the Customs Act, under which a tariff schedule can be laid upon the table and not dealt with for months. I said earlier, in the second-reading debate, that I agreed that this bounty should be paid out of the Consolidated Revenue, and I quite agreed with the principle, that if the duty should be increased, the industry would in consequence receive greater protection; but the bounty is so designed that it shall not be paid whenever the price of newsprint admitted into Australia exceeds £18 lis. 3d. a ton, because the Government expects that the organization in question can produce paper in Australia so long as imported paper cannot be landed here below that figure. It is, however, conceivable that the Government might be disposed to meet the burden of the bounty by increasing the tax on newsprint, thus bringing the price up to the vicinity of £18 Ils. 3d. a ton. This would negative Clause 4 of the bill which provides that “ there shall bc payable out of the Consolidated Revenue Fund the bounty specified in this act “.

Mr Holloway:

– That would kill the local industry.

Mr CURTIN:

– Yes, but that danger is rectified by the earlier part of Clause S, and I wish to safeguard the position by leaving out proviso (a). J desire to protect Parliament from the submission to it by the Government, for financial reasons, of a schedule to tax newsprint coining into Australia in order not only to make up the revenue which has to be paid in bounty, but also to reduce the bounty without having to consult Parliament. At present, Canadian paper admissible under the British preferential tariff is free of duty. I decline to subject the present Treasurer, who 1 know is going to face serious financial difficulties in the. next two years, to the temptation to exhort his ministerial colleagues to impose a duty on newsprint for such purposes.

Mr PERKINS:
Monaro - Assistant Minister · Eden · UAP

– Although there is much in what the Leader of the Opposition (Mr. Curtin) has said, this agreement has been made in good faith by the Government and accepted by the company. Furthermore, the Government is not prepared, or able, to bind any future government. None knows what the situation may be in the next few years. - It may be necessary for a later government, for the sake of obtaining revenue, to do the things which the Leader of the Opposition has predicted, but, even if it did so, the company would not be allowed to* suffer.

Mr Curtin:

– But the bounty would be reduced if the duty were increased.

Mr PERKINS:

– The bounty would be reduced in that case, but the company would benefit to an equivalent extent from the duty, and its position would not be affected. It is not possible for this Parliament to tic the hands of any future government or Treasurer in regard to the finances of the Commonwealth.

Mr Frost:

– Is the Minister satisfied that independent country newspapers are adequately protected under this bill?

Mr PERKINS:

– Yes. Independent newspapers are thoroughly safeguarded, having the right to purchase the paper at the same rate -as the newspapers forming the company.

Mr Curtin:

– That is not the case.

Mr PERKINS:

– In what way?

Mr CURTIN:
FREMANTLE, WESTERN AUSTRALIA · ALP; FLP from 1934; ALP from 1936

– They are protected today, because they can buy Canadian newsprint free of duty, and they, therefore, have an alternative source of supply, but, if the Government brings .down a tariff schedule imposing a duty on imported newsprint, then the independent newspapers may find themselves in a very different position.

Mr PERKINS:

– The honorable member is again talking about the future. We cannot legislate against what a future government may do.

Mr Frost:

– I am concerned about the independent country newspapers, and I want the Minister’s assurance regarding their position.

Mr PERKINS:

– This bill will not alter it. If, in the future, a contingency arises, they will be in the same position as the company.

Mr NAIRN:
Perth

.- There are two different ways of protecting an industry, one by means of a duty and tho other by means of a bounty. In this instance, we have adopted the principle of a bounty. A subsequent government may decide that the other form of protection is the more desirable, and may introduce a duty. In that event, protection will be afforded by the duty and the necessity for the bounty will cease. This, therefore, is a necessary provision that, if a duty is imposed, then to the extent of the duty the bounty shall bo withdrawn.

Mr Curtin:

– But the honorable member will recognize that by the imposition of the duty, the costs of all newspapers in Australia, except those composing the paper pulp company concerned, will be increased.

Mr NAIRN:

– But this bill represents a compromise made by tlie Government for the purpose of protecting the new industry, and at the same time not increasing the price which the newspapers will have to pay for newsprint. We cannot bind future parliaments or governments. It may be necessary in the future, in the interests of the finances of the Commonwealth, to alter the provision, and in that case, if a duty is imposed, then necessarily the bounty will be proportionately reduced.

Clause agreed to.

Clauses 9 to 11 agreed to.

Clause 12-

The Minister may withhold the whole or any portion of the bounty unless he is satisfied -

that the manufacturer has published an offer containing a provision in accordance with paragraph (b) of this suction, to sell the paper manufactured or to be manufactured by him within four years from the commencement of this act to all newspaper proprietors carrying on business in Australia . . .

that in the event of the quantity of paper covered by all the acceptances of the offer exceeding the manufacturers’ anticipated production, the manufacturer has apportioned the anticipated productionequitably and without discrimination.

Mr PERKINS:
Monaro- Minister for Trade and Customs · Eden · UAP

– I move -

That after “(b)” paragraph (a) the words “ and subject to conditions designed to give effect to paragraph (c)” be inserted.

This amendment is purely a machinery provision, and designed to provide for the manufacturer, when publishing the offer prescribed in paragraph (a), taking into account the conditions specified in paragraph (c) with respect to the equitable apportionment of the anticipated pord action if the quantity of paper covered by the acceptances of the published offer exceeds such production.

Amendment agreed to.

Clause as amended agreed to.

Clauses 13 and 14 agreed to.

Clause 15 (Stocktaking and inspection of manufacture and accounts).

Mr JOLLY:
Lilley

– I am somewhat concerned about the method to be adopted in checking accounts, and also in arriving at the basis of cost. This clause provides that “any authorized person “ may enter any factory or premises and do certain things which really amount to taking stock and checking accounts.Would there be any objection to providing that the Auditor-General shall do this work? I cast no reflection upon the provisions of the previous clause, but different people have different ideas in regard to capitalization, depreciation of stock, and all that kind of thing, and personally I can see no reason why the Auditor-General should not be authorized to do this work for the Go vernment. Perhaps it is intended that the Auditor-General shall be an “ authorized person “.

Mr PERKINS:
Monaro- Minister for Trade and Customs · Eden · UAP

– I doubt very much whether the Government could direct the AuditorGeneral in this way. Such a provision has not been embodied in other similar measures. Provision is made in the Audit Act for the AuditorGeneral to do any checking that he desires. The clause is a sufficient protection to the Government as it stands. I do not think that we can direct the Auditor-General. In fact, if there is any power to direct it probably lies with the Au d it or-G en er al .

Clause agreed to.

Clauses 16 to 24 agreed to.

Mr CURTIN:
Fremantle

.-I move -

That the following new clause be inserted: - “21a. - (1.) The Minister may make application to the Chief Judge, or a Judge of the Commonwealth Court of Conciliation and Arbitration, or to any Commonwealth authority established for the purpose of determining rates of wages and conditions of employment, for a declaration as to what rates of wages and conditions of employment are fair and reasonable for labour employed in the production of paper or in the growing, felling and carting of timber from which paper has been produced. (2.) Every person who claims the bounty payable under thisAct shall, in making such claims, furnish to the Minister such evidence as the Minister requires as to the rates of wages paid, and the conditions of employment observed, in respect of any labour employed in the production of paper and in the growing, foiling and carting of timber from which paper has been produced. (3.) If the Minister finds that the rates of wages or conditions of employment, or any of them, paid or observed in respect of any labour employed in the production of paper upon which bounty is claimed or in the growing, felling and carting of timber from which paper has been produced -

are below the rates and conditions declared, in pursuance of sub-section (1.) of this section, to be fair and reasonable ; or

are below the standard rates and conditions prescribed by the Commonwealth Court of Conciliation and Arbitration, or by any other industrial authority of the Commonwealth or a State, the Minister may withhold the whole or any part of the bounty payable. (4.) If-

the Chief Judge, or a Judge of the Commonwealth Court of Conciliation and Arbitration has not declared, in accordance with subsection (1.) of this section, what rates of wages and conditions of employment are fair and reasonable for labour employed in the production of paper or in the growing, felling and carting of timber from which paper has been produced: and

there are not in force, in the locality where the paper is produced or the timber is grown, any standard rates andconditions relating to the labour employed in the production of paper or the growing, felling and carting of timber from which paper has been produced, prescribed by the Commonwealth Court of Conciliation and Arbitration or by any industrial authority of a State, or contained inan industrial agreement registered under any law of the Commonwealth or a State, the Minister may appoint an authority or authorities for determining, for the purposes of this section, rates of wages and conditions of employment which are fair and reasonable for labour employed in the production of paper or the growing,felling and carting of timber from which paper has been produced, and any authority so appointed shall be deemed to be a. Commonweal th authority within the meaning of sub-section (1.) of this section. (5.) An authority appointed by the Minister under the last preceding sub-section shall consist of a representative of employersengaged in the production of paper or the growing, felling and the carting of timber from which paper has been produced, a representative of employees engaged in such production, growing, felling and carting, and a person who shall act as Chairman and who shall be appointed by the Minister on the joint nomination of the representatives of employers and employees:

Provided that, if the representatives of employers and employees fail to make a joint nomination of a Chairman within twenty days after being called upon by the Minister so to do, the Governor-General may appoint a person to act as. Chairman.”

The Deputy Leader of the Opposition (Mr. Forde) gave notice of his intention to move for the insertion of this proposed new clause. Our purpose, of course, is to protect the interests of the workers in the industry.When a previous bill of this description was under notice last week, the Attorney-General (Mr. Menzies) expressed doubt as to the constitutionality of a clause of this character, which the Deputy Leader of the Opposition wished to be inserted in that measure, and undertook to consider whether a bill could not be drafted to provide for the general application to all bounty legislation of provisions such as are embodied in my amendment. I question the wisdom of making a general rule of this kind for, in connexion with some industries, serious administrative difficulties might arise. I frankly confess that had such a provision been inserted in the Wheat Industry Assistance Bill, which was before us last week, the administrative problems might have been almost insuperable. For this reason such provisions may be more appropriately considered in relation to the specific industries in respect of which it is desired to provide bounties from time to time. I feel sure that the purpose of the Opposition, that new industries shall he obliged to conform to the general standard of wages and conditions in Australia, would be endorsed by the great mass of our people. A general standard may be said to be a little below the best, and a bit above the worst, conditions that may be found. We think it is of cardinal importance that new industries shall be established on sound lines, particularly in relation to the workers. In the newsprinting paper industry a number of technicians will doubtlessly be employed as well as many other workers, and the Government should insist upon the observance of Australian standards in respect of wages and general working conditions. The constitutional issue is not likely to be raised. Only the company concerned would be likely to raise it, and I very much doubt whether it would do so having regard to what has already happened. In any case, as the Government is providing a bounty for the industry, it is entitled to request, as a condition, that Australian conditions shall be observed. We have provided that other conditions shall be enforced in this industry. For example, the company is required to use not less than 60 per cent. of Australian material in the manufacture of its pulp. That is quite a proper stipulation. The Opposition is favorable to the establishment of these new industries because they contribute to the welfare of the country, but it -thinks it only fitting that the rights of the workers shall be safeguarded. Concerns which receive bounties from the Government should be forced to pay decent wages and observe decentworking conditions. If it should be necessary for the Government to exert any pressure to ensure that this is done, it should be able to insist upon it. I repeat that we should make sure, right at the inception of new industries of this description, that proper conditions will be provided for the workers. Wage rates and conditions of labour should approximate to the general standards of the country.

Mr PERKINS:
Monaro- Minister for Trade and Customs · Eden · UAP

– The Government cannot accept this amendment. Last week the AttorneyGeneral (Mr. Menzies) questioned the validity of such a provision as this and gave an assurance to the Deputy Leader of the Opposition (Mr. Forde) that he would look into this whole subject to see whether a provision of general application could be drafted to meet the purpose of this amendment in respect of all bounty bills. The Government sympathizes with the object of the Opposition, but it cannot accede to the request to insert this new clause.

Mr FROST:
Franklin

– I cannot understand why the Government should object to this proposal. The company most vitally interested in this project would offer no objection to the insertion of such a provision. Seeing that a section similarly worded to this amendment is to be found in the Wine Export Bounty Act, the Iron and Steel Bounty Act, the Iron and Steel Products Bounty Act, and others that I could name, no legitimate objection can be offered to the amendment. The company behind this enterprise has already expended £250,000 in various ways in preliminary investigations and experiments, and so far as I know, has always observed Arbitration Court and Wages Board awards. I am sure that it would welcome the inclusion of this provision in the bill.

Mr NAIRN:
Perth

.- Seeing that the wages board system is operating in Tasmania where this new industry will be located I can see no reason for the inclusion of a provision of this description. The employees engaged in the industry may surely be trusted to look after their own interests and, if necessary, to obtain an award from a States Wages Board to cover their calling.

Proposed new clause negatived.

Preamble and title agreed to.

Bill reported with an amendment; report adopted.

Bill read a third time.

page 2725

TARIFF PROPOSALS 1938

Customs Tariff Amendment (No. 4.)

In Committee of Ways and Means:

Consideration resumed from the 17 th November (vide page 1658), on motion by Mr. Perkins -

That tho schedule to the Customs Tar iff 1933-1938 … be further amended . . .(vide page 1657).

Division XIII. Paper and Stationery.

Item 334 (Newsprint.)

Mr PERKINS:
Monaro- Minister for Trade and Customs · Eden · UAP

– As I explained when introducing this tariff proposal on the 17th November, the amendment of Tariff Item 334(c) (1) is complementary to the Newsprinting Paper Bounty Bill. The amendment provides for the imposition of the following additional rates of duty on unglazed newsprinting paper in rolls, namely : - 5s. a ton when the imported cost is less than £15 a ton. 7s. 6d. a ton when the imported cost is less than £14 a ton, and 10s. a ton when the imported cost is less than £13 a ton.

The additional rates will be imposed on a date to be proclaimed, concurrently with proclaiming of the operation of the bounty act. On present indications, the proclamation will not be issued until at least twelve months from now, and, even then, these duties will apply only when the imported cost falls below £15 a ton. If the duties come into operation the amount of the duty a ton will automatically be deducted from the rate of bounty.

Item agreed to.

Preliminary paragraphs.

Mr PERKINS:
Monaro- Minister for Trade and Customs · Eden · UAP

– I move -

That the preliminary paragraphs be omitted, with a view to insert in lieu thereof the following preliminary paragraph: - “ That the schedule to the Customs Tariff 1933-1938 be amended as hereunder set out, and that on and after the eighteenth day of November, One thousand nine hundred and thirty-eight, at nine o’clock in the forenoon, reckoned according to standard time in the Australian Capital Territory, Duties of Customs be collected in pursuance of the Customs Tariff 1933-1938 as so amended.”.

This is a formal amendment in order to eliminate from the preliminary matter any reference to earlier tariff proposals and thus confine the resolution to the tariff amendments which the committee has just approved.

Amendment agreed to.

Preliminary paragraph, as amended, agreed to.

Resolution reported.

Standing Orders suspended; resolution adopted.

Ordered -

That Mr. Perkins and Mr. Archie Cameron do prepare and bring in a bill to carry out the foregoing resolution.

page 2726

CUSTOMS TARIFF (No. 2) 1938

Bill brought up by Mr. Perkins, and reported from committee without amendment or debate; report adopted.

Third Reading

Motion (by Mr. Perkins) proposed-

That the bill be now read a third time.

Mr GREGORY:
Swan

.- The Minister for Trade and Customs (Mr Perkins) should make this matter a little clearer.

Mr Nairn:

– Not one honorable member knows what this is all about.

Mr GREGORY:

– That is so. The Minister should explain.

Mr Perkins:

– This is the usual practice. It is impossible to print the schedule until the House has passed it.

Mr Nairn:

– That is not much of an explanation.

Question resolved in the affirmative.

Bill read a third time.

page 2726

QUESTION

TARIFF PROPOSALS 1938

Customs Tariff Amendment (No. 3)

In Committee of Ways and Means:

Consideration resumed from the 21st September, 1938 (vide page 33), on motion by Mr. Perkins -

That the schedule to the Customs Tariff 1933-38 … be further amended . . . (vide page 30).

Division II. - Tobacco and Manufactures Thereof.

Item 19

Mr PERKINS:
Monaro- Minister for Trade and Customs · Eden · UAP

.- The tobacco duties now before the committee are penal duties imposed! in instances where less than the prescribed percentages of Australian leaf are used. This policy of imposing penal duties on tobacco leaf was initiated by the Government in May, 1936. From that date, increased duties were imposed on imported tobacco leaf used in conjunction with less than 2½ per cent. of Australian leaf in cigarettes, and less than 13 per cent. of Australian leaf in manufactured tobacco. The action of the Government had the effect of forcing all manufacturers to use the required proportion of Australian leaf, whereas previously some manufacturers were disinclined to incorporate local leaf in their blends. The result has been much keener competition for Australian leaf, and has made practicable the purchase of all marketable leaf grown locally at prices considerably in excess of world parity.

Some months past, a review of the Australian tobacco industry was undertaken, and having regard to the increased production of Australian leaf, combined with the remarkable improvement of quality, the Government decided to raise the minimum percentages of Australian leaf used in the manufacture of cigarettes and tobacco. Accordingly, steps were taken in September last to raise the required percentage from 2½ per cent. to 3 per cent. in cigarettes, and from 13 per cent. to 15 per cent. in the case of tobacco. This can be regarded as a second step in the implementation of the Government’s policy to ensure the purchase and consumption of all usable tobacco leaf grown in Australia.

Since the Lyons Government took office in 1932, there has been a continued increase of the use of Australian-grown leaf. During 1937-38 a quantity of 5,400,000 lb. was used by manufacturers, which offers a remarkable contrast to the 1931-32 consumption of 2,600,000 lb. Financial assistance provided by the Government for research, experimentation and instruction has brought about an improvement of the general quality of leaf produced, which is reflected in remunerative prices to growers of the right type of leaf.

Items 20, 21 and 22 refer to manufactured tobacco and cigarettes. The duties on manufactured tobacco and cigarettes were increased in May, 1936, coincidental with the imposition of the penal duties on imported tobacco leaf. Subsequently, the old duties were reverted to on manufactured tobacco and cigarettes of United Kingdom manufacture, provided the required percentages of Australian-grown leaf were incorporated, namely, 13 per cent. in manufactured tobacco and 2½ per cent. in cigarettes. The Government proposes under the tariff resolution now before the committee to require such manufacturedproducts imported on and after the 1st January, 1939, to include a larger percentage of Australian leaf - 15 per cent. in manufactured tobacco and 3 per cent. in cigarettes.

Item agreed to.

Preliminary paragraph.

Mr PERKINS:
Monaro- Minister for Trade and Customs · Eden · UAP

.- I move -

That the preliminary paragraph be omitted with a view to insert in lieu thereof the following paragraph: - “ That the schedule to the Customs Tariff 1933-1938 be amended as hereunder set out, and that on and after the twenty-second day of September, One thousand nine hundred and thirty-eight, at nine o’clock in the forenoon, reckoned according to standard time in the Australian Capital Territory, Duties of Customs be collected in pursuance of the Customs Tariff 1933-1938 as so amended.”

This is a formal amendment in order to eliminate from the preliminary matter any reference to earlier tariff proposals and thus confine the resolution to the tariff amendments which the committee has just approved.

Amendment agreed to.

Preliminary paragraph, as amended, agreed to.

Resolution reported.

Standing Orders suspended; resolution adopted.

Ordered -

That Mr. Perkins and Mr. Archie Cameron do prepare and bring in a bill to carry out the foregoing resolution.

page 2727

CUSTOMS TARIFF (No. 3) 1938

Bill brought up by Mr. Perkins, and read a first time.

Second Reading

Motion (by Mr. Perkins) proposed -

That the bill be now read a second time.

Mr GREGORY:
Swan

– I rise to protest against the method used in introducing customs tariff legislation. I have a very lively remembrance of the tariff schedule that was tabled seven months ago, and of the fact that at the insistence of the Minister for Trade and Customs (Mr. Perkins) honorable members agreed to validate the collection of duties under that schedule for a temporary period. Honorable members were then informed by a speech made by the honorable member for Riverina (Mr. Nock), who has been ableto obtain details, that they had approved the collection of enormous duties upon which the Tariff Board had never reported. No information was tendered to Parliament at the time. It was a grave scandal that we empowered the Department of Trade and Customs to collect these duties. I am certain that honorable members would not have agreed to do so had they been in possession of the facts. It is my belief that any legislation of this sort should lie on the table for a certain period in order to enable honorable members to examine it and reach a decision whether it would be in the interests of the country to pass it. The Minister for Trade and Customs should bring back to the House the schedule to which honorable members have temporarily assented in order to enable the House to consider it in the light of what it has learned from the honorable member for Riverina. I have no particular quarrel with this bill, but I do object to the procedure which is being followed.

Question resolved in the affirmative.

Bill read a second time and passed through its remaining stages without amendment or debate.

page 2727

TARIFF PROPOSALS, 1938

Excise Tariff Amendment (No. 3)

In Committee of Ways and Means:

Consideration resumed from the 21st September (vide page 33) on motion by Mr. Perkins.

That the Schedule to the Excise Tariff 1921-1938 … be further amended . . .( vide page 32).

Item 6. (Tobacco, Australian-grown).

Mr PERKINS:
Monaro- Minister for Trade and Customs · Eden · UAP

– Under this tariff item the Government has provided for an increase of the excise duties on manufactured tobacco of Sd. per lb. This increase forms part of the Government’s proposals to finance the wider defence plan. The additional revenue which this increased excise duty is expected to yield is £500,000 over a full twelve months’ period, whilst during the currency of the present financial year it is anticipated that approximately £375,000 will be added to the revenue. Since the increase was made in September, representations have been made by certain interests that the Government’s action has resulted in a reduction in the protection accorded- to the Australian tobacco-grower. On this point I desire to state, first, that the protection to the Australian grower is granted mainly by means of customs duty on imported leaf, and to a further degree by the differential excise of 8d. per lb. in favour of tobacco made wholly from Australian-grown leaf; and, secondly, that the increase of excise duty applies irrespective of whether the manufactured tobacco is made wholly from Australian leaf or whether it contains imported leaf. As 12 lb. of imported leaf is used for every 5 lb. of Australian leaf used in the manufacture of tobacco, it can truly be claimed that the excise increase affects imported leaf to a greater degree than it does locally-grown leaf.

I am able to assure honorable members that this increase of excise duty does not reduce the substantial protection, ranging up to 500 per cent, ad valorem, which the Government has accorded to the tobacco industry. In conclusion, I may point out that the Government has widened the market for the consumption of Australian leaf by increasing the minimum percentage requirement of Australian leaf in tobacco and cigarettes.

Item agreed to.

Preliminary paragraph.

Mr PERKINS:
Monaro- Minister for Trade and Customs · Eden · UAP

– I move -

That tho preliminary paragraph be omitted with a view to insert in lieu thereof the following preliminary paragraph: - “That the schedule to tlie Excise Tariff 1921-1938 be amended as hereunder set out, and that on and after the twenty-second day of September, One thousand nine hundred and thirty-eight, at nine o’clock in the forenoon, reckoned according to standard time in the Australian Capital Territory, duties of excise be collected in pursuance of the Excise Tariff 1921-1938 as- so amended.”

This is a formal amendment in order to eliminate from the preliminary matter any reference to earlier tariff proposals and thus confine the resolution to the tariff amendmen(t~-which the committee has approved.

Amendment agreed to.

Preliminary paragraph, as amended, agreed to.

Resolution reported.

Standing Orders suspended ; resolution adopted.

Ordered -

That Mr. Perkins and Mr. Archie Cameron do prepare and bring in a bill to carry out the foregoing resolution.

page 2728

EXCISE TARIFF (No. 2) 193S

Bill brought up by Mr. PERKINS, and passed through all stages without amendment or debate.

page 2728

AUSTRALIAN SOLDIERS’ REPATRIATION BILL 193S

Second Reading

Debate resumed from the 2nd December, 1938 (vide page 2618), on motion by Mr. Archie Cameron -

That the bill be now read a second time.

Mr BLACKBURN:
Bourke

.- I have examined this bill, and find as has been stated by the Minister, that it elucidates a difficulty which has arisen under the Repatriation Act. At present a war pension payable to a mentally-deficient ex-soldier, or to a soldier who is a lunatic, whose wife is not drawing a pension for him, is administered at the discretion of the Repatriation Commission, and a provision to this effect is contained in the fourth schedule to the act. Doubts have arisen as to how the Repatriation Commission may dispose of the accumulated arrears of pension when such an exsoldier dies. As a general rule, only part of the pension is paid for the maintenance of such a pensioner during his life-time, the balance being accumulated in the hope that he may sometime recover, when it may be paid over to him. In the event of his death, however, the arrears of pension which were not paid over to him have to be disposed of. It is claimed by the State probate departments that the amount of those arrears forms part of his estate, andhas to be taken into consideration in assessing the value of his estate. And in the event of intestacy, it becomes available for distribution to his next-of-kin. The Repatriation Commission thinks, in my opinion rightly, that it should not be bound to pay the money to the nextofkin without any consideration of their merits. It very often happens that some of the next-of-kin of such a pensioner are quite indifferent as to what happens to him, whilst others may have stuck to him. The Repatriation Commission should be given discretion as to which members of the family are to share in this accumulated pension money. I commend the bill to the House.

Question resolved in the affirmative.

Bill read a second time, and reported from the committee without amendment or debate; report adopted.

Bill - by leave - read a third time.

page 2729

APPLE AND PEAR ORGANIZATION BILL 1938

In committee (Consideration of Senate’s amendments) :

Clause 14 - ( 1 . ) The Board may - (3.) For the purpose of giving effect to any determination made by the Board under subsection (1.) of this section, the GovernorGeneral may make regulations prohibiting the export from the Commonwealth of any apples or pears -

except by persons who hold licences issued on the recommendation of the board by the Minister or by any person authorized thereto in writing by the Minister;

in accordance with such conditions and restrictions as are prescribed after recommendation to the Minister by the Board; and

Senate’s amendments -

Leave out “giving effect to any determination made by the Board under subsection (1.) of this section,”, insert “ enabling the Board effectively to control the export of Australian apples and pears,”.

After the symbol “ (b) “ insert “except”.

Mr ARCHIE CAMERON:
BarkerPostmasterGeneral · CP

– I move -

That the Senate’s amendments be agreed to.

These amendments are purely consequential upon certain amendments made in clause 14 in committee of th is House which should have been attended to here, but were overlooked.

Motion agreed to.

Resolution reported; report adopted.

page 2729

TRADE AGREEMENT (SWITZERLAND) BILL 1938

Second Reading

Debate resumed from the 30th November, 1938 (vide page 2358), on motion by Mr. Perkins -

That the bill be now read a second time.

Mr CURTIN:
Fremantle

.- The Opposition has examined this bill and the relevant matter associated with it. We have nothing to say other than to express the hope that the expectations of the Minister, in introducing the measure, will be realized. If it were not for the fact that these trade treaties were having the effect of partitioning the world into divisions of favorable and unfavorable influence, we would say that there ought to be some hope that the world, as the result of the economic readjustments, would overcome these troubles which lead to political divisions and to grave international consequences; but it so happens that we are living in an age of economic nationalism. We hope, however, that, to the degree that these treaties lessen the extension of that nationalism, they may be contributing factors towards a solution of the problem. I need not say, because I think it will be taken for granted, that measures of this description passed hitherto bythis Parliament to ratify trade treaties with a number of countries, have not been as useful as their propounders hoped; but in an age in which failure is attached to so many things I do not feel disposed to offer criticism on the fact that things are not. better than they are.

Question resolved in the affirmative.

Bill read a second time, and reported from committee without amendment or debate; report adopted.

Bill - by leave - read a third time.

page 2730

TARIFF PROPOSALS 1938

Customs Tariff Amendment (No. 5)

In Committee of Ways and Means:

Consideration resumed from the 30th November, 1938 (vide page 2362), on motion by Mr. Perkins. -

That the schedule to the Customs Tariff 1 933-1938, be further amended . . . ( vide page 2358).

Division 4, - Agricultural Products and Groceries

Item 41 (Butter, cheese) agreed to.

Division 5. - Textiles.. Felts, Furs and Manufactures thereof and Attire.

Items 305, 106 and 110 agreed to.

Item 120 (Handkerchiefs)

Mr BEASLEY:
West Sydney

– This morning all honorable members, I think, received a circular letter from parties interested in the manufacture of handkerchiefs in Australia, which draws attention to the fact that the Australian trade agreement with Switzerland will be responsible for the lowering of the duties on ladies’ and men’s handkerchiefs to such a degree as to affect very seriously the Australian handkerchief industry. The circular states -

Statistics show that in twelve months endingJune, 1937, imports from Switzerland were 227.493 dozen handkerchiefs valued at £24,204 sterling. In the twelve months ending June, 1938, imports had risen to 294,673 dozen, value £28,029 sterling, an increase of67,000 dozen, increased value £4,000. These figures alone prove that the present tariff rates are not too high.

In 1932, our managing director was in Great Britain, and, encouraged by the protection afforded by the Government at that time, ho. bought machinery in Belfast and founded the embroidered handkerchief industry in Australia. The first two machines were soon in production, and cost over £1,000. Direct employment was immediately given to two senior males and fifteen females. Shortly afterwards a further three machines were purchased from Belfast. At the same time, further hemstitching machines were bought to feed those embrioderers ; the amount of capital now expended in this special work would amount to £6,000. Extra staff was immediately employed, and there are now 80 Australians directly employed by these machines. As 85 per cent. of our production from these machines is put into quarter-dozen boxes and half-dozen boxes, substantial increases in staff were recorded by our boxmakers and printers. Even at the present rate of tariff it is impossible for us to compete against Swiss importations, and we have had to transfer the bulk of our production to initial handkerchiefs. If there is any lowering of tariffs, as suggested in the trade agreement, our machines will definitely, be stopped, causing immediate heavy losses and substantial reductions of our staff, the majority of whom have been specially trained for this class of work, and would now find it difficult to obtain other employment.

We are an Australian firm, built on Australian capital; our executive staff and all our employees are Australians, working under award rates and conditions, and we extenda hearty invitation to members to visit and inspect our factory at any time.

We have been manufacturing handkerchiefs in Australia since 1908, and at present we have over 300 employees on our staff. A large percentage of this staff is threatened by the proposed lower duties. We therefore beg of members that they give this matter their serious consideration and treat same with urgency.

I receivedthis communication only within the last hour or so, and I have had no opportunity to check the details contained in it. I think, however, that the Minister should go into the matter in order to ascertain whether the position is as this firm claims. It is all very well to enter into agreements with a view to increasing the volume of our export trade with foreign countries, but we should consider whether the result may be to displace our own Australian workers. We should try to strike a proper balance in these matters. It seems to me that this is a new method of reducing the tariff. A new technique, apparently, has been devised for whittling away the protection of Australian industries. I should like to receive an explanation from the Minister.

Mr PERKINS:
Monaro- Minister for Trade and Customs · Eden · UAP

. -I can assure the honorable member that this part of the agreement was very carefully considered by Cabinet, which agreed that it would not affect the Australian trade or, if it did, to a minor degree only. The reduction of duties now proposed applies to a very limited range of handkerchiefs. The goods involved mustbe wholly or partly of machine-made lace or embroidered by multiple-needle machines, and finished with machine-made edges or hems. If the handkerchiefs contain hand-made lace, or any embroidery done by hand, they are excluded from the proposed duty under the intermediate tariff. In addition, the reduced specific duty will apply only to the special kinds of handkerchiefs described when they are of a value for duty between1s. 4d. and1s. 9½d. a dozen. When they are of a value for duty of1s. 9½d. a dozen, the ad valorem component - that is,42½ per cent. - of the intermediate tariff duty, which is that provided under the existing tariff, will apply. The range of handkerchiefs, on which it is proposed to grant a duty concession, comprises Swiss specialty lines manufactured en machines peculiar to Switzerland. A heavy Swiss export duty on these machines prevents exportation to other countries. The Government is mindful of the interests of the Australian trade, and is doing its best to guard those interests while, at the same time, attempting to increase our trade with Switzerland.

Item agreed to.

Division 11 - Jewellery and Fancy Goods

Item 318 agreed to.

Division 13. - Paper and Stationery

Item 338 agreed to.

Preliminary paragraphs.

Mr PERKINS:
Monaro- Minister for Trade and Customs · Eden · UAP

– I move -

That the preliminary paragraphs be omitted with a view to insert in lieu thereof the following paragraph: - “That the schedule to the Customs Tariff 1933-1938 be amended as hereunder set out, and that on and after a date to be fixed by proclamation, at nine o’clock in the forenoon, reckoned according to standard time in the Australian Capital Territory, duties of customs be collected in pursuance of the Customs Tariff 1933-1938 as so amended.”

This is a formal amendment in order to eliminate from the preliminary matter any reference to earlier tariff proposals and thus confine the resolution to the tariff amendments which the committee hasjust approved.

Amendment agreed to.

Preliminary paragraphs, as amended, agreed to.

Resolution reported.

Standing Orders suspended; report adopted.

Ordered -

That Mr. Perkins and Mr. Casey do prepare and bring in a bill to carry out the foregoing resolution.

page 2731

CUSTOMS TARIFF (No. 4) 1938

Bill brought up by Mr. Perkins, and passed through all stages without amendment or debate.

page 2731

WAR PENSIONS APPROPRIATION BILL 1938

Second Reading

Mr CASEY:
Treasurer · Corio · UAP

.- I move-

That the bill be now read a second time.

The purpose of this bill is to provide £10,000,000 out of the Consolidated Revenue Fund for the payment of war pensions. This is the usual measure submitted to Parliament to provide for the transfer of this money from Consolidated Revenue to a trust fund. Since the beginning of war pensions payments, a total of £145,000,000 has been appropriated for this purpose. The amount appropriated in this measure is only sufficient to last until the end of this calendar year. The whole amount will not be withdrawn at once from Consolidated Revenue, but will be drawn upon as required to pay pensions. This measure has no relation whatsoever to the rates or conditions under which war pensions are paid.

Mr GREGORY:
Swan

– I urge the Treasurer (Mr. Casey) to do what he can to ensure that the act is administered more sympathetically, particularly in regard to determining what injuries are attributable to war service. I have here the history of an extraordinarily hard case. This man was awarded the Distinguished Conduct Medal by His Majesty the King for conspicuous gallantry to devotion and duty. The record relating to his case states -

By encouraging his men he established them rapidly in a strong defensive position, afterwards taking water up to the outputs, and bringing back a. wounded man from “No Man’s Land “ under heavy fire.

I have here a long letter from his wife pointing out that the man died at the Edward Millen home, the death certificate disclosing thecause of death as pulmonary tuberculosis. Although every effort was made by the returned soldiers’ organization in Western Australia to obtain a pension for him during his lifetime, the board turned him down. A certificate given by a doctor who attended the man is as follows: -

This is too certify that . . . was under my professional care on and off for the past seven and a half years, for pulmonary tuberculosis. It is my considered opinion that this condition was due to his war service, although no definite proof can bc-, brought forward

This man endured terrible experiences for four and a half years. He was gassed and wounded, and to say that his condition was not due to war services is to go beyond anything intended by this Parliament. His widow is now applying for a full pension, and I hope that the Treasurer will take the matter up with the commissioner and see that justice is clone.

Mr BEASLEY:
West Sydney

– .1. direct the attention of the Treasurer (Mr. Casey) to what is occurring in connexion with the continuance of war pensions subsequent to the death of soldiers upon whom a post-mortem examination has been held. The case that I bring to notice is similar to the well-known case in which a Mrs. Dubois had her pension stopped by the department because of medical evidence disclosed as the result of a post-mortem examination upon her deceased husband, tlie department declaring that his death was not due to war service. This case caused a good deal of controversy in different quarters; it was taken up by soldiers’ organizations, representatives of churches, and the press generally, and after much investigation the department finally agreed to restore the pension to the widow. It appears to me that there are other cases of a similar kind. The case that I cite is that of a returned soldier who, for 20 years, had suffered from tuberculosis. On the ‘29th May, 3929, he received from the Repatriation Department the following communication : -

I have to inform you that during your lifetime your war pension will not be reduced below tho 100 per cent, rate, namely £4 4s. per fortnight, but should your condition become worse, or if you develop any additional complaint which you consider is duc to war service you should at once apply to this office for further medical examination.

This returned soldier subsequently died. Representations were made to his son, without the knowledge of the widow, and he agreed to the holding of a postmortem examination of his deceased father. He now states that he did not then think any harm would be done, his belief being that the post-mortem examination might produce satisfactory evidence of the cause of death, or that the authorities of the Prince Alfred Hospital might consider it would be of some medical advantage to students and others at that institution. Whatever evidence was disclosed, the result of it was that the department declared the death to be not due to war service. The unfortunate widow has not the same opportunity to procure publicity for her case as was available to Mrs. Dubois, whose case was extensively featured on the ground that circumstances could arise which would deprive a widow of her pension; she has not been- able to interest the same bodies in the matter. I admit that she is a constituent of mine, and therefore has a claim upon me to ventilate her case in this Parliament. I feel that, even if only out of a feeling of generosity, the department might be good enough to grant a pension to her.

Mr. SPEAKER (Hon. G. J. Bell).Order ! The honorable member for Swan (Mr. Gregory) and the honorable member for West Sydney (Mr. Beasley) have instanced cases of administration under the Repatriation Act. There has been, and there probably will be again, difference of opinion as to what limit should be imposed on the debate of a measure of this character, but it appears to the Chair to be not in order to discuss the administration of the act on a bill to appropriate money for repatriation purposes. It might be regarded as in order for an honorable member to decline to agree to the appropriation’ of money on the ground that certain action had been taken by the Repatriation Commission, but that has not been done. Were I to allow the debate to proceed along the lines so far followed, which appear to mo to be not strictly in order, the whole of the administration of the Repatriation Department could be discussed.

Mr CASEY:
Treasurer · Corio · UAP

. - in reply - Honorable members are aware that this measure has no reference to the rates or conditions under which pensions are granted, and that my responsibility in the matter is confined to the financial side; I do not administer the Repatria-ti on Department. I assure the honorable member for Swan (Mr. Gregory) and the honorable member for West Sydney (Mr. Beasley) that if they will be good enough to forward to me, or possibly direct to the Minister concerned, particulars of the cases they have cited, those cases will be fully investigated.

Question resolved in the affirmative.

Bill read a second time, and passed through its remaining stages without amendment or debate.

page 2733

APPLE AND PEAR EXPORT CHARGES BILL 1938

In Committee of Ways and Means:

Motion (by Mr. Thompson) agreed to-

That, subject toa lower rate being proscribed by regulations made under the act passed to give effect to this resolution, charges shallbe imposed on all apples and pears exported from the Commonwealth after the commencement of that act, at the rate of threefarthings for each case, two half-cases or three trays of apples or pears exported.

That the Governor-General may, from time to time, by order published in the Gazette. after report to the Minister by the Australian Apple and Pear Board constituted under the Apple and Pear Organization Act 1938, exempt any apples or pears from the charges imposed by or under the act passed to give effect to this resolution.

That any such exemption may be unconditional or subject to such conditions as arc specified in the order of exemption, and shall apply in respect of such period (if any) as is so specified.

That the Governor-General may, by order published in the Gazette, cancel any such exemption.

That where the Governor-General has, In order published in the Gazette, cancelled any such exemption, or where the period in respect of which any such exemption applies has expired, tho charges imposed by the act passed to give effect to this resolution shall, from the date fixed by the order or from the expiration of the period of exemption, as the case may be, become payable in respect of the apples or pears to which the exemption related.

Resolution reported.

Standing Orders suspended ; resolution adopted.

Ordered -

That Mr. Thompson and Mr. Casey doprepare and bring in a bill to carry out the foregoing resolution.

Bill brought up by Mr. Thompson, and read a first and second time.

In committee:

The bill.

Mr NOCK:
Riverina

.- Will the Assistant Minister (Mr. Thompson) explain the reason for the provision for the exemption of some fruit from the levy of¾d. a case?

Mr THOMPSON:
Minister without portfolio assisting the Minister for Commerce · New EnglandAssistant Minister for Commerce · CP

. -Under the Apple and Pear Organization Act 1938, provision is made for the establishment of an apple and pear export fund, into which shall be paid all moneys collected under the Apple and Pear Export Charges Act 1938. The Apple and Pear Organization Act indicates the purposes for which the fund is to be used. The bill nowbefore the committee provides for the levying of charges on all apples and pears exported from Australia, in order to provide the necessary fund. This follows the usual procedure in regard to all statutory boards established for the purpose of controlling the exports of primary products, and looking after the welfare of the respective industries.

The maximum rate of levy is fixed in the bill at¾d. a case. This rate was agreed to at a conference of apple and pear growers’ organizations held at Canberra, and sets the limit of the charge which may be made. The actual rate of charge, which must not exceed¾d. a case, will be determined by the board and recommended to the Minister, who will then arrange for the necessary rate to be prescribed.

With regard to the provision in clause 5, for the exemption of certain apples and pears from charges imposed by the act, it is not intended that any wide or general exemptions sha ll be granted. It may happen, though, from time to time, that a small experimental shipment of fruit is being forwarded overseas, or that some other special circumstance may arise in regard to a small shipment, in which case it is desirable that the power to exempt such shipment from the charges should be available. That is the only reason for the inclusion ofthis provision, which appears in all other export charges acts for the purposes mentioned.

Bill agreed to, and passed through its remaining stages without amendment or debate.

page 2734

PRIMARY PRODUCE EXPORT CHARGES BILL 1938

Second Reading

Mr THOMPSON:
New EnglandAssistant Minister for Commerce · CP

. -I move -

That the bill be now read asecond time.

The measure, which is an amendment of the Primary Produce Export Charges Act 1935, merely provides for the abolition of the existing charge on the export of apples and pears from Australia, to take effect from the date on which the charge under the Apple and Pear Export Charges Bill comes into operation.The present charge is collected to provide the funds of the Australian Apple and Pear Council, but, as the Apple and Pear Board will take the place of the council, there is no necessity for further collection of the charge under the Primary Produce Export Charges Act.

Question resolved in the affirmative.

Bill read a second time, and reported from committee without amendment or debate; report adopted.

Bill - by leave - read a third time.

page 2734

STATE GRANTS (FERTILIZER) BILL (No. 2) 1938

Message recommending appropriation reported.

In committee (‘Consideration of Governor-General’s message) :

Motion (by Mr. Thompson) agreed to-

That it is expedient that an appropriation of revenue be made for the purposes of a bill for an act to provide for financial a.ssistanco to the States in the making of payments to primary producers, and for other purposes.

Resolution reported.

Standing Orders suspended; resolution adopted.

Ordered -

That Mr. Thompson and SirEarle Page do prepare and bring in a bill to carry out the foregoing resolution.

Bill brought up by Mr. Thompson, and read a first time.

Second Reading

Mr THOMPSON:
New EnglandAssistant Minister for Commerce · CP

– I move -

That the bill be now read a second time.

The hill provides for payment of a subsidy at the rate of 10s. a ton on all artificial fertilizers used during the year ending the 30th June, 1939, in the production of primary produce other than wheat. Payment will not be made on any quantity in excess of ten tons of fertilizer used by any one primary producer, and, for the purposes of this legislation, a partnership or a group of persons working under a share-farming agreement are to be regarded as one primary producer. This subsidy first came into operation in December, 1932, and, excepting for the period from the 1st December, 1933, to the 30th June, 1934, has been continued at varying rates since that date. The rates of subsidy paid since its inception, the total amount paid, and the quantity of fertilizer used in each year have been as follows: -

For the year ended the 30th June, 1938, no subsidy is payable in respect of any quantity in excess of 20 tons by any individual producer. This provision is responsible for the reduction of the quantity on which it is estimated that subsidy will be paid; and in the total amount of payment. The fertilizer subsidy scheme has proved to be one of the best forms of assistance to primary producers introduced by the Government. It has resulted in a remarkable increase in the use of artificial fertilizers, which has enabled substantial reductions of prices to be made by the manufacturers of artificial fertilizers, and it has also been of great benefit in demonstrating to primary producers the advantages to bo derived from a wider use of fertilizers in primary production, particularly on soils which are deficient in plant food. The reduction of the price of superphosphate alone, as the result of the increased output in factories, has been approximately £1 a ton since the scheme was introduced. Furthermore, the extension of top-dressing of pastures has proved of material benefit by creating a permanent increase of productive activity. Whilst the Government realizes the value of this subsidy to primary producers generally, it is faced with the necessity for reducing expenditure because of the heavy calls on revenue in other directions, lt is desirable, however, that some form of assistance should bc continued, particularly to the users of small quantities of fertilizer, and, therefore, it has been decided to continue the subsidy in respect of fertilizers used during the year ending the 30th June, 1939, but to pay it only on quantities up to 10 tons used by any individual producer. It is estimated that the cost of the subsidy will be £215,000.

Mr Curtin:

– The Government is subsidizing the use of fertilizer, and then subsidizing the product from the fertilizer.

Mr THOMPSON:

– If the honorable member is referring to the wheat industry, no subsidy of this kind is paid to wheat-growers.

Debate (on motion by Mr. Curtin) adjourned.

page 2735

STATE GRANTS (FERTILIZER) BILL 193S

Second Reading

Motion (by Mr. Thompson) proposed -

That this bill be now read a second time.

Debate (on motion by Mr. Curtin) adjourned.

page 2735

FINANCIAL RELIEF BILL 1938

Message recommending appropriation reported.

In committee (Consideration of Governor-General’s message) :

Motion (by Sir Earle Page) agreed to-

That it is expedient that an appropriation oi revenue be made for the purposes of a bill for an act to amend Sections 27 and 28 of the Financial Relief Acts 1030.

Resolution reported.

Standing Orders suspended; resolution adopted.

Ordered -

That Sir Earle Page and Mr. Thompson do prepare and bring in a bill to carry out the foregoing resolution.

Bill brought up by Sir Earle Pack, and read a first time.

Second Reading

Mr. THOMPSON (New EnglandAssistant Minister for Commerce) [4.15 j. - I move -

That the bill be now read a second time.

Under the Financial Relief Acts “1930 provision was made for the payment of a subsidy on artificial fertilizers used during the year ended the 30th June, 1937. Claims for payment of subsidy had to be lodged by the prescribed date, which was subsequently made the 30th April. 1938. It was thought at the time that if any applications for subsidy were received after the prescribed date and were accompanied by a satisfactory explanation of the delay, a further date could be prescribed to permit of such applications being accepted ; but advice has been received to the effect that once a date is prescribed no later date can be subsequently prescribed. A small number of applications has been received, and satisfactory explanations have been submitted for the delay beyond the prescribed date. The amount involved will not exceed £722. In order to permit of payment being made to these applicants, it is necessary for a small amendment of the act to be made to permit the Minister to determine a later closing date where any exceptional circumstances are brought under notice as having caused delay in the submission of the application.

Mr CURTIN:
Fremantle

.-! support this bill. The act passed in 1936 contained anomalies which had the result of depriving certain applicants for the fertilizer subsidy of any payments, because their applications were not received by the prescribed date. A bill was passed which sought to rectify that and certain other anomalies, but apparently it was not completely successful in dealing with the problem. The persons whose claims will be validated by the passage of this bill are legitimately entitled to amounts aggregating £722. A number of wheat-growers in Western Australia made personal representations to me on this subject. I believe that their circumstances were absolutely identical with those of the majority of people to whom this subsidy was paid. That being so, it is proper that the applications with which this bill is concerned should be paid. I sincerely trust that this will be the last we shall hear of the anomalies of the 1936 act.

Question resolved in the affirmative.

Bil] read a second time.

J.h committee:

The bill.

Mr LANE:
Barton

.- It seems to me that the members of the Country party can come along at the eleventh hour in practically any period of any parliamentary session and get what they want.

Mr Curtin:

– The honorable member should realize that this bill relates to the past.

Mr LANE:

– All I know is that it relates to certain persons who were late in making application for the fertilizer subsidy. If any other section of the community is late in making application for various benefits provided by the Government, it has to suffer the usual penalty of lateness and go without; but the primary producers seem to be in a privileged position in this respect.

Mr Curtin:

– The honorable member does not seem to understand that certain primary producers did not know, when they put in their crops, whether they would cut them for hay, or reap them for wheat.

Mr LANE:

– I know that they were late in making their applications for this bounty. Why should the wheat-farmers be in a favoured position?

Sir Earle Page:

– The farmer who grew wheat did not get any fertilizer subsidy.

Mr LANE:

– The procedure of the Government in this connexion is wrong. I submit that if the regulations prescribe a date by which applications must, be made, only applications received by that date should be considered.

Mr Anthony:

– The honorable member does not understand the real position.

Mr LANE:

– The primary producers seem to be able to request their representatives in this. Parliament to come along here at any time, but particularly in the closing hours of a session, and say, “ We have not. been given enough; we want a few more hundred pounds “. I am accustomed to the actions of the members of the Country party in the State parliament, and I know that this is their general procedure. It seems that the Labour party is at present aiding and abetting the Country party in this matter. I protest against the practice that has been followed. Lf the Leader of the Country party (Sir Earle Page) wishes to sweeten his constituents a bit, and bind them to him with the cords of love and mopey, he should adopt some other method to do it.

Mr JAMES:
Hunter

.- Is the purpose of this amending bill to enable the Government to deal with late applications?

Sir Earle Page:

– That is so.

Mr JAMES:

– Then I shall offer no objection to the measure. Unlike the honorable member for Barton (Mr. Lane), I am always prepared to act fairly towards the primary producers. Some time ago, I brought under the notice of the Minister for Commerce the case of a primary producer at Cessnock who posted his application for the fertilizer subsidy and was able to prove, by the postmark on the envelope, that it should have reached the prescribed authority before the date on which applications closed. The right honorable gentleman told me that he regretted that nothing could bo done in the matter until the law was amended. I am glad that steps are now being taken to cover such cases as that.

Bill agreed to without amendment, and passed through its remaining stages without debate.

page 2736

SEAMEN’S COMPENSATION BILL 1938

Second Reading

Mr THOMPSON:
New EnglandAssistant Minister for Commerce · CP

.- I move-

That the bill be now read a second time.

The Seamen’s Compensation Act, passed by Parliament in, 1911, has become in several respects out of date, chiefly by reason of the inadequacy of the amounts of compensation prescribed, owing to the considerable increase of the cost of living that has since taken place.

The act provides for payment by the employer, as compensation for total incapacity, of a sum not exceeding 30s. a week, and to the dependants, in case of death of the seaman, for example, by shipwreck with loss of life, of a sum not less than £200 and “ not exceeding in any case” £500.

State acts providing for compensation in respect of injuries to workmen, including seamen employed on purely intra state vessels, passed since the enactment of our Seamen’s Compensation Act, and also of our Commonwealth Employees’Compensation Act 1930, all make more liberal provision than does the Seamen’s Compensation Act. The following table gives a comparison of the amounts, with limitations in lump sums, payable under each act: -

It is clear from this table that the amount of compensation payable under the Seamen’s Compensation Act, whether by way of lump sum in case of death, or weekly payment in case of incapacity, is considerably below that payable under the Commonwealth Employee’s Compensation Act 1930 and the Workers’ Compensation Acts of the various States and that the anomaly can be overcome only by an increase of the compensation payable so that it shall more closely accord not only with the higher cost of living now as compared with 1911, but also with the amounts payable under other comparable Sta>te and Commonwealth acts. Thus the bill proposes that a seaman totally or partially incapacitated by injury shall receive a maximum weekly payment of 70s. instead of the maximum 30s. a week under the existing act. In the case of death resulting from the injury, the maximum amount payable to dependants will be increased from a minimum of £200 to a minimum of £400, and a maximum of £500 to a maximum of £750.

A second important direction in which it is proposed to amend the act is by providing for lump sum payments as compensation in respect of certain specified physical injuries. Under the act as it stands, a seaman who has lost, say, a finger or a foot, is entitled to compensation at a weekly rate, with 30s. as a maximum, during incapacity. A man who has lost, say, the index finger of his right hand would be seriously inconvenienced for the rest of his life. But in a fewweeks,, after the injury had healed, he would still be capable of doing a seaman’s work, so compensation payments stop. Under the amendment proposed he would be entitled to a lump sum payment of £150.

On the other hand, the man who lost a foot, though quite capable of engaging without handicap in many other avocations, would be incapable of returning to his former position as a deck or stokehold hand on board ship. The employer would accordingly be liable to pay him, so long as he lived, the difference between the amount of his average weekly earnings before the accident and the average weekly amount which he is earning, or is able to earn, after the accident in some other employment or business suitable to his incapacitated condition. If he were so incapacitated as to he unable to take up any other form of employment, lie would receive, in the aggregate, if he lived another 25 or 30 years, and the weekly payments continued, three and four times as much as the widow and family of a seaman killed on the job. In neither case is the result equitable; the man deprived of his index finger does not get enough, while the man who loses a foot gets too much.

It is true that under paragraph 18 of the first schedule to the act, the liability of the employer for weekly payments may be redeemed by a lump sum payment (a) equal to that which would purchase an immediate life annuity for the seamen equal to 75 per cent, of the annual value of the weekly payments under the act or (6) settled by arbitration under the act or (c) fixed by a county court or (d) arrived at by agreement between the parties. In practice, during the last 27 years, the last-mentioned method only has been used. The defect of the method is that no standards are prescribed by which the amount of a lump sum may be fixed as being commensurate with the degree of incapacity of the seaman for general usefulness, arising from the particular injury suffered. The consequence is that an energetic man, desiring to secure capital for, say, a small business, will often accept a relatively small amount, while another, content to live in idleness on the weekly allowance, will not agree to any, or at any rate any reasonable, lump sum payment. The new provision proposed remedies this. The third schedule specifies the amount of the lump sum payable ‘ in respect of any of the injuries enumerated. The amount for the loss of both eyes, or hands or feet, or of a hand_ and a foot, or of mental powers, or total paralysis of limbs, is the same as the maximum amount payable in the case of death, viz., £750. For the loss of the sight of one eye the proportion has been fixed as 50 per cent., equivalent to £375, and so on for various permanent injuries, down to the loss of a joint of a finger ot a joint of a toe for which the proportions are 12 per cent, and 10 per cent., equal to £90 and £75 respectively. >

The relativity of the proportions to the injuries is not new or arbitrary, but is based first on that observed in the Commonwealth Employees’ Compensation Act, which in turn followed generally the proportions set out in earlier State acts. In the fixing of the proportions originally, regard .was paid, it is understood, to the degree of disability the average worker would be subject to in the way of obtaining employment in any general community.

Another important provision of the bill is the payment of a weekly allowance, where total incapacity for work results from the injury, of 7s. 6d. a week in respect of each dependent child of the seaman under 14 years of age, with the proviso that the total amount payable shall not exceed -.the seamen’s average weekly earnings. The Commonwealth Employees’ Act and all State compensation acts, excepting in the case of Tasmania, provide for weekly allowances in respect of dependent children.

Provision for the payment of hospital and medical expenses is made in the Navigation Act and also in the Commonwealth Employees’ Compensation Act, but no corresponding provision is made in the Seamen’s Compensation Act. It is considered reasonable that an injured seaman, or, in the case of death resulting from the injury, his dependants, should not he required to pay these expenses, and provision has accordingly been made in the bill for the payment of hospital and medical expenses up to a maximum of £25.

In. an Arbitration Court award, made in 1928, in respect of wages and conditions of employment of members of the Merchant Service Guild of Australasia’, which comprises masters, officers and certain engineers, it was provided that compensation should not be payable if the employee concerned were entitled to receive compensation under any Federal or State act. This had the effect of excluding masters and officers on interstate vessels from the provisions of the award relative to compensation, as the Seamen’s Compensation Act applies equally to -masters and officers as it docs to deck and stokehold ratings. In actual practice, however, it is understood that, as the award provisions with respect to compensation are more favorable than those under the Seamen’s Compensation Act, ship-owners have, as a matter of course, paid compensation in accordance with the provisions of the award. Masters and many officers employed on interstate vessels enjoy the benefits of the award, by reason of the fact that’ the workers’ compensation acts of the various States limit compensation payable under those acts to employees whose annual remuneration is less than certain stipulated amounts. These amounts range from £550 in New South “Wales to £312 in Tasmania.

Tinder the award: dependants of a master or officer, whose death resulted from an injury received in the course of his employment, would receive a sum equal to three years’ earnings of the employee, or about £2,100 in the case of a master. Under the existing Seamen’s Compensation Act the amount payable in the case of death is £500. The bill provides for this maximum to be increased to £750. To overcome this anomaly the bill provides for the exclusion of masters and deck and engineer officers from the provisions of the Seamen’s Compensation Act so that they, or their dependants, may receive the better conditions provided by their respective awards.

The existing act is defective also in that no provision is made therein for compensation in respect of occupational or industrial diseases. It is proposed to remedy this defect. The remaining amendments of the Seamen’s Compensation Act proposed to be made are either consequential on those above referred to, or are machinery or minor administrative changes found necessary or desirable in the light of experience in the administration of the act. These amendments will be explained in detail if necessary, in committee.

The whole object of the bill, as already explained, is to improve the position of seamen with respect to” compensation for injury arising out of, or in the cour.se of, their employment. The amendments of ibc Seamen’s Compensation Act are overdue and as it is desired, if at all possible, to put ‘the hill through all stages during the current sittings of Parliament. T would ask honorable members to assist bv giving the measure a speedy passage.

Mr BEASLEY:
West Sydney

– The Opposition welcomes this bill, and the opportunity to deal with it immediately after the second-reading speech of the Assistant Minister (Mr. Thompson), because, knowing that more than 27 years have clapsed since the principal act dealing with compensation to seamen was passed by this Parliament, it believes that amendments are long overdue.

Mr Holloway:

– We have been lagging behind other countries.

Mr BEASLEY:

– As my honorable friend says, whereas progress has been made in other countries in regard, not only to seamen’s compensation, but also to workers’ compensation generally, the Australian seamen’s compensation law has remained unchanged since it was placed on the statute-book in 1911. The Commonwealth even lags behind the Australian States, because the State Parliaments have passed legislation in recent years to modernize their compensation laws in all directions. The Assistant Minister himself showed that amending legislation is necessary when he cited the. fact that tho cost of living has risen since the original act was passed. As rises of the cost of living affect workers ashore, so also do they affect those who go to sea. In 1931 I was pleased to be the Minister who piloted through this House a bill amending the Commonwealth Employees Compensation Act. It is interesting to recall that, the right honorable member for Cowper (Sir Earle Page) was then sitting on this side of the House.

Sir Earle PAGE:

– Yes, I helped the honorable gentleman with his bill.

Mr BEASLEY:

– At any rate, if the right honorable gentleman did not help mc very much he at least did not show a great deal of opposition. I hope, therefore, that the Government will take no action in this chamber to reduce to any degree the benefits for seamen which the bill contains. Tho measure has been fully discussed and amended in the Senate. As the Commonwealth Employees’ Compensation Amendment Act was a milestone on the road of progress, so also will this bill be. Considerable progress has been achieved all over the world in the matter of workers’ compensation generally, and I repeat that this bill is long overdue. In fact, it is extraordinary that Parliament - I say “ Parliament “ - did not act in this matter long ago. I do not think any reason can be advanced to excuse its inaction. There has never been any delayin granting assistance needed by industries, both primary and secondary; indeed, the Opposition has been reasonably generous in permitting Parliament, to deal with them. I hope, therefore, that the Government will keep in mind the very ready response in the way of assistance that has been provided for others when, dealing with this bill, because it is one of particular importance to.a large number of honorable members on this side of the House.

When dealing with a bill of this description the international character of the work carried out by seamen must be borne in mind. Their welfare and advancement have been the subject of long discussions at international conferences of various kinds. In many of the ports, not only in Australia, but also in other countries of the world, if not in most of them, welfare bodies have been set up to provide, entirely without governmental aid, for the entertainment and assistance of seamen whilst they are ashore. Good-intentioned people are induced to engage in this humanitarian work, because they feel that, as seamen by reason of their employment are obliged to remain away from their homes and dependants, some entertainment and attention should be provided for them to compensate in some small degree fdr the loss of their home life. For the same reasons which actuate these people I believe that seamen have a greater claim on the Government and on the community as a whole for assistance to make their lot a more happy one than have some workers ashore whose regular occupations enable them to enjoy the comforts of a home and to lead normal lives.

It is fitting in considering a bill such as that now before us, and before passing on to discuss the principles contained therein, that one should pay tribute to the value of the work of many of these voluntary seamen’s welfare organizations, which, as I have said, are to be found, not only in Australia, but also in most of the ports of the world where seamen congregate. I have claimed on behalf of seamen that their work in the interests of various countries from which they come is invaluable. It cannot be really over-stated. In peace time they move from one country to another, acting as emissaries for the country which they represent in keeping open the free flow, of trade and commerce. It is most essential that a country like Australia, which depends on the export of its surplus primary products for its very existence, should have a happy and contented mercantile marine. We have to find markets in other countries for our surplus primary commodities, and to our seamen falls the task of providing their contribution towards the maintenance of the steady flow of trade and commerce upon which our prosperity depends. Therefore, I feel sure that I can appeal successfully to the representatives of the primary producers in this Parliament to have particular regard for the dangers of maritime employment and the need for bringing their compensation laws up to date. In war-time the duties of seamen are confined to maintaining, not only the even flow of trade and commerce, but also the regular transport of troops and war material. Therefore, in the interests of our safety and development we should be prepared to do everything possible to place the welfare of seamen on the best possible basis. I am sure that honorable members will agree with me that the part played by seamen is an important one. When we feel disposed to recognize that fact I think that Ave ought to approach the consideration of anything done in their interests, perhaps more generously than we might feel disposed to view the betterment of the condition of others who are more fortunately placed. I therefore appeal to honorable members to pass the bill into law in i t« present form as soon as possible.

In regard to the international character of seamen’s work I feel I may make passing reference to the fact that it has been my privilege to speak for seamen at the International Labour Conference at Geneva. At these conferences special sessions are devoted,- from time to time, to deal with matters concerning the welfare of seamen, not only the question- of compensation for injuries, but also sickness, repatriation and the codification of ship’s articles which they are called upon to sign. It is interesting to relate that when the International Labour Organization was first set up under the authority of the League of Nations it was intended that it should tackle the question of determining some means whereby backward countries could be forced to adopt the standards of the more forward ones. In this connexion the question of the welfare of seamen received a special place in its work. The International Labour Organization, realizing that this matter was of great importance, provided special sessions for the discussion of maritime questions alone. In the course of its inquiries questionnaires were sent out to various countries asking for their advice and comments. I recall that the first conference of the International Labour Organization, which was held at Genoa in 1919, sought to arrive at a basis whereby the conditions and welfare of seamen could be determined on a world basis. No matter how much we may feel disposed to criticize the efficacy of the League of Nations to secure the peace of the world, it cannot be denied that its attempt in regard to industrial matters, to bring backward countries up to the level of more advanced countries is of’ great value. It will be agreed that where countries which have low-wage standards and, in effect, slave conditions are permitted to compete against others in which better conditions are enjoyed, conflict in regard to trade and markets must continually arise. Consequently any attempt to establish on an international basis a means whereby backward countries could be forced up to the level of mort advanced countries is much to hu applauded. It is interesting, therefore, to note that the International Labour Organization has devoted considerable time and energy to the consideration of tlie conditions under which seamen are called upon to work. In 1926 I had the honour of representing the Australian workers at the ninth session of the International Labour Organization at Geneva. The object of that conference was to codify seamen’s articles and to deal with other phases of their occupation. It was a very interesting experience for me to meet representatives of seamen from all parts of the world, all imbued with the common desire for the improvement of the conditions of seamen generally, irrespective of nationality.

Mr Holloway:

– That was done in the common interests of all countries.

Mr BEASLEY:

– As my friend the honorable member for Melbourne Ports (Mr. Holloway), who has also represented the workers at Geneva, has reminded me, all countries had a common interest in the endeavours of their representatives. I found it a great pleasure and vastly interesting to mix with the representatives of other countries, and I could not but appreciate their very keen desire to see that the best conditions for seamen should prevail generally throughout the world. I regret to say, however, that the greatest opposition to any betterment of seamen’s conditions came from the representatives of the British ship-owners; they were hard to move and were very reluctant even to agree to the removal of many of the penalties which they are capable of imposing on seamen in the event of their not doing just all that is required of them in certain circumstances. The last conference was held in 1936, and again a special session was devoted to the question of maritime affairs, as the result of which much good was done. At that conference Australia was represented by the secretary of the Marine Transport Workers Group in Sydney, Mr. Tudehope, who has had long experience of the seafaring industry.

I conclude my general remarks by saying that seamen generally have a claim to a special place in the affairs of all countries, particularly when the International Labour Organization has devoted so much time and attention to them. I think, in speaking for them in this Parliament, I can justly ask the Parliament to bc as generous as it possibly can in regard to the laws it places on the statute-book in relation to seamen’s compensation. The dangers associated with their work cannot be over-stated. Itis true that the hours of labour for seamen are specified in awards, but, after all, those hours are not adhered to in special circumstances. For instance, during adverse weather conditions the seamen are subjected to greater dangers and are called upon to carry out such work as the captain may order irrespective of any hours they may have already laboured. In fact it can be said that seamen are really at work all the time. The laws which prevail in regard to the mercantile marine lay it down that the captain is entirely in charge of the ship and may call upon his crew at any time to carry out duties considered by him to be necessary for the safety and welfare of the ship, its crew and its passengers.

Mr Holloway:

– The captain is really a king on board his ship.

Mr BEASLEY:

– That is so, and I can quite appreciate in certain circumstances the necessity for clothing him with such high authority. A ship is really a little country of its own and it is necessary that the crew and even the passengers should be subject to the direction of the captain. The risks run by seamen are many and varied; there is no need for me to elaborate them. It may be true that modern methods of transport have resulted in many improvements of the lot of seamen - they have been given better quarters and better food - but the march of time and modern methods have multiplied the dangers associated with their work. After all, every man, irrespective of what he is called upon to do, should be regarded as a human being and as such entitled to the fullest consideration and the best conditions in regard to his employment. For instance, the conversion of most modernliners to the use of oil fuel has added another risk to those already run by seamen, that of contracting dermatitis. Their added dangers in more recent years could be elaborated in many ways. In these days of speed, the shipowner’s anxiety to clear the ports in order to save harbour dues and excess charges for tugs after certain hours has resulted in a considerable speeding up of the loading and unloading of vessels, which has added to the dangers of the calling. Whilst it may besaid that some of the risks incurred by seamen in the past no longer exist, others which have taken their place as the result of the introduction of modern methods call for special treatment by way of compensation. Suitable and proper compensation should be provided for sickness, injuries and disease arising out of the changed nature of the seafaring industry. The occupation of these men, which takes them away from their homes and dependants, and gives rise to constant anxiety regarding their welfare, entitles them to further sympathetic consideration.

This measure has been discussed in the Senate at considerable length and a number of amendments proposed. I ask the

Minister to accept them. I frankly state thatI do not want to lose the bill or have it delayed. The seamen’s representatives, who have been considering this matter for the last two years, have asked me to express their appreciation of the way in which they have been received by the Minister for Commerce (Sir Earle Page) and the former Assistant Minister (Mr. Archie’ Cameron). I introduced several deputations of seamen to these Ministers, and on other occasions we submitted representations to them in writing. All of the proposals we put forward have been closely investigated by the Government, and the Assistant Minister was good enough to advise me from time to time of the developments that, were taking place, and also to seek the further advice of the maritime unions.

In dealing with this bill, I wish to state that the proposed new section 5 a fixes the amount which shall be paid in regard to medical, surgical and hospital treatment at £25. I ask the Government to raise that amount to £100, and I base my request on the fact that section 11 of the Commonwealth Employees Act 1931 fixes the maximum amount in similar circumstances at £100.

Mr Blackburn:

– Why fix any limit?

Mr BEASLEY:

– It would be far better if no limit were fixed, I admit. In any case, even if the limit were fixed at £100, it would not necessarily mean that the full amount would be paid in all cases. It is provided that the matter shall be subject to the direction of the Minister. Section 5 of the New South Wales Workers Compensation Act provides for ambulance, medical,surgical and hospital treatment. It fixes the amount for ambulance services at £2 2s., and the amount for hospital treatment at £25. In most of the other States, 1 understand, a maximum amount payable is also fixed. In Queensland and Victoria, the Workers Compensation Acts provide for better allowances than those in the New South Wales act. Those acts should be considered when we are fixing the amount under this legislation.

Proposed new section 5b relates to compensation for injury or partial incapacity, and the seamen suggest that in the second column of the schedule, after the word “incapacity” first occurring, the words “ if a seaman so elects “ should be inserted. The proposed new paragraph corresponds with section 12 of the Commonwealth Employees Compensation Act 1930, but the corresponding section in the New South Wales act is section 16, and it permits a worker to elect whether he shall take the lump sum provided in the relevant schedule, or weekly payments. The paragraph, as it now reads,limits a seaman’s right to compensation to the amount specified in the second column of the third schedule opposite the specification of the injury, less any amount received by the seaman under the first schedule. No case is known which involved the consideration of the question whether a worker covered by section 12 of the Commonwealth A.ct was limited to the amount so specified, even in a case where the weekly payments might, or would have, exceeded the amount so specified. The section is however, open to that construction, and for that reason, and for the purpose of definitely conferring a right of election on a seaman, it is suggested thatthe words mentioned should be added. An anomaly might arise if the section means what it is suggested it does mean in its present form, inasmuch as the seaman might be permanently and totally incapacitated when suffering none of the injuries specified in the first column of the schedule, in which case his right to receive weekly payments would not be exhausted when he received payments aggregating £750. The seaman who was permanently and totally incapacitated by reason of his having sustained one or more of the injuries specified in the first column of the third schedule would be limited to £750.

Clause 8 reads -

The first schedule to the principal act is amended -

by omitting clause (1.) and inserting in its stead the following clause:- “ (1.) The amount of compensation under this act shall be -

where death results from the in jury -

if the seaman leaves any dependants wholly dependent upon his earnings, a sum equal to his earnings in the employment of the same employer during the four years next preceding the injury, or the sum of four hundred pounds, whichever of those sums is the larger, but not exceeding in any case seven hundred and fifty pounds:

The amount of £7 50 mentioned in clause 1 of the first schedule is a decided improvement on the amount at present payable where death results from injuries, but more beneficial provisions are to be found in the State acts. The New South Wales act provides for a lump sum of £800, and £25 in respect of each dependent child under sixteen years of age. We suggest that at least £25 should be added to the lump sum in respect of each dependent child under sixteen years of age, even if the lump sum is not increased to £800.

The bill states that an amount of £25 shall be provided for funeral expenses. Originally, the Government had intended to pay £30, but this was reduced to £25. This point, I know, involves consideration of the question of what is a reasonable amount, but the seamen feel that at least £30 should be allowed.

Clause 9 includes a schedule describing various diseases for which compensation is payable, and I direct the attention of the Minister to “ dermatitis, produced by oil or grease, or dust or caustic or corrosive liquids “. We want the Government to eliminate those qualifications. I have looked up the disease in the Encyclopaedia Medica, and, while I hesitate to put forward my views on such matters in the presence of the Minister for Commerce, who belongs to the medical profession. I point out that, according to the encyclopaedia, while dermatitis does arise largely from the causes mentioned in the bill, it is not confined to those causes. If the clause is allowed to stand in its present form the argument may arise as to whether a seaman suffering from dermatitis contracted the disease from any of the causes specified. Some seamen, it is true, may be engaged in handling the liquids mentioned, but others, who do not come directly in contact with them, may also contract the disease. The seamen have interviewed Dr. Charles Badham, of the Board of Health, in regard to the incidence of crude oil to dermatitis among seamen engaged among oil burners, and they were furnished with references to certain medical treatises brought under the notice of Chief Judge Dethridge, who was considering whether a provision should be included in a new award dealing with dermatitis. In Hover and Hayhurst, on Industrial Health, the following appears: -

The utmost care should be taken to secure efficient removal of concentrated petroleum vapors from tanks and stills by means of compressed air, steam or oxygen. Careful supervision of the work, impermeable gloves, personal cleanliness by means of frequent ablutions of the hands, shower baths and change of clothing upon cessation of work are indicated. Suspension of toxic symptoms should be insisted upon.

It goes on to say -

Petroleum as a fluid has a direct action on the skin, and persons engaged in filling barrels, emptying retorts and handling of paraffins and other residues, are liable to develop obstinate inflammatory conditions of the skin, petroleum and paraffin itch, also pimples, pastilles, ‘boils, and warty growths.

This matter has been discussed at great length before the courts, and it appears to me that a good deal of attention has been paid to it in the arguments advanced by the legal advisers of the seamen. I am afraid that if the limitation in regard to dermatitis proposed by the bill is adopted a number of men who may become affected will be denied the benefits of compensation. In the Senate, the party of which I am a member was anxious to have included in the measure as compensatable all diseases’ arising from the occupations followed, but that chamber resolved that the only two diseases which could be accepted were pneumonia and pleurisy. Apparently, honorable senators were prepared to accept the principle that seamen because of the nature of their employment, become victims of those diseases to a greater degree than do men who are employed ashore. It will be admitted that if men can obtain medical attention immediately they become victims of influenza, or contract a bad cold, the likelihood of pneumonia or pleurisy developing can be minimized, if not absolutely avoided, whereas the conditions under which the men employed on sea-going vessels work preclude them from the opportunity to procure that early attention which is necessary, and are thus more susceptible to the danger of contracting pneumonia or pleurisy than are men who are employed ashore. It may be argued, from the Government side of the House, that this is a departure in connexion with workmen’s compensation legislation. Even though I have to admit that it is, I feel that there are special circumstances which justify it.

Mr Holloway:

– Hear, hear!

Mr BEASLEY:

– I believe the honorable member will agree that men who sail the seven seas are subject to all sorts of sudden climatic changes and other conditions which call for special treatment.

In this connexion, I cite a case which came before the courts for the purpose of establishing whether or not pneumonia could be regarded as an injury “ by accident “. In a communication that I have “received, an interesting passage reads as follows : -

Pneumonia lias already been held by the High Court of Australia to be an injury by accident within the meaning of that well known expression to be found in ‘all Compensation acts in existence. The case in which it was so held was in the case of McGuire v. The Union Steamship Company of New Zealand, reported in 27 C.L.R. 570. This case was one in which the worker, who was in his usual good health when he commenced work at 8 o’clock on a winter’s morning, after working throughout the day and the ensuing night, developed cold shivers at C.30 a.m. the following morning and went home and to bed; the following day he developed pneumonia and was laid up for some time. The case first caine before the District Court in Sydney and then proceeded on appeal to the Supreme Court of New South Wales and the High Court of Australia.

Prom the judgment of Knox, C.J., the facts above-mentioned are quoted, and it is also stated that, “ the workman had some eighteen months’ previously suffered an injury to his elbow; pneumonic organism attacked the injured spot, an operation on the elbow was performed, and his arm is now so useless as to render the workman, for the present, totally incapacitated from work.” The question .was. whether or not, on the facts stated, personal injury by accident arising out of and in the course of the employment was caused to the workman.

It was stated that the workman suffered injury in the course of his employment, but the question for consideration by the courts was whether he had suffered injury by accident in the course o”f his employment. The High Court reviewed many cases and finally decided that, in the particular circumstances of the case, injury by accident had been sustained. Isaacs and Rich J. J., at page 590, said this: “ The long hours of work had apparently so reduced the man’s powers of resistance that lie wds unable to withstand the effects of the cold air. Of the suddenness and unexpectedness of the attack, there can he no question. Ko finding to the contrary could stand. There was no gradual development of injury as would take place, for instance, in lead poisoning in some trades, and which precluded compliance with section 0 (2). No one could contend that the result that occurred is the inevitable, or is even to be expected as a usual, occurrence. In our view, on the facts as found by the learned District Court Judge, there was necessarily, on a proper construction of the act, ‘ injury by accident ‘ “.

Gavan Duffy and Starke JJ., said, “ In this case we find that the facts found by the Arbitrator do in point of law constitute an injury by accident within the meaning of the statute. The combination of circumstances and the results arc so unexpected and unlooked for from the workman’s point of view that they may properly be described .as accidental. The learned Arbitrator was of opinion that he was precluded in point of law by certain cases, from holding that the occurrence was accidental, and in this we think he was in error. This court should, therefore, declare that tlie appellant is entitled to compensation in accordance with the earnings of the workman agreed upon by the parties.”

The position is, therefore, that the High Court has determined that where the nature of the workman’s employment contributes to pneumonia, he is entitled to compensation in accordance with the provisions of the Workmen’s Compensation Statutes. There should be no doubt, we think, that the nature of a seaman’s employment renders him liable to develop pneumonia, or pleurisy. Exposure to clements, emerging from hot stoke-holds into a cold atmosphere, and such like, place him in a position frequently in which he is likely to develop either of these two diseases.

The inclusion of pneumonia and pleurisy in the schedule of occupational diseases in respect of which compensation is to bo provided for docs not, we suggest, impose any additional liability on employers so long as it is clear that the illness was contracted in the service of the ship.

That concludes my summary of the position. Although in another place we failed to secure the inclusion of all diseases arising from a man’s occupation, we are particularly anxious that pneumonia and pleurisy should he retained. I hope that the Minister will not, feel that they should not he included because to include them would be a departure in comparison with other compensation acts. The decision of the High Court is evidence of the feeling of the courts in regard to this matter. I put it that the circumstances governing the employment _ of seamen are not to be considered as parallel with the conditions that prevail generally in respect of men who work in other industries. I trust that, perhaps next year, the Government will give those of us who are deeply interested in the matter an opportunity further toreview the act. I repeat that 27 years have elapsed since it was last dealt with. Even though the Government be unwilling to accept at the moment the amendments I have forecast, I hope that my suggestions will receive consideration in the not very distant future. I echo the wish expressed by the Minister in his concluding remarks for the speedy passage of the measure so that seamen may be given something for which they have been waiting for many long years.

Mr HOLLOWAY:
Melbourne Ports

– I wish briefly to support the honorable member for West Sydney (Mr. Beasley) in his advocacy of this measure. We are most fortunate in that we have in charge of it a medical gentleman in the person of the Minister for Commerce (Sir Earle Page). I am certain that he would npt dream of denying that the two diseases included in the list of occupational diseases by the Senate are not of the type which seamen would he more likely than others to contract. Throughout the post-war years, whilst the treatment, meted out by other countries to those who go to sea has been on the upgrade, Australia has largely remained stationary. I pay a tribute to those Ministers who have been associated with the bill, as well as to the officers of the Navigation Department, particularly the marine branch, for the time they have devoted and the sympathetic help they have given in respect of the preparation of a formula for the guidance of the Parliamentary Draftsman. I know that for years these officers have been desirous of making a little better the conditions of those who go to sea ; but it is a long job to prepare and pass through Parliament a measure of this character.. On numerous occasions we have made claims on behalf of seamen. Prom the observations we were able to make on trips overseas, we have been able to point out that seamen in the mercantile marine of the United States of America, Canada, the Scandinavian countries, and Great Britain, have had their conditions improved very materially since the war. Some of those conditions are in advance of what obtains in Australian waters. We have reason to be proud of the fact that this legislation will bring us into line with the best conditions in the world, and for that I thank the Government and the officers of the Navigation Department. The two diseases emphasized by the honorable member for West Sydney should be covered. I believe that Ministers and officers who have prepared this measure will agree, upon consideration, that they should not have been omitted. I have sat around the table with seamen who have suffered as the result of the last war, men who have been almost wholly submerged for hours and have never regained their former health, having contracted pneumonia, pleurisy, and other lung complaints. Having just passed a measure associated with our defence scheme, the object of which is to make provision for certain improvements t.o merchant ships to enable the mounting of guns on them, and thus transform members of the mercantile marine into gun crews should the necessity to do so arise, it is appropriate to mention the fact that seamen who are to be covered by this bill were not allowed to participate in any of the repatriation benefits granted at the termination of the last war, although the services they rendered were, equal to those given by any other section which participated in that conflict. Heroic deeds were done, and many sacrifices made by members of the Merchant Service Marine. Generally, a navytrained mau was placed aboard a merchant ship, and handled the gun crew, which was made up of the ordinary ratings of the ship. They performed the work under his instructions, he being the expert. They took all the risks, they were sunk, taken prisoner, and towed behind submarines. Ever since, as they have been gradually getting older, they have broken down in health, but all our efforts to obtain pensions or burial money for them, have, up to date, failed. I hope that some of them will receive benefits under this bill. Those who are still able to go to sea will, I am sure get some. That, at least, is something that I am glad to know, but there is one thing that I regret to have to say. Whilst I thank the Government and the officers of the Navigation Department for giving us this bill, and am sure that the Minister will not attempt to cut out the amendments which the Senate made in it, and which make it a- first-class measure, bringing Australian conditions for seamen into line with the best anywhere in the world, I fear that the benefits to which seamen will be entitled under this measure, because of the nature of their industry, will be largely destroyed by the last piece of so-called social legislation passed by this chamber, known as the National Insurance Act. The benefits are given to the men under this bill because of the risks they take in going to sea. These are allowed for and taken into consideration when awards are made by judges in the arbitration courts, and the seamen receive them without making any direct contribution. However, under the other act to which I have referred, they will be called upon to make direct payments, and therefore will get none of these benefits free. They will get nothing at all under the other measure that they pay for, whilst they will receive them under this bill, so that, indirectly, they will be paying ls. 6d. a week for the advantages they derive from it.

Sir Earle Page:

– There are other sicknesses besides those mentioned in the bill.

Mr HOLLOWAY:

– The great bulk of them will be covered by it. I am pleased to be able to support the bill, and commend it to the House. I hope it will go through in it’s present form. I wish to add my word- of praise to those responsible for it, both inside and outside of Parliament. I know that our navigation officers did a great deal by means of suggestions, knowing, as they did, the experiences of seamen, and what things ought and ought not to be covered. They have helped to make the bill what it is, and I am sure they will be just as glad as we who represent the seamen in this chamber are at the passage of a measure of this type.

Mr PRICE:
Boothby

.- This subject is one in which I have taken an interest for a great number of years. Some years ago, I had the pleasure and honour of representing a. seaport, and in that way was brought into contact with many men who go away in ships, and with others who serve the shipping industry. The State parliaments have endeavoured to bring their Seamen’s Compensation Acts up to date, and in thi3 regard I am glad the Commonwealth is following their example. With the last two speakers, I should like to plead with the Government to allow the amendments made by the Senate to remain in the bill. I refer in particular to the provision relating to pneumonia and pleurisy. I need not, I think, plead with Ministers in that regard, because I am sure they intend to adopt the measure as it stands. Pneumonia and pleurisy are diseases which those engaged in the shipping industry can easily contract. I like the measure as it came from another place, and hope it will be carried in its present form. Of course it is to be understood that the bill refers only to pneumonia and pleurisy contracted in the shipping service. I welcome the bill,’ I congratulate the Government on having introduced it, and I hope it will have a speedy passage.

Mr BLACKBURN:
Bourke

.- 1 have on several occasions urged the Government to bring up to date the seamen’s compensation legislation. The first enactment was passed by the Commonwealth Parliament in 1909, 1ml: the High Court’s decision in the Kalibra case, that the power of the Commonwealth was limited to seamen engaged in trade and commerce between the States and other countries resulted in the repeal of that act, and the passage of the act of 1911. That act has stood until the present day. It is proposed by means of this bill so to amend it as to bring it into line substantially with the legislation that has been adopted by the States. In Australia the unfortunate position obtains that seamen employed in intra-State coastal trade are subject to State legislation in relation to workers’ compensation, whereas thos” engaged in trade and commerce between the States or with other countries are subject to the Commonwealth power. lt is a question whether the Commonwealth act goes as far as it constitutionally might. It is undesirable to have one standard of legislation for one class of seamen and another for another, and I am glad to see the Commonweatlh taking steps to bring its seamen’s compensation legislation up to the level adopted by the States. In some respects it is not up to that of the act on the subject recently passed by the

Victorian Parliament. It does not make such good provision for a dependant child, but, on the whole, it is up to the standard of State legislation generally. In this and other matters the Commonwealth should initiate a movement similar to that in force in Canada, where there exists a body whose object is to bring about uniformity in provincial legislation. Standard ‘ laws have been adopted by the various provinces of Canada dealing with matters which are entirely within the provincial power, but still handling them in the same legislative way as is adopted by the Dominion Parliament. Thus there may be identical legislation in the provinces of Ontario, Saskatchewan, Manitoba, Quebec, Alberta, and Prince Edward Island. Large departments of the law have been altered in that manner. For instance, the law as to negligence has been dealt with uniformly, although I do not know how far this has been found satisfactory. 1 do not agree with the honorable member for Melbourne Ports (Mr. Holloway) that this bill puts the Australian seamen in as good a position as are seamen anywhere else in the ‘world. Seamen in the United States of America oppose being brought under workers’ compensation legislation. There is a federal workers’ compensation law passed under the federal power over interstate trade and commerce, which I think applies to railway men and to those whom here we call waterside workers, but who are called there longshoremen, engaged in interstate and foreign trade and commerce, but the Seamen’s Union thinks that any proposition to bring its members under the Workers’ Compensation Act would deprive them of the advantages which they possess under other legislation. They possess privileges and certain rights of action under the Navigation Act, which other employees do not have, and they think they are better served in that way.

Mr Beasley:

-. - The merchant service guild and the engineers say that in this case.

Mr BLACKBURN:

– The laws in New Zealand are more liberal than they are in Australia, and more liberal than this bill. In the event of a seaman getting £3 17s. 6d. a week, which, I think, is about the basic wage here, being killed and leaving persons totally dependent upon him, they would be paid the sum of £806, because the compensation there, in the case of the death of a seaman leaving persons totally dependent on him is four times the annual wage with an upward limit of £1,000 and a minimum of £500. In other respects, the New Zealand legislation is more liberal also. An interesting departure, in dealing with industrial diseases, has been made in Victorian legislation. The Victorian Workers’ Compensation Aof was altered in 1935, 1936 and 1937, and the result of all this has been to create a commission which administers the act, hears cases and makes annual reports to the Government. That commission, which is really a judicial tribunal, includes a representative directly appointed by the Trades Hall Council. One of its functions, as I have said, is to make representations to the Government, and the Government to-day is given by orderincouncil, on the recommendations of the commission, power to add industrial diseases to the schedule. Some such power should be included in Commonwealth legislation. This is desirable, because the list of industrial diseases expands from time to time. As the honorable member for West Sydney (Mr. Beasley) pointed out, a disease may result from an accident, and it may be possible to assign a certain point of time as the date of contracting it. If so, the case comes under the ordinary .law, but’ the onset of most diseases which are contracted during work is gradual, and it is not possible to say that, at a given point of time, a man contracted a certain disease. For instance, it is not possible, in nine cases out of ten, to say that at some definite point of time ‘a man contracted pneumonia. In those instances, therefore, the causation of the disease would be put down as accidental. All that could be said would be that a ‘man contracted the disease during the course of his employment. It would be impossible to assign a definite beginning to it. But no doubt ihe Minister for Commerce (Sir Earle Page) is more competent to express an opinion on this subject than I am. All I say is that that was the position taken by the House of Lords in the case Brinton’s v. Turvey, and it was the position taken by our own High Court. I should like to see industrial diseases dealt with as they are dealt with in Victoria. In that State the Government may by order in council add industrial diseases to the schedule. That is also the position in England.

The bill is, of course, a wonderful improvement upon any legislation of the kind that we have had in the past; but I trust that it will not be the final word on the subject. Like the honorable member for West Sydney, I hope that the Government will be receptive of now ideas and’ new suggestions on this subject, and that it will not say “ We altered the law in 193S and, having done so, we shall wait for another 27 years before we alter it again “. ‘

Sir EARLE PAGE:
Minister for Commerce · Cowper · CP

– It is very pleasing to the Government that honorable members of all parties have recognized, in the course of this debate, that a substantial effort has been made to bring our seamen’s compensation legislation up to date. Though the various amounts fixed for compensation in respect of the different injuries and accidents are not exactly the same as those provided in certain of . the State compensation acts, it has been generally admitted that they are fair and reasonable, and have been determined after very careful inquiry and consideration. I believe that all who have any intimate knowledge of this subject will realize that the officers of both the Marine branch and the Health Department have examined the whole problem in the most sympathetic and understanding way. As the honorable member for West Sydney (Mr. Beasley) has said, they, have been prepared to give consideration to all suggestions and to discuss all matters as fully as possible, as my fellow Ministers and I have done, directly with representatives of the seamen. I therefore ask the honorable member for West Sydney not ‘ to press his suggested amendments. If he does .so the Government will be obliged to ask for time to consider the full effect of them and that might have the result of seriously delaying the passage of the bill. That, I think, would be a mistake, and would be detrimental to the interests of the seamen. I have taken a note of the various suggestions made by the honorable member and I assure him that I shall investigate them carefully to ascertain the consequence of incorporating them in the act.

I wish to mention only one other matter that has been raised. The diseases, pneumonia and pleurisy, were added to the fourth schedule of the bill when it was before another place. Every one who has any knowledge of those diseases will appreciate how difficult it is to relate them to the particular employment or falling which a person may follow. It was for that reason that they were not included in the schedule originally. I do not think that it can be demonstrated that seamen are more prone to pleurisy and pneumonia than are other sections of the community. If they show a slightly higher percentage in respect of these diseases than do workers in other callings the difference is negligible. We must realize, however, thatcompensation will be payable only in respect of diseases contracted by seamen in the actual course of their employment. I think it will be generally admitted that ample provision has been made in that regard. As the Navigation Act provides for thepayment of wages, and for the cost of medical and hospital treatment of seamen and of their conveyance home, if they contract diseases in the course of their employment while away from home and are landed at the first port of call for the indefinite period that may elapse until their recovery, I shall not resist the payment of compensation to seamen in. respeot of pneumonia and pleurisy as vigorously as I should resist it if it wereproposed in connexion with any other calling. My objections, in fact, are largely minimized because of the provisions of the Navigation Act, which must inevitably limit what might be described as the unnecessary liabilities that would otherwise be incurred if this provision were made in this measure without the existence of the provisions of the Navigation Act to which I have already referred.

In the circumstances, I am glad, on behalf of the Government, to intimate that no objection will be offered to the inclusion of these twodiseases in the fourth schedule of the bill. I appeal to honorable members to allow this bill a speedy passage through the House.

Question resolved in the affirmative.

Bill read a second time.

In committee:

The bill.

Mr BEASLEY:
West Sydney

– As the Minister for Commerce (Sir Earle Page) has stated that he will investigate the suggestions that I have made for the inclusion of additional provisions in this bill, and that the Government will agree to the inclusion of pleurisy and pneumonia in the diseases named in the fourth schedule of the bill, I am happy to reciprocate by agreeing to the bill being considered as a whole in the committee stage. I hope that amendments such as I have suggested will be introduced during the next period of the session or, at any rate, early next year.

Bill agreed to and reported without amendment; report adopted.

Bill - by leave - read a third time.

page 2719

APPLE AND PEAR PUBLICITY AND RESEARCH BILL 1938

Message recommending appropriation reported.

In committee (Consideration of Governor-General’s message) :

Motion (by Mr. Thompson) agreed to-

That it is expedient that an appropriation of revenue be made for the purposes of a bill for an act to make provision for assisting in the production and marketing in Australia of apples and pears.

Resolution reported.

Standing Orders suspended ;. resolution adopted.

Ordered -

That Mr. Thompson and Mr. Archie Cameron do prepare and bring in a bill to carry out the foregoing resolution.

Bill brought up by Mr. Thompson, and read a first time.

Second Reading

Mr THOMPSON:
New EnglandAssistant Minister for Commerce · CP

– I move -

That the bill be now read a second time.

This bill provides for the appropriation of the money derived from a sales tax on apples and pears sold within Australia and the crediting of such moneys to the Apple and Pear Publicity Fund. The fund is to be used for publicity directed towards increasing the consumption of these fruits within Australia and for such research as may be possible into the production and marketing problems of the industry. The fund will be vested in the Apple and Pear Board recently constituted by this Parliament, and may only lie used for the specific purpose stated in clause 5 of the bill - briefly, for publicity and research.

This proposal arises from repeated requests by the Australian Apple and Pear Council over the last few years for the provision of a means of collecting such a fund. The council, which represents growers’ and merchants’ organizations throughout Australia, has long realized the importance of propaganda to extend the consumption of apples and pears, and also of research.

For the past two years, the Commonwealth Government has contributed towards apple and pear publicity in Australia. In 1937, an amount of £5,000 was granted and was supplemented by the States and by certain sections of the industry. In 1938, an amount of £2,000 was granted by the Commonwealth. The results achieved from the campaigns conducted in these two years indicate that excellent results may be anticipated if a continuous and practical campaign be conducted. In Victoria alone this year it is considered that sales of apples have increased by 300,000 cases as the result of the publicity campaign. Much keener interest is now being displayed by the public in the health-giving qualities of apples and it would be a pity to let the good work recently commenced cease on account of lack of funds.

The industry desires that the campaign for new markets should be continuous, and that it should not be necessary to come cap in hand to the ‘Government each year seeking a grant from Consolidated Revenue for publicity purposes.

During the debate on the Apple and Pear Organization Bill reference was made by various speakers to the necessity for expanding our markets for the fruits in question. Production in- Australia is approximately 1-2,500,000 bushels, of which about -5,400,000 bushels are exported. Overseas markets cannot bo expected to absorb” very much larger quantities and therefore producers must sell more on the Australian market ‘or reduce their output. Under present conditions about 4,000,000 or 5,000,000 cases per annum can be profitably marketed in Australia so that, even after allowing for about 1,500,000 bushels which are processed, there still remain about 1,000,000 bushels to be disposed of in Australia. In addition, it would probably pay the producer to divert fruit on to the local market, thus enabling better regulation of supplies on to overseas markets and relieving the selling pressure for overseas outlets which may or may not be profitable. Export losses mean a reduction of the average return over the whole crop and, as a rule, applications to the Government for export bounties. Safe home markets are far preferable to doubtful markets overseas which may be subject to severe tariff variations or affected by exclusive trade agreements.

The industry asks Parliament to help it by providing it with the means of contributing its own fund for expansion of markets in Australia. The levy, although specified at a maximum of fd. a case, is not expected to exceed -Jd. a case, and in fact, it may not even be as much as that. It cannot affect the price paid by the consumer, nor can it be said to be harsh upon the producer who is expected to benefit materially from the increased sales which may be anticipated.

The desire of the industry to help itself is a very praiseworthy one, and I am sure that honorable members generally will give their support to the measure.

Mr FROST:
Franklin

.- I welcome any plan for the advertisement of apples and pears in Australia, for the purpose of which the fruit-growers have, up to the present, made a voluntary levy. The advertising campaign last year had very good results in Victoria. I am at a loss to understand, however, why charges for advertisements over the commercial radio stations and in newspapers vary as between Victoria and New South Wales.

The following tables show the larger amount of money that it cost to advertise apples and pears in New South Wales, compared with Victoria, in the July-September quarter of 1937 : -

It is difficult to understand why there should be such disparity. Some action should be taken by the Government to prevent its repetition in the future.

Mr THOMPSON:
New. EnglandAssistant Minister · CP

. -in reply - The advertising charges vary according to the populations of the different States. The advertising campaign was conducted last year by the Apple and Pear Council through State committees, but, with a continuous advertising policy, matters such as that referred to by the honorable member for Franklin (Mr. Frost) will be overcome, because one authority will be responsible for the whole of the campaign.

Question resolved in the affirmative.

Bill read a second time, and passed through its remaining stages without amendment or debate.

page 2751

APPLE AND PEAR TAX ASSESSMENT BILL 1938

Second Reading

Motion (by Mr. Thompson) agreed to- .

That the bill be now read a second time.

Silting suspended from 6.10 to 8 p.m.

In committee:

Clauses 1 to 3 agreed to.

Clause 4 -

In this act, unless the contrary intention appears - “ Wholesale Fruit Merchant means any person who engages in the purchase of apples or pears from the grower for resale to -

a person who purchases for resale; or

a fruit processor.

Mr FROST:
Franklin

.- I move -

That the definition of “wholesale fruit merchant “ be omitted with a view to insert in lieu thereof the following: - “‘wholesale fruit merchant’ means any person who engages in the purchase of apples or pears from the grower for sale to a person who purchases them for resale “.

I do so in order to ensure that fruit bought for a processor will be exempt from this tax. As the Assistant Minister is agreeable to the acceptance of the amendment I see no necessity to labour the point.

Amendment agreed to.

Clause, as amended, agreed to.

Clauses 5 to 11 agreed to.

Clause 12 -

The tax shall be paid -

where the apples or pears are sold by the grower to a wholesale fruit merchant or to a fruit processor - by the wholesale fruit merchant or a fruit processor as the case may be; and . . .

Amendment (by Mr. Frost) agreed to-

That the words “ or to a fruit processor “ and “or the fruit processor, as the case may be “, be omitted.

Clause, as amended, agreed to.

Clause 13-

Notwithstanding anything contained in this part, tax shall not be payable by any person in respect of -

pears sold to a fruit processor for use by him in the production of canned pears.

Mr FROST:
Franklin

.- I move -

That paragraph (b) be omitted with a view to insert in lieu thereof the following paragraph: - “ (b) apples or pears processed or to be processed by him or sold or to be sold by him to a fruit processor “.

My reason for so doing is to exempt from tax fruit sent to a. cider factory or to a processing firm for canning. Such fruit is generally of poor quality, and if this tax were levied in respect of it a burden would be imposed on processors which might result in their refusal to buy fruit that is otherwise unsaleable.

Amendment agreed to.

Clause, as amended, agreed to.

Clause 14 consequentially amended, and, as amended, agreed to.

Clauses 15 to 36 agreed to.

Clause 37 consequentially amended, and, as amended, agreed to.

Clauses 38 to 40 agreed to.

Bill reported with amendments ; report - by leave - adopted.

Bill - by leave - read a third time.

page 2752

APPLE AND PEAR TAX BILL 1938

In Committee of Ways and Means:

Motion (by Mr. Thompson) agreed to-

That a tax be imposed upon apples and pears grown in Australia and, on or after the first day of January, One thousand nine hundred and thirty-nine, sold by or on behalf of the grower.

That, subject to a lower rate being prescribed by regulations made under the act passed to give effect to this resolution, the rate of tax shall be Three farthings per bushel case.

That the Governor-General may, after report to the Minister by tho Australian Apple and Pear Board constituted under the Apple and Pear Organization Act 1938, make regulations prescribing a lower rate of tax on apples and pears than that imposed by the act passed to give effect to this resolution.

Resolution reported.

Standing Orders suspended and resolution adopted.

Ordered -

That Mr. Thompson and Mr, Perkins do prepare and bring in a bill to carry out the foregoing resolution.

Bill brought up by Mr. Thompson, and read a first time.

Second Reading

Mr THOMPSON:
New EnglandAssistant Minister for Commerce · CP

– I move -

That the bill be now read a second time.

This bill is complementary to the Publicity and Research Bill and the Assessment Bill which have just been passed. It provides for the levying of a tax in order to establish the Apple and Pear Publicity Research Fund, at the rate of ¾d. a case or such lower rate as may be prescribed. It is not expected that the levy will be more than½d. a case.

Mr Anthony:

– Is the levy to be imposed in respect of apples and pears sold in Australia?

Mr THOMPSON:

– The bill deals only with apples and pears which are not processed but which are sold in Australia. In other words, it applies only to fresh fruit sold in Australia. It has nothing to do with apples or pears exported.Under the provisions of a bill which has already been passed, the Apple and Pear Board, if it so desires, is to use certain of its funds for publicity and research in respect of apples exported. That is not affected in any way by the bill with which we are now dealing.

Mr Anthony:

– Will this fund be used by the Apple and Pear Board?

Mr THOMPSON:

– Yes, it will be used by the board for publicity and research designed to increase the consumption of apples and pears within Australia.

Mr CURTIN:
Fremantle

.- I think it would have been fitting if the Assistant Minister had told us how much money it is contemplated will be raised by the imposition of this tax, and if he had also given to us an indication of the various heads of expenditure in connexion with publicity upon which the money is to be expended. I quite agree with the idea that a wider knowledge among the Australian people of the advantage of a greater consumption of apples and pears would make unnecessary these burdens which we are imposing upon the people in order to dispose of the surplus unconsumed in Australia in a market already very difficult to exploit, the world market.

Mr Thompson:

– It is expected that the tax will yield approximately £10,000.

Mr CURTIN:

– The honorable gentleman should give us some particulars as to how it is proposed to expend that money. Is the discretion of the board to be left unfettered? Has not the board to report to the Minister in connexion with, and the Minister to approve of, proposed expenditure ?

Mr Thompson:

– Yes.

Mr CURTIN:

– Where is that provided?

Mr Thompson:

– In the Apple and Pear Organization Bill.

Mr CURTIN:

– I take it that the Department of Commerce is answerable for the right use of this money ?

Mr Thompson:

– That is so.

Mr CURTIN:

– Therefore, at any time we consider that the money is not being wisely used, or that it is being badly used, we can hold the Government to account for it.

Mr Thompson:

– The accounts of the board are subject to audit by the AuditorGeneral.

Mr CURTIN:

– That only means that a check is imposed in order to ensure that the money is being paid to the persons to whom it is properly clue. What I am concerned about are the publicity methods used - whether the Minister will authorize the expenditure of this money on radio broadcasts, hoardings, or the issue of pamphlets. It seems to me that £10,000 is a fairly reasonable budget for an advertising campaign. From my experience of such campaigns it should be possible to pay the advertising costs of a general election for that amount.

Mr ANTHONY:
Richmond

.- I should like some further information about this proposal, because it establishes a precedent. If we levy an excise tax for the purpose of providing a publicity fund for apples and pears, it may be said that there is ample justification for the establishment of a similar fund in respect of quite a number of other fruits. I should like to know whether this tax is being levied at the request of the representatives of the apple and pear growers in Australia.

Mr Thompson:

– It is.

Mr ANTHONY:

– Then I have no objection to the measure.

Mr LANE:
Barton

– A little while ago, this House passed a bill dealing with the export of apples and pears from Australia. When it was before the House, I asked whether it was proposed to place a levy on those who produced apples and pears for the local market only, and I was assured that it was not. We, in New South Wales, do not care where the Tasmanian growers sell their apples. We know that they are largely dependent on the export market, but they also sell a considerable quantity of their produce in New South Wales. We are gradually learning to grow our own apples, so that in future we shall be able to do without supplies from Tasmania. When the previous measure was before the House, we were told that there was no occasion for the growers or consumers of New South Wales to be represented on the control board because Tasmania was the chief exporter of apples and pears, although it also sells apples and pears to the other States. Now the growers of all the States are to pay this levy for publicity purposes. It seems to me that the Tasmanians have got everything they wanted here to-day. I only hope that none of this money will be used for political purposes. I suggest that some Neon signs should be erected in Sydney and other cities telling the people that “ an apple a day keeps the doctor away “. This form of publicity might be more effective than any other that could be devised. It is proposed to impose a tax which, if the Minister thinks fit, may later be reduced. Why was not a similar principle adopted in regard to the previous measure dealing with apples and pears? In that measure a board consisting of eight or nine representatives was created to control the industry, but in the bill now before us it is proposed to place all the power in the hands of the Minister.

Mr Thompson:

– The board will still be in control.

Mr FROST:
Franklin

.- The honorable member for Barton (Mr. Lane) suggested that this measure was designed to benefit the Tasmanian growers. I remind him that, as the Tasmanian growers produce 80 per cent. of the apples and pears, they will pay 80 per cent. of the tax. During the last two years, a voluntary levy has been imposed to finance an advertising scheme, the proceeds being supplemented by a government grant. This advertising campaign has achieved a remarkable success. In Victoria alone an extra 300,000 bushels of fruit were sold this year as compared with the year prior to the introduction of the campaign. In 1930, a great national advertising campaign was inaugurated in Great Britain, and by 1935 the consumption of fruit had been increased by 26 lb. per head of population. We should advertise fruit throughout Australia, not only in the cities, but in the country districts as well. Before the advertising campaign was begun in Great Britain, a shipment of 5,000 bushels of grapefruit was sufficient to flood the market ; in 1935 the market was absorbing 80,000 cases per week. If the people of Australia could be brought to realize the benefit of eating more fruit, the local market would be able to absorb nearly all the fruit produced.

Question resolved in the affirmative.

Bill read a second time, and passed through its remaining stages without amendment or debate.

page 2754

LOAN BILL (No. 2) 1938

Message recommending appropriation reported.

In committee (Consideration of Governor-General’s message) :

Motion (by Mr. Street) agreed to -

That it is expedient that an appropriation of moneys be made for the purposes of a bill for an act to authorize the raising and expending of a certain sum of money.

Resolution reported.

Standing Orders suspended; resolution adopted.

Ordered -

That Mr. Street and Mr. Casey do prepare and bring in a bill to carry out the foregoing resolution.

Bill brought up by Mr. Street, and read a first time.

Second Reading

Mr STREET:
Minister for Defence · Corangamite · UAP

– I move -

That the bill be now read a second time.

In the normal course of events it would have fallen to the Treasurer (Mr. Casey) to introduce a financial measure of this kind, but in the existing circumstances, and in order to acquaint the House with the details of the Government’s defence programme, I, as Minister for Defence, am placing this measure before honorable members. I take this opportunity, therefore, the first appropriate one after the discussion of the budget and Estimates, to advise honorable members regarding matters relating to the defence programme. The Treasurer will deal with the financial implications of the programme as a whole, and as they will be reflected in this bill.

One of my predecessors, in a statement of the Government’s defence policy in 1933, outlined what he referred to as the ultimate objectives of Australian defence. He described the method of attaining these strengths as the “ continual development of an effective defence policy “. The Government has followed this method by expansion programmes and a steadily increasing defence vote, which has risen from £3,200,000 in 1931-32 to an amount of £16,800,000 provided for in the recent budget. It is now proposed to increase the defence programme for this and the two succeeding years from an aggregate of £44,500,000 to £63,000.000. Of the total provision of £63,000,000 for the three years of the programme, it is estimated that an amount of £11,500,000 will be required for expenditure overseas. This expenditure will be incurred on those types of armaments and equipment which it is not possible to provide locally, and on the pay and allowances to personnel who are undergoing instruction abroad.

The rate at which provision should be made for increasing the defence strength of Australia is dependent on the following considerations : -

  1. The time elapsing before the probable risk is likely to eventuate.
  2. The financial resources available.
  3. What is physically possible with the time and money at our disposal.

As to the time and risk aspects, I remind honorable members that the Prime Minister (Mr. Lyons), in announcing the new defence programme in March, said that itwould be flexible, to be increased or reduced according to the trend of the international situation. It is an instinctive hope of the Australian people that the policy of appeasement initiated by the Munich Pact will succeed, and that ultimately the limitation, and later the reduction, of armaments will be possible. However, as the Prime Minister pointed out in his recent broadcast, events since Munich have not taken us very far along the road to peace, and it is the bitter truth that, at any time in the nest few years, we may have to resist an attack on our country.

It is, therefore, a plain fact that cannot be evaded that there must be greater acceleration towards the attainment of those strengths laid down by the Government’s advisers as necessary for national security. In short, tho crisis in September revealed that the time factor on which we are working must be reduced by speeding up defence preparations.

The second consideration - the financial resources available for defence - will be dealt with bymy colleague the Treasurer, when reviewing the measures proposed for financing the expanded programme.

The final consideration of what is physically possible in the next three years will be referred to in more detail later. At this stage, it is sufficient to say that the following conditions were laid down for the guidance of the technical advisers : -

  1. Their proposals must make the greatest immediate contribution to Australian defence.
  2. Co-ordination must exist between the proposals of the services, and they must be of a corresponding degree of priority.
  3. The expansion and improvement of organization should be actually realized as early as possible, and within the period of the programme.

The expanded programme, therefore, represents practically the maximum that is possible within the next three years without greatly upsetting the national economy, and placing it on an emergency footing.

Before entering upon a summarized statement of the relation of the expanded programme to each service, I shall outline the Government’s conception of the general basis of Australian defence. Our defence problem as a small nation is insoluble without Empire co-operation. We can share in the common naval defence of the Commonwealth, but we cannot provide naval forces sufficient for our security. We can provide forces for local defence as a deterrent to. aggression, and as a means of holding out until support is forthcoming, but we cannot defeat a powerful aggressor single-handed. If the Empire is to survive, and if the independence of its members to be preserved, we must stand together. The reverse side of this picture is that, if the parts of the Empire do not co-operate in defence, they will be left individually isolated in the face of attack by superior forces.

The reciprocal view has been expressed by the Prime Minister of the United Kingdom in the following terms : -

In the last resort, it is on the transport of adequate forces and their supplies by sea that the different parts of the Empire rely to resist aggression and to ensure the security of their interests and the integrity of their territory.

Thus it is that the security by sea passage to this country, as well as to and from all parts of the Empire, forms the basis and foundation of our system of Imperial defence, without which all other measures can be of but little avail.

Accordingly, in the words of our own Prime Minister :

Our own defence efforts must ever be related to the wider pattern of Empire defence.

As part of the scheme of Empire naval defence, the Australian Navy provides for the protection of trade in Australian waters, and the seaward defence of the main ports. In accordance with the responsibility of each part of the Empire for its local defence, the army and the air force are being strengthened, and Australia is being made more selfcontained by the expansion of munitions factories and the development of secondary industries, for it is implicit in the principles of Empire defence and cooperation that the stronger the parts of the Empire, the stronger is the whole British Common weal th .

Our links with the other parts of the Empire are being strengthened by air communications and strategic bases. Thus, Darwin is the opposite end of the archway of which Singapore is the other pillar. Port Moresby is to be developed as a base for mobile naval and air forces, and through it, hands will be joined with New Zealand and Great Britain through the Pacific Islands as well as across the Tasman.

The naval programme is to be increased from £15,933,000 to £20,548,000. The main items are the replacement of overage destroyers by two T’ribal class destroyers; the construction of twelve motor torpedo boats; works at naval shore establishments; the building up of reserves of -stores and oil fuel; and the establishment of mine production in Australia. The destroyer and motor torpedo boats will be built locally.

The Government programme for strengthening naval defence can be divided into three main categories. They are :

First, to increase the number of ships, which are mobile and are therefore available to act at the decisive point;

Secondly, to make the principal harbours secure against surface and submarine attack in conjunction with the army and the air force; and

Thirdly, to build up reserves of warlike stores to improve the repair and refitting establishments, to increase and establish schools for training the personnel, and to erect wireless stations.

Taking these in. order: First, the ships. The Government considered that time was the first essential, and that extra cruisers would be of far greater value now than in three or more years’ time. It therefore purchased two sister ships of the Sydney. Of these, one is on its way to Australia, and the other is due next year. “When it arrives, the squadron will consist of five modern cruisers, and the Adelaide, which is not modern but is in excellent order and is strong enough to deal with armed merchant ships.

The function of these cruisers will be to protect the seaborne trade and to act against raiders attacking trade on the coast, and the strength of the force v be adequate to deal with all except capital ships. In addition, the Australia and the Canberra are being in turn modernised, and when alterations to them have been completed these two ships will be exceedingly powerful units.

A programme of sloop construction was also initiated, and two sloops are now under construction, in addition to the two already in existence. The function of the sloops and of the five destroyers, which are certainly old but are still efficient for their purpose, is mainly for anti-submarine, mine-sweeping and escort work.

It is intended to construct at Cockatoo Island Dockyard twelve motor torpedo boats. These craft, which have only recently passed out of the experimental stage, are employed by the British Admiralty, and some of them are already in service witu the fleet. They are very fast, and for the expenditure entailed they have high offensive and defensive qualities in addition to being most seaworthy.

To’ provide a continuous programme of local naval construction, and to enable the Cockatoo Island Dockyard to proceed with a more advanced type of vessel than sloops, it is proposed to lay down two Tribal class destroyers. These ships are of the large and fast type, which will be specially valuable in Australian waters for the protection of trade and for other purposes. They arc armed with eight 4.7-iv.ch guns and four torpedo tubes. Their displacement tonnage is 1,850, and their speed 36£ knots an hour.

It is proposed to accelerate the entry of recruits to the sea-going forces so as to raise the personnel from 4,550 to 6,770 by 1940-41. The previous maximum strength of the Royal Australian Navy was 5,350, in 1920. Crews will exist for the maintenance of the following ships in commission by 1941-42 : five cruisers, four escort vessels, two destroyers, twelve motor torpedo boats, and one surveying ship.

The defence of the principal harbours not only involves a system of nets and booms, but also requires vessels for maintaining and. supplementing them. It further involves the training of a large number of men for anti-submarine work, and the institution of a school for that purpose. All this is slow and expensive work. Expensive and complicated apparatus must be purchased not only for the naval vessels but also for the ships and smaller craft which would have to be requisitioned in wartime.

The Government is in consultation with the Admiralty regarding the manufacture of mines in Australia. These are essential for harbour defences, and negotiations are at present in progress with the Government of the United Kingdom regarding the supply of certain of their needs by the Commonwealth.

Thirdly, there is” the work of maintenance, barracks, stores, magazines, schools, dockyards and wireless stations. Much of this expenditure goes into bricks and mortar, of which the public sees little, and of which only those who are closely concerned with the service realize the value. Nevertheless, any stinting in this regard would react directly on” the efficiency of the seagoing ships and the security of the harbours. It is, in fact, the foundation on which the naval structure rests.

The following are the main works for which provision is made: -

Expansion of Flinders Naval Depot.

Sydney depot and hospital to replace the Penguin.

Additional facilities for Sydney and other naval establishments.

Additional magazine accommodation, Sydney.

Enlargement of slip and provision of workshop and equipment at Darwin.

Victualling arrangements and buildings at Darwin.

War signal and port war signal stations.

Constructing retaining walls at oil tank installation at Darwin.

Machinery and plant for Cockatoo Island.

In addition, a large sum is provided for increasing the reserves of oil fuel, armament stores and naval stores.

There has been much public discussion concerning the type of the Australian naval squadron. Some persons advocate capital ships, others submarines, and some both of these types of vessels. Others, again, would not add to the navy, but would concentrate on the air force.

Expert naval opinion is definitely against submarines for the Australian navy. The primary role of the submarine is not coast defence, and for this reason it is not considered an effective weapon for the coastal defence of the Dominions. In addition, the submarine has the disadvantages that, for its tonnage, it is the most expensive type of war vessel to build and maintain, and that the standard of training required of officers and men is higher than in any other type of ship.

In regard to the part played by the capital ship in the scheme of Empire naval defence, I quote the following words of the Prime Minister of the United Kingdom : -

The main fleet is the basis upon which our naval strategy rests, but the cover it can provide is rarely complete, and it may always be expected that detachedenemy units may evade the main fleet and carry out sporadic attacks on territories and trade. To deal with these attacks, considerable numbers of cruisers are required over and above those forming part of the main fleet.

In the main fleet the capital ship remains the essential element upon which the whole structure of our naval strategy depends.

Australia’s part in the scheme of Empire naval defence has been to provide for the defence of trade in Australian waters by cruisers, destroyers and sloops. It would, of course, be a great advance to have a capital ship also, but I remind honorable members that the expense of such a vessel is not limited to its capital cost and annual maintenance; there must also be a suitable dock, destroyers for escort, and reserve outfit of ammunition and armament. The training of the crew is also a special problem. In fact, the total estimated cost is about . £16,000,000. The Government has decided that, as a capital ship could not be obtained before 1943, the idea should not be adopted at this juncture.

The people of Australia fully appreciate that British seapower is the essential basis of the security of the Empire. We look to Britain in an emergency to station at Singapore a fleet of sufficient strength to safeguard Empire interests in the eastern hemisphere. There has been much loose talk about the crisis having proved that this could not be done. Nothing of the sort was indicated. On the contrary, the Government has sound grounds for being re-assuredon this point. Britain’s strength is satisfactory in comparison with that of any other two powers, apart from the United States of America, with which country, of course, war is unthinkable. If Britain were confronted with an alliance there is no reason to believe thatit would lack powerful allies, while, in addition, it has in hand a vast naval programme.

The Government is of the view that, if Australia cannot obtain a capital ship, it is important that docking facilities should exist in Australian waters for such a type of ship operating in this region. Accordingly, it is proposed to consult the Admiralty and to obtain expert engineering advice on the provision of a suitable dock at Sydney. In addition to its defence value, such a dock would be an important economic asset and one that no doubt will be required in the near future with the growth of the size of merchant ships.

The army programme is to be increased from £11,612,000 to £19,704,000. The main items are the accelerated enlistment of permanent personnel provided for under the existing programme, the increase of the militia forces from 35,000 to 70,000, reserves of ammunition and war equipment, and increase of antiaircraft defences.

The function of the Australian army, in co-operation with the Royal Australian Navy and the Royal Australian Air Force, is to defend the Commonwealth against territorial aggression.

The most serious form of aggression would be attacks by large forces of enemy troops, made with the object of capturing and dominating the important centres on which the continued resistance of the nation would depend. Defence against such threatening hostile action depends on -

  1. The presence at Singapore of a fleet adequate to give security to our sea communications. This fleet would provide a threat to the communications of an enemy from any part of the world bent upon the invasion of Australia, and either deter it from aggression, or be able to defeat it should it undertake such an operation.
  2. An army and an air force of sufficient strength to require an enemy to come in great strength, and thus render it more vulnerable to naval and air force action at sea. If the army and air force are of considerable strength the enemy will be deterred from undertaking a hazardous operation,
  3. An army and an air force of sufficient strength to defeat an aggressor should it secure a footing in this country.

In the last resort in war, the essential requirements for victory are -

  1. The military capacity and the will of the people to continue resistance; and

    1. The financial and economic ability to do so.

If the enemy possessed command of the sea and also had powerful land and air forces, these and its free access to the world’s resources of supplies would present us with a formidable military task.

There is no doubt that the Australian national resources, when developed, are capable of placing in the field an army strong enough to defeat an expeditionary force of the size that could be landed from one convoy. It is even within the potential capacity of thiscountry to deploy an army that would deter a hostile power from undertaking largescale operations in the main areas. At the same time, the resources of our small, young nation are not yet adequate to enable us to be military strong at all points of this large continent. It is, therefore, essential in the present stage of national development, to concentrate a large proportion of military effort on the protection of the areas on which the maintenance of resistance would depend. The army would also be responsible for protecting, if the situation required, the more distant populated areas.

The effective application of the available resources to meet the most serious form of attack is the major consideration governing the war organization of the military forces. For this requirement, the peace organizations includes the framework of a field army of two cavalry divisions and the equivalent of five infantry divisions, with line of communication units for maintaining this force.

The war organization also takes into consideration the possibility of seaward and air attack on the larger coastal cities, and attacks by landing parties at any of the main ports. Attacks of such character might be incidental to largescale operations against vital centres, or they might be made either as a preliminary to, or quite apart from, a more serious attack. They would naturally be delivered with little if any warning. For this requirement, the peace organization includes the fixed coast and anti-aircraft defences. The troops responsible for defence against smaller landing attacks are provided from the field army.

The current process of developing the peace nucleus of the Australian Military Forces to the standard of readiness necessary for effective transition to a war footing is as follows: -

In regard to the Government’s policy for the development of the army, in the progressive preparations for its development the following important considerations have to be taken into account : -

  1. The relative probability of the various forms of attack.
  2. The financial provision that can be made for the army in conjunction with the requirements of the other defence services,
  3. The rate at which it is possible in peace to expand the personnel and increase the war material.

The Government is at present concentrating, in the first stage of re-armament, on the forms of preparation that would provide for the direct protection of the main ports, including the larger coastal cities and some of the smaller distant seaboard towns, including ports of naval importance, against the more probable forms of attack.

As for progress in re-armament, the process of re-arming the fixed coast defences is approaching completion. Antiaircraft defences are being established up to the scale recommended by the Committee of Imperial Defence, and the efficiency of the troops responsible for supporting the fixed coast defences of the main ports against attacks - the first line component of the field army - has been improved. The permanent force personnel for all these defences is being increased.

In the early period of the programme it was necessary to allot the available funds principally to the fixed coast and antiaircraft defences, but with the progress made and the provision of additional funds under the new programme, it has been possible to turn to the requirements of the first line component, particularly in respect of the needs of arms, armament, ammunition, mechanization and war equipment.

The first line component consists of the equivalent of three cavalry and four mixed brigades, two infantry divisions and the necessary supporting and maintenance troops, and this force represents a large proportion of the whole field army. It follows that any improvement of its standard of preparedness represents a proportional instalment towards the development of the field army as a whole. It is therefore to be emphasized that the process of improving the efficiency and strengthening the war material of the first line component is also a very effective contribution towards an improved standard of readiness for defence against invasion.

I wish to deal now with the effect of the crisis in September, 1938, on the process of developing the army. Up to the occurrence of the crisis in September, it was assumed that there would be sufficient time, after the first warning of an emergency, to expand the peace establishment of troops to an emective war footing; and for this reason, the general order of priority of preparations was -

  1. The training of commanders, staffs, junior leaders and specialists ;
  2. The provision of arms, armament, ammunition and war equipment;
  3. The training of the rank and file.

The outstanding lessonis that in a future similar situation there may be little or no time in which to complete the current peace-time preparations, or to finish them after the first warning. This applies particularly to the raising and training of the required number of personnel. It. is, therefore, necessary to undertake now the training of the required number of personnel of the lower ranks, concurrently with the training of commanders and staffs and with the provision of war material.

In order to meet the present situation, in which it is necessary to raise and train a stronger peace nucleus of the rank and file, the strength of the militia forces will be raised, as rapidly as possible, to a total strength of 70,000 troops of all ranks. A force of that size, maintained effectively in peace,will form a satisfactory foundation for transition to a war footing.

The peace nucleus of 70,000 troops will consist very largely of troops forming the first line component, who are responsible for protection against attacks by large landing parties. This component of the field army would also form the covering force in the event of more serious sustained landing operations. It would be responsible for preventing landings, or for delaying such hostile forces as might be able to land, and these covering and delaying operations would facilitate the process of mobilizing, training and deploying the remainder of the field army. The increase of the strength of the militia forces, particularly that of the formations and units of the field army, is therefore another step in progress towards readiness to resist invasion.

I come now to proposals for an expanded programme. As the result of the foregoing considerations, the Government now proposes to allot additional funds for expanding the army development programme to: -

  1. Increasing the strength of the militia forces;
  2. Accelerating the provision of permanent force personnel for the fixed coast and anti-aircraft defences and the permanent staff of the militia;
  3. Expediting the acquisition of arms, ammunition and war equipment of all kinds for the first line component of the field army;
  4. Speeding up the construction of permanent defence works and barrack and drill hall accommodation.

The larger part of the additional allotment will be expended on personnel and material preparations that can be completed during the programme period. In framing the new proposals, the financial provision for the army is limited only by the probable capacity to train man-power, and to acquire material by purchase abroad and by manufacture in this country.

As regards air defence, the air force programme is to be increased from £12,512,000 to £16,444,000. The main items are: increased reserve of raw materials for local manufacture of aircraft, reserves of equipment, tools and fuel, the training of personnel on the reserve, formation of a citizen force cadre squadron at Townsville, and the establishment at Port Moresby of a base for mobile naval and air forces.

The functions of the Royal Australian AirForce may be set out in detail as follows : -

The aim of the Royal Australian Air Force, acting in close co-operation with the navy and army, is to defend Australia and its territories against attacks either on territory or on trade. In furtherance of this aim it will provide for -

  1. Local air defence. - The combat and destruction of enemy aircraft.
  2. Coast reconnaissance and protection of shipping. - In conjunction with the naval forces, the protection of shipping in the focal areas, Darwin,Albany- Fremantle, Bass Strait, MelbourneSydneyNewcastle, and in Papua-New Guinea. This entails reconnaissance for a distance to sea for the detection of raiders, against either shipping or territory, and the direct attack of such raiders when found.
  3. Co-operation with the fixed defences. - To assist and supplement the fixed defences at Darwin,Fremantle, Melbourne and Brisbane, and in the SydneyNewcastle area.This entails local air reconnaissance, the direction of the fire of the main gun armament at long range, protection against enemy aircraft, and the direct attack of enemy forces.
  4. Direct co-operation with the navy. - The provision of aircraft to be embarked in the cruisers to carry out the air duties of the squad ron, that is, reconnaissance, gun-fire observation and direct attack of enemy sea or aircraft.
  5. Co-operation with the field army. - Provision of the air requirements of the field army, that is to say, reconnaissance, observation of gun fire, protection against enemy aircraft, and direct attack of the opposing forces.
  6. Independent offensive action. - In certain circumstances, to take independent offensive action against raids and attempted landings.

For these purposes the first-line strengthof the Royal Australian Air Force will be 212 aircraft.

Now as to strategic distribution, the principle underlying the proposed strategic distribution of the air force in pence is that forces of sufficient strength to undertake air defence, reconnaissance and striking duties should be maintained in each vital area of the Commonwealth. In addition, a reserve is to be maintained in a central area from which, if necessary, reinforcements can be despatched along the organized air routes to the other areas or to other threatened parts.

Development is necessary to provide the required strength. As already announced in the new programme, adopted last March, provision is being made for the completion of the Salmond scheme by raising the strength of the air force from eight squadrons, with a first-line strength of 96 aircraft, to seventeen squadrons, with a first-line strength of 198 aircraft, and with ancillary units in proportion. Those figures are now to be increased to eighteen squadrons with a first-line strength of 212 aircraft.

The delivery of twin-engined general reconnaissance type of aircraft from overseas has been a matter of concern to the Government for some time, owing to the great demands of the United Kingdom programme on factories in Britain. Special representations were made by the Prime Minister (Mr. Lyons) personally to the Prime Minister of the United Kingdom, and all that is possible is being done to ensure the earliest possible delivery. As the result, the United Kingdom Government is lending to Australia, on a charter basis, a number of AvroAnson aircraft, as an interim measure. As recently announced, the Government has decided, however, as a necessary measure of reinsurance against the nondelivery of the twin-engined aircraft commencing next year, to order in addition 50 Lockheed-Hudson type of aircraft from the United States of America.

The rapid technical development of aircraft types and the rising cost of. raw materials are also reflected in the increased provision necessary beyond that originally included in the programme. The large additional amount of £2,500,000 is included in the expanded programme for aircraft. This will provide for the full equipment of the firstline strength of 212 aircraft, together with the necessary reserves. In addition, the orders for the local manufacture of “Wirraway” single-engined aircraft are being increased. The “ Wirraway “ is the standard single-engined two-seater type of aircraft for fighter, bomber and army co-operation work. Provision is also being made in the programme for the establishment of a reserve of raw materials, so that in an emergency supplies will exist for the local manufacture of a large number of aircraft.

As to existing types of aircraft, statements have recently appeared in the press to the effect that certain types of aircraft in service in the Royal Australian Air Force are either obsolete or obsolescent. Avro-Anson general reconnaissance aircraft are still being produced in large numbers for the Air Ministry for employment in general reconnaissance squadrons until a more suitable type is in production. The Commonwealth Government ordered a replacement aircraft for the Anson type some time ago, but was unable to obtain deliveries. A. new type of aircraft will shortly be in production in England, and as soon as these and the Lockheed machines recently ordered from America are available, it is intended that they shall replace the Ansons for general reconnaissance service. The Australian Demon differs from the two-seater fighter Demon employed by the Royal Air Force, and is similar to the Hind light bomber, of which the Royal Air Force still retains large numbers as first-line aircraft. It is of importance to note that the performance of our aircraft is equal to the tasks likely to be presented to them by the seaborne aircraft which may be brought against them by a potential enemy. With regard to the radius of our bombers, they are sufficient to perform their functions against any aggressor. in regard to reserves of equipment, fuel, and so on, in order to ensure to the air force adequacy of reserves in an emergency, provision is being made in the programme for stocks of technical equipment, tools, aircraft fuel, clothing, uniforms, materials and tentage.

Mobility is an essential. The civil aviation policy of the Commonwealth has been directed towards providing for the air force developed air routes over which it could readily move in an emergency. The dual purpose of air transport and defence has been served by co-ordination. There are, however, certain isolated centres off the regular air routes at which there is need for strategical landing grounds, and provision is made in the programme for aerodromes at certain points on the New South Wales, Victorian and Western Australian coasts, such as Nowra and Moruya Heads, in New South Wales; Bairnsdale and Mallacoota, in Victoria; and either Busselton or Harvey, in Western Australia.

A squadron is to be provided in Northern Queensland. Although the Salmond scheme provides for seventeen squadrons located at strategical centres throughout the Commonwealth, the Government has decided, on the advice of its air advisers, to form an additional air force squadron at Townsville, where it will be a valuable contribution towards the defence of Northern Australia generally. It will provide a reconnaissance force which can, in conjunction with the Brisbane squadron, keep the long coast north of Brisbane and the passages of the Barrier Reef under observation. It will also provide a striking force for offensive action against attacks on this coast. In addition, owing to the inherent mobility of air forces, the squadron will be available, if necessary, for action in a wide area to the north as well as to the north-east. This now unit, being partly manned by citizen forces, will also give an opportunity to many young men in Townsville and North Queensland to serve in the air branch of the defence forces.

The development of a base at, Port Moresby is also necessary, and the Go- vernment has decided, on the recommendation of its advisers, to establish at Port Moresby a. base for mobile naval and air forces. The fixed defences will be provided by the army. The air force will station flying-boats there, and the base will provide a centre from which cruisers and small, craft can operate.

Turning now to the munitions supply, I have to advise honorable members that the programme is to be increased from £3,057,000 to £4,855,000. The main items are for extensions to the ammunition, explosives and ordnance factories and the laboratories and inspection branches to provide for the production of-

All types of artillery ammunition, small arms ammunition and respirators up to a large annual output, the figures for which must remain secret.

Armoured vehicles.

Depth charges and filling of mines.

Provision will also be made for reserves of raw materials for operation of factories at war capacity.

For 2S years up to 1936-37, our capital expenditure upon munitions establishments was £2.874,933. By the end of four years to 1940-41, the Government will have incurred additional capital expenditure amounting to £3,365,210.

The essential basis of the Government’s policy for increasing local self-sufficiency is -

Adequate reserves of munitions.

Establishments for the local production of special types of munitions not produced by industry.

The aircraft industry.

The fostering of primary and secondary industries to add to the country’s resources of raw material, stores, manufacturing establishments and skilled labour.

A plan for the organization of industry for the supply of the services in time of war.

This expanded programme has certain definite objectives. The new programme already in hand will provide for the following new types of government factories which, while increasing local selfsufficiency, will also relieve Great Britain of the responsibility to meet our demands, and will contribute to the needs of the Empire in an emergency -

An improved type of anti-aircraft gun.

Brass cartridge cases for anti-aircraft. ammunition.

The Bren machine gun.

The expanded programme has the following additional projects: -

Gun ammunition and explosives - The manufacturing capacity for explosives used in ammunition is to be increased, and additional facilities provided for the filling and assembling operations.

Facilities are being provided for increased production of the metal components for gun ammunition, such as cartridge cases, fuses and shell, the intention being that the bulk requirements of shell and fuses shall be obtained from commercial industry.

All of the foregoing expansion is for increased production of gun ammunition, mainly for army requirements.

Anti-aircraft guns. - The plant for the manufacture of the mobile anti-aircraft gun is being increased in order to enable it to meet the expanded army requirements. This will be additional to the factory for the improved anti-aircraft gun which is already under construction.

Small arms ammunition. - The production of . 303 inch small arms ammunition is to be duplicated in order to meet the increased requirements consequent upon the expansion of the militia to 70,000 men, and to provide for adequate reserves.

Respirators. - Thecapacity for assembly and test of anti-gas respirators is to be duplicated. The manufacture is undertaken by various commercial firms, and “the respirators are assembled and tested at the laboratories.

Laboratories. - A section is to be added at the laboratories to enable a commencement to be made in Australia, of the manufacture of artillery instruments and optical equipment which at present are being imported. This is a very important requirement, which will take some timeto develop, but it will be a positive step towards self containment.

Extension of steel sheet manufacture. - Provision is being made for manufacturing capacity for the fabrication of special plating and sheet metal manufactures of munitions, such as mines, depth charges, armoured vehicles, and various sheet metal components of ammunition.

Inspection and testing. - Consequent upon the foregoing developments, it is necessary to provide for extensions at the artillery proof range in South Australia, and also for the additional inspection gauges and testing equipment required for examination of the new types of munitions being manufactured.

Stocks of raw materials. - Provision is being made for carrying stocks of materials so that production will not be hampered by lack of materials if an emergency should require additional shifts to be worked, or if there should be a stoppage of supplies by enemy action.

Industrial organization for munitions. - The scheme of annexes contemplated in the existing programme is to be expanded by the provision of annexes for mines and bomb pistols.

In the location of government munitions factories well defined principles have been followed. We wish honorable members to be quite clear as to the principle that has governed the recent and proposed expansion of government munitions factories. In all eases the extension of facilities forthe manufacture of munitions, in so far as the departmental factories are concerned, provides for additions to factories already in existence at Lithgow, New South Wales, and Maribyrnong andFootscray Victoria, and to the artillery proof range at Wakefield,

South Australia, or for other expansion which, by reason of the allied nature of the munitions already being produced, must be located at these centres.

In the selection of sites for munitions production regard is had to both the strategic and economic aspects, and if it bc decided to provide additional government factories for new types of munitions not associated with the present groups of factories, the establishment of such now factories at inland centres will receive full consideration.

Something should be said in regard to location of annexes and the part of industry generally. As to annexes, the requirements of the fighting service in general call for the co-operation and assistance of all branches of industry, for, in an emergency, the Government would be obliged to rely upon commercial sources for production beyond the present and potential capacity of Government factories. Arrangements to this end are now being organized in conjunction with existing commercial industrial establishments. The Government is also taking special steps to supplement the Government factories by the provision of annexes at State railway establishments and at the works of selected private firms. The allotment of an annex to a firm necessitates the possession by that firm, of certain precision machine tool equipment.

Speaking generally as to the potentialities of industry, I may say that as the development of national self-sufficiency in requirements for an emergency depends upon the successful exploitation of the whole of our resources, it is the policy of the Government to foster commercial industries, thereby systematically adding to our resources of raw materials, stores and manufacturing establishments. Industries established to meet civil requirements are usually well able to cope with the situation as regards the nature and, in most cases, the quantity of the similar requirements of the fighting services, although, as already mentioned, the special organization of manufacturing plant is essential in a certain number of eases, for example, for the production of components of ammunition which have no counterpart in commercial industry. ‘

The limitation of munitions factories to special products requires a word or two. There has been some demand, which has its origin in the important matter of employment, that Government munitions factories be changed over to types of production different from that for which they were created. Such a ready transition is, in fact, not practicable, and confirmation is forthcoming from the system of annexes adopted in Great Britain and being followed here, where special buildings must be provided and equipped at factories employing labour of the class similar to that required for the manufacture of munitions.

If we are to beat our sword into a plough-share and our spear into a pruninghook, obviously our sword and spear will not be available when needed, without re-conversion. The same applies to highly-specialized factories designed for one purpose and converted to other uses.

It may be, and is, unfortunate in the economic sense that in peace-time a large, well-equipped factory should not be fully used, awaiting the problematical chances of war, but it would be disastrous if war suddenly burst upon the country and one or other of the factories were not available for their designed purpose. It is clear, therefore, that all the munitions factories must, in the present situation, be kept strictly to their designed purposes. That is the price of preparedness.

The department has not been unmindful, for example, of the utilization of the Small Arms Factory for other purposes, and, wherever possible, orders have been sent there for articles within the range of the factory. Tools and gauges are an example. That practice will be continued. It is the policy of the department to utilize the resources of the Government factories to the utmost in remedying the deficiencies of munitions, but it must have regard to the possibility of war and of keeping each factory ready for that contingency.

I come now to national .planning and its basis. The Commonwealth War Book is an index of national measures necessary in an emergency, and it is important that it should be backed up by detailed plans for each phase of national activity. The. Prime Minister (Mr. Lyons) has said -

It is the intention to press on with the completion of plans for all phases of national activity in an emergency. The aim of these is to provide for the parts that could be played by every organization, industry and citizen, either in respect of their normal work in the life of the community or by special voluntary effort.

Nothing less than organization on this scale will give a democratic State a degree of preparedness comparable to that of an authoritarian State.

The wider steps necessary to implement the Prime Minister’s declaration are broadly -

  1. The organization of man-power and woman’s voluntary efforts;
  2. The regulation and control of primary production in an emergency;
  3. Industrial mobilization of secondary industries in an emergency ;
  4. Commonwealth and State cooperation in peace and war.

Coining now to man-power, I point out that to enable the Man-Power Committee to proceed with its work with the utmost expedition, it has been decided to give it a chairman who would be able to concentrate on this work, and Major-General Sir Thomas Blarney has been appointed to this post in a civilian capacity. The chairman of the committee, the Commonwealth Statistician, and the secretary of the Department of Defence have been appointed by Cabinet as a committee to report on the measures necessary for a national register. This report will shortly be submitted to Cabinet for consideration.

The regulation and control of primary production is also important. The Department of Commerce is making an exhaustive study of aspects involved in the regulation and control of primary production with a view to the setting-up of committees, to prepare plans relating to the various classes of primary production with the terms of reference as follows : -

  1. Study of supply and demand, as, for example, Australian production, home consumption and exportable surplus in an emergency. In the latter case, the aspect of the demands of the other parts of the Empire to be related to the Australian scheme.
  2. The machinery for marketing both in Australia and abroad, and the safeguards necessary to ensure equitable treatment both to producer and consumer.
  3. Method of financing production and marketing, especially in the event of export being delayed for a lengthy period on account of insufficient shipping space or the dislocation of overseas shipping as the result of enemy activities.
  4. Storage of products, as the result of export being delayed, pending the resumption of export facilities.
  5. Cargo space in overseas ships.

As to industrial mobilization, the Principal Supply Officers Committee is responsible for the organization of supply requirements of the services in an emergency. Associated with the committee is the Advisory Panel on Industrial Organization, which furnishes advice when necessary on the broader principles of the committee’s work. The Advisory Panel has endorsed the lines on which the Principal Supply Officers’ Committee is working, and recommended the measures for the organization of industry for the production of ammunition components. Accordingly the Government has decided to invite the gentlemen forming the Advisory Panel to make their services available in the following additional directions : -

  1. A study of the measures necessary for industrial mobilization of secondary industry beyond those contemplated by the Principal Supply Officers’ Committee, which relate to service requirements only.
  2. Consultation on all business matters associated with the defence programme. This is of importance in view of the large expenditure now involved.

It is understood that the members of the panel are able and willing to co-operatet o the fullest degree desired, and I express my own and the Government’s appreciation of their public services.

The Government has also decided to invite the accountancy societies to nominate a panel to advise on the scheme of costing and profit control for the production of munitions by private industry in an emergency.

State co-operation is essential to this whole programme. At the conference of Commonwealth and State Ministers on the 21st October, it was agreed that there should be close collaboration between the Commonwealth and the States on defence works and works of a defence value. Machinery, such as the War Railway Council, is in existence to deal with certain aspects of this subject, but cooperation would be helpful in many other directions. It is proposed to invite the Premiers to a conference in the new year and to place a review of the defence position before them.

The financial and economic effects of the cessation of sea-borne trade require careful consideration. The Government has decided to appoint an expert committee on the effects of the national financial and economic structure of the loss of command atsea and the closing of tho trade routes. An examination of this kind is a necessary supplement to the preparation of schemes relating to primary and secondary industries. Such a review would authoritatively reveal the strong and weak points of our national economy under stress, and indicate the directions in which planning could strengthen the weaknesses.

Finally, I wish to say a word upon the difficulties peculiar to and inherent in a defence programme. These are not the normal obstacles which can be readily overcome, but are those inherent in the nature of the defence programme and peculiar to the class of work being undertaken. A defence programme divides itself broadly into the following headings : -

  1. Material requirements, in the shape of armaments, munitions and equipment.
  2. Works, such as fortifications, barracks and other accommodation.
  3. Man power, including its training.
  4. Development in a co-ordinated manner, so as to ensure that the results represent the maximum all-round security obtainable from the defence vote.

Taking material requirements, the resources from which supplies can be obtained are: -

Munitions factories specially created for the production of particular types of munitions;

The manufacturing resources of secondary industry:

Importations from overseas.

As already emphasized, we are continuously expanding our munitions factories. These factories take a long time to build and equip, especially in respect of the special plant which must be obtained from overseas. In addition, the training of operatives is a long process. The possibilities of secondary industry and the contribution it can make to defence are mainly dependent upon economic factors, and the Government can stimulate them by its trade policy and by special measures, such as the organization of industry for defence, as represented by the scheme of annexes. Finally, in regard to importations, there is a rapid trend to local production, but there are many directions in which we are still dependent on overseas, and the speed at which delivery can be obtained is governed by the demands of Britain’s programme on its manufacturing resources.

The works aspect of the defence programme needs mention. There is a general appreciation, in regard to any large building project, of the time that elapses from the decision to undertake the work until it is completed. There are certain minimum periods for completing plans, for getting out quantities, for calling tenders and the letting of the contract, and for the completion of the job.If these are multiplied manifold to apply to a works programme extending into millions, there will be an appreciation of the task confronting the Defence and Works Departments. It is also a feature of many of the works for the services that much of it is located in isolated parts, with added difficulties of construction. The recent formation of a Works Department, with a special Minister, should ensure the expeditious and economical execution of the works side of the defence programme.

The training of man-power for most of the ranks of the permanent services is a highly-specialized business, requiring in many, cases a period of years, and it is a well-known axiom that it takes longer to train a crew than to build a warship. Any large increase of the number of personnel is therefore limited by the training facilities that are available, including instructors.

It is, of course, important that the various parts of the defence programme should be carefully co-ordinated with one another, so that it will represent a balanced scheme of defence. The defence of Australia does not rest on any one of the services entirely - it is the joint responsibility of the whole, backed up by the productive resources of the country. This co-ordination must exist both within tho services and between services. Thus, it is important that barracks should be ready by the time recruitment of personnel is completed, and that hangars and. workshops should be finished by the time aircraft are being delivered.

An illustration of joint-service coordination can be obtained from the defences of a port. The army contributes the gun defences for defence against ships and raiding aircraft. The navy provides for the boom defences, to ensure the security of the harbour. The air force furnishes the aircraft for cooperation with the gun defences and naval vessels. It will be appreciated, therefore, that the development must proceed in a carefully planned manner, with simultaneous progress between the services.

I come now to the strategical distribution of the Australian defence forces. There is a demand from representatives from some parts of the Commonwealth for a greater strength of forces in their States. I would make a plea for a national outlook on defence, for it is an elementary military principle that dispersion of strength is a fatal weakness. The fact that a. place is remote and is not a centre of strategical importance is the best guarantee of its immunity from attack; for an enemy would not waste his resources on objectives which did not, contribute to the success of his campaign. The defence of any part of Australia is inseparably linked with the general scheme of defence for the whole of the Commonwealth, and measures for development, therefore, must be framed from the point of view of the unity of the problem of Australian defence. It follows, therefore, from the organization and disposition of the forces that have been raised, that underlying their strength and location are certain considerations of policy and strategy which, in the first place, have regard to the most vital centres whose loss would compel submission or imperil the capacity to offer resistance.

I would commend to honorable members appendix No. 20 of the reply to the case for the secession of the State of Western Australia, which deals with the defence aspect of the smaller States. It will be seen from this that the defence of the more remote parts of Australia hinges on the mobility of the navy, army and air force and the aggregate sum of Australia’s defence strength, the major source of which is the larger States.

Freedom to criticize is an essential feature of democracy, and it is a healthy sign when it hinges upon a vital question of national policy, such as defences. I would, however, observe that much of the public criticism on defence since the recent crisis has been contradictory when one critic’s opinion is set against another’s, and much of it has been unsound when set against ‘the advice of the Government’s advisers. Some of the critics suggest that the Government is proceeding on wrong lines, and that if it would concentrate on the navy, or the army, or the air force, all would be well in regard to our security. These criticisms are of a one-service kind, and have to be accepted with considerable reserve. The form of defence to be provided, and the relative strengths of the three services, are matters than can alone be determined by the Government, after consideration of the joint technical advice tendered to it by its advisers.

Too great emphasis cannot be laid on the joint aspect of defence.- Policy must take into account naval, military and air force views, and any one who has had tho opportunity to weight judicially . the service opinions will not become an extreme advocate of any particular arm. All of them have a part to play. Policy must be based on the unity rather than the diversity of the services. The only result of ex parte propaganda for ohe or another service can be a breaking down of the balanced position that has at present been established.

The Government feels that the programme I have outlined at some length is the effort that is called for from Australia now, and that it will be carried through with that determination and resolution displayed by the Australian people when confronted with critical occasions earlier in their history. Whilst our policy is one of peace and non-provocation, I am certain that, if our vital interests are assailed, the people of this country will respond in a manner in keeping with the traditions of our soldiers, sailors, and airmen in the Great War. The purpose of this (programme is to enable them to be prepared to do so.

Mr CASEY:
Treasurer · Corio · UAP

, - My friend and colleague, the Minister for Defence (Mr. Street), in introducing this bill, has described the Government’s proposals for the defence of this country in the years that lie immediately ahead of us. It falls to me to deal with the finance side. What the Minister for Defence has had to say, on behalf of the Government, will give Australia considerable food for thought. The proposed formidable increase in respect of Australia’s defence effort is a reflection of the Government’s reaction to the news that comes .to us from overseas.

As I said in the budget speech, we have no enemies and no enmities; yet we find it essential, the world ‘being as it is, to impose great burdens on ourselves in an endeavour to ensure some measure of security for ourselves and for our children. The burdens that adequate defence will impose are now realized to be greater than had been thought to be necessary even such a short time ago as the early part of this calendar year. Honorable members are aware that each year since 1932-33 has seen a steady annual growth of the expenditure on defence from various sources - culminating in the programme that was announced about eight months ago, which involves a total of more than £44,000,000 in the next three years.

The expenditure already provided for, for the current financial year, is just under £15,000,000, to which has to be added the financing of commitments entered into in previous years, to an amount of £1/800,000, which will be met from trust and loan funds. This total sum of “ £16,800,000 is to be met as follows :-

The total programme that the Government has now decided to recommend to the Parliament involves a total expenditure for the three years, including the present financial year, of about £63,000,000 ; that is about £19,000,000 in excess of the £44,000,000 .programme announced six or eight months ago.

The Government is very conscious of the serious nature of a proposal involving the expenditure of such a vast sum of money, but it believes it to be essential, and no less than essential, in the interests of Australian security. The programme involves authorizations and expenditure over the three years of the programme as follows : -

Honorable members will realize that, in connexion with defence it is essential to plan for some considerable period in advance. Orders have to be placed and commitments entered into for periods of up to two years - and sometimes more - ahead. This leads me to dwell for a moment on the importance of proper distinction being made between the terms “ authorization “ and “ expenditure “. In the early years of any programme designed to cover a period of years it will be found necessary to provide for authorizations very much in excess of actual expenditure.

In the latter years of a programme, the reverse holds good; that is to say, actual expenditure will be in excess of authorizations. It has been the general practice - and I believe an entirely proper practice - in Commonwealth public finance, not. to embark on authorizations or. commitments unless there has been in existence some parliamentary authority for the expenditure involved. It is necessary at times to some degree to anticipate parliamentary appropriations of a subsequent year, but it is as far as possible restricted to cases of urgency or the necessity to carry on existing departmental activities. It is for this reason that this Loan Bill is necessary.

In this year 1938-39, this increased programme involves entering, at once, into authorizations or commitments to an amount of about £10,000,000 in excess of those envisaged and provided for in respect of the 1938-39 portion of the £44,000,000 programme. The actual expenditure in 1938-39 will only be about £3,000,000 above the actual expenditure previously envisaged. It becomes necessary, therefore, to acquaint Parliament with the new proposals and to obtain parliamentary authority for further commitments to be entered into for defence equipment and additional obligations being undertaken in accordance with the enlarged programme.

What I have said is designed to explain why, under the new programme, a loan bill for £10,000,000 is now submitted for approval, on top of the loan authority for £10,000,000 which was obtained last April or May. The first loan authority was obtained to enable £5,250,000 of urgent authorizations to be entered into immediately for the first year of the programme, and further authorizations which have since been entered into bring the total commitments up to date to approximately £8,500,000. The balance of the authority remaining in the £10,000,000 loan fund of May last, that is £1,500,000, is insufficient to meet the immediate needs of the expanded programme. The schedule to the Loan Bill will, therefore, constitute the basis for future authorizations. It will enable authorizations or commitments to be entered into in respect of 1938-39, 1939-40, and 1940-41.

The final allocation of the expanded programme as between revenue and loan will be decided later when the budgets for 1939-40 and 1940-41 are brought down. Honorable members will realize that it is impossible to say, at this stage, what the budget position will be so far ahead, but the policy of the Government will be to carry as much as possible of the total expanded programme on the revenue account of the next two years. The expanded programme also involves increased expenditure on ordinary services as apart from capital services. These increases relate mainly to expansion of thepermanentand citizen forces. It entails further expenditure in the current year and it is necessary to obtain parliamentary authority for the expenditure involved. Additional estimates of expenditure will, therefore, be brought down later, involving additional expenditure from revenue this year of £1,320,000. Details of these items will be explained when the Estimates are before the committee. The finance of this additional expenditure from the budget so late in the year involves some recasting of the budget position. In order to provide for the additional £1,320,000 on the budget for the current year, the Government proposes to charge to loan fund a portion of the £1,618,000 provided for in the budget for capital services under new works, and to introduce additional Estimates of defence expenditure from revenue.

Mr Curtin:

– Is it intended to provide money from revenue to meet that expenditure?

Mr CASEY:

– There is no immediate proposal; that will come later.

Under the authority of the Loan Act, of April last, £4,000,000 was borrowed for defence purposes just prior to the commencement of this financial year, and we are also borrowing at present a further £4,000,000, as part of the current cash and conversion loan. The necessity for this further borrowing of £4,000.000 became evident after the recent crisis. We have already entered into commitments in respect of the years 1938-39, 1939-40 and 1940-41, to the amount of about £8,500,000 out of the £10,000,000 authorized in the April loan, and, as I have previously staled, further commitments of £10,000,000 and expenditure of £3,000,000 for capital services and ordinary services combined have to be faced this year under the new programme.

Mr Anthony:

– How much of the proposed expenditure of £63,000,000 will be provided from loan moneys?

Mr CASEY:

– That cannot be determined at the moment. The maximum amount possible will be carried on the budget. It is anticipated that the whole of the £8,000,000 already raised will not be expended this financial year, and that a portion of it will be available towards meeting expenditure early next year.

The enlarged programme involves an expenditure of approximately £63,000,000 over three years, or, on an average, about £21,000,000 a year. For the last three years, the average expenditure on defence from current budget revenue has been about £6,000,000 a year, as distinct from defence expenditure from trust and loan funds. Wo, therefore, have to finance large additional amounts, from one source or another, for defence in this year and the next two years. Even if it were physically possible to raise the whole of this additional burden by taxation alone - and I do not for one moment think it is - the reactions to our internal economy would be too serious to contemplate. Such an extreme course would bring about most adverse repercussions to State revenues and also to employment in industry. On the other hand, there arc not lacking those who would advocate that the whole of the defence expenditure should be financed by some mysterious form of national credits. I say quite frankly that the Government is not prepared to adopt a form of inflation which would jeopardize our economy and might well lead us to disaster.

Mr Holt:

– Can the honorable gentleman indicate the estimated maintenance cost of the revised programme?

Mr CASEY:

– No. Estimates vary upward from the height they have reached at present. It is expected that the annual maintenance costs will rise until the end of the programme.

Mr Holt:

– The honorable gentleman, himself, suggested that maintenance costs would be approximately £10,000.000 a year.

Mr CASEY:

– I think that maintenance costs are considerably below that at present. I have roughly in my mind the rate at which they will rise, hut I should prefer to give a more carefully considered answer to the honorable member’s question during the committee stage. Clearly, therefore, our full financial resources must be concentrated for this emergency. In addition to the maximum sums that can be provided from revenue without serious repercussions, a substantial portion of the total programme must be met by borrowing. Nor can’ finance be visualized solely from Australian revenue and loan resources. In the circumstances, the Government has in contemplation the raising of some portion of the loan requirements on the British market. Havingregard to the national emergency with which we are faced the Government believes that this course is fully justified. Just how much money will be raised overseas, and when it will be raised, are matters to be determined when the actual expenditure becomes more imminent than it is at present. It would also be necessary to bear in mind, in this connection, the state of the relative loan markets, both in Australia and overseas.

Under the £10,000,000 loan authority which was obtained in May last, £8,000,000 of loan money is in sight to meet expenditures for this year and part of next year. Under the authority of £10,000,000 at present available, commitments have been entered into to the extent of about £8,500,000. There is a balance of £1,500,000 available towards further commitments under the acceleration of the old programme and the additions under the new programme. This is inadequate for immediate proposals and the bill now before the House will enable additional commitments for 1938-39,1939-40, and 1940-41 to be entered into. As previously indicated, it is not possible now to make a final allocation between revenue and loan for the whole of the £63,000,000 programme, but the policy will be. when the budgets of the next two years arc brought down, to carry as much as possible of the total programme from revenue.

In conclusion, my colleague, the Minister forDefence (Mr. Street) has advised the House of the items of defence equipment that in the opinion of the Government are essential for the adequate defence of Australia in the present circumstances. Following that, I have outlined the scheme, so far as it can be outlined in advance, for the financing of such proposals.

Mr Curtin:

– It was a very elementary outline - merely to borrow.

Mr CASEY:

– It might be supposed that that was the end of the business, and that all that now remains is to raise the money. I do not believe that that is the case. I believe the people of Australia have to he convinced of the necessity for this greatly enhanced expenditure in order for them to have the will and the purpose to carry out this great defence programme with spirit and enthusiasm.

Debate (on motion by Mr. Curtin) adjourned.

page 2774

QUESTION

ESTIMATES (No. 2) 1938-39

Message recommending appropriation reported.

In committee (Consideration of Governor-General’s message) :

Motion (by Mr. Casey) proposed -

That the following additional sum be granted to His Majesty to defray the charges for the year 1938-39 for the services hereunder specified: -

Mr CURTIN:
Fremantle

.- I suggest to the Treasurer (Mr. Casey) that he should report progress. It is very clear that the message relates to Estimates which are involved in the statement of expanded defence policy submitted to the House by the Minister for Defence (Mr. Street). The principles of that expanded defence policy are to be dealt with in the Loan Bill which the Treasurer is sponsoring, the debate concerning which has just been adjourned. I submit that until that matter is disposed of in principle the honorable gentleman ought not to ask us to proceed any further.

Mr Casey:

– The honorable member has seen the Estimates.

Mr CURTIN:

– I have heard the Treasurer’s statement in regard to the financing of the programme and also the exposition by the Minister for Defence as to the necessity and the character of the expanded programme;but I submit that in order to preserve the deliberative capacity of this House, we should agree to the expanded programme in principle before we are committed to any of its details. I therefore suggest that progress be reported at this stage.

Mr Casey:

– I agree.

Progress reported.

page 2774

STATES GRANTS (FERTILIZER) BILL (No. 2) 1938

Second Reading

Debate resumed from page 2735.

Mr CURTIN:
Fremantle

.-I propose to deal with this bill though I am frankly taken by surprise that the debate should be resumed at this stage because this House has seen this bill for the first time only to-day. When the debate was adjourned, I presumed that I would have until to-morrow to deal with it, more particularly in view of the tremendously important matters which have since been submitted to this House for consideration. Apparently, however, in these last few days of the sitting, Ministers propose to produce rabbits out of their hats with greater dexterity than even the prince of jugglers. The bill is one to provide a bounty of 10s. a ton on fertilizer used by primary producers to enrich their cultivable land provided it is not used for the. production of wheat. It has been the practice of this House for some years to pass legislation of this character. From what I can gather from the cursory perusal of the bill which time has permitted since it was brought in this afternoon, it is proposed to limit the bounty to the first 10 tons of fertilizer. It cannot be denied that the use of superphosphates for the cultivation of wheat, and of other forms of fertilizers for other crops, has been very successful. The use of fertilizers of various kinds has made primary production more economic andhas greatly increased the yield; but in view of the fact that the produce of most of these crops is now the subject of bounty, it appears to me to be a little incongruous thatwe should be encouraging by the payment of a subsidy greater production from the soil and then be obliged to provide another subsidy in order to make the excess production profitable because of the effect of increased world production on the price level. It is about time that this Parliament reconsidered its attitude towards legislation of this kind which gives the impression of doing two things, one of which cancels the value of the other. I ask leave to continue my remarks at a later date.

Leave granted; debate adjourned.

page 2772

MOTOR INDUSTRY BOUNTY BILL 1938

Bill returned from the Senate with an amendment.

In committee (Consideration of Senate’s amendment) :

The schedule -

Description of Goods.

Radiator assembly, comprising the radiator core . . . overflowpipe, and baffle or filler neck . . .

Senate’s amendment -

Leave out “ and baffle or”, insert “ baffle and “.

Mr PERKINS:
Monaro- Minister for Trade and Customs · Eden · UAP

– I move -

That the amendment be agreed to.

The amendment was introduced by the Minister in charge of the bill in the Senate in order to define more accurately a radiator assembly. It is merely a machinery provision, and does not extend the operation of the bill, or in any way affect the principles upon which the bill was passed by this House.

Motion agreed to.

Resolution reported; report adopted.

page 2772

PAPERS

The following papers were presented : -

Meat Export Control Act - Third Annual Report of the Australian Meat Board, for year 1937-38, together with Statement by the Minister regarding the operation of the Act.

Northern Australian Survey Act - Aerial, Geological and Geophysical Survey of Northern Australia., Report of Committee, for period ended 30th June, 1938.

Ordered to be printed.

New Guinea Act - Ordinances of 1938 -

No. 10- Public Service (No. 2).

No. 11- Appropriation (No. 3)1937-1938,

No. 12 - District Courts.

No. 13 - Explosives.

No. 14 - Education.

No. 15 - Electric Light and Power.

No.16 - Companies.

No. 17 - Gold Buyers.

No. 1 8 - Immigration.

No. 19 - Commerce (Trade Descriptions).

No. 20- Medical.

No. 21 - Legal Practitioners.

No. 22 - Maintenance Orders (Facilities for Enforcement).

No.23 - Administrator’s Powers.

No. 24-Succession Duties.

No. 25 - Native Administration.

No. 26 - Motor Traffic.

No. 27-Sheriff.

No. 28 -Supreme Court Assessors.

No. 29 - Quarantine.

No. 30 - Petroleum Storage.

No. 31-Public Health.

No. 32-Prisons.

No. 33 - Natives Taxes.

No. 34 -Superannuation (No. 2).

No. 35 - Currency Coinage and Tokens.

No. 36 - Customs.

No. 37 - Liquor.

No. 38 - Police Offences.

No.39-Wills.

No. 40 - Roads Maintenance.

No. 41 -Stamp Duties.

No. 42 - Appropriation 1938-1939.

No. 44 - Salamana to Wau RoadLoan.

No. 45 - Customs Tariff.

No. 46 - Aerial Tramways.

No. 47 - Native Labour (No. 2).

No. 48 - Fisheries.

No. 49 - Lands Registration.

No. 50 - Miners’ Homestead Leases.

No. 51 - Uncontrolled Areas.

House adjourned at 9.48 p.m.

page 2772

ANSWERS TO QUESTIONS

The following answers to questions were circulated : -

Commonwealth Bank : M ethod of Appointments to Staff

Mr Mahoney:

y asked the Prime Minister, upon notice -

With regard to previous representations by the honorable member for Denison (Mr. Mahoney) on the subject of appointments to the Commonwealth Bank, isthe Government prepared to introduce the necessary legislation making it mandatory that eligibility for appointment to the Commonwealth Bank shall be secured by competitive examination instead of the present system of appointment on the recommendation of the local manager?

Mr Lyons:
UAP

– It is considered that the method of appointments to the staff of the Commonwealth Bank should be determined by the Commonwealth Bank Board. Accordingly, the Government does not propose to take action along the lines suggested by the honorable member.

Expenditure of NewWorks and Repairs.

Mr Curtin:

n asked the Minister for Works, upon notice -

Of the £15,899,2 10 to he spent during the financial year 1938-39 on new works, repairs and maintenance, how much is it proposed to spend in each State?

Mr Thorby:
CP

– The information is being obtained.

Governor-General’s Residence : Yarralumla House

Mr Drakeford:
MARIBYRNONG, VICTORIA

d asked the Prime Minister, upon notice -

  1. . What was the original cost of erecting Yarralumla House?
  2. What amount has been spent by the Commonwealth in fitting it up as a residence for the Governor-General?
  3. What is the estimated cost of improvements, extensions. &c., proposed to be effected to prepare it for occupancy by the Duke of Kent?
  4. Is Yarralumla the proper site for Government House according to the Griffin plan of Canberra?
  5. Will the Government refer to the Public Works Committee the question of the erection of a permanent Government House on the site shown in the accepted plan of Canberra?
Mr Lyons:
UAP

– The answers to the honorable member’s questions are as follows : -

  1. The Governor-General’s residence in the Australian Capital Territory was the homestead of the YarralumlaEstate. When the compensation money was determined, no dissection was specially made for the homestead, outbuildings and grounds. At the time of the acquisition (in 1912) the value of the main residence, attendant buildings and grounds, was in the vicinity of £4,000.
  2. Government House buildings, £53,988 3s. 9d; furniture and equipment, £15,896 3s.1d.: grounds, £6,291 9s.6d.
  3. Information not available. The matter is still under consideration.
  4. No.
  5. As no scheme has been developed for the erection of a Government House on the site indicated on the approved plan it would not be practicable, at this stage, to refer the matter to the Public Works Committee.

Commonwealth Works Department : Method of Engaging Employees

Mr Rosevear:

r asked the Minister for Works, upon notice -

  1. What method of recruitment was adopted in respect of the 100 men who were provided with work by the Commonwealth Works Department in Sydney since June, 1938?
  2. Were the vacancies advertised: in the Sydney press; if so, in what papers and on what dates?
Mr Thorby:
CP

– The answers to the honorable member’s questions are as follows : -

  1. Where possiblemen were obtained through the State Labour Bureau. In cases where the bureau did not have men with the requisite qualifications, they were selected by the supervising officers of my department.
  2. No.

Tobacco Industry

Mr Forde:
CAPRICORNIA, QUEENSLAND

e asked the Minister for Trade and Customs, upon notice -

  1. Has his attention been drawn to a meeting of tobacco-growers at Myrtleford, on the 29th November. 1938, at which strong dissatisfaction was expressed at the condition of the tobacco industry, and where it was suggested that the Government should prevent the importation of American tobacco until all leaf of a similar grade grown in Australia had been used?
  2. In view of the Minister’s recent assurance that the tobacco-growing industry was in a flourishing condition, will he give favorable consideration to the statements made at that meeting?
Mr Perkins:
UAP

– The answers to the honorable member’s questions are as follows : -

  1. No.
  2. If responsible representatives of the industry submit a case, the matter will receive consideration.

Public and Private Wealthof Australia

Dr Maloney:
MELBOURNE, VICTORIA

y asked the Treasurer, upon notice - 1. (a) What is the estimated private wealth of Australia, up to date, as shown in the Compendium of Statistics; (b) what is the estimated public wealth of Australia up to date ?

  1. If the information is not readily obtainable, when is he likely to be in a position to inform the House on these important questions, considering thatwhere the private wealth used to be given at intervals of six years, and on one occasion at two years, nothing has been given since 1929?
Mr Casey:
UAP

– The attention of the honorable member is drawn to the reply furnished on the 16th November, 1938. It is not possible at this stage of the investigation to state when final results will be available, in view of the great amount of information which has to be collected by correspondence from local governing bodies all over the Commonwealth.

Imports of Bags and Sacks

Mr Price:

e asked the Minister for Trade and Customs, upon notice -

What was the quantity and value of bags and stacks imported into Australia during each of the past five years?

Mr Perkins:
UAP

– Imports of bags and sacks into the Commonwealth during the past five years have been as follows: -

Commonwealth Public Service: Superannuation Paymen ts

Mr Blackburn:

n asked the Treasurer, upon notice -

How many (a) ex-officers of the Commonwealth Public Service, and (b) widows of ex-officers of the Commonwealth Public Service, arc receiving superannuation payments?

Mr Casey:
UAP

– The figures desired by the honorable member are as follows: -

  1. 3,729; (b) 2,119.

Invalid and Old-age Pensioners.

Mr Blackburn:

n asked the Treasurer, upon notice -

How nmny (a) old-age pensioners, and (b) invalid pensioners, are there in Australia?

Mr Casey:
UAP

– The present numbers of old-age and invalid pensioners in Australia are as follows:-

  1. Old-age pensioners, 227,449; (b) Invalid pensioners,87,224.

National Insurance: Regulations - Cost of Printing Pamphlets

Mr Sheehan:
COOK, NEW SOUTH WALES

n asked the Treasurer, upon notice -

  1. Have the regulations under the National Health and Pensions Insurance Act been framed ?
  2. Will these regulationsbe brought before Parliament for review before they are put into operation?
Mr Casey:
UAP

– The approved society regulations and thecollection of contribution regulations have been prepared in draft form but cannot be made until the parts and sections of the act under which the regulations are made have become law as provided in the National Insurance Bill which is now before this House. It is unlikely that these regulations can be presented to Parliament before the end of the present session.

Mr Rosevear:

r asked the Treasurer, upon notice -

  1. What is the estimated cost of the printing of the pamphlet entitled What National Insurancemeans?
  2. How many copies are to be printed?
  3. What is the estimated cost of distribution?
  4. Will the cost of printing and distribution be a charge against the funds of the National Insurance Commission?
Mr Casey:
UAP

– The answers to the honorable member’s questions are as follows : -

  1. £1,650.

2.1,820,000.

3.Postage payable to the PostmasterGeneral’s Department, £5,000. Cost of envelopes and wages of female staffs for enveloping leaflets. £700.

  1. The cost of printing and distribution will be charged against the Treasury Vote for National Insurance - preliminary expenditure.

Postal Department : Extension of Sydney General Post Office.

Mr Archie Cameron:
CP

n. - On the 1st December, the honorable member for Wide Bay (Mr. Bernard Corser) asked a series of questions regarding matters pertaining to the purchase of Hoffnung’s Building, Sydney, with a view to the erection thereon of a building for the requirements of the Postal Department. I informed him that the purchase price of the building was in the vicinity of the amount he then indicated, and undertook to supply him information on the further points which he raised, viz.: -

  1. Was this amount provided from revenue?
  2. Have shop-owners occupying the ground floor of Hoffnung’s building at a rental of from £20 to £30 a week been notified that they are on a weekly tenancy?
  3. Is it a fact that the building is about to be demolished and another post office erected, bringing the total cost to approximately £1,000,000?
  4. Will the amount be provided from revenue?
  5. When was the decision regarding this purchase and re-building arrived at?
  6. Is not the present upper floor space of Hoffnung’s building conveniently situated for immediate post office use?

The answers are as follows: -

  1. Yes.
  2. Yes. as from the11th December, 1938.
  3. The answer to the first part of the question is yes. The estimated cost of the new structure is £483,000.
  4. Yes.
  5. October, 1936.
  6. No;the space would be entirely unsuitable for departmental purposes.

Civil Aviation : Improvement to Aerodromes - Radio Equipment of Passenger Aircraft

Mr Green:

n asked the Minister for Civil Aviation, upon notice -

  1. Following on a letter from the accountant of the MacRobertson-Miller Aviation Company, received by the honorable member for Kalgoorlie (Mr. Green), is it a fact that there is an urgent need to provide several runways on some of the landing grounds of the North-West Aerial Service, and also to extend the areas of a few of the grounds to increase the safety margin for taking off with the larger machines which will be employed in the future?
  2. With reference to the letter received in Perth from the Minister, in which he stated that several works had been planned and that be proposed to make a statement in the near future, when may the considered reply of the Minister be expected.
Mr Thorby:
CP

– The answers to the honorable member’s questions are as follows : -

  1. I have not seen the letter received by the honorable member from the accountant of the MacRobertson-Miller Aviation Company, but the department has already realized the desirability of providing runways on certain landing grounds and extensions in certain cases along the Perth-Darwin route. Action to this end is already in hand but there is no possibility of having any of the runways completed for the approaching wet season. The MacRobertson-Miller Aviation Company has, however, informed the department that many of the landing grounds are fit for use in all normal weathers by the large type of aircraft now in use on the service, though they have indicated the desirability of improvement in certain cases, presumably to minimize delays on the service during the wet season as indicated in the company’s telegram to the honorable member, dated the 17th November., In view of the impossibilityof having new runways available for the forthcoming wet season, the company is being instructed that in no circumstances is any desire for regularity of operation to impair safe running.
  2. I am not sure what letter the honorable member is referring to. but the intention is to effect necessary improvements (including extensions and runways at certain places) to landing grounds at Geraldton. Carnarvon, Port Hedland, Broome. Derby, Fitzroy Crossing. Hall’s Creek and Wyndham. and the preparation of a. new emergency ground at Port Keats.
Mr Beasley:

y asked the Minister for Civil Aviation, upon notice -

  1. . What type of radio equipment was carried on the K.P.M.-D.C.3 passenger aeroplane which crashed in Holland on the 14th November, and what equipment was installed at the ground radio station?
  2. Isth is equipment the same as that recently ordered by the Civil Aviation Department”?
  3. Who were awarded the contracts for the supply of the Adcock cathode ray directionlinding equipment?
Mr Thorby:
CP

– The answers to the honorable member’s questions are as follows : -

  1. Complete details of the aircraft and ground equipment are not available, but generally both medium and high frequency transmitters and receivers of Philips design were fitted to Dutch aircraft and ground stations, In addition, a Philips medium frequency approach beacon is installed at the aerodrome.
  2. No.
  3. Amalgamated Wireless (Australasia) Limited, Sydney.

War Pensions

Mr Blackburn:

n asked the Minister representing the Minister for Repatriation, upon notice -

  1. How many(a) ex-service men, and (b) wives of ex-service men and widows of exservice men, are receiving service pensions?
  2. How many persons are estimated to be wholly dependent on war pensions, including ex-service men, widows and other dependants of deceasedex-service men?
Mr Archie Cameron:
CP

– The Minister for Repatriation has supplied the following answers : -

  1. (a)6,647: (b) wives, 2,036; widows, 304: total, 8,807.
  2. It is impossible to arrive at an estimate as no disclosure of income is sought in the assessment of war pensions to ex-soldiers’ wives or children.

Militia Forces : Recruiting Centres - Definition of Duties.

Mr Street:
UAP

t. - On the 1st December, the honorable member for Watson (Mr. Jennings) asked the following question, without notice: -

Is the Minister aware that there have been many complaints in Sydney by intending militia recruits regarding their inability to find out the exact location of the places where they may enlist? Willhe make inquiries to see if this difficulty can be overcome?

I am now in a position to inform the honorable member that I am advised by the District Base Commandant at Sydney that recruiting officers are in attendance each day at Victoria Barracks and at all drill halls inthe metropolitan and suburban areas and full particulars’ are available from these officers regarding the location of the places of enlistment.

In addition, information has been published on several occasions recently in the metropolitan press, and printed cards showing the location of all centres are now being issued.

Mr Street:
UAP

– On the 2nd December, the honorable member for Cook (Mr. Sheehan) asked the following questions, upon notice : -

  1. Is there any provision relating to militia recruitment defining the duties which members of the Militia Forces may or may not be called on to perform in assisting State police forces?
  2. Would a member of the Militia Forces have a right to conscientious objection if called on to enforce against his fol low-workers repressive measures similar to those taken during the present industrial dispute in France ?

I am now in a position to inform the honorable member as follows: -

  1. I would invito the honorable member’s attention to section 119 of the Constitution, section 51 of the Defence Act . 1903-1934 and to Part V. of the Australian Military Regulations, which prescribe the duties of the Military Forces in aid of the civil power during domestic violence.
  2. Section 51 of the Defence Act specifically provides that the Citizen Forces of the Commonwealth, which include the Militia Forces, shall not be called out or utilized in connexion with an industrial dispute.

Shipbuilding Industry and Shipping Trade

Mr McCall:
MARTIN, NEW SOUTH WALES

l asked the Prime Minister, upon notice -

  1. Has he been informed that 200 employees and 40 unionists at Mort’s Dock have received notices of dismissal owing to the stagnation of the ship-building industry?
  2. In view of the fact that Sir Walter Carpenter, head of an Australian shipping line, is about to leave for England for the purpose of purchasing new vessels, and in view of the parlous condition of the Australian shipbuilding trade, will the Government, before the session ends, expedite the presentation to Parliament of the report made by the ex -Minister for Trade and Customs (Mr. White) on the industry ?
  3. What reply has the Government to make to the statements made by Sir Walter Carpenter that his shipping company, which is the only Australian shipping company engaged in foreign shipping, has been running for four years without receiving £1 worth of Government cargo, whileother non-Australian companies have been getting Government cargo, including munitions, guns and aeroplanes for defence ?
  4. Is it a fact that some foreign ships have brought defence materials to Australia?
  5. Is preference given to Australian-owned organizations. If so, why has this company been overlooked?
Mr Lyons:
UAP

– The answers to the honorable member’s questions are as follows : -

  1. No.
  2. The Government hopes to be in a position to announce its decision in this matter at an early date, if possible before the present parliamentary sittings terminate.
  3. In 1930, the Australian Industries Preservation Act was amended specially to enable agreements to be made between shippers of goods from Australia, and shipowners, and approved by the Australian Overseas Transport Association whereby, in consideration of periodical sailings to be provided by the shipowners, and the carriage of goods of the shippersat agreed rates, the shippers agree to ship exclusively by the shipowners. Such exclusive agreements have been made, and similar agree mentis have been made by the shipowners with shippers from the United Kingdom and Europe to Australia. The Commonwealth Government, as a shipper, is party to an agreement for shipment of goods to Australia.

The Commonwealth Government, apart from its responsibility under the agreement as a shipper, has a general responsibility to ensure adequate and efficient shipping connexion between the United Kingdom and Europe on the one hand and Australia on the other. The Government relies on the conference lines to supply this service and their vessels make between 300 and 400 sailings annually to Australia front various United Kingdom ports as part of their regular service. The Carpenter Line on the other hand makes about six sailings annually from United Kingdom ports to Australia, and the conditions associated with the running of these vessels (e.g. itineraries, method of loading, &c.) are said to be unsuitable for the regular shipment of cargoes. It is understood that the capital of the Carpenter Line is subscribed substantially in Australia but that the ships are registered outside Australia and that the crews are not on Australianarticles.

The Oversea Shipping Representatives Association which was recently approached in the matter has advised that Carpenters have been given a number of concessions which have proved embarrassing to conference lines in dealing with other merchants. The association added that these concessions were granted as the result of agreements and conversations between conference lines and Carpenter, and that these agreements still have some time to run.

Notwithstanding the above every effort has been made by the Commonwealth Government to secure back loading from the United Kingdom compatible with the conditions under which the vessels are running. 4.It is the practice for Commonwealth defence supplies from the United Kingdom to be shipped in British-owned vessels. Occasionally, odd shipments of small dimensions from the continent or the United States of America may be brought in foreign ships; but these are isolated cases only and the amount of freight would be negligible.

  1. See answer to 3.

Cite as: Australia, House of Representatives, Debates, 6 December 1938, viewed 22 October 2017, <http://historichansard.net/hofreps/1938/19381206_reps_15_158/>.