House of Representatives
16 March 1950

19^th Parliament · 1^st Session

QUESTION
- ALIEN DOCTORS
QUESTION
- DE. HEWLETT JOHNSON
QUESTION
- PUBLIC WORKS
QUESTION
- HOUSING
QUESTION
- TUBERCULOSIS AND CANCER
QUESTION
- CURRENCY
QUESTION
- COAL
QUESTION
- COMMUNISM
QUESTION
- INDUSTRIAL UNREST
QUESTION
- HEALTH AND MEDICAL SERVICES
QUESTION
- ROADS
QUESTION
- DEFENCE FORCES
QUESTION
- WOOL
QUESTION
- IMMIGRATION
QUESTION
- SHIPPING
QUESTION
- WAR DAMAGE
QUESTION
- PENSIONS
QUESTION
- JAPAN
QUESTION
- MELBOURNE TRAM STRIKE
QUESTION
- COMMONWEALTH EMPLOYMENT SERVICE
QUESTION
- MORWELL POST OFFICE
QUESTION
- MR. ERIC J. HARRISON, M.P
CIVIL AVIATION
COMMONWEALTH BANK BILL 1950
GOVERNOR-GENERAL’S SPEECH
- Opperman -
COMMITTEES OF SUPPLY AND WAYS AND MEANS
JAPANESE WAR CRIMES
- Japanese War Crimes Trials - Ministerial Statement
COMMONWEALTH BANK BILL 1950
- Second Reading
INTERNATIONAL AFFAIRS
- Foreign Policy -Ministerial Statement. 9th March, 1950
STANDING ORDERS COMMITTEE
ADJOURNMENT
PAPER
- Commonwealth Public Service Act - Appointment - Department of Works and Housing - R. G. C. Agnew
ANSWERS TO QUESTIONS
- Petrol
- Telephone Services
- Banking

Mr. Speaker (Hon. Archie Cameron) took the chair at 2.30 p.m., and read prayers.

page 866

QUESTION

ALIEN DOCTORS

Mr FITZGERALD:
PHILLIP, NEW SOUTH WALES

– Is the Minister for Health aware that Dr. Paul Sutton, a brilliant American ear, nose and throat specialist, has decided to return to the United States of America with his Australian wife and family because he is not allowed by the British Medical Association to practise in this country ? I remind the right honorable gentleman that the Government’s immigration programme, which provides for the entry of 200,000 persons each year, will create an urgent need for outstanding medical men. Will he have the matter investigated with a view to lifting the ban and offsetting adverse criticism of Australia in the United States of America? Does he not consider that the Government should encourage and make welcome to Australia men with such high scientific attainments as those of Dr. Sutton?

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

– The registration of doctors generally is not controlled by the British Medical Association or by this Government. It is a matter for the State governments, except in Commonwealth territories. The policy of the State governments is to grant registration only to doctors from countries which recognize on a reciprocal basis the qualifications of medical graduates from Australian universities. This policy is designed to ensure that there shall be a proper standard of medical practice in Australia. An Australian doctor would not be permitted to practise in the United States of America without a certificate of registration for the American State in which he lived. Before he could obtain registration he would be required to pass medical examinations in. that State. Legislation enacted in the Australian States provides that a doctor from a country which has no reciprocal arrangement with Australia may secure the right to practise if he studies at an Australian university for a certain number of years and passes the examinations set by the university. This Government has no power to register foreign doctors, except in the territories that it administers directly.

page 867

QUESTION

DE. HEWLETT JOHNSON

Mr TOWNLEY:
DENISON, TASMANIA

– I ask the Minister for Immigration whether the Dean of Canterbury, the Reverend Dr. Hewlett Johnson, will be permitted to enter Australia, particularly as the security services of the United States of

America prevented him from landing in that country? If he will be allowed to land here, does the Minister think that the reverend gentleman’s marked pro-Russian sentiments and his stated belief that northern Australia should be handed over to the Japanese are likely to further the cause of peace ?

Mr HOLT:
Minister for Immigration · HIGGINS, VICTORIA · LP

– I was asked some weeks ago by newspaper representatives whether Dr. Johnson would be allowed to enter Australia, and I said then that I did not propose to deal with supposititious cases. Last night, however, I was informed that the Dean of Canterbury had indicated publicly that he had accepted an invitation to attend a conference in Australia, and I was asked again whether his entry would be permitted. After making suitable inquiries I stated that, assuming that the dean had a valid British passport, he would be eligible for admission to Australia. The security authorities have informed me that they will raise no objection to his admission to Australia. The statement attributed to the Dean of Canterbury is not one which I endorse or which this Government endorses, but we are not called upon to sanction the views or opinions of all the people who are admitted to Australia under our present immigration laws. Many views are held by the dean which do not commend themselves to this Government. If the facts are as indicated to me then no official objection will be raised to his admission. On the question about the United States of America, I understand that although the entry of the dean was opposed there on a former occasion, subsequently he was permitted to enter the United States for the purpose of conducting a lecture tour.

page 867

QUESTION

PUBLIC WORKS

Mr GILMORE:
LEICHHARDT, QUEENSLAND

– I direct a question to the Minister for Supply and Development. The Queensland Government has for many years been promising the tobaccogrowers of northern Queensland that it would put the Barron-Walsh irrigation scheme in hand. Has the Queensland Government approached the department of the Minister for Supply and Development seeking financial and technical aid!

Mr CASEY:
Minister for Works and Housing · LP

– I have not had any official information about the particular scheme that the honorable gentleman has mentioned, although I happen to know something about it personally. I shall be most interested to have any particulars that the honorable member or Government of Queensland can lot me have- on that scheme.

page 868

QUESTION

HOUSING

Mr FRASER:
EDEN-MONARO, NEW SOUTH WALES

– I direct a question to the Minister for “Works and Housing about, increases in rentals, charged to ex-servicemen who are occupants of war service homes. Those increases began to operate about the time the Minister assumed control of his department but in the two letters that I have addressed to him I have not succeeded in getting the informative answers for which the honorable member for Gellibrand pleaded last night. Therefore I ask the Minister whether he will examine the matter again and see whether he can furnish me with a more informative reply than the ones I have received, which states, without adequate explanation, that the increased rentals are in accordance with a formula approved by the New South Wales Rent Controller. “Will the Minister particularly examine the case I submitted to him by letter? In that instance the rental of an ex-serviceman was increased from 21s. to 24s. 6d. after a period of eight years’ tenancy without any reason being given other than the one I have quoted. Will the Minister agree to examine this case, having in mind the fact that it is not necessary for the Commonwealth to charge the maximum rent approved by the New South Wales Rent Controller, but only a fair rent? Will he also consider the matter, having regard to the consideration that increasing the rents of ex-servicemen is not putting value back into the £1?

Mr CASEY:
LP

– The honorable member has inferred that this Government has made some new arrangement under which higher rentals will be charged for way service homes. That is not so. This Government has taken no steps at all to increase the rentals of war service homes either new or existing. In fact the Go vernment is examining propositions under which the reverse may happen. That is that rentals may possibly be decreased. 1 make no undertaking in that regard but the matter is being examined in that light. In connexion with the particular case- that he has mentioned, I was under the impression that I had given him all the relevant information which is, as I understand it, that this particular house, which is in Goulburn, has been the subject of an error in calculation of the rental extending back for some years. That error has been recently discovered and an additional 2s. or -3s. a week has been charged to this individual. I shall get all further information that it is possible to get in respect of that particular house and let the honorable member have it.

Mr FALKINDER:
FRANKLIN, TASMANIA

– Will the Minister for Works and Housing indicate the possibility of (a) reducing the present interest rate on war service homes and (&) reducing the present minimum period for re-payments?

Mr CASEY:

– The matters to which the honorable member has referred are at present being examined by the Government. It is not possible for me to make a statement or even suggest what the outcome of that examination will be, but I assure him that the matter is being considered sympathetically at this moment.

page 868

QUESTION

TUBERCULOSIS AND CANCER

Mr McMAHON:
LOWE, NEW SOUTH WALES

– I ask the Minister for Health whether the Government will make an adequate allowance to people who suffer from tuberculosis? Will the. Government also provide better facilities for the early diagnosis and treatment of cancer, and ensure that adequate information on the subject is published in order to reduce the fear component of this affliction?

Sir EARLE PAGE:
CP

– The Government is considering, at the present time, the payment of certain allowances to tuberculosis patients under treatment, and hopes to publish a notice on the matter in the Gazette within a week or two. The allowances will be sufficient to enable tubercular patients to refrain altogether from working, so that they may recover completely. The Government hopes at a later date to discuss proposals for the diagnosis and treatment of cancer with the State authorities which control hospital and teaching services in the various States.

page 869

QUESTION

CURRENCY

Mr WARD:
EAST SYDNEY, NEW SOUTH WALES

– In view of the fact that the value of the £1 has continued to decline every day since the present Government took office, can the Prime Minister indicate approximately when the policy of the Government to put the value hack into the £1 will become effective ?

Mr MENZIES:
Prime Minister · KOOYONG, VICTORIA · LP

– The honorable member is guilty of tedious repetition. What he is really trying to do is challenge the verdict of the electors. The process to which he referred began, in its initial stages, on the 10th December, last year.

INDUSTRIAL UNREST

Mr DALY:
GRAYNDLER, NEW SOUTH WALES

– I direct a question to the Minister for Labour and National Service. Reports indicate that because of strikes, 23 coal mines are idle, the Melbourne tramways are disorganized and the rolling strike technique on the waterfront has disorganized the stevedoring industry. Does not the Minister consider that those strikes have a serious effect on the -Government’s policy of putting value back into the £1 ? What action does the Government intend to take in order to terminate those strikes audi bring peace to industry?

Mr HOLT:
LP

– This Government has inherited a host of industrial troubles from its predecessor, but we are dealing with the issues which those situations have created as vigorously and capably as we can. The three tribunals which are directly concerned with the matters to which the honorable gentleman has referred have been dealing with them as recently as yesterday and even to-day. The Coal Industry Tribunal conferred this morning with the parties who are involved in the trouble on the coal-fields, and the conference was adjourned until 3 p.m. The Full Court of the Commonwealth Court of Conciliation and Arbitration considered an application for the de-registration of the tramways union, and was to announce its decision at 2.15 p.m. to-day. Heavy rain has interrupted work on the waterfront in Brisbane, but the Australian Stevedoring Industry Board has already given a decision to the effect that those men who disobey its award will forfeit their attendance money.

page 870

QUESTION

HEALTH AND MEDICAL SERVICES

Dr NOTT:

– A* the whole of the people of Australia are awaiting with increasing impatience the introduction of a national health scheme, as the proposals of the Labour party in that respect have many merits, and as the scheme that is now being developed by the Minister for

Health is approaching the stage at which it will be submitted to the Parliament as a provocative party measure, will the right honorable gentleman give consideration to the suggestion that the all important matter of a national health scheme shall be treated as a non-party measure, and that an all-party committee, under his supervision, will be appointed to draft a non-party measure for submission to the Parliament ?

Sir EARLE PAGE:
CP

– I trust that when the bill in which the Government’s proposals for a national health scheme are embodied is introduced, it will be recognized as completely non-partisan in every respect, and will secure the approval of all those organizations and people who are directly associated with tending the sick and caring for the health of the community. I also hope that that legislation will be treated as a non-partisan measure by every section of the House.

Mr ROSEVEAR:
DALLEY, NEW SOUTH WALES

– In view of the fact that the British Medical Association very spiritedly opposed the health scheme of the last Government, and, according to press reports, is opposing the health scheme of this Government, could the Minister for Health say whether this resistance to both governments is due to Communist influence?

Sir EARLE PAGE:

– The honorable member for Dalley has had sufficient parliamentary experience to take no notice of press reports. The press reports on this matter have been quite untrue. Negotiations are continuously proceeding with the Federal Council of the British Medical Association.

Mr W M BOURKE:
FAWKNER, VICTORIA

– I ask the Minister for Health whether, in view of the grave difficulties that are being experienced by age and invalid pensioners in subsisting on their pension of £2 2s. 6d. a week and the heavy calls upon their limited incomes for the purchase of medicines, he will have the Pharmaceutical Benefits Act brought into effect at least for the benefit of pensioners so that our elderly and infirm citizens may obtain their medical requirements free of cost.

Sir EARLE PAGE:

– I am pleased to observe the honorable member’s interest in this subject, because I am. sure that he will support wholeheartedly the health proposals of the Government, which will fix up the age pensioners.

– As private shipowners will not now service Darwin, will the Prime Minister state how much per annum it is costing the Government of Western Australia to provide a service to the Northern Territory? Is it not a fact that until certain freight charges were increased last year Australian Government owned ships carried the biggest, percentage of non-profitable cargoes such as ironstone, coal, timber and steel? Is the Prime Minister aware that the trading of the Australian Government owned and chartered ships resulted in an accumulated surplus as at the 30th June, 1947, of £3,000,000 and as at the 30th June, 1948, of £852,000?

Mr SPEAKER:

– I think the honorable gentleman is conveying information.

Mr Menzies:

– And rather surprising information.

Mr MULLENS:

– Is the Prime Minister aware that the loss during 1948 was due to the pegging of freight rates and the discontinuance of subsidies?

Mr MENZIES:
LP

– I am indebted to the honorable member for the rather surprising information he has conveyed to me.

Mr Mullens:

– The pleasure is all mine.

Mr MENZIES:

– I am sure it is. The honorable member will appreciate that I shall need to confer with the Minister for Shipping and Fuel in order to obtain the exact figures that he seeks. I shall do that and have the information conveyed to him.

Mr ANDREWS:
DAREBIN, VICTORIA

– I direct a question to the Prime Minister with reference to press reports concerning the disposal of the ships owned by the Australian Shipping Board. What negotiations have taken place between the Government and the Broken Hill Proprietary Company Limited and/or shipping companies for the sale of the people’s shipping line? In considering the position of vessels owned by the Australian Shipping Board, will the Government bear in mind, as the Australian people will do, the action of the Bruce-Page Government in giving away Commonwealth-owned ships to a convicted British criminal? Will the Prime Minister give an undertaking that neither the decision to sell nor the terms of the sale will be finalized without the approval of the Parliament?

Mr MENZIES:

– No decision has been made by the Government concerning the future of the Commonwealth Shipping Services. The whole matter awaits Cabinet consideration and decision. When that consideration is being given, the arguments that have just been advanced by the honorable member will, of course, be given due weight.

page 873

QUESTION

WAR DAMAGE

Mr CRAMER:
BENNELONG, NEW SOUTH WALES

– In view of the fact that the British Government is now giving compensation for loss of assets occasioned by the war to former residents of British possessions who have returned to and are now residing in England will the Minister for External Affairs say whether the Australian Government has approached the British Government concerning such people who have decided to reside permanently in Australia?

Mr SPENDER:
Minister for External Affairs · WARRINGAH, NEW SOUTH WALES · LP

– I am aware of the fact that the British Government has a scheme which provides only for its own citizens. The Government is considering this matter which will presently come under review.

page 873

QUESTION

PENSIONS

Mr E JAMES HARRISON:
BLAXLAND, NEW SOUTH WALES · ALP

page 875

CIVIL AVIATION

Mr WHITE:
Minister for Air · BALACLAVA, VICTORIA · LP

-Recently the honorable member for Maribyrnong asked whether I would lay on the table the agreement made between Australia and Ceylon on the establishment of an air service, together with all the relevant correspondence. I now lay on the table the following papers : -

Air Services between Australia and Ceylon - Copy of Agreement for the Establishment, and Correspondence regarding frequency of service.

page 875

COMMONWEALTH BANK BILL 1950

Motion (by Mr. Menzies) - by leave - agreed to -

That so much of the Standing Orders be suspended as would prevent motions being moved in connexion with the introduction and the first and second readings of the Commonwealth Bank Bill 1950.

Motion (by Mr. Fadden) agreed to -

That leave be given to bring in a bill for an act to repeal the Banking Act 1947-1948, and to amend the Commonwealth Bank Act 1945-1948.

page 875

GOVERNOR-GENERAL’S SPEECH

Address-in-Reply.

Debate resumed from the 15th March (vide page 827), on motion by Mr.

Opperman -

That the following Address-in-Reply to the Speech of His Excellency the Governor-General be agreed to: -

We, the House of Representatives of the Commonwealth of Australia, in Parliament assembled, desire to express our loyalty to our Most Gracious Sovereign, and to thank Your Excellency for the Speech which you have been pleased to address to Parliament.

Mr.RYAN (Flinders) [3.17].- As one of the older members of this House and as one who has listened with great attention to this debate I should like to say that the Nineteenth Parliament is opening with advantages not enjoyed by the former Parliament. The first advantage lies in your elevation, Mr. Speaker, to the Chair. I congratulate you on your appointment and I also congratulate the House itself, on securing your service. During the previous Parliament the House suffered some loss of dignity and prestige. I am sure that under your tender, and, perhaps, sometimes not so tender, guidance the House will recover that prestige and dignity which should distinguish a Parliament of the Commonwealth. The second advantage of this House is the increase of moral and intellectual strength due to the influx of new members. I have listened to the maiden speeches of the honorable gentlemen with great appreciation because they brought freshness of mind and sincerity, qualities that were sometimes lacking on other occasions. All the talent is certainly not on one side of the House, although some honorable members of the Opposition seem to have done their best to convince me that this is not the case. I am sure that the new members of this House will add a great deal of value to its deliberations on its many problems.

To-day we are arguing about ideas and words that mean different things to different people. For instance the word freedom is much used in this House and outside it but the definition of freedom varies from license at one end to regimentation at the other. Democracy is another word that means different things to different people. It has one meaning in Russia, another in the western democracies including Australia, and a further one in the Asiatic countries. The third word which has a large number of meanings is socialism. I listened to the speech of the honorable member for Hunter (Mr. James). He said that we have had for many years a form of socialism because we have had a number of State enterprises working with great efficiency. The same argument was stated by the right honorable member for Barton (Dr. Evatt) who detailed some economic history and told us about the public enterprises which have been set up by various governments. He implied that because the parties on this side of the. House had acknowledged State enterprises, their policy is one df socialism. That point of view depends on the meaning attached to the word socialism. I believe that my meaning is shared by all the honorable members on this side of the House and probably by a lot on tho other side. The ordinary sane view of anybody who has studied the question of socialism is that it is a form of government which, amongst other things, means that the major economic activities pf the country are owned and operated by the State. It is not a question of a little more or a little less State enterprise. That is not important. During the last 2,000 years, practically all nations have had some State enterprises, but very few of them could be described as socialist nations. A nation may be said to be socialist when there is a preponderance of State enterprise over private enterprise. Once that condition is brought about, there is always a tendency for the State to absorb more and more economic activities. We have seen that happen in Russia, and the same process is at work in the United Kingdom. Having dealt in this rather cursory fashion with socialism-

Mr RYAN:
FLINDERS, VICTORIA

– I could say more, but I wish to pass on to other important matters. In the course of this debate, and during the election campaign, members of the Labour party declared that the Labour party’s policy of socialism was essentially the same as that defined in the Blackburn resolution. The Leader of the Opposition said so last night at some length.

Mr Bryson:

– He should probably know something about it.

Mr RYAN:

– After listening to him last night, I wonder whether he really does. The real goal of the Labour party is set out clearly enough in the party’s platform. As the honorable member for Werriwa (Mr. Lazzarini) once reminded us, words mean what they say. What does the Labour party platform say? It declares that the objective of the party is the socialization of the means of production, distribution and exchange. There is nothing doubtful about that, but I know that not all honorable membersopposite subscribe to that policy.

Mr BRYSON:

– Who told the honorable member that?

Mr RYAN:

– The right honorable member for Barton himself does not subscribe to it,t because he said that he agreed with the Blackburn resolution, which is certainly at variance with the terms of the Labour party’s platform. Some honorable members of the Labour party doubt the wisdom of an all-out policy of socialism. That being so, I urge them to expunge from the party’s platform the reference to the socialization of the means of production, distribution and exchange, and replace it with the Blackburn resolution. If they cannot succeed in that, let them come over to this side of the House, where they will find themselves among people who think very much along the same lines as they do themselves.

– No, my submissions are not dependent upon that information.

Mr Clarey:

– Can the honorable member state the percentage increase of the value of the output of manufacturing industries as well?

Mr RYAN:

– I have stated the figures relating to the gross added incomes of companies. A dissection of the returns of companies shows that in the last prewar year, 1938-39, of every £1 of income received by companies, wages accounted for 4s. 3d., fuel and materials for lis. lOd. and all other items including taxation and overhead, for 3s. lid. In 1947-48, out of every £1 earned by companies, wages accounted for 4s. 9d., and fuel and materials for lis. lid., but all other items, including profits dropped from 3s. lid. to 3s. 4d. Those figures amply support the argument which I have advanced. In reply to the interjection of the honorable member for Fremantle (Mr. Beazley), I point out .that the dissection of the actual moneys remaining to companies in 1947-48, after wages and outgoings for material have been met shows that only 6d. was available for dividends. In that year, of the 3s. 4d. expended on all other items, other expenses accounted for ls. 8d., taxation absorbed 8d., reserves 6d. and dividends 6d. In other words, the average return to shareholders ‘for every £1 of income earned by the companies in which they had invested was only 6d. I do not believe that any honorable member would claim that a dividend of 6d. in the £1 is excessive, especially when one considers the large number of shareholders in the average company. There is a general idea that, to use the words of the honorable member for Watson (Mr. Curtin), this is a country of “ financial tycoons who absorb everything and seize all the wealth earned by huge monopolies “. An examination of the hooks of large companies in Australia discloses that the average shareholder owns no more than between 300 or 400 shares and that the average amount of dividends paid to shareholders is between £30 and £40. If all of the profits of companies were converted into wages the increase of the average worker’s wage would be very small indeed.

I impress on the House and on the people generally the necessity for presenting the facts in relation to vital problems such as that which I am now discussing. When Opposition members, such as the honorable member for

Bendigo, whose words are accepted without question by members of the trade unions, make statements in this House which are not in accordance with fact, or which contain a wrong slant, it is to be expected that we shall not be able to achieve that desirable cooperation between the workers and management which is so essential ,to the progress of this country. Members of this Parliament should be the leaders of opinion in this country. The facts in relation to all matters should be stated clearly so that those whose lives are affected by them may know the truth. Misrepresentations of the truth that are so frequently indulged in by Opposition members undoubtedly constitute one of the principal causes of the continued industrial unrest that exists in this country.

Before I conclude I wish to state some of my views, for what they are worth, about the future development of industry in Australia. Although in general honorable members share a common objective of prosperity for this country and happiness for its people, sometimes I am rather disturbed by the attitude of many Opposition members who seem to be concerned more about their own political future than about the way in which we should tackle the problems that face us. Too often they distort the truth purely for political purposes. How are we to re-organize industry and industrial relations? The old order has gone. It is a trite saying that one cannot put back the clock; but everybody knows that we can do so merely by turning its hands. Yet we cannot go hack to the industrial conditions that existed in 1939. Much less can we go back to the conditions of 1914. Since then people have changed their views and they have a better general knowledge of world economics. They naturally look forward to a betterment of their conditions. If the old order has gone, what is to take its place? That brings me back to the need for co-operation between the workers and management. There can be no progress or contentment in this country unlessthe closest co-operation exists between management, irrespective of what form it may take - whether it be Government or private management - and the workers in industry. What form of industry are we to have in the future? To take the extreme view we may have one or more of three forms of industry. First, we may have free enterprise. I shall not deal with that aspect of the problem at the moment. Secondly, we may have socialism, and, thirdly, we may have syndicalism:

Mr CURTIN:
WATSON, NEW SOUTH WALES · ALP

– What is socialism?

Mr RYAN:

– If the honorable member does not yet understand what I mean by socialism I am afraid that I shall never get it into his head. Let us consider the possibilities of socialism. I suspect that some Opposition members are doubtful about the real merits of socialism. They, like myself and others, have seen it in practice. Time after time theorists have said that when a man works for the Government he puts his heart and soul into his job and is happy. We have witnessed the results of the socialist experiment in two great countries, first and foremost in Russia, which is the prototype of all socialist countries. In Russia state enterprise covers everything. Do we find cooperation between workers and management in that country? Of course we do not. There, on the one hand, we find savage penalties, death, starvation and the concentration camp, and on the other hand a system of incentive payments. In England, the land of great socialist enterprise, do we find happiness and contentment among the workers and cooperation between workers and management? Not at all ! In England to-day the workman is far more distantly removed from management than is the worker in any other country with the exception of Russia. We shall not obtain co-operation by the Russian method of operating big socialized enterprises. It will not work.

Syndicalism has been tried in several countries. We have a form of syndicalism in Australia to-day. [Extension of time granted.] It was tried, to some extent, in Italy. We are using it on the coal-fields of this country. What are Australian coal mines hut great syndicalized enterprises, the whole activities of which are run throughout the length and ‘breadth of the country by one body of men? That body is nearly always up against the rest of the community. The same thing applies to the activities of the wharf labourers, the seamen’s union and others whose work has been syndicalized. I see no hope of co-operation and prosperity ‘being attained in that way.

The solution to our problem is a system of private enterprise, by which I do not mean just a few bosses and a lot of wage slaves. I mean the co-operation which was referred to by the honorable member for Bendigo and other honorable members. I believe that co-operation can be achieved by doing away with the intense suspicion that exists in the minds both df employers and trade unionists. That suspicion must be swept away. I remember what my honorable friend said about a brick wall. Of course, the brick wall is there and it has to be destroyed. That cannot be done unless honorable members on both sides of the House co-operate. I believe that such co-operation is practicable. Therefore, to-day, I have been trying to persuade honorable members on the other side of the House that we cannot achieve contentment and prosperity unless we all contribute to the great work.

Question resolved in the affirmative.

Presentation of ADDRESS-IN-REPLY

Mr SPEAKER:

-I shall ascertain when it will be convenient for His Excellency, the Governor-General, to receive the Address-in-Reply, and honorable members will be informed accordingly.

page 880

COMMITTEES OF SUPPLY AND WAYS AND MEANS

Motions (by Mr. McBride) agreed to -

That the House will, at the next sitting, resolve itself into a committee to consider the Supply to be granted to His Majesty.

That the House will, at the next sitting, resolve itself into a committee to consider the ways and means for raising the Supply to be granted to His Majesty.

page 881

JAPANESE WAR CRIMES

Debate resumed from the 24th February, (vide page 102), on motion by Mr. Menzies -

That the following paper be printed: -

Japanese War Crimes Trials - Ministerial Statement

Mr WARD:
East Sydney

Mr Tom Burke:

– I rise to a point of order, Mr. Deputy Speaker. The Minister is speaking constantly to the back benches on the Government side of the

– I have listened to the defence of the Government’s attitude by the Minister for

External Affairs (Mr. Spender) and I propose to answer some of the criticisms he levelled at the previous Administration. The public of this country to-day are very concerned that one of the present Government’s first administrative acts should have been the release of many war criminals who are undoubtedly guilty of serious offences against Australian servicemen. It was because of my question on this matter that the Prime Minister (Mr. Menzies) made a statement. As the honorable member for East Sydney (Mr. Ward) has mentioned, there are a number of disturbing features associated with this matter which the Minister for External Affairs has not dealt with to the satisfaction of honorable members or the people. The abuse that he indulged in against honorable members of the Opposition, and one honorable member in particular, did not impress the Opposition wth the sincerity or the honesty of the. Government in this connexion. He said that up to last December no action had been taken by the previous Administration to bring suspected war criminals to trial. He has criticized the inactivity of the previous Government in this important matter. I refer him to page three of the address given to us by the Prime Minister in relation to the Government’s action in this case. Near the bottom of the page, he will find it stated that when the Liberal Government came to office at the end of 1949 it found that 811 persons had been tried by the Australian war crimes courts and 143 convicted persons had been sentenced to death and executed. In addition, 432 persons had been sentenced to terms of imprisonment, 236 to terms of ten years or more, and of this number of 432 sentenced, 30 served sentences in Hong Kong, 30 at Singapore and 226 at Manus; whilst 146 had completed their sentences and had returned to Japan.

Does that indicate that the previous Government was inactive? Is that not an answer to the Minister’s charges? When this Government took office 44 cases were outstanding involving 193 suspects. That number has been reduced by this Government to seventeen and the number of suspects has been reduced to 120. What the Minister fails to remember is that some of these people may have been held for a long time. I have no sympathy for any Japanese held for any time at all because of the crimes they have committed against this nation. In cases such as this years are required for the collection of evidence. In eases being investigated at the present time much research and a wide field had to be covered. The difficulties under which these suspected war criminals are brought to trial are not encountered in bringing ordinary criminals to trial in Australia or other countries of the Empire. It may take four and a half or five years to bring a Japanese to trial because of the investigation required. Therefore the Minister’s charge of procrastination against the previous Government is unwarranted, according to his leader’s own statement.

The previous Government faced up to its responsibilities and was determined not to release any Japanese, civilian or soldier, as long as there was a charge standing against him of atrocities against the people of this country. The answer to the Minister’s charge is given clearly and precisely in the statement presented to this House. The Opposition and the public generally want to know who the individuals are who have been released and why the Government will not give us their names. Also, why, if it is possible to release men and keep them under surveillance pending the collection of evidence, that could not have been done in the other cases. They would not have been gaoled unless some atrocity charge had been pending against them. It is a reasonable assumption that every Japanese associated with the army played some part in seeing that some of our men were made to suffer. Even such an organ of Government propaganda as the Sunday Sun, of Sydney, is troubled about what the Government has done. For instance, in an article published on the 12th February, under the heading, “ Japanese Generals let off Atrocity Trial - Royal Australian Air Force Men Beheaded “, the following appears : -

Three Japanese generals held on atrocity charges will be released on orders from Australia.

One of them is suspected of ordering the beheading of captured Royal Australian Air Force men in New Guinea.

I should like to know whether that suspected person is one of those that have been released. Is he one of those against whom no evidence can be collected? Is he one of the Japanese whom the Government lias let loose in order to clear the matter up speedily? The article goes on to state -

This follows the reported decision of the Australian Government to release 90 suspects because their crimes were “only against civilian.1! “. ls it not wrong to release Japanese who might have been concerned in the perpetration of atrocities against civilians? Why differentiate between civilians and soldiers in this way? “We want a better explanation of these matters than was given to us by the fiery and voluble Minister for External Affairs. I continue the quotation -

Australia has decided tn try prisoners in seventeen cases miti release those hold in 30 other cases.

Mr DALY:

– We want an assurance that the Japanese suspected war criminals whom the Government has released were not responsible for crimes such as those mentioned in the newspaper article, from which I have quoted. No matter how long they have been held, if there is any suspicion that they are guilty of such crimes, it is the duty of the Australian Government to pursue them, and bring them to justice. Dr. Burgmann, a wellknown churchman, has forcibly expressed his opinion of the action of the Government in releasing Japanese suspects. In the Sydney Sun of the 12th February, there is a leading article under the heading, “ Getting away with Murder which paints a terrible picture of the crimes committed by Japanese soldiers. The last Government held the Japanese suspects for a long time while an attempt was made to collect evidence that would show whether or not they were guilty of the crimes charged against them. If they fire guilty they should receive no mercy. I agree that accused persons should be brought to trial as quickly as possible, hut I say that, no matter how long it was necessary to hold the Japanese, either on bail or under arrest, they should have been kept until the charges against them had been proved or disproved. We are not satisfied that some of those released are not guilty of having committed atrocities. We want more than an assurance from the Minister for the Army on this point. We want to know the names of those whom the Government has released. Some of the names have been published in the press.

I hope that the Minister will state clearly what actuated the Government in reaching its decision to free these men. Servicemen’s organizations want that information, too. We know that it is a principle of British justice that accused persons shall be brought to trial as quickly as possible, but that does not justify the Government in releasing these suspects if there was a possibility that ultimately the charges could be proved. There is certainly no justification for differentiating between crimes against civilians and crimes against soldiers. The civilians who suffered at the hands of the Japanese were either Australian citizens, or were under the protection of Australia. The relatives of the victims demand, not so much revenge, as an assurance that the Japanese responsible shall be made to pay for the suffering they caused. When the Minister replies, we may be able to decide whether the Government was justified in acting as it did. If the Government was motivated merely by expediency, it has been guilty of a gross betrayal of the people of Australia.

Mr GRAHAM:
St. George

.- 1 rise to support the motion foi1 the printing of the paper. Members of the Opposition have indulged in emotional and hysterica] denunciations of the Government, and it is obvious that their interpretation of the facts has been distorted by their political outlook. The background of the present situation makes an interesting study. Honorable members should realize that the war against the Japanese was in some ways substantially different from the war in Europe. As long ago as 1937, the evidence of Japanese imperialism was very clear, hut the concept of a feudal nation like Japan being involved in war with democratic western nations was something new to us. We were unfamiliar with the ideas held by the Japanese people. We knew very little of the methods used in training the Japanese army, and our intelligence service did not help us very much. For instance, it told us that Japanese aircraft could not operate at a height of more than 8,000 feet. In discussing this matter, I am telling the simple truth. I am not endeavouring to make party political capital out of it, and I realize that the implications in this debate can be very serious. In the first place, I should like honorable members to realize that atrocities in war are not committed by one side alone. It is not beyond belief that certain atrocious actions contravening international conventions might be laid at the door of our own forces. Honorable members should bear that fact in mind, because I am afraid that what T have suggested is quite true.

It is possible to argue for hours on the pros and cons of these matters, but it is well to remember that in the Japanese wc were dealing with creatures who were barely human. The Japanese soldier, reared in a totalitarian State, and trained as he was in the Japanese army, became, in effect, an automaton. The training was carried out under the direction of Russian and German officers, but hundreds of thousands of these weird little creatures reacted to it in a way that i.« beyond our understanding. We should have realized that the Japanese nation with that very pliant material, would be able to build a navy of considerable efficiency and to establish an army and an air force of amazing efficiency, but we made no allowance for it. The Japanese is a. sub-human creature. To my mind, his complete elimination as a race from this earth would in no way detract from ite future prospects of advancement or prosperity. Some honorable members who had a close contact with the Japanese have a deep personal reason for loathing and hating them with a hatred the equal of which could not be inspired by politics. Possibly there is nothing to equal the hatred that can be engendered by years spent in a prison camp and by the concentration of the captor upon the elimination of the prisoner. Many Japanese, who have been convicted of war- crimes, have been executed, or imprisoned. Our people carry with them, the greatest hatred for the Japanese, but to say that the Japanese should be denied elemental British justice is to advocate a departure from British j justice. I agree that, if I were guided by Japanese standards. I should shoot the lot of them- the 88,000,000 of them - but, by our standards, things are done differently. We fought for the maintenance of our standards. We British people apply to even the sub-moronic little yellow mcn our own standards of justice. That is a splendid achievement on the part of a great civilized nation. Honorable members opposite say, “ The Prisoners of War Association will demand to know why the Australian Government is allowing Japanese war criminals to go free, and may approve of the participation of Japanese athletes in the next Olympic Games “. Let us consider the facts.

In the last war there could not possibly have been atrocities that were worse than those committed in Sachsenhausen, Belson and Dachau, the German concentration camps? Yet the German is regarded to-day as a human being, and is being fostered. That change of attitude is inevitable. We have to grow up. We must realize that the progress of life will leave ‘behind the hatreds and loathings that accrue out of war. It must be so. We should not say that, because the Australian Government let 71 of those wretched little people, who may have committed frightful atrocities, go free, we shall cause an upset in our own country for political reasons, whip up hysteria and start mothers, fathers and brothers remembering again the horrors that were revealed when accounts of the atrocities were published in the newspapers. Such an attitude is simply not moral. It is quite wrong. If we, as British people, are to maintain our standards of justice, we are forced to mete out to the Japanese, Germans and Italians - our three foes in the last war - the same measure of justice. Germany again trades with Australia, and an Italian grand opera company visited this country last year, yet are we still looking at the Japanese with suspicion. I admit that there are many people who will always have feelings of rancour and hatred for the Japanese, but, from a national viewpoint, if we are to maintain our standards for posterity, we must put aside those feelings. Inevitably there will be Japanese who cannot at present be proven guilty of War crimes, according to British standards of justice, and they must be released until further evidence is collected against them. We shall then be in a position to know whether they are likely to be found guilty, and, if the evidence is sufficiently strong, we can then apprehend them, put them back into’ gaol, and try them. That proposal is perfectly fair and reasonable. There is no question of allowing Japanese war criminals to go free.

Before honorable members opposite indulge in recriminations they should examine the whole position, with its immense problems. .Surely the bombing of Rotterdam by the Luftwaffe in 1940 pave the people of Holland a good reason for nursing feelings of hatred against the Germans, yet they adopted a sane, Christian attitude towards the aggressor. They are pressing on with their rehabilitation, and are not shrieking for the blood of the Reich. We trust that the Third Reich was the final Reich, and that another Fuhrer will never arise. We have to admit that the Dutch people have settled down in a proper manner in their attitude regarding Germany. They are progressing with measures that will enable them to regain their pre-war prosperity, and they are forgetting the rancour, which it is impossible to maintain if their country is to prosper. It is only because the outlook of some people becomes warped that hatred and rancour are not forgotten. Personal outlooks are affected by all kinds of emotional reactions, and the problem that is now under consideration will not be simplified hy prodding tactics and hysteria. The people of the United States of America have claims to exact revenge from the people of Nippon as great as we have. The ratio of deaths among American sailors, soldiers and airmen was as great as our own. But the average American is endeavouring to approach the problem from a fairly sane viewpoint.

I agree with the statement of the honorable member for East. Sydney (Mr. Ward) that looming large on the horizon is the standard of international politics. We are aware that to-day the Union of Soviet Socialist Republics is the greatest threat to the preservation of peace. There are 250,000,000 reasons why there will be a third world war and they all are Russian. That, is true. Wo knew that the Wehrmacht and the Luftwa ffe were being strengthened in the early 1930’s, but wc saw, in the growth of the Reich, a bulwark against the Bolsheviks. We now realize that it may be advisable for the Anglo-Saxon countries to have bases from which they can either defend their homelands, or, at least, have some general strategic plan to cope with the march of the 2.50,000,000 Russians. Why has Soviet Russia the largest army in the world ? Why does Lieutenant-General Vassili Stalin say, “We have more aeroplanes and better aeroplanes than any other country possesses, and our aircraft fly faster and higher than those of any other nation”? Are those the words of peace-loving people? Of course, they are not, and we know that they are not. As the representatives of a great political party that has played a not inconsiderable part in the progress of this country, members of the Opposition should realize that they will do the Labour party irreparable harm by reducing these matters of international importance to the level of mere political intrigue, and by indulging in the absurd badinage of accusing us of being immoral because of certain actions that we have taken. It is most unfortunate that international political matters should have intruded in a debate of this kind, but, in my opinion, the very fact that the Russian Politburo engaged in a political form of foreign policy during the last three years, has undoubtedly affected thi’ attitude of the United States of America and British people towards Japan, because of its immense strategic value in the Pacific. The Japanese know it, we know it, and the Russians know it., A similar position has arisen in Germany. With all due respects to our standards of debate, and the standards of the press, I believe that some Australians can, with advantage, indulge in a little soul-searching. The reports we read in the press to the effect that an alleged leader of a youth movement has stated that the Red Army will protect the Communist youth should Anglo-American troops endeavour to oppose their march, is the kind of sensationalism that is allegedly good for boosting the circulation of newspapers, but on matters of international importance, it is proper and desirable that a. high standard should be maintained. I am convinced that a large number of reputable journalists do maintain high standards, but I believe that the newspapers that indulge in petty sensationalism nf thu type which this debate will provide for them, cannot claim that they employ reputable journalists to write their material. But that fact, is not influencing the decision of the Australian Government which has said, “Certain Japanese are either guilty or not guilty of war crimes. If they are guilty, they must be tried without delay. If evidence against them is lacking, they must be released until such time a3 evidence is available to warrant their being placed on trial “. Surely that is elementary British justice. A number of major Japanese war criminals, including Tojo and Yamashita, have already been dealt with, and I assume that the majority of the minor war criminals will be tried in time. I refer to them as “ minor “ war criminals because they are relatively insignificant. As a counter to the emotional approach of the Opposition to this matter, I point out that the atrocities of war were by no means confined to the enemy. In 1942, or early in 1943, a film of the Battle of the Bismarck Sea was screened in motion picture theatres of the suburbs of Sydney. In that decisive action, a Royal Australian Air Force squadron that was commanded by a particular friend of mine took a prominent part. The film showed a Japanese convoy being attacked by bombers and fighters of the Royal Australian Air Force und the United States Army Air Force. The scenes were most illuminating, because they revealed to the public the facts of war. In war, there are no real standards. Countries may sign international conventions on the conduct of war, as they have done, and you can hi am e the enemy for breaking those conventions if you win the fight, but it is sheer hypocrisy to speak of the conventions of war in the actual battle. We saw evidence of that in the film to which I have referred. When the Japanese ships had been torpedoed and bombed, and were burning fiercely, Australian aircraft strafed those poor, unfortunate, subhuman Japanese wretches as they climbed on to life rafts. The sea ran with blood, the water was alive with sharks, yet again and again, the aircraft swept over the area. That is the truth. The film was exhibited to our school children in all the suburbs of Sydney. So I warn honorable members opposite to think deeply and to look into their own souls before they persist with this emotional, hysterical and hypocritical appeal. If some honorable members have a personal interest at heart, if they were confined in a prison camp, they may be pardoned for standing up in this chamber and saying, “ I hate the Japanese. I want all of them to be shot”. But if honorable gentlemen opposite are statesmen and are thinking of the best interests of their country, they will overcome the instinct or desire to rant about the Government’s decision regarding Japanese suspected war criminals. I say these things because I believe that we should consider what may result from a debate of this description. We should consider the press reports of these trials and their effect upon the nation as a whole. The House should agree that our approach to this problem must be based on British justice. If it does so, the Government’s action in relation to these trials will be completely vindicated.

Mr TOM BURKE:
Perth

.- The debate on this subject arises from a statement that was read by the Prime Minister (Mr. Menzies) on the 24th February. At the outset of my remarks I wish to record my disapproval of the attitude adopted by the Minister for External Affairs (Mr. Spender) in discussing this subject. The whole of his speech was characterized by bumptious arrogance which does neither him nor the Government any credit. The honorable gentleman’s attitude indicates that he is a little man who occupies a very big position. I trust that his conduct will improve as time goes on. In marked contrast to the speech of the Minister was the excellent speech delivered by the honorable member for St. George (Mr. Graham), to whose fairness, frankness and fine feelings of humanity I pay sincere tribute. The chief Government Whip, the honorable member for Henty (Mr. Gullett), laughs. No tributes will be paid to him unless he improves his manners in this House. I regret that the honorable member for St. George misunderstood the very purpose of this debate. I invite him to read again the Prime Minister’s statement which gave rise to it. In that statement the right honorable gentleman made a false accusation that the former Government had been guilty of undue delay in bringing Japanese suspected war criminals to trial. For the information of honorable members I shall read the passages in the Prime Minister’s speech to which I refer.. After pointing out that when the present Government assumed office a large number of suspected Japanese war criminals were still awaiting trial, the Prime Minister said -

Immediately after the swearing in of the new Government, this disturbing state of affairs was brought to the notice of the Cabinet by my colleague, the Minister foi the Army (Mr. Francis) . . . We at once formed the opinion that those extraordinary delays violated the fundamental concepts of British justice and that the whole matter must be brought to a head with all speed.

The same note permeated the whole of his speech. Later, the right honorable gentleman said -

Information already appeared on the files that the previous Government had been advised that there were eight such cases meriting trial, and that the remainder were either surrounded with doubts or would, on conviction, merit imprisonment sentences only.

The Prime Minister’s statement contained a clear accusation that the previous Government had failed in its duty by not bringing Japanese suspected war criminals to trial. He said that the present Government had acted promptly in the matter immediately after it had assumed office. “What did his words convey except a suggestion that the previous Government had been dilatory in the matter? No attempt has been made to substantiate that charge, which has been answered fully and effectively by my colleagues who have taken part in this debate. Let me make clear my views regarding the trial of war criminals. I deprecate the suggestion that any honorable member or group of honorable members in this House represents ex-servicemen or the relatives and friends of ex-servicemen. I commend to honorable members the classic words of the late John Curtin, than whom the serviceman had no greater friend. Speaking in this House as Prime Minister Mr. Curtin said -

make no claim to a monopoly of consideration for service men and their dependants. I concede to every honorable member and to all political parties the same keen interest in servicemen and their dependents as I myself have.

If that attitude were adopted generally by honorable members we should not hear in this Parliament gibes of the kind in which the Minister for External Affairs indulged to-day. They reflect no credit on the honorable gentleman or on this Parliament and they are of no benefit to the men and women of this country. I share the sentiments that have been so well expressed by the honorable member for St. George. The manner in which he took his courage in his hands and frankly and fearlessly stated his views will earn for him the approbation of this House and of every ex-serviceman.

The system of war trials which we have adopted brings us down to the inhuman level of those whom we propose to bring to trial for atrocities committed under the strain and stress of war. As leaders of this country and as representatives of the people in this Parliament we should take a sane view of this matter. Soon after hostilities had ended suspected German war criminals were quickly brought to trial. Later Japanese servicemen who were suspected of having committed war crimes were tried in Japan. Was the purpose of those trials to wreak revenge on those who had broken the legal or moral laws of civilized nations? Have those trials succeeded in deterring others from breaking the legal or moral laws of civilized nations ? Was the purpose of the trials to attempt to prevent future wars, and if so, has that objective been achieved ? I do not believe that the future peace of the world iB any more assured because of them. Indeed, I believe that the whole basis on which the war trials were initiated has been falsified by the results that have been achieved. War trials began in Germany almost immediately after the end of the war. In the atmosphere that then existed what hope could there have been, that the ordinary processes of justice would be followed, that normal court procedures would be adopted and that those accused of war crimes would receive what we are pleased to call a measure of British justice? In the conflict from which the world had just emerged what chance was there of obtaining unbiased witnesses to testify either for or against the accused persons or of obtaining corroborative evidence?’ As the honorable member for St. George has said, by what standards should we try the Japanese who are now awaiting trial? They were born, not in a British community, but in a foreign land the ethics and laws of conduct of which are very different from our own. It must not be forgotten that Japan has not subscribed to the principles of international law. Again, as the honorable member for St. George has pointed out, the perpetration of atrocities at a time when war fever is at its height is by no means confined to any one nation. That brings me to my final point on this aspect of the subject. In an ordinary criminal trial for murder it is customary for courts to take into account the state of mind of the accused when the murder was committed. Will the much vaunted principles of British justice be satisfied by the mere statement that a Japanese soldier, sailor or airman committed murder under the stress and strain of war? In conformity with the principles of British justice his mental state at the time the alleged crime was committed must also be examined. In present circumstances it is impossible to ensure that British justice or any other type of justice shall be upheld in these war trials. In imposing sentence on a prisoner a judge is guided by the principle that the punishment must be made to fit the crime. Imagine, what would have happened had a judge who conducted the trial of a major Gorman war criminal found the accused person not guilty ! What an outcry there would have been, even though in recording a verdict of “ Not guilty “ the judge had said that he would not be justified in convicting the accused person on the evidence that had been placed before him. In these circumstances war trials were degraded to the level of those inhuman monsters who had been guilty of the vilest atrocities. If Japanese war criminals are executed for war atrocities, will not the Japanese people accept their execution as a penalty for losing the war? Will these war trials not have the effect of making the Japanese people prepare better for a future war? Will they not resolve to choose their allies more carefully in the future? If war comes again and they emerge the victors will not they then in turn bring to trial and condemn, those among their enemies whom they regard as war criminals? The Prime Minister has said that for diplomatic- reasons a decision was made that the trials of suspected Japanese war criminals should not take- place in Japan. According to the right honorable gentleman, the deci’sion to move the venue of the trial to Manus was made for diplomatic reasons. I suggest that that decision was dictated by a desire not to inflame the Japanese people against the democratic countries. Genera] MacArthur is trying to convince the- Japanese that we are a kindly people. Soon1 after the war with Japan had ended war1 criminal’s were tried in that country and executions took place en masse. If the executions were designed to act as a deterrent to those who would break international laws, we should have made films of the executions and exhibited them throughout the length and breadth of Japan, thus showing the Japanese people in a graphic way what happens to inhuman monsters who are guilty of gross war atrocities. Photographers were denied an opportunity to photograph the scenes that ended the careers of major Japanese war criminals under the misapprehension that the photographing of execution scenes might inflame the Japanese against us. In the dead of night and at the break of day Japanese war criminals were executed secretly. Representatives of the press clamoured’ to be present bcause of a fear in the minds of many people that the sentences would not be carried out, but permission was refused. We cannot be proud of our conduct in that respect. It has done nothing to uphold the principles of British justice and to deter nations from waging war. It aroused and is still arousing a feeling among the nations that in future they must reach a state of war preparedness that will make the winning of a war certain. It will make them firmly resolve that having engaged in a conflict they must fight on and not submit to their enemies in any circumstances. That, of course, means that wars will be more fiercely fought, and that there will never be an imconditional surrender. I have endeavoured to show that the last Government was not dilatory hut on the contrary discharged its task with all expedition. I have also endeavoured to- show that we have not done a thing that this country and the world, will laud us for in future, and that we have done nothing to achieve the high purposes to which we set ourselves.

Mr FRANCIS:
Minister for the Army and Minister for the Navy” · Moreton · LP

– When the Prime Minister (Mr. Menzies) made his statement in the House a few days ago, I should have thought that honorable members opposite would have hung their heads in shame instead of engaging in this sham fight. I remind them that the files that I have before me contain a whole series of cables from General MacArthur and his staff, protesting against suspected war criminals being kept in prison year in and year out without any charge having been made against them. It was only when the present Government received a communication from its representative in Tokio indicating that the matter was likely to be brought before the Allied Council for Japan in Washington and that General MacArthur would be forced to release these prisoners because of the protracted delay in bringing them to trial - which honorable gentltmen opposite deny took place - that positive action was taken. There is on the file a copy of a Cabinet minute recommending that no further investigations be carried out and that all prisoners be released. If the Leader of the Opposition (Mr. Chifley) would like me to read it, I shall do so.

Mr Chifley:

– That recommendation was never adopted by the Cabinet.

Mr FRANCIS:

– I do not wish to read from these documents, but I have been compelled to refer to them because of the humbug we have had from honorable members opposite to-day. The evidence is emphatic that, had the present Government not been returned to office, every one of these men would have been released. There is another telegram on the file, in which General MacArthur was asked to delay a decision in this matter until the end of December. What happened towards the end of December ? A general election was held and, had the last Government been re-elected, every one of these prisoners would have been released. The suggestion that this Government is releasing prisoners is utterly monstrous. There was a continuous brawl between the former Minister for Defence (Mr. Dedman) and the Minister for the Army at the time (Mr. Chambers). The last minute that the latter honorable gentleman wrote was, “ This is to be prepared in the ordinary way and is not to be given to the Minister for Defence “. That atmosphere permeates the whole of this file, and I shall be happy if the former Prime Minister will give me an opportunity to lay it on the table of the House. I am sure that the honorable member for East Sydney (Mr. Ward) knows the contents of this file. There is ample evidence of constant discontent in the Cabinet over this proposal.

Honorable members interjecting,

Mr SPEAKER:

– If honorable members choose not to maintain order, I shall have to act.

Mr FRANCIS:

– The letter written by the Minister for the Army to the Acting Prime Minister (Mr. Holloway), dated the 4th May, 1949, reads -

I am also informed that it is unlikely that suitable persons could be engaged from outside the service in order to send them to Manus, and in those circumstances I am compelled reluctantly to suggest for your concurrence that further investigations and prosecutions should not be undertaken.

The Cabinet minute of June, 1949, is a very lengthy document of five pages. I shall not read all of it, but shall read only the recommendation. It was in these terms -

It would appear that, whilst Manus Island is the only possible location for an Australian military court, the establishment of a court at that location would bc inadvisable and. moreover, it would be impracticable to establish a court at Manns Island to try further cases before the 80th .lime, 194!), the date by which Cabinet previously decided that every endeavour should bo made to complete the trials. In view of these circumstances, and the discontinuance of the trials by the British and United States courts-

remind honorable members that the British and American courts were concluded by the dates agreed upon with General MacArthur. The minute continued -

I recommend that further investigation and trials of Japanese suspect minor war criminals by Australian military courts should not be undertaken.

The day on which this Government was sworn in, Ministers met their departmental officers. I then had placed before me these files, containing the cables from General MacArthur, General Robertson and Colonel Hodgson - who is Australian representative in Japan. It was quite clear that Genera] MacArthur was determined that he was not going to be “ shilly.shallyed “ any longer. He considered that he was under an obligation to release these Japanese, who had been in prison for so many years. Consequently, we prepared a Cabinet minute stating that where the evidence was complete the trials of minor war criminals should take place forthwith. That was the first recommendation made to Cabinet, and it was accepted by Cabinet that afternoon. Then negotiations had to take place to ascertain where these trials could be held. They could not be held in Hong Kong. We examined the possibility of holding them in other places, such as Singapore, Dreger, in Few Guinea, and Port Moresby. All those places were impossible because there were no facilities that could be used to establish the court or to provide quarters for the people who had to conduct the trials, which would take a very long while. Finally, it was resolved to hold the trials at Manus, which has disabilities, but also has a large number of homes. With the co-operation of the Minister for Works and Housing (Mr. Casey), a No. 1 priority was granted to the preparation of a court and other buildings. We proceeded with the job immediately, because we believed that these men who were suspected of perpetrating such atrocities should be brought to trial with the utmost despatch.

These suspected war criminals are now at Manus. I hope that the court will be completed on Saturday. The only cause of delay is that the State government has not yet provided the judge, but I believe that those arrangements have been almost completed by the Attorney-General (Senator Spicer).

I do not want to deal with atrocities or with the remarks of the honorable member for Grayndler (Mr. Daly), who read a series of statements that emanated from Japan. Those statements were most embarrassing to those who were endeavouring to capture war criminals who were still at large. We are still trying to secure certain suspected criminal 9 who are at large, and the difficulty of doing so has been accentuated by the statements emanating from Japan which were read by the honorable gentleman.

Mr Haylen:

– Who sent those statements to Australia?

Mr FRANCIS:

– They were sent here from Japan by journalists and were utterly untrue.” This Government has released nobody. When it took office it directed that proceedings should be instituted against every one of the suspected Japanese war criminals in respect of whom the evidence was complete. Where the evidence is not complete, the suspects have been provisionally released while it is being completed. This Government has never hesitated to do the right thing in this matter. During the major portion of 1948 and the whole of 1949, very little action was taken, and because of that the previous Government was guilty of having held the men suspected of having committed atrocities, without even filing a charge against them. As the trials proceed’, honorable members will probably read some of the evidence given at them, because, despite the observations of the honorable member for Perth (Mr. Tom Burke), authority has already been issued for journalists to attend the trials. They are to he public trials. A court will be set up, with a judge in charge of it and certain personnel to assist him. There will be the usual arrangements for the prosecution and for the accommodation of witnesses. As soon as we are able to announce the name of the judge the trials will be commenced. But if this Government had not been elected on the 10th December, all these suspected criminals would have been released.

The former Government acted in a way that will bring great discredit on this country and will focus unnecessary attention on these trials, because all of them should have been finished. America and Great Britain were able to complete their trials of Japanese war criminals. We alone dilly-dallied. On these files there is enough to indicate the strife that was going on between the Minister for the Army and the Minister for Defence at the time, which was one of the factors that contributed to the delay. There is an endorsement in the handwriting of the Minister for the Army himself that the Cabinet minute was to be prepared without any reference to the Minister for Defence. If honorable members will look at the cables that passed between ourselves find our representative in Japan who had to negotiate with General MacArthur, they will see that there has been an interminable and unnecessary delay, for which the former Government should take full responsibility. I regret that I have had to make these observations, but when we have such men as the honorable member for East Sydney using the time of the House to charge the Liberal party with having been guilty of an atrocious crime because it was releasing suspected Japanese criminals, it is necessary to show that we are not releasing any except those who have ‘been in prison for a long while, and against whom there is no completed evidence and then only provisionally. It would be utterly impossible to keep them in prison any longer. By arrangement with the Supreme Commander, Allied Powers, they have been released, subject to re-arrest should evidence of atrocities be obtained against them. The prompt action of this Government in bringing the Japanese suspects to trial reflects great credit upon it. The decision was made on the very day on which the new Ministry was sworn in. The men will be tried, and the law will take effect with the utmost despatch. Those who have so grossly maltreated our servicemen should l)o brought to trial. But no democratic country could defend the procedure of incarcerating men for years without laying charges against ..hem. The action taken by this Government must commend itself to every right-thinking person in the community.

Mr CHIFLEY:
Leader of the Opposition · Macquarie

– This matter, over which so much heat has been generated, involves problems that are not easy of solution. The Minister for the Army (Mr. Francis) has said that the .previous Government was dilatory in bringing Japanese suspected war criminals to trial. The fact is that, if appropriate accommodation and other essentials had been available, the trials would have been conducted. The delay was not the fault of the Labour Government. The trials would have been held at Hong Kong but for certain physical circumstances over which we had no control. Having failed to obtain tha necessary accommodation at Hong Kong, we tried to arrange for the proceedings to take place in Japan. If the Minister for the Army will examine the files, he will find that that is so. I do not propose to suggest that the minutes that were subm’” .ted to the Cabinet, should be laid on the table of the House. I have never asked any government to do so and I have never tried to do so myself, because I have always regarded them as confidential documents that should be available only to Cabinet members. However, the Minister is now in a position to study the files and, if he does so, he will realize that the Labour Government was anxious that the trials should be conducted in Japan.

Mr Anthony:

– Why were the American trials concluded?

Mr CHIFLEY:

– Because the Americans had the necessary physical resources at their disposal, I suppose. The previous Government did not press for the release of any of the prisoners. Delays in the initiation of prosecutions for alleged war crimes have occurred also at Nuremberg, in Germany, where the Americans were still conducting trials until recently. We did everything that we could do when we were in power to have the trials conducted in Japan, but the authorities in that country absolutely refused to agree to the arrangement. Investigations were proceeding continuously, and people were reporting new suspects every week. Had that sort of thing been allowed to continue, as happened in Germany, we should have been faced with the prospect of the trials extending over the next twenty years. The situation at Nuremberg eventually became, a standing joke, even with the Germans. If such proceedings are kept going long enough, people cease to attach any importance to them. Finally, in Germany, the United States of America was the only Allied power in charge of war crimes trials, and the. situation became ridiculous.

When the efforts of the previous Government to commence the hearings in Hong Kong or Japan failed, a suggestion was made that the tribunal should he convened at Darwin. Anybody who knows about the scarcity of accommodation there will realize that the proposal was physically impossible of accomplishment. Then Manus Island was suggested as the headquarters. I was never very enthusiastic about that proposal, because I knew that a great amount of valuable work had to be carried out there in the salvaging of war stocks that had been purchased from the United States of America. The provision of extra accommodation and the assembling of the tribunal and all its adjuncts would have been a task of considerable difficulty. There are 246 Japanese war prisoners from Rabaul engaged upon salvage work at Manus. Some of them have already been sentenced to terms of imprisonment. In order to put the matter in clear perspective, 1 assure the House that, had the authorities in either Hong Kong or Japan been willing to provide the necessary facilities, the trials would have been completed last year at the latest. I could not see much purpose in continuing investigations aimed at the tracing of war criminals. That sort of thing could go on for the next twenty years, and new criminals could be located almost daily. I do not attempt, of course, to condone atrocities such as the honorable member for Grayndler (Mr. Daly) mentioned. The situation has stirred up considerable public feeling, and has caused some criticism, not only of the former Government, hut also of this Government. Many people ask how long these trials and investigations are to continue. Church representatives have criticized the long drawn-out trials at Nuremberg. I want to be strictly fair, and I acknowledge that the Government is confronted with a difficult problem. I emphasize that, had the necessary facilities been made available to the Labour Government the trials would have been over, or at any rate nearly over, bv now. Nobody would provide us with the facilities that we needed.

Mr Spender:

– Did that situation operate from June, 1948, until December, 1949?

Mr CHIFLEY:

– There was a lot of going and coming about the matter, but the authorities in Japan were not prepared to allow the trials to be held there. The Government had failed previously to obtain the necessary facilities at Hong Kong.

It had no desire to release criminals who were guilty of shocking atrocities against Australian troops, or even civilians. I sympathize with the Government in its difficulty. I know that it cannot hold the trials in Japan, and the, obstacles to be overcome in establishing the judicial head-quarters at Manus Island are very great. I have no intention of engaging in hostile criticism, but I want to show clearly that the former Government did not attempt to evade the issue. I have never approved of the idea of carrying on indefinite investigations and piling up lists of new suspects, and I hope that the present Government will take the same view. In fact, I believe that the Minister for the Army said that the Government did not propose to continue investigations for years and years. This Government may say that the Labour Government could have tried much harder to persuade General MacArthur to allow the trials to ,be held in Japan. I merely say that I pressed the matter strongly with the authorities in Japan, but they had made up their minds very firmly against the proposal and we had to look for some other venue. We rejected the idea of making Darwin the centre of the trials, and we were considering the suitability of Manus Island when we went out of office. I repeat that we made no attempt to avoid bringing the suspected criminals to justice.

Mr ANTHONY:
PostmasterGeneral · Richmond · CP

– The Leader of the Opposition (Mr. Chifley) has said that he sympathizes with the Government because it has to deal with this problem. We sympathize with him, because it would not have been necessary for us to defend our actions and reveal the failure of the previous Government if some of his supporters had not attacked us upon this issue to-day.

– It is true, and the feeling of the Leader of the Opposition is apparent from his mealy-mouthed speech. The trials will go on because of those men who did not come back, and because of others who suffered at the hands of the Japanese war criminals.

Question resolved in the affirmative.

Sitting suspended from 5.56 to 8 p.m.

page 900

COMMONWEALTH BANK BILL 1950

Bill presented by Mr. Fadden, and read a first time.

Second Reading

Mr FADDEN:
Treasurer · McPherson · CP

– I move -

That the bill benow read a second time.

In 1945 and 1947, banking bills of major importance were introduced into this Parliament and, on each occasion, the views of the present Government were clearly stated. In 1945, we foreshadowed that, when re-elected to the treasury bench, we would regard ourselves as being obliged to review the working of the 1945 banking legislation and that we would reconstitute a Commonwealth bank board. In 1947, we left no doubt whatever of our intention to defeat the nationalization proposals by every constitutional means at our command. Not only did we announce in this House our proposals with respect to banking, but the policy speech delivered by the Prime Minister (Mr. Menzies), on behalf of the Liberal party and the Australian Country party, made specific reference to our intention to repeal the 1947 act and to our proposals regarding the Commonwealth Bank. The bill now before the House gives effect to that policy.

So far as the 1947 act is concerned, there is little that need be said. The act is a violation of the principles for which this Government stands and we gave an undertaking to the people of Australia that we would repeal the act if we were returned to office. In accordance with the mandate which the people have given us, this bill provides for therepeal of the 1947 act. Moreover, the High Court of Australia and the Privy Council have declared that act to be invalid in major respects.

In reviewing the 1945 banking legislation and in the preparation of this bill, the Government has been deeply conscious of its responsibilities to the people, and particularly of the fact that these responsibilities require -

that measures of such great importance should not be approached in a partisan spirit; and
that the administration of the bank should not be subject to frequent and violent change.

In respect of central banking operations and otherwise, the Commonweal th Bank and the other banks have achieved a considerable measure of harmony and co-operation and. the Government is satisfied that the broad purposes of monetary and banking policy are being achieved. For this reason, and because it would be undesirable to make frequent changes in legislative requirements affecting the banking system, the Government has decided to preserve the general pattern of control by the Commonwealth Bank over the banking system and the broad structure of the Commonwealth Bank.

I remind honorable members that there are few countries in the world with banking systems as highly organized and efficient as the Australian banking system. Moreover, it is, I feel, appropriate to recall that the essential features of the 1945 banking legislation were based upon the war-time banking control regulations, which themselves were based upon an agreement arranged between the Commonwealth Bank and the private banks in 1941, during my previous term of office as Treasurer. As I indicated in my budget speech on 25th September, 1941, we were faced at that time with the danger that secondary expansion of credit and excessive private bank profits might occur as a result of the use of treasury-bill finance for war purposes. To meet this danger I secured from the private banks a firm understanding that they would co-operate in the institution of arrangements which included -

depositing of their surplus investable funds with the Commonwealth Bank;
steps to ensure that excessive profits were not made by the private banks; and
compliance with an advance policy laid down by the Commonwealth Bank.

When the Labour party came into office, the basic elements of this agreement were embodied in the war-time banking control regulations under the National Security Act, and the substance of those regulations was subsequently incorporated in the banking legislation of 1945’. The pattern of central bank-private bank relationships at present embodied in legislation does not differ in essentials from the arrangements which I caused to be instituted in 1941.

The- importance of monetary policy has frequently been stressed in the Parliament, and the fact that it has a significant effect upon the welfare of the people has been fully recognized. Although it is easy to fall into the error of thinking that monetary policy can cure all economic ills, it is nevertheless true, as the Prime Minister pointed out in his policy speech, that great financial decisions, if they are wrong, are wrong on so vast a scale as to injure many thousands of people. We, therefore, believe that such decisions should not be made by one man either in the bank or in the Government.

We are convinced that responsibility for the determination of monetary and banking policy should be a collective responsibility, and the bill now before the House is designed to give effect to this principle by setting up a Commonwealth Bank Board under the chairmanship of the Governor, and by restoring to the elected representatives of the people the ultimate responsibility for monetary and banking policy. The same principle was embodied in the Commonwealth Bank Bill which was introduced by the right honorable Sir Earle Page, as Treasurer, in 1924. By that act, the control of the note issue was vested in the bank and provision made for a board of eight directors.

When the ‘board was established in 1924, the technique of central banking bad not been developed in Australia. Even among the older central banks in Europe, central banking policy and technique had not been fully developed and, in any case, their experience was hardly applicable to Australian conditions. In these circumstances, the board, of necessity, had to feel its way and no doubt, on looking back, it is possible to see how the work of the board could have been improved. To some extent, its difficulties arose from the fact that the Governor of the ‘bank was not chairman of the board-. This tended to divide responsibility. With the passage of time, however, many of the board’s difficulties were overcome. The members developed knowledge and understanding of the problems with which they had to deal. Knowledge in relation to these problems in Australia had been built up, and a growing body of expert technical advice was available from the bank’s staff, and by 1939 the hank, under the board, was operating efficiently both in its central banking and trading banking activities, and a satisfactory co-ordination of the hank’s policy with that of the Government had been achieved-.

During the war years, the responsibilities devolving upon the bank and the board were greatly increased’. War-time control of banking, exchange control, loan raisings and? the financing of various commodity schemes each involved problems of considerable magnitude, and there were many other requirements in the financial field for which it was necessary for the board to make provision. Many of the problems encountered were new to Australia, but under the direction of the board the bank undertook the tremendous responsibilities of war-time finance with outstanding success. The record of the bank during those difficult years is a tribute to the effectiveness of the system of board management as then developed.

There is wide recognition overseas of the principle that the management of a central bank should be vested in a board of directors. Taking other Commonwealth countries, for example, I point out that the Bank of Canada and the reserve banks of South Africa, India and New Zealand are in each case managed by a board of directors. Moreover, when the Bank of England was nationalized in 1946, it is significant that the system of management by a board was retained.

However, in 1945 the Commonwealth Bank Board was abolished under the legislation of that year and the management of the bank was vested solely in the Governor, who was assisted, in the determination of monetary and banking policy, by an advisory council. In the determination of monetary and banking policy, there is a great advantage in maintaining continuity. Furthermore, the Government recognizes that the monetary and banking policy of the bank is closely interwoven with the financial and economic policy of the Government and that, therefore, the board must include men familiar with these matters. Accordingly, the Government has decided that some members of the board will be drawn from the present Advisory Council, all of whom have had wide experience of the relationship between banking policy and governmental financial and economic policy and administration.

As provided in the hill, the board is to consist of the Governor of the bank, who shall he chairman, the Deputy Governor of the hank, who shall be deputy chairman, the Secretary to the Department of the Treasury and seven other members, of whom two may he officials of the bank or of the Public Service. The Government proposes to appoint the following officials to the board : Mr. L. G. Melville, who has been Economic Adviser to the Commonwealth Bank for some twenty years, and Dr. Roland Wilson, the Commonwealth Statistican and Economic Adviser to the Government. Both these men are of outstanding capacity and are members of the present Advisory Council. In addition, the board will have five other members. In appointing these members, who will not be representative of any sectional interests within the community, and will not have any association with other banks, the Government will be fully conscious of the need for men of wide knowledge and experience. The inclusion of such men will bring to the board’s deliberations the views of men who are not directly associated with Government administration and policy. The periods of the original appointments of these members will range from one to five years and thereafter each appointment will be for a period of five years. This arrangement will result in one member retiring each year, thus ensuring a proper measure of continuity in the personnel of the board. In the event of an equality of votes upon any question, the chairman will have a casting vote.

It is the Government’s view that theproposed composition of the board will result in balanced judgments by a body of men appropriately chosen for their various abilities and knowledge; due integration with the Government’s general financial and economic policy is likely to result and, at the same time, the board isgiven an appropriate measure of independence. The board’s functions will beto determine the policy of the Commonwealth Bank in its central banking and trading activities. The policy of the Commonwealth Savings Bank will also be a matter for determination by the board. In short, the bill provides that the board’s power over policy matters will extend to the performance of all functions of the bank, including those entrusted to it under the Banking Act 1945. It will be the function of the Governor to administer the bank in accordance with the policy laid down by the board. The Government does not contemplate that the board will concern itself with matters of day-to-day administration such as applications for advances or detailed staff management.

In respect of the monetary and banking policy of the bank, the legislation provides that the bank shall keep the Government informed. If the Government and the bank differ on a policy matter, the Treasurer and the board are to endeavour to reach agreement. If the Treasurer and the board are unable to reach agreement, the board is to furnish a statement of its views and the Treasurer may submit a recommendation to the Governor-General who, acting with the advice of the Federal Executive Council, may determine the policy to be adopted by the bank. This procedure will ensure that any submission to the Governor-General on this matter will be made after full consideration by the Government.

Where in such circumstances the Government determines the policy to be adopted by the bank, the legislation requires the Treasurer to inform the bank accordingly, and to have a statement of the policy, together with a statement of the views of the Government and of the bank, laid before each House of the Parliament within fifteen sitting days after the policy has been communicated to the bank. The relevant provisions of the bill are framed to meet administrative requirements and to give effect to the principle that great financial issues shall be the ultimate responsibility of the elected representatives of the people. In the opinion of the Government, the amended section will give the fullest possible effect to the principles underlying the views expressed in 1937 by the Royal Corn mission on Monetary and Banking Systems, on the relationship between the

Parliament, the Government and the Common wealth Bank. The Leader of the Opposition (Mr. Chifley) was a member of that royal commission and made certain recommendations in the report.

So far as the note issue is concerned, the Government, in preparing this bill, considered whether statutory provisions should be made for a. limitation upon the :i mount, of notes that could be issued, but, having made provision for the Government to bring policy issues before Parliament where the bank is required to adopt a policy determined by the Government, has decided that further statutory provision in respect of the note issue is not necessary. It is clear that in Australia to-day, as in other modern communities, the note issue is an indicator of the general credit situation rather than n mean-: of controlling credit and, to reverse trends in the note issue, it may lie necessary to modify the whole credit policy. The policy of the bank in relation to the note issue is thus part of the monetary and banking policy of the bank, and is n mutter upon which the bank is required to keep the Government informed and one which the Government may, if necessary, bring to the notice of the Parliament. Tt is also covered by the provisions relating to a disagreement between the bank and the Government on monetary and banking policy. With the establishment of a board to determine the policy of the bank, it is necessary to make consequential alterations in certain provisions of the existing act under which the Governor is given power to determine various matters. These amendments are set out in the schedule to the bill.

So far, I have been dealing with the Commonwealth Bank primarily in its capacity as a central bank. With respect to the trading sections of the Commonwealth Bank, the policy of the Government, as announced by the Prime Minister, is that the bank’s trading activities will be continued in fair competition with the private banks. The Government is of opinion that such a policy will serve the public interests by ensuring an adequate development of Australian banking services. In the light of this policy, the Government has given consideration to the position of the General Banking Division and of the. several departments of the bank. The General Banking Division of the Commonwealth Bank operates in competition with the private banks and has made a valuable contribution to the welfare of the community, particularly in relation to housing finance. The Rural Credits Department, which was established under a bill introduced in 1925 by the then Treasurer (Sir Earle Page)-

Opposition members interjecting,

Mr SPEAKER:

– Order ! There is altogether too much noise. The Treasurer is making a statement of first-class importance and honorable members will have an opportunity to express their views later in the debate; but, for the moment. 1! should be much obliged if they conform to the rules and give the right honorable gentleman a fair hearing. No doubt, in due course, those honorable members who have been interjecting will expect to be beard without interruption.

Mr FADDEN:

– I was saying that the Rural Credits Department, which was established under a bill introduced in 1925 by the then Treasurer, has facilitated the production and orderly marketing of a wide range of basic foodstuffs and other primary products on a scale that has increased tremendously in recent years. The Mortgage Bank Department provides long-term loans to primary producers, and the Industrial Finance Department, which has only been in operation for a little over four years, has been of great, benefit to industry. In order to ensure that these sections of the bank will be able to continue to offer the community the facilities now available, the bill provides a means for the board, within specified limits, to add totheir capital resources as such additional resources are needed. The previous Government completely overlooked that matter. The additional resources will come from the profits derived from central banking business and from profits of the note issue. It is from these sources that the capital of the Mortgage Bank Department is being built up at present. Under existing legislation it is provided that until the capital of the Mortgage Bank Department has reached £4,000,000, one-quarter of the annual profits of the Central Bank and £150,000 per annum from the profits derived from the note issue shall be paid to that department. These provisions will be replaced by the proposals in the bill.

Although the General Banking Division operates in competition with the private banks, the Government, having regard to its policy of continuing the trading activities of the Commonwealth Bank in fair competition with the private banks, has examined the activities of the General Banking Division and has found that the main pressure upon the division’s resources is for housing, especially from co-operative building societies. In this field the responsibility is falling heavily and to an increasing extent upon the Commonwealth Bank. The Opposition did not remedy that when it had the opportunity to do so. The Rural Credits and Mortgage Bank Departments of the Commonwealth Bank were established to meet special needs, and competition between these departments and the private banks is of a limited kind. In the case of the Industrial Finance Department there is a particularly heavy demand for hire-purchase facilities to finance the purchase of industrial and farm equipment, trucks and other motor vehicles. The private banks do not provide these facilities for the public. The additional resources which are being provided by this Government, whilst permitting reasonable development in the trading sections of the Commonwealth Bank, will, thus, not be used as a basis for unfair competition with the private banks, but will supply the demands generally of the public.

The detailed provision regarding capital is that the board will have dis cretion to transfer an amount not exceeding £500,000 a year to the bank’s trading sections out of the half share of the profits from central banking business which is now retained by the bank as reserves of the Central Bank or as capital of the Mortgage Bank Department. The other half of the profits from this source is paid to the National Debt Sinking Fund and the bill maintains this provision. In addition, the bill provides that the amount transferred from the profits of the Central Bank shall be supplemented by an equal sum, but not. exceeding £500,000, from the profits of the Note Issue Department. The maximum amount transferable in any year is, therefore, £1,000,000, and as the arrangement is to be limited to a period of five years the maximum amount which can be added to the capital of the trading sections of the bank under the provisions of the bill is £5,000,000. The additional capital is to be divided among the trading sections of the bank in proportion to their present nominal capitals, but the board may vary the proportions with the consent of the Treasurer.

Assuming that over the five-year period the maximum addition of £5,000,000 is made to the capital of the trading sections by the board in the proportions shown in the bill the present capital of the various sections of the bank would be increased as follows: -

In conclusion, I invite the attention of honorable members particularly to the following points : -

The general pattern of control by the Central Bank over the banking system is being preserved ;
The broad structure of the Commonwealth Bank will remain unchanged but the bank will be strengthened in all its departments ;
Collective responsibility for the determination of policy will be restored by the re-establishment of a board comprising men of wide knowledge and experience, which will ensure the integration of the policy of the bank with economic and financial policy generally without impairing the independence of the bank ;
Whilst policy will be determined by the board, the day-to-day administration of the bank will be in the hands of the Governor ;
The bill gives recognition to the principle that the ultimate responsibility for monetary and banking policy lies with the Parliament while preserving an effective working relationship between the Government and the bank; and
Further capital resources are being provided for the trading sections of the bank, thus enabling them to continue to offer the community the services now available and to develop with . the Australian economy.

The Government is convinced that the primary responsibility of the Commonwealth Bank is its responsibility as a centra] bank for the continued health and progress of the banking system as a whole. Part of the strength of the Commonwealth Bank as a central bank is, however, derived from the direct contact with the financial and industrial system which it maintains through its trading sections. The proposals of the Government are designed to strengthen the Commonwealth Bank both as Australia’s central bank and as an essential part of the commercial banking structure of the country. I commend the bill to honorable members.

Debate (on motion by Mr. Chifley) adjourned.

page 905

INTERNATIONAL AFFAIRS

Debate resumed from the 9th March (vide page 641), on motion by Mr. Spender. -

That the following paper be printed: -

Foreign Policy -Ministerial Statement. 9th March, 1950

Motion (by Mr. Menzies). - by leave - agreed to -

That so much of the Standing Orders be suspended as would prevent the right honorable member for Barton (Dr. Evatt) from concluding his speech without limitation of time.

Dr EVATT:
Barton

.-I am much obliged to the House for giving me an opportunity to deal fully with the statement presented by the Minister for External Affairs (Mr. Spender). It is a very important statement which covers a very wide field. In fact it covers the whole range of the external policy of Australia. It is therefore necessary for us to analyse the various aspects of the statement in order to judge its implications, to ascertain the area of agreement there may be in relation to the matters contained in it, and to lay a foundation for a full and free debate on the international situation and Australia’s part in relation thereto. The first important feature of the statement is that the Minister, speaking for the Government, has advocated in very broad terms a policy of economic and technical assistance to South-East Asian countries. As he made that a feature of his statement I should, perhaps, refer to it first. The honorable gentleman said that the primary objective of such assistance was to improve living standards and help to check the spread of Communist or other extremist influences in that region. With that general statement of policy I think everybody agrees. I should like to quote to the House the firm expression of policy which was made by the Prime Minister of India in a statement when he recently welcomed the United Nations Economic Commission for Asia and the Far East, to one of its conferences in India. Speaking of this principle, Pandit Nehru then said -

If some countries which are fortunate enough to-day, more fortunate than others, think that they can live their lives apart, whatever happens in the rest of the world, it is obvious that they are under a misapprehension. To-day, if one part of the world goes down economically or otherwise, it has a tendency to drag others with it. Just as, if unfortunately war breaks out, other people are involved who do not want war. So, it is not a question of the prosperous merely out of the generosity of their heart, helping those that are not prosperous - though generosity is a good thing - but it is a question of an enlightened self-interest realizing that if some parts of the world do not progress and remain backward, they have an adverse effect on the whole economy of the world and they tend to break down those parts that are at present prosperous. Therefore it becomes inevitable l.o consider these problems in a global way and to pay even more attention to those parts which are relatively backward.

That general policy is not only just, sound and acceptable in itself but it was also the firm and accepted policy of the previous Government. That fact is recognized fairly enough in the following statement of the Minister regarding the active aid rendered by the Chifley Government : -

The Australian Government has helped warstricken countries with relief supplies and also has done and will continue to do what it can to foster the spread of education in SouthK;ist A.,ia. both by the gift of education textbooks and materials and the creation of fellowship* and scholarships for South-East Asian students at Australian educational institutions. In planning for economic assistance to South-East Asia, particular attention will be given to those aspects that will produce immediate results.

Indeed for some years such a plan has formed a part of the official policy of the. Labour movement of Australia. One of the clauses of that policy dealing with international affairs provides for -

Active co-operation with the Governments of (lie Pacific and South-East Asia to assist in the economic and political development of those areas by means of regional agreements and by means of direct technical, educational and material assistance.

In principle we find common agreement in this statement of policy. As a result of the war, however, very few nations have been able to contribute to the rehabilitation of economic conditions in South-East Asia. In spite of post-war difficulties, let me refer the House to the enormous growth that has taken place in trade between Australia and South-East Asia. For the purposes of illustration I shall compare the figures for the years 1934-35, 1938-39 and 1947-48. Australian exports to and imports from far eastern countries, including India, Ceylon, Malaya, China and the Netherlands East Indies, were as follows : -

It is very important that as and when help of the kind to which I have referred is to be given it should not be in the nature of a charitable handout. These trade relations are important to Australia from the point of view of engendering friendly feelings between our people and the peoples of the countries with which we trade. The only other matter to which I wish to refer at the moment on that aspect of the subject is the machinery suggested by the Minister for the establishment and development of a system of economic and technical assistance to .South-East Asian countries. I suggest that the machinery proposed may be very cumbersome in practice and may duplicate the work of that mo3t useful existing agency, the United Nations Economic Commission for Asia and the Far East. I havealready quoted from the speech of the Prime Minister of India at the opening of the third session of the commission’sproceedings. That body has done valuable pioneering work in this field. Itsmembers include representatives of not only the British Nations in the area but also the United States of America,. Russia, Siam, the Philippines, the Netherlands, France, China and BurmaAssociate members include countries: which are not fully recognized internationally such as Hong Kong, Malaya,. British Borneo, Indonesia, Cambodia and Laos - the development of these has occurred recently - Nepal and until lately Ceylon. I understand that Ceylon has now become a full member.. The commission provides an excellent set-up for the purpose of laying the foundations for the development of economic assistance throughout SouthEast Asia. I shall refer later in detail to the proposal of the Minister, the object of which is to establish a British Commonwealth consultative committee, with very much the same objectives as the United Nations body. The Minister hopes that other nations will join it. Duplication is not necessarily a bad thing, but it should be pointed out that there is already a United Nations agency in this field, though I do not suggest that its work has developed as fully as one would like.

I pass from that point, on which there is substantial agreement, to the next point in the Minister’s statement. The honorable gentleman rightly emphasized the extreme importance of close cooperation between this country and the other members of the British Commonwealth. He referred to the accepted long standing practice of, endeavouring to resolve any differences that may exist between the members of the British Commonwealth and agreed that Australian diplomatic association with Europe should be fully retained because of Britain’s situation in Europe. I endeavoured to put that in a slightly different way to the House on another occasion by saying that Australia, because of its kinship with Britain and the British people should never contract out of Europe. So this statement of policy, is in a sense, a re-declaration of the policy of all Australian governments including the Curtin and Chifley Governments. Those Governments worked unceasingly to develop and expand British Commonwealth co-operation. The Minister is somewhat critical of the existing organization. He says -

As regards organization the association need not be rigid but should provide constant means for consultation and contact. In theory these may lie said to exist. In practice, except between Australia and New Zealand where close liaison is maintained by special arrangement they have proved only too often to be insufficient or insufficiently used. Better means must be found and better advantage taken of existing methods. 1 shall come back to that later. That machinery of co-operation and consultation has always to be kept under review. It has to be periodically overhauled. At the Prime Ministers’ Conference in London in 1948, where all British Commonwealth nations were represented, it was decided, on the initiative of Australia and New Zealand, that there should be closer consultation, not only by means of meetings of Prime Ministers, but also by means of meetings to deal with the foreign affairs activities of the eight nations constituting the British Commonwealth. In relation to financial and economic matters and in relation to defence it was also decided that there should be ministerial meetings of a regular character. In that matter, the former Prime Minister (Mr. Chifley) and his

Government took the initiative and one result was the selection of Colombo as the first meeting place for foreign affairs consultations at the ministerial level. I do not say that that is sufficient. I shall make a suggestion about the future before I conclude my remarks.

In the third main point of the Minister’s statement he emphasized the desirability of maintaining the closest links with the United States of America and closest co-operation with that country in pursuing objectives held in common. That has been the policy of the Curtin and Chifley. Governments and those Governments tried with success to carry that policy into effect. The Minister referred, for instance, to the recent Fulbright agreement which established an educational foundation in Australia, financed from the residual settlement of lend-lease and reciprocal aid. Agreements of that kind often take considerable time to negotiate, but we are very pleased on this side of the House that it was completed when it was and we hope to be fully informed on the future operation of it.

I notice that the Minister referred to the desirability of a treaty of friendship, commerce and navigation with the United States of America and a -convention on the subject of double taxation. Those are highly technical questions. The treaty of commerce and navigation may cover an enormous field. The matter is being discussed departmentally and if this agreement can be reached that will be all to the good. But it is not sufficient to say that, this Government wants better commercial relations. It has to watch the interests of its own citizens and manufacturing industries and see that they are treated fairly. That applies also to the question of double taxation. We have a double taxation agreement with the United Kingdom and the general principle of it is very satisfactory. That is one of the points which is rightly emphasized.

Having regard to what has occurred since 1945 it is very important to this country that the Minister supported an early peace treaty with Japan and emphasized Australia’s right of direct participation as a party principal. He opposed an indefinite postponement of the peace settlement. The existing machinery - the Far Eastern Commission at Washington and the Advisory Council at Tokyo advising the Supreme Commander, General MacArthur - all show that Australia’s place as a party principal in the negotiation of the Japanese peace settlement has been recognized. In Japan, the Australian representative acts not only on behalf of Australia but also on behalf of other members of the British Commonwealth of Nations. The fact is undoubted, as the Minister pointed out in another part of his statement, that there does not seem at present to be any attempt to get rid of the log jam which is preventing the negotiation of the final peace settlement with Japan. Honorable members should be reminded that the Chifley Government convened a conference of the British Commonwealth of Nations at Canberra in 1947 on the subject of the settlement with Japan. The purpose of that conference was to try to get British Commonwealth agreement on the principles, procedures and terms of settlement with Japan. After a meeting in this chamber, agreement was reached between all the British Commonwealth countries concerned. There still remains, however, an acute difference of opinion between the United States, supported in substance by the British Commonwealth, and the Soviet Union on the method of procedure which will be adopted at the Japanese peace settlement. The Russian view, to which that country has adhered consistently since the end of the war with Germany and the end of the war with Japan, is that the peace treaty should be drafted by the Big Powers. That would not permit the inclusion of Australia as a primary participant in the settlement. It would include only Britain, the United States, Russia and China, and would mean that each one of those four powers would have to agree with the draft and would have, in effect, a veto over the final settlement. From the Australian point of view, such a position was impossible. The Chifley Government fought against it and has been supported by the United States and all members of the

British Commomwealth. But one impasse has led to another.. At present,the situation in Japan ischanging slowly but inevitably, and it is quite possible that through the mere passage of time a state of peace will be declared practical and there will be no peace conference and no negotiated settlement with Japan. I feel it is right that there should be another meeting of the British Commonwealth countries to consider the position that is foreshadowed by the Minister in his statement.

The next point in the Minister’s statement to which he referred in somewhat guarded language was the relationship of Australia to The United Nations and the obligations under the United Nations Charter. The Minister’s statement indicates that Australian foreign policy will continue to be based upon the principles of the United Nations Charter. The Charter of the United Nations sets out in its earlier Articles the duties which are cast upon all members of the United Nations. For instance, Article 2 provides that all members shall settle their international disputes by peaceful means. Paragraph 4 of the same Article says -

All members shall refrain in their international relations from the threat or use of force against the territorial integrity or political independence of any State.

So there are duties cast upon the members of the United Nations in that way by the Charter. It is plain that the Minister accepts the position that these duties are placed upon Australia as upon all signatories and that they have to be carried out. The honorable gentleman then urged continued support of the United Nations “ so long as the United Nations itself operates in accordance with those principles “. That is the point on which the House should obtain some clarification and explanation. To say that there should be support for a body of which one is a pledged member so long as the body itself operates in accordance with its principles means that reference must be made to Articles of the Charter itself to ascertain the principles involved. For example Article 25 of the Charter provides -

The members of the United Nations agree to accept and carry out the decisions of the

Security Council in accordance with the present Charter.

It is impossible for such an organization to be successful if members feel at liberty to ignore decisions reached by the body according to constitutional means. That has happened too often. We have had instances in the history of the United Nations of the boycott of the organization and its subsidiaries and of refusals to recognize decisions given constitutionally by one of its organizations. Perhaps some extreme situation may lead to the disbandment of the United Nations organization by the withdrawal of members - even us. I hope that will never occur. It would be a tragic thing and I should like to have from the Minister an indication of what is meant by his qualified statement that support will .be given to the United Nations so long as that organization “ operates in accordance with those principles “. I imagine there have been thousands of decisions given in the last five years in the General Assembly or the Security Council or the Trusteeship Council or the Economic and Social Council of the United Nations organization, and I suppose Australia has voted with the majority in the vast number of cases - probably in 96 per cent, of them. It is very important that the rules ‘of the organization should be adhered to in the spirit as well as in the letter and that we should co-operate with all the other members of the United Nations to find workable solutions, but if the decision on’ any particular point is against us we should not, on that account, refuse to abide by it. The statement of the Minister, to my mind, contains a full concession that the United Nations organization and its agencies have done valuable work on the economic, welfare and political sides of its activities. On the political side, paraphrasing the Minister’s own words, it has defined areas of agreement by deterring violent or unilateral action and has successfully mediated. It has not always been able to solve the problems before it, but it has achieved a large measure of success. The illustrations of those facts are not given in the Minister’s statement and I do not want my speech to cover too wide an area but one can think of many cases where great success, both of a political and economic nature, has been achieved. One of the great economic successes referred to by the Minister has been the International Refugee Organization of the United Nations. Its work has been directly of great help to Australia. Then there is the fund from which relief has been given to children suffering from the devastation of war in Europe, the Middle East and Asia, I refer to the United Nations International Childrens Emergency Fund. That has been a great and successful enterprise of the United Nations. I need only refer to the ordinary machinery and day by day work of the Economic Council, including the bodies that deal with the Ear East, Europe, and the other portions of theglobe.

The political aspect of the work of the United Nations is the most difficult of all. The United Nations has no military machinery with which to enforce its decisions in the event of an international dispute. The intention when the Charterwas drafted was that military forces should be at the disposal of the Security Council so that it might enforce its decisions. However, as each of the five Great Powers could exercise its veto, it was realized from the very first that no military action would be taken against a Great Power. Furthermore, as each of the Great Powers had its associates, friends or satellites, it was also well known that enforcement action on behalf of the United Nations through the Security Council would probably never be applied to many, if any, of the member nations. The veto extends not merely to enforcement action, but also to action by way of conciliation and mediation in attempts at the settlement of disputes. That situation has meant that the Security Council has at times been unable to function because of the veto of one of the Great Powers. The strongest objection was taken by Australia and other countries at the San Francisco conference to the second part of the veto provisions. However, the situation has existed since 1945. Thus, without the power to carry out a decision by force, and with the veto capable of being exercised through the objection of any one of the five Great Powers, the Security Council has had to deal with situations under great handicaps. Curiously, and also fortunately, that has resulted in the throwing of a number of disputes in which the veto has been applied in the Security Council on to the shoulders of the General Assembly, whose membership now includes 59 nations. The veto is not applicable in the Genera] Assembly, and its recommendations may be made by decisions of a twothirds majority of all the membership.

Those being the limitations, the recommendations of the General Assembly are not enforceable in the strict sense of the term as they would be if the decisions were given by a national court. Equally, the Security Council decisions could not be enforced in the cases thai I have mentioned. Indeed, there has never been any agreement among the Great Powers to establish a military force for the United Nations, largely because of the differences that I have described. In spite of that, in case after case, through the .Security Council, the General Assembly or both, difficult questions affecting international peace have been taken up, examined, and eventually settled by the procedure of establishing committees of inquiry to determine just terms of settlement, which finally have been accepted by the member nations entirely as the result of the moral force of the decisions of the Security Council or the General Assembly. The first such case was in connexion with Iran, where, after Security Council action, Russian forces were withdrawn from Azerbaijan. Another important case was that of Greece. Through the United Nations, a watch was kept upon the activities of Albania, Yugoslavia and Bulgaria in giving assistance to the efforts of Greek guerrillas to overthrow the Greek Government. A United Nations commission was established originally by the Security Council. But then the veto was exercised in the Security Council and so the matter was brought to the General Assembly, which set up another commission. The United States of America, the United Kingdom and other nations have repeatedly paid tribute to the success of the United Nations Commission for the Balkans in dealing with attempts to interfere with Greek selfgovernment and the authority of the

Government of Greece. Similarly, successful action was taken in Korea. An acute situation arose at first when North Korea was occupied by Russian forces. South Korea, the more populous portion of the country, came under the threat of attack from the north. The United Nations intervened and appointed a commission, with the result that the situation has been stabilized. Up to the present, at any rate, there has been no attacks upon South Korea from the north. Another case was that of Palestine, where perhaps the most acute problem of all developed. The matter was taken up by the General Assembly and was also dealt with by the Security Council in some of its aspects after fighting had taken place between the Arab States on the one hand and Israel on the other hand. Finally, United Nations mediation, through Count Bernadotte and Mr. Bunche, was successful. That problem cannot be regarded as having been completely and conclusively solved, but at any rate the action of the United Nations was largely successful. Intervention in all of the cases that I have mentioned has saved countless lives. That happy result has been achieved, not through physical force, but through the influence that the United Nations is able to wield because of the loyal adherence to its decisions by its members. The Minister for External Affairs referred to Indonesia. A dispute arose in Indonesia between the Indonesian Republic and ‘ the Netherlands. The matter was referred by Australia and India to the Security Council, which issued an order to cease fire. The order was obeyed. A United Nations committee was appointed in the first instance, and ultimately a commission for that area was established. The object of Australia and India throughout was to ensure that this difficult problem, which vitally affected Australia as a neighbour of 70,000,000 people in Indonesia, should be settled without bloodshed. That object was finally achieved. I have cited those cases in order to illustrate the successes that have been achieved by the United Nations. The Minister referred to them in his statement but did not enlarge upon them, and I consider that it was my duty to do so.

I agree with the Minister that Australia’s foreign policy must not rest solely upon affirmation of faith in the United Nations. Nobody has ever made any suggestion that it should. The Labour movement has always advocated unwavering support for the United Nations, but it would be completely incorrect to say that the foreign policy of the Labour administration bad rested solely upon affirmation of faith in the United Nations. I shall explain later the degree of emphasis that I think should be given to the United Nations aspect of Australia’s foreign policy. It would be utterly suicidal to rely entirely upon decisions of the United Nations as themselves guaranteeing the defence security of the nation, because the United Nations has no military force at its command. Nonetheless, all loya! member nations should work together in order to prevent disputes, settle them, or lessen the area of disagreement in order to bring the peoples of the world nearer to the peace that their hearts desire.

The Minister correctly pointed out that the defects of the United Nations had arisen from disputes between the major powers. That has been true ever since the adoption of the Charter of 1945. The basic postulate assumed by those who established the United Nations was that there would be a continuation of agreement between the major powers which fought side by side as allies against Germany, Italy and Japan in “World “War II. However, the situation has developed quite differently. As each of the five major powers possesses the power of the veto, it has often been impossible to deal with disputes through the Security Council. Russia, of course, has most frequently exercised the veto power. That has been an emanation of the Great Powers’ disagreement. The Minister suggested that the United Nations should devote itself to the solution of problems within its reach, and he referred by way of illustration to atomic energy and disarmament. I should have thought that those were perhaps the most difficult problems of all. They are certainly the most urgent problems, and I agree that the United

Nations should continue its work in connexion with atomic energy, having regard, particularly to recent developments and the indications that have been madeabout the production of even more devastating weapons than the atomic bomb.

The problems that are involved aretremendously difficult of solution. If any one of them could be solved by action between the Great Powers, an enormous step would be taken towards relievingthe peoples of the world of the increasing expense of armaments and towards raising hope that a third world war might beavoided. I have said enough to show that there is a considerable area of agreement between the Opposition and theGovernment on foreign policy. That fact is borne out not merely by the statements, that I have made on behalf of the Curtin Government and the Chifley Government, and that the leaders of those Governments made, but also by the statement of principles that is embodied in the platform of the Australian Labour party. That, platform contains the following provisions : -

Steady and unwavering support fur theUnited Nations and for the purposes and principles declared in the United Nations Charter.
Advocacy of democratic methods and procedures in international conferences.

That, of course, is a reference to theinclination of some of the Great Powers to deny to the smaller and middle powersthe rights to which they are justly entitled as the result of their efforts in World War IT. as well as in World War I. Theunrestricted veto is most undemocratic. The platform continues -

Joint action by the British Commonwealth, of Nations to bring about pence in the world based on justice and better conditions of lifefor all peoples.
Recognition that war is best prevented, by removing its underlying causes. All international disputes should be settled hy referenceto what is just and right, and not to what is merely expedient. ;>. Active promotion of economic welfare and improvement of living standards throughout the world.

Then follows the reference to economicand political co-operation in the Pacificarea and South-East Asia, part of which I have quoted already. The conduct of foreign policy by Labour governments in accordance with the principles that I have stated in relation to the United Nations, the British Commonwealth, the Pacific region and South-East Asia undoubtedly reveals a substantial area of agreement between the Opposition and the Government, which gives room for the acceptance in principle of the establishment of an all-party standing committee on foreign affairs. That might be to the great advancement of Australia’s interest. The advantage would depend on certain conditions and details, and on that I shall not say more than that in my view it is certain, as the years pass by, that whatever disputes there may be in this country in regard to domestic policy, they will end at the water’s edge - to use an American metaphor. Often there is not much choice in connexion with what could be done internationally in the interests of Australia in order to achieve world peace and world justice. The matter of emphasis must be looked at in the light of the circumstances of the moment. I have said sufficient to show that the statement of the Minister has shown the acceptance of a great deal of what was attempted by the previous governments and not without success. I think that in the proposed policy, more emphasis should, be placed upon the United Nations. That is the sole working forum to-day for the resolving of international disputes. The bitterness of the differences between the Great Powers cannot affect their meetings, and the fact that those meetings do not take place at the top level as they did during the war, means that there is only one tribunal to resort to and that is the forum of the United Nations. Its importance has been under-emphasized in the statement of the Minister. The position is different in the United States of America. There is no failure in that country to appreciate the achievements of the United Nations except in one or two quarters such as the isolationist press or the small sections which believe that the only way to achieve international peace is to wage immediate war against the Soviet Union. I stand solidly by, and support, the declaration made by President Truman in his inaugural address in January, 1949. He then said that his policy and that of the United States was and would remain sup- port for the United Nations and that that support would be “ unfaltering “. The word “ unfaltering “ was emphasized. Much to the same effect was Mr. Attlee’s declaration of support for the United. Nations made recently in Great Britain., There was no dissent from that by the other parties during, the recent general elections in Great Britain. In 1948, at the British Prime Ministers’ Conference in London the eight delegates from the British Commonwealth treated continuing support of the United Nations as one of the basic features of British Commonwealth international policy. I do not want to see Australia lagging behind the United States or the United Kingdom or retreating from its past attitude of steady and unwavering support of the United Nations. It is easy to overstate its limitations and weaknesses and the occasions upon which there has been a retreat by some of the nations from the decisions of the organizations of that body. I have mentioned the result of the absence of military forces at the command of the Security Council. From the outset, every member nation of the United Nations has had to rely for its defence security upon its own resources and those of its allies. In principle, declarations were made to that effect in this House during the last Parliament and the Parliament that preceded it. That has always been recognized by the Australian Government. However, it is not a qualification of the general policy of support for the United Nations. An illustration of the care that was taken in regard to that aspect of defence security is afforded by the case of the trust territory of New Guinea, concerning which there is considerable misunderstanding. The honorable member for Henty (Mr. Gullett) suggested in a recent debate that some doubt existed in relation to the status of New Guinea in connexion with the defence of New Guinea and Australia. Under the mandate accepted by Australia from the League of Nations in 1920, Australia was forbidden to fortify any part of the Mandated Territory of New Guinea, or to set up naval or military .bases in it. The Chifley Government took care, in the trust agreement, to remove that limitation, and to-day the agreement contains an express provision giving to the Australian Government a complete right to defend the territory and to carry out its duties in respect of international security. The Chifley Labour Government never supposed that the mere existence of the United Nations was in itself a complete defence security in relation to this country. Honorable members are aware, and will be made more fully aware by the Minister for Defence (Mr.> Eric J. Harrison) - I believe the matter is referred to in lie initial defence statement of the Government - of the importance of the guided weapons project undertaken by Australia in conjunction with the United Kingdom. The machinery of defence co-ordination between the United Kingdom, Australia and New Zealand is also being safeguarded. On the service level, there was for a time a working liaison between the Australian and the United States Navy. That was instituted while Admiral Denfeld was in charge of the American South Pacific Fleet. There has been a close association between the two navies during exercises in the Pacific, and I expect that the Government will ensure that that association shall be continued and extended. I point to these matters as illustrations of the fact that support of the United Nations does not mean that the defences of this country have not to be maintained. The fact is quite to the contrary. It is possible that as the United Nations develops, and the area of agreement widens, that situation will be altered, but until that day comes it would be sheer madness to try to alter it. However, continuance of the United Nations and support of it by Australia and other member nations are vital. A great effort must be directed towards eradicating the underlying causes of war without having to bluff or to use threats ; every avenue of peaceful adjustment must be explored so as to prevent a third world war. That is one of the great matters which the Minister discussed in his statement. The statement refers to the present tension between Russia on the one hand and the Western democracies on the other. Is it possible that the differences with Russia can be settled? I share the view expressed by Mr. Churchill in April, 1945, before the final collapse of Germany, in a letter that he wrote to Stalin. It was in these terms -

There is not much comfort in looking into a future where you and the countries you dominate, plus the Communist parties in many other States, are all drawn up on one side, and those who rally to the Englishspeaking nations, with their associates and dominions are on the other. It is quite obvious that their quarrel would tear the world to pieces, and all of us, leading men on either side, who had anything to do with that would be shamed before history. Even embarking on long periods of suspicion or abuse and counter-abuse, and of opposing policies, would be a disaster, hampering great development of world prosperity for the masses which are attainable only by our trinity.

Mr. Churchill was hoping for the continuance of the three-power agreements that had been made during the war by Britain, America and Russia. It is obvious that the second stage referred to in his letter has been in existence for some considerable time. That is the “ embarking on long periods of suspicion or abuse and counter-abuse and of opposing policies “ which “would be a disaster hampering great development of world prosperity for the masses, which are attainable only by our trinity “. That letter was revived by Mr. Churchill only a few weeks ago and I believe, and I gathered from the Minister’s statement that he too takes the view, that either through the United Nations - I say primarily through it - or by other means, attempts should be continued to overcome the threat to civilization that is involved in the recent development of new armaments. With regard to atomic energy the Australian Government has always supported the substance of the United States plan called the Baruch plan to control atomic energy. The suggested system was that before there could be any destruction or prohibition of atomic bombs there must be an adequate control and supervision of atomic energy in all countries. Practically a deadlock has been reached on that matter. Mr. ‘Churchill’s broad line of approach, which he says is still open, does not at all imply any spirit of appeasement, but rather shows strength and frankness and a just appreciation by him of the enormous benefit to every one in the world, through the gradual reduction of the area of disagreement and the easing of the great hurden of armaments. It is clear from the Minister’s statement that he does not rule out the possibility of such a settlement. He expressed the belief that the people of the Soviet Union wan only to live at peace with their neighbours. He referred to the rulers of the Soviet Union, and concluded that they might jointly respond to a new approach for an understanding based on mutual respect for the ways of life of other people, and a genuine desire to halt the crippling cold war. I do not think the door should be closed, because if it were accepted as basic that there could never be agreement between Russia and the West, and that the conflict must go on to a final settlement, then the outlook for civilization would be practically hopeless. That brings us to another question, one which is crucial, I believe, because upon the answer depends the validity of the emphasis placed by the Minister on regionalism. The question is whether the solutions of international problems are to be found on a regional or on a global basis. The rapid expansion of the authority and activities of the United Nations itself suggests that the solutions are to be found on a global basis. For instance, the dispute between Indonesia and the Netherlands affected South-East Asia geographically. It was a regional dispute, because it related to that particular region, but how was it settled? It was settled through the United Nations. Only by taking the dispute to the world organization of the United Nations could it be dealt with at all. That applied also to the dispute in the Balkans, involving Greece and its three northern neighbours. It applied also to Korea, and Palestine. In all those cases, it was necessary to have resort to a world organization, and the disputes were settled through bodies representative of either the 59 nations of the General Assembly, or the eleven members of the Security Council. Therefore, although the Minister was correct when he said that our first and constant interest should be the security of our “ homeland “, and the maintenance of peace in the area in which our country is geographically placed, in practice it would prove impossible to maintain peace in the vast areas of the western Pacific or South-East Asia if attention was limited to them alone. At any time, an incident might occur in Berlin, in the Balkans, in Hong Kong or in Indo-China which would set the whole world ablaze. Indonesia is a good illustration of a regional dispute that was settled through a global organization. Modern weapons of destruction have reached such massive proportions that the latest of them threatens to destroy their very creators. It is significant that the world-government movement has captured public imagination. Its popularity rests upon the truth that unless the nations ultimately resolve their difficulties and disputes through a permanent organization everything may perish, including civilization itself. Whilst I do not agree with the world-government machinery, I share its aspirations. In my opinion, the idea that a world federation would automatically achieve peace is fallacious ; hut the existence of the movement is proof of the anxiety of people throughout the world over the international situation, and is conclusive evidence of their desire that international disputes shall be settled. Our own experience in two world wars has proved that a situation suddenly arising anywhere in the world might involve Australia in war. The spark that started the first world war was lit in the Balkans. In the second world war the spark was struck in eastern Europe. A third world conflagration might begin in the Middle East, in Hong Kong, or in any of the eastern regions. Of course we should not reject regionalism. On the economic side, particularly, it is very useful, and it is not without uses for security purposes. But there are difficulties in the way of applying the principle to our region. Consider a proposal for a pact that would include the United Kingdom and New Zealand, and the United States of America and Australia. The United States of America and the United Kingdom are nations with world obligations. The United States of America would not become a member of such a pact merely to deal with our part of the world. It would be necessary, so far as the United States of America was concerned, for the pact to have a wider significance. The same would apply to the United Kingdom, with its tremendous interests in Europe. Therefore, regionalism, valuable as it can be, is not a complete safeguard against the dangers that may threaten us within a particular region.

I propose now to. make some more positive suggestions. For my part, I suggest as a basic Australian policy that our support of the United Nations should not be grudging or qualified. It should be steady and unfaltering. Only if member nations give the organization such support will it be able to enlarge its area of success, politically and economically. I have already referred to the wise counsel and sound policy and statesmanship of President Truman. Secondly, while entirely agreeing with the policy of technical assistance to South-East Asia, I suggest that it is necessary to beware of multiplying organizations where there is already in existence an organization capable of doing substantially the work proposed to be done. I have already referred to the Economic Committee for Asia, and the Far East that was established by the United Nations to initiate and participate in concerted action in the area of South and South-East Asia. It is important that we should continue to support that commission, which was established largely on the initiative of Australia. The Minister for External Affairs has now suggested that, in addition, there should ‘be set up a consultative committee, membership of which would be open to all British Commonwealth countries that wished to participate in it. Such a body must, in large measure, duplicate the work of the economic committee set up by the United Nations. In his statement, the Minister listed six functions for his proposed consultative committee, but it may be said that the committee would merely receive indications of what Commonwealth countries thought might be feasible in regard to South-East Asian countries. The proposal is that the consultative committee should have the power to approach the governments of countries outside the Commonwealth, and examine methods of co-ordinating development activities in South and South-East Asia, in association with international and regional organizations. Such organiza tions would, I assume, include the United Nations. Broadly speaking, the proposed body would be one empowered to make recommendations to governments. This is a tremendous problem, and what is really needed in South and South-East Asia is the giving of practical assistance on a mutual basis. The needs of the area are tremendous. In its report, the United Nations commission said that plans for reconstruction and development of the region under review would involve the expenditure of 13,600,000,000 United States of America dollars over a period of five years. “What the long-term expenditure would have to be could well be imagined.

I do not think that the duplication of machinery is, in itself, necessarily a bad thing, but when an agency or organization is already in existence, it is good policy to work through it, especially when, as in the case of the United Nations organization that I have mentioned, all the British Commonwealth countries are already members of it. At the conference of representatives of British Commonwealth countries in London in 1948, it was agreed that regular meetings should take place, not only of the Prime Ministers of the various Commonwealth countries, but also of the Ministers concerned with foreign affairs, defence cooperation and financial and economic affairs. The Minister for External Affairs has suggested that there is not al present enough consultation between Commonwealth countries, and that the high commissioners of the member countries should meet regularly at the Commonwealth capitals in turn in order to exchange information. That might be productive of good, but it would be difficult to organize the meetings regularly. There would be an exchange of information between high commissioners and their governments, but such an arrangement might lead to a confused situation, without advancing the real objective in view. At the present time, the high commissioners of the various Commonwealth countries meet in London, presided over by the United Kingdom Foreign Minister or the Secretary for Commonwealth Relations. Such meetings have proved valuable, because they often provide an opportunity for an exchange of opinions before action is taken by the Government of the United Kingdom. I should not exclude other forms of co-operation, but I suggest that one thing is essential; that is, a form of machinery similar to that proposed by Mr. Curtin at the British Commonwealth conference of 1944. He proposed the setting up of a secretariat to follow up the suggestions and recommendations emanating from important conferences of the representatives of Commonwealth countries. At the present time, the whole burden of such work falls on officers in the United Kingdom who may have to deal also with a number of other matters. Mr. Curtin suggested that there should be a British Commonwealth secretariat so that no time would be lost in obtaining decisions from the various governments upon recommendations of conferences and so that there could be a “ follow up “. The Minister for External Affairs has told us that although the Colombo conference took place some time ago, the Australian Government is, apparently, the only participating government that has yet decided to accept the proposals for technical assistance in South and South-East Asia. If the matter has to be dealt with by letters or cablegrams considerable delay is certain to occur. I believe that Mr. Curtin’s proposal was a valuable one, and that it should have been adopted, although at the time of its making it was supported only by the New Zealand representative. Since then, however, events have moved swiftly, and the matter might profitably be taken up again.

In the British Commonwealth, consisting of eight nations, there may well be eight different views about the degree of co-operation that is feasible and practicable in relation to various topics. That was proved during the war. At one stage, the establishment of a wartime Imperial Cabinet was suggested, and the Menzies Government, the Fadden Government and the Curtin Government, in turn, supported that proposal as a war-time expedient, but it was not acceptable to other members of the British Commonwealth. The Prime Minister of Canada, Mr. Mackenzie King, said that it would be quite unworkable from the standpoint of that dominion, and the Prime Minister of

South Africa, Field-Marshal Smuts, expressed a similar opinion. The view of New Zealand was substantially the same as that of Australia. There are difficult problems when machinery has to be established, yet I have always felt that it is the absence of the follow-up machinery that is the crucial difficulty, and that a secretariat not confined to the United Kingdom officers, expert though they are, would certainly he of great assistance in relation to not merely foreign affairs but also defence co-operation and financial and economic affairs.

The Minister’s statement included a fair and just reference to the South Pacific Commission, though he did not read the relevant passage from his statement. The South Pacific Commission is a very important body that deals with the welfare of native peoples throughout the area of the South Pacific. It covers Dutch New Guinea, and the Netherlands is represented on it. It covers New Guinea and Papua, and Australia is represented on it. It covers French territory, and France is represented on it. The head-quarters of the commission are at Noumea. New Zealand is a member of it. The United Kingdom, because of its interests in the South Pacific, and the United States of America are also represented on the commission. It is doing good work. It has no executive authority within any of the territories concerned, but is an advisory body to- all governments in those territories. The commission was a conception of the Chifley and Fraser Governments and was constituted for the purpose of carrying out what is, after all, a fundamental principle of the United Nations Charter, and, indeed, the Atlantic Charter. That is to say, it is the duty of the metropolitan powers not merely to look after the interests of their own native peoples in the territories under their sovereignty, but also to cooperate with other nations. There is a similar commission established in the Caribbean area, and I believe, from what the Minister has said, that the fullest support will continue to be given to it. That is all to the good.

The Minister mentioned a regional military pact for the Pacific and SouthEast Asia. If we could obtain such a pact, it would be of considerable value.

Participation, in it by the United States, because of that country’s primary interest in the Pacific, would be essential. Such a regional arrangement, if it could be obtained, could do nothing but good from the standpoint of security. I want to make the point, and put it quite frankly to the House, that I think it is quite fallacious to concentrate on Russia as the only possible aggressor in the Pacific or South-East Asia. I do not believe that Japan will always be content to remain allied to those nations that were its chief enemies in World War II. It may be so, but I do not think that a pact should leave the other possibility out of account. In other words it should not exclude the possibility in the future of a resurgent J apan deciding to embark upon further aggression. In my opinion, it is wishful thinking to assume that the Japanese question has been permanently solved. That is one reason why I strongly support an early attempt to obtain a peace settlement with Japan, so that in any future industrial development of that country, which, of course, must take place, we shall not be establishing a war potential that may be the means of destroying us. Those are possibilities only, but we must work on the basis of possibilities when we are dealing with defence matters in the Pacific.

Moreover the participation of countries like India, Pakistan and Ceylon in such a pact would be most desirable. The entry of those three nations into the British Commonwealth is one of the most important events in modern times. I believe that, but for what was done in connexion with India, Pakistan and Ceylon by the British Government, we might have had situation after situation that would have caused trouble and bloodshed, and might have led to chaos in those areas. Instead of that, the relations to-day between Britain on the one hand, and India, Pakistan and Ceylon on the other, are closer and more friendly than they have ever been in history. That is a great tribute to the constructive statesmanship of Mr. Attlee, as the head of the British Government, and those associated with him in that settlement. It is most regrettable that India and Pakistan have not yet been able to settle the dispute in relation to

Kashmir. Everything that Australia can do to help the solution of that problem will, I am sure, be done. It should be done. I want to say quite frankly to the House that a regional pact has been discussed officially and unofficially, privately and publicly with United States governmental authorities since 1945 and 1946. In the later year, the then Secretary of State said that such a pact would hardly be necessary in relation to Australia, because of the close, friendly and comradely relations between this country and the United States of America. Of course, that was before the North Atlantic Pact was signed. The world situation has changed since then, and it may be possible to proceed with a pact to-day whereas it was not necessary to do so in 1946. Close co-operation with the United States of America has been basic to our policy for many years. I stress that fact. Australia has given general support to the Supreme Commander, Allied Powers, during his administration of occupied Japan. Often, situations have risen that have caused us some anxiety, but we have believed that he is carrying out a most difficult job, and in the post-war period we have given General MacArthur the same support as the servicemen, the Government and the Parliament gave to him during the crisis of war.

Our relations with the United States of America, through the United Nations and otherwise, have been most close and most friendly. Statements to that effect have been made by American ambassadors, by President Truman, and, prior to him, by the late President Roosevelt, and by successive Secretaries of State, and I believe that some mischief was done by a section of the Australian press which suggested, when this Government took office, that Australian relations with the United States would be improved. Those statements met with a public rebuke from the American Secretary of State, Mr. Acheson, who indicated that the relations of the American Government with Australia and New Zealand, under the Prime Ministerships of Mr. Chifley and Mr. Fraser respectively, had been of the most intimate character, and could not have been friendlier. It is completely untrue to suggest otherwise.

The Minister mentioned in connexion with South-East Asia some of the problems confronting Burma. I entirely agree that in Burma the situation of the Christian people, the Karens, who rendered valuable service to Allied soldiers and airmen during “World “War II. is indeed tragic. They are in open rebellion against the Burmese Government. I consider that a tremendous blunder was made by the people of Burma when they decided to leave the British Commonwealth of Nations, and I believe that one step that could be taken, and that will be taken sooner or later, is that Burma will return to that brotherhood of nations. As a result of so doing, Burma would be stronger and the British Commonwealth would also gain in strength.

I turn now to Indonesia. I consider that the policy of having a friendly relationship between Australia and the United States of Indonesia, which is still - and I emphasize this point - permanently linked with the Dutch Crown, is essential. At the same time I feel strongly that there should he no change in the status of Dutch New Guinea, without the full consent of Australia. I dismiss altogether the suggestion that Indonesia might have some claim in connexion with the other parts of New Guinea; that is to say, with either the trusteeship territory which Australia controls or with Papua, which has nothing whatever to do with Indonesia. To-day Australia recognizes without qualification the sovereignty of the Netherlands in Dutch New Guinea. That territory ethnologically belongs to the Pacific or Papuan area, as it is called, and not to the Asiatic area. As a matter of fact, as I have pointed out to honorable members, the Netherlands is ‘ a member of the South Pacific Commission because Dutch New Guinea is regarded as territory which was quite segregated from the Indonesian Archipelago. The native people of Dutch New Guinea are administered by a sovereign power under Chapter 11 of the United Nations Organization Charter, under which the sovereign power has recognized the duty of administering the territory primarily in the interests of the native people.

Racially the Melanesians of Dutch New Guinea are completely distinct from the Indonesian race.

I now turn to the future relationship of Australia to China and Indo-China. That is a very important matter. In the course of his statement the Minister for External Affairs said -

We should very much dislike seeing the traditional contacts severed between China and the Western world. We should like to think that the Chinese Communists would look for the sympathetic help of the Western democracies in the work of uniting and rehabilitating their country.

Then he referred to the evidence of the Communists’ behaviour, including their treatment of United States property and citizens, leaving the Government uncertain about whether the Peking Government will conduct itself in accordance with recognized principles of international law and will refrain from interfering in the affairs of neighbouring States. The position in China is closely related to the position in Indo-China, ‘ especially the northern part of Indo-China known as Vietnam. The Minister said that Vietnam is the pivotal point, the greatest danger point in. South-East Asia. “What is to be the position in regard to the Government cf Communist China? Yesterday, in reply to my question, the Minister informed me that, at the present moment, there was to be no recognition by Australia of Communist China. Of course, that answer covered the position only up to the time at which it was made. My own feeling is that some degree of recognition of Communist China cannot be deferred indefinitely. To-day, Communist China is recognized by the governments of the United Kingdom and India. I presume that everybody know9 that recognition of a state does not imply the slightest sympathy with the internal politics of the government concerned. Indeed, the Soviet Union is universally recognized to-day through its government. The doctrine of international recognition is flexible and, for myself, I do not see why obligations could not he asked for from the Chinese Government as a quid pro quo for recognition. I refer to such conditions as an undertaking by China to respect territorial integrity and also - and this is important - the basic structures of all neighbouring States, and to make no attempt to undermine those structures or forms of government. The Minister said that the situation in China is analogous to the situation that once obtained in Greece. If that were so it would be competent for the General Assembly of the United Nations to establish a commission to do in Lido-China what was done in connexion with Greece, namely, to have observers at. the boundaries of, and inside, Indo-China to keep close watch and to report periodically on

Huy unlawful intrusion into the area or interference with it.. In the case of Greece, the activities of Yugoslavia, Bulgaria and Albania were very closely obesrved by the United Nations Balkans Commission. Reports were made and gradually interference from those quarters diminished and finally ceased. The results were satisfactory, as they were also in the case of South Korea. I should think that the whole situation in relation to the recognition of the Chinese Government has to be watched closely from day to day, and I suggest that the Government might consider the desirability of making conditions governing Australia’s recognition of that government. Further, the recognition of the Communist Government of China need not carry with it recognition in respect of Formosa. I see no difficulty at all about such a practical distinction being made. But in the long run recognition may have to take place and some form of provisional recognition might be considered. I believe that if that were done it would be an enormous advantage from the trading point of view, and that Australia’s position would not be prejudicially affected.

The final matter that I wish to stress is the desirability of continued support by the Government of the welfare activities of the United Nations, particularly the International Refugee Organization and the United Nations Children’s Emergency Fund. Those matters are of great importance. It was always a policy of the Chifley Government to do what it could to assist those who stood in need of assistance. Australia was able to afford assistance where many other countries could not, and during the Chifley Government’s term of office contributions amounting to £45,000,000 were made to the United Kingdom and £24,000,000 to the United Nations Relief and Rehabilitation Administration in connexion with its efforts to offset the devastation caused by the war. Unrra operated not only in Europe but also in the Far East and a great deal of that money was devoted to China. “When one looks at the present situation in China one cannot help taking into account the reports of the American Secretary of State which said that the failure of the previous Government in China to extend the principle of self government with the utmost dispatch, had lost it a great opportunity. Australia has given to the United Nations Children’s Emergency Fund £3,250,000 as a governmental contribution. Every £1 of Australia’s contribution was matched by a contribution by the United States in the ratio of 2.73 dollars to one dollar. Australia has also given £2,570,000 to the International Refugee Organization. The United Nations Children’s Emergency Fund is still in need of funds. The voluntary appeal for assistance for the fund through organizations in this country is about to begin, and I submit to the Government that both the children’s fund and the International Refugee Organization have been outstandingly successful as welfare units of the United Nations.

I have tried to cover a wide field because in his statement the Minister did so. That statement, which outlined for the first time the foreign policy of the present Government, justified this course. I have tried to indicate as clearly and as frankly as I can the attitude taken by the previous Government on these great matters. In conclusion, there is one thing that I wish to emphasize more than any other. “Whilst subordinate regional agreements or pacts are good, and may help to save the country in an emergency, in the present position of the world we should not depart from a policy of unwavering support of the United Nations. In doing so we must, realize that the United Nations is not of itself a defence organization and that we must continue to maintain our defences and protect our people in order to avoid a catastrophe of the kind which nearly overtook us during “World War IT.

Realizing that, I end my speech on the note that is struck in the first proposition in the platform and policy of the Australian Labour party, which fits in with what President Truman, and Mr. Attlee and other Commonwealth Prime Ministers, have said, namely, that we should give unfaltering and unwavering support to the United Nations.

Mr HASLUCK:
Curtin

.- One statement by the right honorable member for Barton (Dr. Evatt), with which I hope the populace of Australia will agree, was that, whatever differences there may be in regard to domestic policy, they should end . at the water’s edge. The right honorable gentleman’s speech, which was delivered in moderate and extremely comprehensive terms, gives some hope for believing that the attainment of that objective may be possible, for it contained no substantial criticism of the statement of the policy of the present Government by the Minister for External Affairs (Mr. Spender). The speech of the right honorable member for Barton to a great degree was a repetition or perhaps one might say an echo of a number of other notable speeches that he has made on this subject in this House. One could not help but be struck by one notable difference between the speech of the Minister and the statements of foreign policy which have been customarily delivered in this House. The honorable gentleman struck a new note of realism which has been absent from ministerial statements on international affairs for quite a long time. His statement emphasized, as no other recent statement has done, first, that the world is facing to-day a power situation, and, secondly, that that situation is centred in the Soviet Union. The attempt at realism on the part of the Minister does not involve rejection of the United Nations, but it does involve a recognition of certain realities in respect of the United Nations. This realism does not involve enmity with or antagonism towards the Soviet Union, but it does involve a clear recognition of certain outstanding facts in relation to the foreign policy of the Soviet Union. Therefore, in the very brief space of time available to me, I propose to examine matters relating to the United Nations and the post-war foreign policy of the Soviet

Union. I fully realize that by doing so I shall have to concentrate rather narrowly on one aspect of international affairs, namely, the subject of security. In the present state of world relations I believe that in the discussion of international affairs an honorable member would be fully justified in addressing himself primarily, if not almost solely, to that subject. As I see the world situation to-day, all nations, including our own, are in the grasp of fear and suspicion, which are steadily attracting them towards the edge of another war. There are two ways of meeting fear and suspicion. One - and, unfortunately, that is the way we have followed up to date - is to seek means of escape from fear and suspicion by building up a romantic picture of international co-operation and general peace and harmony. The other is to bring our fears and suspicions into the light, look them squarely in the face, and see what we can do to dispel them. In the contribution which, with all humility, I shall endeavour to make to this debate, I shall try to face squarely the questions which lie at the root of the fear and suspicion that exist in the world to-day, and which affect that search for security that is so fundamental to our stability, progress and welfare. First, we must recognize that the Soviet Union 19 an inescapable fact. It has its own existence and its own ambitions. It follows its own policy by which it seeks to protect its existence and serve its ambitions. In considering international affairs we must avoid the abstract noun, particularly if it ends in “ ism “. Our failure to do so was perhaps one of the greatest errors that we committed in the period between the two world wars. We were accustomed to talking about communism, fascism, internationalism and imperialism, and failed to realize that the entities that counted in international affairs were national States. The same error is present to-day for in the post-war world some national States still pursue their national aims and seek to achieve them by the instruments of power. Foreign policy is conducted, not by fascism, imperialism, nazi-ism, communism or capitalism, but by national States. When we conduct negotiations we treat not with something that ends in “ ism “. but with representatives of another government. If we make a treaty we conclude it not with something that ends in “ ism “ but. with a national State. When we went to war, we fought Germany and Japan, not an abstract noun. That basic fact must be recognized so that we may correct the rather loose and vague thinking that creeps into our discussions of international affairs. Communism in our midst is a problem, but we escape the real and concrete issues if we talk internationally about a wave of communism sweeping over the world or of the menace of world communism. The concrete fact behind such, phrases is that national States have national aims and that they seek to achieve them by using the instruments of power. Some honorable members may be inclined to disagree with me and stick to the notion that communism as such is the menace. In order to illustrate what is in my mind, I point to the example of Yugoslavia. What made Tito of value to Moscow at one time was not simply that he was a Communist, but that he followed policies acceptable to Moscow. What made him unacceptable to Moscow was not that he ceased to be a Communist - Yugoslavia is still Communist - but that he ceased to follow policies that were in conformity with the national aims of Moscow. Although we recognize that the Soviet Union is a national State pursuing nationalistic policies we must qualify it in two ways. The first is that, both before and after the last war it introduced into its foreign policy some novel and extremely dangerous weapons. It has used the ideological weapons in war more subtly, more ruthlessly and more continuously than they were ever used before in human history; and the terrible thing about (he use of ideological weapons is that they have some of the frightening possibilities of bacteriological warfare. Using ordinary weapons, destruction ceases when you stop squeezing the trigger; but when you deal in lies, the poison keeps on spreading after the lies have been told. The Soviet Union has been 11.5i.ng and clearly intends to continue to use this ideological weapon. Another element to be taken into account in con sidering the foreign policy of the Soviet Union is that the minority that governs the Soviet is a Communist party, and because the members of that party are Communists they sincerely believe that the basic and inescapable relationship between Communist and non-Communist States is one of conflict. They believe in the inevitability of change and assign to the Soviet Union the definite role of “ helping history to happen “. In order to illustrate more vividly the nature of Soviet policy, I quote from an article written by E, Tarle in New Times, a weekly journal published in Moscow. Talking of Stalin’s policy, he says -

Gradual transition to full communism such is the imposing aim of the Soviet people in the present period. Stable, profound and prolonged peace between the Soviet Union and all countries that do not betray hostile intentions towards it and are not preparing aggression against it - such is the means, or, more precisely, such is one of the essential conditions for tranquil’ and unhampered work for thi” attainment of this lofty aim. The fight for peace is a fight for the security and independence of the peoples.

This is the formula which explains and unites the principal features in the richly eventful Stalin foreign policy of the great Soviet Power.

When we analyse that statement, we see in it the declaration of a clear intention on the part of the Soviet Union to overcome any opposition and to bring about a world dictatorship under Russian control. It also reveals that the Russians look to attain the millenium not through international co-operation, but by the triumph of Stalinist Russia.

I have indicated some of the facts that must be taken into account when we attempt to assess realistically the position of the Soviet Union to-day. Those facts may be qualified, and, perhaps, objected to by some one who may ask, “But is not Russia a signatory to the United Nations Charter and is it not a member of the United Nations ? “ That is quite so. On other occasions I have expressed the opinion that when the Soviet Union signed the Charter it did so in good faith and with the intention to work within the United Nations. But I am also convinced that when it signed the Charter it had in mind a type of organization rather different from that which most other countries of the world had in mind at tl. at time. If one examines the origins of the United Nations in the conversations which took place between Stalin, Roosevelt and Churchill during the course of the recent war, it becomes abundantly clear that the Soviet Union had in mind something in the nature of a military, alliance among the great powers. Indeed, at one time - and this is a part of the record quoted by Mr. Harry Hopkins in the book recently published and edited by Robert E. Sherwood - the Soviet Union referred to the enforcement agency of the United Nations as the “ four policemen “, that is, the four Great Powers which would have power, collectively and without prompting from outside, to deal immediately with any threat to the peace. The Soviet Union’s whole idea was more close to a military alliance than to an assembly of democratic powers exercising democratic rights. When one studies what the Soviet Union has done inside the- United Nations and its attitude on the Security Council and on the Atomic Energy Commission, and when one recalls how its actions have prevented those organizations from operating fully and effectively to ensure the maintenance of world peace, it is difficult to escape the conclusion that its view of the United Nations was different from that held by the democratic countries. When it found that its own ideas of the way it could guarantee security through military alliance were not likely to prosper, it applied itself to stultifying the United Nations; and by its actions it has done more than any other single factor to prevent the United Nations from functioning effectively.

When one examines the post-war events outside the United Nations - the discussions of the Council of Foreign Ministers, the dispute over reparations in Europe and in the Ear East, the dispute over the control of Berlin, and the Soviet Union’s steady encroachments into countries bordering on its territory in Eastern Europe - can one escape the conclusion that since the war the Soviet Union has sought and is still seeking security by means .other than international co-operation? When we examine the actual documents and find that between 1946 and early in 1949 it completed an interlocking network of 24 treaties, binding in an alliance all those countries in Eastern Europe that are under Communist - controlled governments can we have any doubt that the Soviet Union is at present seeking security by establishing its own military power through the aggregation of countries that it can draw to itself by diplomatic measures and the pressure that it can apply in order to bring them into its orbit? It was that situation that led to the North Atlantic Pact. Since that pact was signed and gave a check to encroachment in Europe we have seen a repetition of that same series of events in another quarter of the world with the Soviet Union spreading its influence into Asia down to South-East. Asia. These facts, which, I suggest, are wellknown to all honorable members, add up to this: At present, we are facing not only a fellow member of the United Nations but also a power that- has committed itself to policies that are based on the use of power and the attainment of security by measures of power within its own control independently of the activities of any international organization. When we examine the security provisions of the United Nations Charter we find that the measures of enforcement provided for in it depend entirely on the co-operation and the unanimity of the Great Powers. At present we have no chance of obtaining that unanimity. Further, even with the peaceful settlement of disputes, the Charter still requires and the United Nations still needs the unanimity of the Great Powers and that unanimity is not possible of attainment at the present time. That is an inescap-able fact.

The right honorable member for Barton mentioned several cases in which the United Nations had dealt with what I think I may call minor disputes in various parts of the world such as Iran, Greece, Indonesia and Palestine. He seemed to find satisfaction in the fact that these matters had been dealt with within the framework of the United Nations. I think those negotiations may have taken on a surface smoothness from being handled through that organization : but, when we examine what was actually done in the handling of every one of those disputes, we find that they were not settled in accordance with the procedures or principles of the United Nations. They were settled by the methods of power politics. They were settled as the result of arrangements reached by diplomatic negotiations behind the doors of the United Nations. Those arrangements were afterwards confirmed in public. I do not think that because these things happened within the framework of the United Nations they were a demonstration of the method of the United Nations. Rather, they were a demonstration of old methods of power diplomacy carried on by the Great Powers within the United Nations. It may be said that because we speak in this frank and forthright way we are disparaging the United Nations and are displaying hostility to it. That is not correct. I should rather compare what we are doing to the realism of a person who points out that the petrol in the tank is running low. If one says that the petrol in the tank is running low that does not mean that one is saying that the motor car is a bad motor car or that it is not efficient or cannot run. One is pointing to the fact that the motor car lacks one essential operating condition. At the present moment the United Nations lacks that one essential condition of unanimity among the Great Powers and unless, like those who recognize that the petrol in the tank is low, we are prepared to face this fact, one of these days we are likely to find ourselves miles from anywhere, walking home on a dark and dirty night. One point that has often occurred to me in observing the policy of the previous Government in relation to the United Nations is that that Government did a grave disservice to the United Nations by asking it to do things for which it was never suited. The previous Government’s actions often reminded me of the behaviour of a child which, having a new axe, looks around for something to chop down and not finding any trees, starts chopping stones. Chopping stones may prove that the axeman is a remarkable fellow, but it does not do any good to the axe. I think that that is what has happened in the post-war years in respect of the United Nations. Australia, on more than one occasion, has asked the United Nations to undertake tasks for which it was not then fitted. In the coming period we should use this great international institution with a great deal of discretion and care, taking some precautions against spoiling it without gaining any substantial improvement in international affairs.

In the remarks that I have made I have attempted to show what are the salient features of the world situation to-day. We are facing a power situation and the Soviet Union is following policies which are imperialist in outlook, are being advanced by methods of power under purely national control and are definitely hostile to international cooperation.

The United Nations cannot give the assurance of full security that is necessary to stability, because it still lacks the unanimity of the Great Powers and it has no means within itself of obtaining that unanimity. The consequence is that we have to apply ourselves with realism to the tasks of diplomacy and to the primary task of reconciling the Great Powers - of finding some means by which the Great Powers can work together and thus make the United Nations effective. That is the first task to which the foreign policy of every country in the world should be applied. For the carrying out of such a task Australia has certain limited resources. Australia is not a great power but it is not an inconsiderable power. I believe it to be a power that can exercise an influence in quarters that are powerful and I suggest that we should take that responsibility on ourselves and subordinate lesser ambitions to the one overall objective of trying to find some method of composing the direct opposition of power that exists both in Europe and in the Ear East between the Great Powers - the Soviet Union on the one hand and the United States and the British countries, associated with the other signatories to the North Atlantic Pact on the other hand. I subscribe to the view expressed by the right honorable member for Barton that at this stage there is no need to accept the idea of war with the Soviet Union as being inevitable. I think that with sound diplomacy, with reason and moderateness and, above all, with cohesion of power and with resolution on our side it may be possible to find some means of living in this world with the Soviet Union. I say unhesitatingly and sadly that, unless we find that means within the next few years, we shall be moving upon a course that will inevitably end in war. We still have our chance - the diplomatic chance - but it will not last for long.

Debate (on motion by Mr. Daly) adjourned.

page 924

STANDING ORDERS COMMITTEE

Mr SPEAKER:

-(Hon. Archie Cameron). - I bring up from the Standing Orders Committee, a report, and proposed standing orders of the House of Representatives. The present Standing Orders Committee has considered existing standing orders and proposals brought forward from time to time by previous committees, and has incorporated further amendments designed to provide a procedure which will be adequate to meet the needs of the enlarged House. The committee recommends that they be adopted in place of the existing standing orders.

Mr MENZIES:
Prime Minister · Kooyong · LP

.- I move -

That the consideration of the report be made an order of the day for the next sitting.

I take this action so that honorable members may have an opportunity to examine the proposed new standing orders, copies of which, I assume, will be distributed, together with the amendments that have emerged from the committee’s discussions.

Dr Evatt:

– Is the report available in writing ?

Mr MENZIES:

– Yes.

Question resolved in the affirmative.

page 924

ADJOURNMENT

Potatoes - Poliomyelitis - Canbebra:fruit and Vegerables. Motion (by Mr. Menzies) proposed -

That the House do now adjourn.

Mr DUTHIE:
Wilmot

– I apologize for delaying honorable members at this late hour, but I wish to speak on a matter that is of the greatest importance to the economy of Tasmania. I propose to get right down to earth and to deal, for a few moments, with the potato industry. Tasmanians are generally united when their island State is in danger, and, regardless of party affiliations, Tasmanian members of this

Parliament have, in the last week, been waging an intensive campaign to safeguard the future of this great industry. Undoubtedly potato growing in Tasmania is at the crossroads. The industry is in grave danger of at least partial eclipse because of low prices and unstable markets. During the war years, the industry was stabilized by the Australian Government. It flourished and provided an enormous quantity of potatoes for the people of the Commonwealth. In fact, 3,000,000 bags of potatoes were exported from Tasmania in one year. However, the defeat of the 1948 referendum proposal ended Commonwealth control, and threw the Tasmanian potato industry into the hands of far-distant price fixers. To-day the industry is at the complete mercy of those who fix prices on the Sydney market. Tasmania supplies 60 per cent. of Sydney’s requirements, and 30 per cent. of Queensland’s requirements. Obviously, the Tasmanian potato industry is of great importance to the mainland. Present price levels and high production costs are making it impossible for small farmers to grow potatoes at a profit. Last year, the then Prices Commissioner for New South Wales, Mr. C. J. Bellemore, promised the Tasmanian Potato Marketing Board that the Sydney price for 1950 would not drop, below ?22 12s. 6d. a ton, which is the equivalent of approximately ?16 a ton in Tasmania. The growers planted their crops with that promise in mind. Unfortunately, Mr. Bellemore died, and the new prices commissioner decided in December of last year - after the crops had been planted - to reduce the price to ?21 15s. a ton, or ?1 2s. 6d. a ton less than the figure fixed by Mr. Bellemore. The profit margins of Sydney merchants would, of course, be reduced accordingly. A price of ?20 15s. a ton in Sydney means only ?14 12s. a ton to the Tasmanian grower. From the time of digging, it costs ?11 13s. 6d. a ton to market potatoes in Sydney. The cost of planting is ?41 4s. 9d. an acre, based on a 3-ton crop, which is the average in the potato-growing districts. The growers also receive ?14 12s. a ton for what they sell in Tasmania, but, as Tasmania uses only 250,000 bags a year, clearly the future of the industry depends upon export prices. The export market is recognized as the life-blood of the industry. Tasmania is recognized as the potato storehouse for eastern Australia. During the war, an effort was made to boost potato production on the mainland, but the experiment failed because sufficient suitable soils could not be found. Failure of the Tasmanian potato industry because of unpayable prices and the absence of organized marketing could easily produce a potato famine in Australia in the next year or two. In fact, already a serious reduction of acreage has occurred. Plantings declined from 47,000 acres in 1948 to 35,070 acres last year - that is the crop now being dug. I have spoken to potato-growers in my electorate in northern Tasmania, and many of them have stated that they have grown potatoes for the last time unless prices improve. They are turning to the raising of fat Iambs, dairying, and even wool-growing. Probably many of them will never return to potato-growing. To peg the maximum price in Sydney and not allow increased production costs to be passed on to the consumer, as is the practice with other commodities and in secondary industries, i9 most unfair. Potatoes are pegged at 3d. per lb. to the consumer, and it would appear that the potato industry has been singled out to keep the cost of living down, because potatoes and onions are the only vegetables included in the basic wage computation. I am not advocating an increase of the price to the consumer. That would add considerably to the difficulty of reducing our cost of living, which already is high enough. Therefore, we must tackle the problem in a different way. That means Government assistance to keep prices down while, at the same time, encouraging growers to produce potatoes. Tasmanian members of this Parliament have suggested to the Government the payment of a freight subsidy on potatoes, but the proposal has been rejected. It was rejected previously by the Labour Government. I submit that the matter should be given further consideration. We are in the unfortunate position that there is sea between Tasmania and the mainland. Sydney is a long way from Devonport. Stanley. Ulverstone and Burnie, from which ports potatoes are exported. Freight charges add consider ably to the cost of marketing and reduce the price to the growers. Mr. de Bomford, the secretary of the Tasmanian Potato Marketing Board, had this to say in a letter that he wrote to me on the 11th March -

My board feels their case in appealing for a freight subsidy is just, and considers the refusal on the ground that other commodities would have to he included if it was granted is unfair, for, as far as we know, potatoes are the only commodity carrying the imposition of a maximum price where increased costs art; not permitted to be added to the selling price

He is quite right there, too. Freight charges have increased by 260 per cent during the last few years, and the potato grower is footing the bill. We asked that the old premium be restored on the Sydney market. Prior to the war, Tasmanian potatoes, on account of their special quality, brought £3 a ton over and above the price paid for potatoes from other States. Early Tasmanian potatoes reached the Sydney market late in December. The premium was abolished when controls were introduced, and it has not been reinstated because controls are still in force. If we demand the restoration of the premium, we may have to ask for the removal of controls in order to be consistent. The growers contend that, if the controls were discontinued, Sydney buyers would automatically pay a premium for Tasmanian potatoes. However, we have no guarantee of that and the proposal is too risky. The secretary of the Potato Marketing Board stated in his letter to me -

Our appeal to the Commissioner for a premium for our high quality potatoes which this State always commanded prior to controlled prices was refused on the ground that it was impossible to have two retail selling prices.

It was not impossible before the war, but that apparently is of no significance. The letter continued -

How futile this argument is, is borne out by the fact that under the same administration different prices are set for different cuts of meat from the same beast, and different prices prevail for various grades of eggs and other lines.

Potatoes are subjected to special treatment. I believe that the only effective way to solve the problem would be to re-introduce a Commonwealth -wide stabilization plan. The former stabilization scheme was abandoned after the war, and another blow was struck at our hopes when the referendum appeal to the people two years ago was defeated. The Potato Marketing Board of Tasmania has decided to recommend to this Government the restoration of the stabilization plan and the re-introduction of the contract system. I believe that the Australian Agricultural Council has agreed to make a similar recommendation. However, that proposal requires the agreement of all State governments. The proposition was submitted to the States last year, but I believe that all but two of them rejected it.. Thus, Tasmania is completely at the mercy of the mainland, as has so often been the case in the past. It has become the plaything of power politics in Australia. We often hear about power politics in the international sphere, but Tasmanians feel the weight of it in their homeland. At present, the people of Sydney are getting cheap “ spuds “ at the expense of Tasmanian growers.

Mr Gullett:

– Why did not the honorable member talk about this when his party was in power ?

Mr DUTHIE:

– I did, but I was never heard. This Government, which talks so freely about increased production, ought to do its utmost to provide a greater margin of profit for Tasmanian potatogrowers. Some of those growers, in fact, are obtaining no profit from their labours. The Government has a responsibility to save the industry from partial eclipse. It is losing its status as a great industry in Tasmania. Potatoes are a vital foodstuff and, unless the Government treats seriously the protest of Tasmania’s representatives in this Parliament, it will prove that its statements about increased production, particularly in primary industries, have been completely hypocritical. I hope that the combined efforts of Tasmanian members of all parties will move the Government to protect the industry from extinction.

Mr FALKINDER:
Franklin

– The case that the honorable member for Wilmot (Mr. Duthie) has stated on behalf of the Tasmanian potato industry is not unknown to the representatives of Tasmania who sit on this side of the House. Indeed, the honorable member for Bass (Mr. Kekwick) and other honorable gentlemen have been expressing the same point of view to the Government for some time past. [Quorum formed.] As the honorable member for Wilmot is probably aware, the Premier of Tasmania led a deputation to the Minister for Commerce and Agriculture (Mr. McEwen) some time ago in order to state the claims of Tasmanian potato-growers. I hope that the honorable member will accept from me, as a somewhat curious assistant to the Minister and also a Tasmanian, an assurance that this matter will be examined very closely by the Government and will receive the most sympathetic consideration. The honorable member said that the Tasmanian growers are at the mercy of the Sydney markets. Would it not be more accurate to say that they are at the mercy of the Minister for Prices in the New South Wales Government? I 6hall not labour the point, because the honorable member has clearly stated the situation as the Tasmanians on this side of the House understand it. I assure him that he can confidently expect that the Government will study this matter carefully and sympathetically.

Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP

The matter that was raised by the honorable member for Hindmarsh (Mr. Clyde Cameron) is one that commands the sympathetic interest of all members of the Parliament. At one time or other the effects of poliomyelitis have been felt in varying degrees in every State of the Commonwealth. I am sure that we all have a genuine sympathy with the honorable gentleman in his family troubles. I know that I am speaking on behalf of all honorable members when I express to him our very sincere wish that his children may recover their health speedily and completely. I know that he mentioned them only to illustrate what is happening, and I accept it in that way, but I should like him to know that we entertain a sympathetic regard for him. I shall bring the comments of the honorable member to the attention of the Ministers directly concerned. The honorable member will know that, in general, problems of health are primarily the concern of the State governments, but the Australian governments, particularly in recent years, have shown that they are anxious to assist financially and otherwise in the great matter of health. On this problem I am certain that there will be sympathetic consideration given by both the Treasurer (Mr. Fadden) and the Minister for Health (Sir Earle Page).

We were just getting interested in the predicament of the citizens mentioned by the honorable member for the Australian

Capital Territory (Dr. Nott). I am sure that he adequately represents those citizens, and that every householder vill give him a response that will encourage him to press on with his efforts. Perhaps on another occasion we shall have an opportunity of hearing more from him on the subject to which he referred. Any other matters that have been raised will be brought to the attention of the appropriate Ministers.

Question resolved in the affirmative.

page 928

PAPER

The following paper was presented : -

Commonwealth Public Service Act - Appointment - Department of Works and Housing - R. G. C. Agnew

House adjourned at 11.6 p.m.

page 928

ANSWERS TO QUESTIONS

The following answers to questions were circulated: -

Petrol

Mr Daly:

y asked the Minister representing the Minister for Shipping and Fuel, upon notice -

. What was the petrol consumption m Australia for the months of January and February, 1949?
What was the consumption for the same months of this year?
How much petrol has been made available from defence stocks in Victoria during the transport strike in that State?

Mr Anthony:
CP

– The Minister for Shipping and Fuel has supplied the following information : -

31,459,073 gallons of petrol were consumed in January, 1949. and 33,858,174 gallons in February, 1949.
38,622,065 gallons of petrol were consumed in January, 1950. The final sales figures for February, 1950, are not yet available.
Nil.

Telephone Services

Mr Davies:
CUNNINGHAM, NEW SOUTH WALES

s asked the PostmasterGeneral, upon notice -

ls it a fact that the lack of telephone installations in the Wollongong-Port Kembla district is causing considerable difficulties and interfering with production?
Is it a fact that even men on call from the city council electricity undertaking, whose job it is to deal with emergency work during a breakdown, have been refused telephone installations 1
As the Wollougong-Port Kembla district is developing rapidly and the demand for new installationsis so great, will he make a special effort to meet this situation by sending more men and material to the district at once?

Mr Anthony:
CP

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

At present 478 applications for telephone services are outstanding in Wollongong, and 40 in Port Kembla. Itis recognized that considerable difficulty is being caused due to the department’s inability to provide the services, and relief measures are in hand with the object of having the facilities installed with the least possible delay.
Five recent applications for telephone services in the residences of employees of the Greater Wollongong City Council Electricity Service in the Wollongong-Port Kembla districts are awaiting completion. These applications have been given a high priority and the facilities will be provided as promptly as possible.
Vigorous efforts are being made to meet the situation. An additional switchboard is being installed in the Wollongong Exchange to cater for 200 subscribers lines, and the work should be completed within the next six weeks. The department will also send additional men and materials to the district at an early date to undertake large underground cable works. It is proposed to install an automatic exchange at Wollongong to provide for 2,000 subscribers lines and smaller automatic exchanges will be established at Wollongong North and Unanderra. The trunk lines between Wollongong and Sydney will be increased by eight within the next three months: 22 additional channels will be provided in the near future. In view of the rapid development in the Wollongong and Port Kembla districts the department fully appreciates the importance of expediting the various projects with the object of improving and expanding the telephone facilities in those localities, andthe matteris receiving special attention.

Mr Daly:

y asked the Prime Minister. uponnotice -

How many persons were employed in the Commonwealth Public Service on the 10th December, 1949, in the following groups: - (a) permanent, and (b) temporary?
Has this number been reduced since that date; if so, by how many in each of the above groups ?
How many of those dismissed have been placed in emplyment and in what industries ?
How many more dismissals will take place within the next three months?

Mr Menzies:
LP

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

The number of persons employed in the Commonwealth Public Service at 10th December, 1949, is not known, but at the 31st December there were -

2, 3 and 4. It is not known whether any net reduction in these numbers has taken place, or will occur in the next three months. Figures to 31st March will not be available until the second quarter of this year.

Public Service employment will be kept to the minimum consistent with the adequate and efficient discharge of the tasks of Govern ment. This may involve increases in some departments such as the Postmaster-General’s, Social Services, Civil Aviation and Immigration where demands for services are increas ing with population and social and economic development.

Mr Menzies:
LP

s. - On the 2nd March the honorable member for Burke (Mr. Peters) asked me a question concerning the Prices Branch in Victoria. I have hadthe matter examined and the Public Service Board has informed me that in the event of the disbanding of the branch, any permanent officers of the Commonwealth Public Service released from the Victorian prices organization would retain their rights to be absorbed in departments. Every endeavour would be made to place in suitable vacancies, temporary employees who, while employed with the Commonwealth Prices Branch, were guaranteed employment for a specific period. Accruing rights would be preserved if service between State and Commonwealth employment were continuous.

Mr Haylen:

asked the Minister for External Affairs, upon notice -

Is he satisfied that the Zaibatsu has been broken up in Japan?
Have the terms of the Potsdam Agreement been applied to the banking interests of Japan with more leniency than was intended?
How many banks have been ordered to discontinue business?
ls it a fact that tcn banks in Japan now operate, controlling 80 per cent, of the whole industrial, financial and economic lite of the country
Have the Mitsui and Mitsubishi banking, newspaper, textile, farming, fishing, coalmining, shipbuilding, railway and forestry interests been dissolved? ti. Have the directives of the Supreme Commander of the Allied Powers on the break-up of the war-making potentialities of Zaibatsu been implemented?

Mr Spender:
LP

r,. - The answers to the honorable member’s questions are as follows : -

Active control of the economic life of Japan by the great concentrations of monopolies of capital and industrial power known as the Zaibatsu has been broken to the extent that their securities in holding and operating companies have been taken over and are in process of disposal in return for government bonds unredeemable for ten years. Of 325 companies designated as excessive concentrations of economic power by the Holding Company Liquidation Commission, 297 were freed from this charge by the Deconcentration Review Board. while the remaining 28 were dissolved. Included in the 28 were the eleven Zaibatsu whose families are now restricted in their active participation in business.

On 3 1 st Jul v. 1948, the Holding Company Liquidation Commission. after surveying Japan’s banking structure, announced that Japanese banks would not be reorganized under the deconcentration programme. Severing of the banking system’s connexion with the Zaibatsu by the application of anti-trust and anti-monopoly laws, however, have to some extent fulfilled the original conception of necessary action.

Two special banks, the overseas development banks and the special wartime financing organizations have been closed.

S.C.A.P.!s review of Japanese economic statistics states that the ten largest banks with branches throughout Japan aggregate over two-thirds of the banking business. The remaining one-third is apparently accounted for by 55 smaller commercial hanks operating within the prefectures in which they are located and by the special banks.

Most operating companies formerly controlled by the Zaibatsu family holding companies (including the Mitsui and the Mitsubishi) still exist, although the holding companies’ financial control is stated by S.C.A.P. to have been removed.

S.C.A.P. has reported that all specialized war-making facilities in Japan have been destroyed.

Banking

Mr Tom Burke:

e asked the Treasurer, upon notice -

Did the Royal Commission on Monetary and Banking Systems consider the relationship of the Commonwealth Bank with the Commonwealth Government?
Did it say, “In part the responsibility for monetary policy it> delegated to the Commonwealth Bank by the Federal Parliament in the legislation under this section establishing the bank and conferring upon it certain powers, but in part the responsibility is with the Federal Government “ ?
Did it say further, “ The Federal Parliament is ultimately responsible for monetary policy, and the government of the day is the Executive of Parliament “.
Did it recommend as follows: - In cases in which the differences of opinion are irreconcilable the Government should give the bank an assurance that it accepts full responsibility for the proposed policy and is in a position to take, and will take, any action necessary to implement it. It is then the duty of the bank to accept this assurance and to carry out the policy of the Government “ ?

Mr Fadden:
CP

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

Yes. 2, 3 and 4. These questions form only a portion of the text of paragraphs 528 to 531 of the royal commission’s report.

Mr Tom Burke:

e asked the Treasurer, upon notice -

Did the Royal Commission on Monetary and Banking Systems consider the composition of the Commonwealth Bank Board?
Did it report as follows: - “ The limitation on the field of choice of directors should be removed. The members of the hoard should be selected lor capacity and diversity of experience and contact and not as representatives of special interests”?
Was this recommendation made after hearing extensive evidence on this subject, particularly from leading Australian economists?
Is the expressed view of these expert advise:. unchanged?

Mr Fadden:
CP

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

. Yes
This quotation is a part only of paragraph 57(i of the royal commission’s report. The commission’s conclusions and recommendations on the composition of the hoard were set out in paragraphs 575 and 570.
A list of witnesses who appeared before the royal commission is shown on page 384 of the report.
The information is not available.

Cite as: Australia, House of Representatives, Debates, 16 March 1950, viewed 22 October 2017, <http://historichansard.net/hofreps/1950/19500316_reps_19_206/>.

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House of Representatives16 March 1950

QUESTION

ALIEN DOCTORS

Mr FITZGERALD:PHILLIP, NEW SOUTH WALES

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

QUESTION

DE. HEWLETT JOHNSON

Mr TOWNLEY:DENISON, TASMANIA

Mr HOLT:Minister for Immigration · HIGGINS, VICTORIA · LP

QUESTION

PUBLIC WORKS

Mr GILMORE:LEICHHARDT, QUEENSLAND

Mr CASEY:Minister for Works and Housing · LP

QUESTION

HOUSING

Mr FRASER:EDEN-MONARO, NEW SOUTH WALES

Mr CASEY:LP

Mr FALKINDER:FRANKLIN, TASMANIA

Mr CASEY:

QUESTION

TUBERCULOSIS AND CANCER

Mr McMAHON:LOWE, NEW SOUTH WALES

Sir EARLE PAGE:CP

QUESTION

CURRENCY

Mr WARD:EAST SYDNEY, NEW SOUTH WALES

Mr MENZIES:Prime Minister · KOOYONG, VICTORIA · LP

Mr COSTA:BANKS, NEW SOUTH WALES

Mr MENZIES:

QUESTION

COAL

Mr WENTWORTH:MACKELLAR, NEW SOUTH WALES

Mr MENZIES:LP

QUESTION

COMMUNISM

Mr CREMEAN:HODDLE, VICTORIA

Mr HOLT:LP

QUESTION

INDUSTRIAL UNREST

Mr DALY:GRAYNDLER, NEW SOUTH WALES

Mr HOLT:LP

QUESTION

HEALTH AND MEDICAL SERVICES

Dr NOTT:

Sir EARLE PAGE:CP

Mr ROSEVEAR:DALLEY, NEW SOUTH WALES

Sir EARLE PAGE:

Mr W M BOURKE:FAWKNER, VICTORIA

Sir EARLE PAGE:

QUESTION

ROADS

Dr EVATT:BARTON, NEW SOUTH WALES

Mr FADDEN:Treasurer · MCPHERSON, QUEENSLAND · CP

QUESTION

DEFENCE FORCES

Mr HOWSE:CALARE, NEW SOUTH WALES

Mr FRANCIS:Minister for the Army · MORETON, QUEENSLAND · LP

Mr GRAHAM:ST GEORGE, NEW SOUTH WALES

Mr MENZIES:LP

QUESTION

WOOL

Mr CLARK:DARLING, NEW SOUTH WALES

Mr MENZIES:LP

Dr Evatt:

Mr MENZIES:

QUESTION

IMMIGRATION

Mr TURNBULL:MALLEE, VICTORIA

Mr HOLT:LP

Mr OSBORNE:EVANS, NEW SOUTH WALES

Mr HOLT:

QUESTION

SHIPPING

Mr MULLENS:GELLIBRAND, VICTORIA

Mr SPEAKER:

Mr Menzies:

Mr MULLENS:

Mr MENZIES:LP

Mr Mullens:

Mr MENZIES:

House of Representatives
16 March 1950

Mr FITZGERALD:
PHILLIP, NEW SOUTH WALES

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

Mr TOWNLEY:
DENISON, TASMANIA

Mr HOLT:
Minister for Immigration · HIGGINS, VICTORIA · LP

Mr GILMORE:
LEICHHARDT, QUEENSLAND

Mr CASEY:
Minister for Works and Housing · LP

Mr FRASER:
EDEN-MONARO, NEW SOUTH WALES

Mr CASEY:
LP

Mr FALKINDER:
FRANKLIN, TASMANIA

Mr McMAHON:
LOWE, NEW SOUTH WALES

Sir EARLE PAGE:
CP

Mr WARD:
EAST SYDNEY, NEW SOUTH WALES

Mr MENZIES:
Prime Minister · KOOYONG, VICTORIA · LP

Mr COSTA:
BANKS, NEW SOUTH WALES

Mr WENTWORTH:
MACKELLAR, NEW SOUTH WALES

Mr MENZIES:
LP

Mr CREMEAN:
HODDLE, VICTORIA

Mr HOLT:
LP

Mr DALY:
GRAYNDLER, NEW SOUTH WALES

Mr HOLT:
LP

Sir EARLE PAGE:
CP

Mr ROSEVEAR:
DALLEY, NEW SOUTH WALES

Mr W M BOURKE:
FAWKNER, VICTORIA

Dr EVATT:
BARTON, NEW SOUTH WALES

Mr FADDEN:
Treasurer · MCPHERSON, QUEENSLAND · CP

Mr HOWSE:
CALARE, NEW SOUTH WALES

Mr FRANCIS:
Minister for the Army · MORETON, QUEENSLAND · LP

Mr GRAHAM:
ST GEORGE, NEW SOUTH WALES

Mr MENZIES:
LP

Mr CLARK:
DARLING, NEW SOUTH WALES

Mr MENZIES:
LP

Mr TURNBULL:
MALLEE, VICTORIA

Mr HOLT:
LP

Mr OSBORNE:
EVANS, NEW SOUTH WALES

Mr MULLENS:
GELLIBRAND, VICTORIA

Mr MENZIES:
LP

Mr ANDREWS:
DAREBIN, VICTORIA

Mr CRAMER:
BENNELONG, NEW SOUTH WALES

Mr SPENDER:
Minister for External Affairs · WARRINGAH, NEW SOUTH WALES · LP

Mr E JAMES HARRISON:
BLAXLAND, NEW SOUTH WALES · ALP

Mr MENZIES:
LP

Mr BIRD:
BATMAN, VICTORIA

Mr SPENDER:
LP

Mr KENT HUGHES:
CHISHOLM, VICTORIA · LP

Mr HOLT:
LP

Mr EGGINS:
LYNE, NEW SOUTH WALES

Mr HOLT:
LP

Mr BROWN:
MCMILLAN, VICTORIA

Mr ANTHONY:
Postmaster-General · RICHMOND, NEW SOUTH WALES · CP

Mr DRAKEFORD:
MARIBYRNONG, VICTORIA

Mr MENZIES:
LP

Mr WHITE:
Minister for Air · BALACLAVA, VICTORIA · LP

Mr RYAN:
FLINDERS, VICTORIA

Mr CURTIN:
WATSON, NEW SOUTH WALES · ALP

Mr WARD:
East Sydney

Mr SPENDER:
Minister for External Affairs and Minister for External Territories · Warringah · LP

Mr CLYDE CAMERON:
HINDMARSH, SOUTH AUSTRALIA · ALP