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Wednesday, 24 February 1932

Mr GREGORY - Why not limit the life of the bill?

Dr EARLE PAGE - That would have some effect; but we should go further, and formulate some provisions for incorporation in the bill to ensure its equitable operation and to provide efficient and satisfactory safeguards.

In my opinion the fight that has been entered upon by the Commonwealth Government in the interests of honest, as against dishonest, government will be protracted. It will not be quickly ended either in the law courts or elsewhere.

I believe that it will continue until the next great step in our constitutional reform is taken, the step which was outlined many years ago by B. R. Wise and Sir Henry Parkes. That step involves an extension of real local governing powers by the subdivision of the bigger States, and especially the subdivision of New South Wales. At present the position of the Commonwealth is much more seriously menaced if a big State like New South Wales defaults, than if a small. State like Tasmania defaulted. The total debt of Tasmania is only between £20,000,000- and £30,000,000. The interest on that sum is not large when compared with the £13,000,000 or £14,000,000 which has to be provided annually for interest in connexion with the indebtedness of New South Wales; If New South Wales were subdivided into three or four areas the total amount of interest payable by any one part would not relatively be very great, and the Commonwealth, in the case of any default, would be able to meet the situation. The problem is very difficult with a State which contains two-fifths of our population and two-fifths of our resources, aud is responsible for a very large proportion of our debt.

I am quite satisfied that the only real cure for our present ills is the subdivision of the big States. If that policy were adopted, the Loan Council would be so composed that solid support would be assured for a sound policy of finance, because such a number of large rural areas which are essentially stable and honest, would be represented. Until the large States are subdivided in this way, there will always be a certain instability about the procedure of the Loan Council ; but when the council consists of representatives of a large number of units, Australia will be in a much better position in the eyes of the world, and we shall he assured of stable national political equilibrium and sound policies from an investor's point of view.

Australia is at the parting of the ways. Mr. Lang's policy of default and repudiation is a retrograde one ; it means the repudiation of all contracts. What he acclaims as the new revolution can only throw us back to barbarism. Such a policy may tickle the ears of the multitude for a short period; hut the destruction of the sanctity of contracts would undoubtedly be a retrograde step, and would ultimately result in the destruction of civilization as we know it. The policy of the Commonwealth Government, which is to honour contracts, is an honest one, and I feel sure that, although Australia is now in difficulties, if all the people put their backs to the wall, this country will emerge from its present trials as it has overcome similar troubles in the past. By carrying out the joint policy on which the United Australia party and the United Country party were elected to this House the cost of living, of government and of production can be reduced, progress and prosperity can be restored, and employment can be increased. Only by stimulating employment can we escape from our present difficulties. Default can be of no real assistance to us. We must show that we have the will to work out our salvation and the whole of the weight of the nation must be put into the effort, if this great country is to fulfil its destiny.

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