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Wednesday, 16 December 1914

The PRESIDENT - Order! Will the honorable senator allow me to correct what may be, after all, a very natural error on his part? It is quite true that, apparently, on the Estimates for the Parliament this year it appears that certain of our officers are getting increases of salary, but that is not so. The increases were granted and voted last year; but they were paid out of the Treasurer's Advance instead ofbeing provided on the ordinary Estimates. The honorable senator, therefore, will sen that, while there is an apparent increase given to our staff this year, that is not so. The increases we're voted last year, when the matter was fully explained in the Senate. I have no desire in any way to avert the honorable senator's criticism. I am only pointing out the facts, in order that he may not fall into a mistake.

Senator Millen - Was Parliament informed of the facts?

The PRESIDENT - Yes; and honorable senators can see a full report of the debate which took plice when the Estimates were going through

Senator DE LARGIE - While that may be an answer in the case ofthe particular officers to whom I have been directing my attention so far, I do not think that the same excuse can be ad vanced foT a number of other increases which are embodied in these Estimates. I do not go out of my way to bring forward a matter of this kind. When one is, so to speak, cheek by jowl with the officers, he feels a certain amount of delicacy in introducing the subject; but we have to put that feeling aside when there is a plain duty to be performed. We shall see by-and-by how the public view these increases. I believe that nine-tenths of the people outside will view them with disfavour. There are other increases to which I wish to draw attention. Take, for instance, the highly-paid officers on the transcontinental railway. I find that not only are the Government giving increases there, but are actually increasing the number of officers on that work. Towards the end of last year a parliamentary return was issued, showing the number of officers engaged, and I think that the common opinion expressed then was that far too many engineers were employed for the work which was being done. I venture to say that if the work were being done by a contractor, about half the number of engineers would be used. When I find that a running staff of officers is provided such as would be necessary if the railway were carrying passengers and goods; when I find that highly-paid officers are appointed to do that kind of work on a line which is only a little over 100 miles long at either end, and there is practically no traffic other than that of construction, I am far from satisfied that the number of new appointments is justifiable. On page 180 of the Estimates an increase of £50 is proposed for the construction and maintenance engineer, and, if it is agreed to, his salary will be £800. I do not remember what title was given to the deputy enginner-in-chief .

Senator Pearce - He was assistant engineer-in-ch ief .

Senator DE LARGIE - In these Estimates a salary is provided for a construction and maintenance engineer. I was inclined to think that there was a change of designation.

Senator Pearce - It may be in the Central Office.

Senator DE LARGIE - It is not stated whether it is in the Central Office or not. Theitem appears under the head of "Kalgoorlie to Port Augusta Railway," and does not disclose on what particular part of the railway the officer is engaged. I take it that it refers to Mr. Hobler, who was assistant engineer to the Engineer-in-Chief. He was paid a salary of £750, and the title now set down on the Estimates is " construction and maintenance engineer," with a salary of £800. From what I know of the work on the line through my association with a Select Committee, and of work of a similar kind in Western Australia, I am able to say that engineering of any kind is very seldom required. It is more a matter of construction than of engineering, because the country is flat. There are no hills to be crossed or rivers to be spanned. There is practically no engineering work required in the construction of this line. What is chiefly wanted is organization and management. The principal work is the gathering together of the sleepers and rails at the places where they have to be used. Still we find that we have a supervising engineer with a very numerous staff at each end of the lino. The staff, in my opinion, was larger than was necessary at the beginning of the year, and many additions have, in the meantime, been made to it. This, in my opinion, cannot be justified. I do not wish to minimize the hardships and disadvantages of those engaged in the construction of this line, because I lived long enough in the outside districts of Western Australia to be familiar with them. While there are disadvantages, there are also advantages to be considered. The climate, for instance, is better than in many other parts of Australia. We should remember that we are called upon to meet the expenses in connexion with the war, and that we have great difficulty in raising sufficient funds for the ordinary purposes of government. In the circumstances, to increase salaries and the number of officers employed in connexion with the construction of this line is extravagant and wasteful. When we were investigating the dismissal of the first supervising engineer, the increase in the expenditure beyond the estimate of cost was shown to be so great that it was apparent that the total cost of the line would be a great deal more than any of us ever expected. I am afraid that our hopeful anticipations of seeing this railway built at a reasonable cost will not be realized. From the way in which the work is being carried out, it will cost very much more than is necessary. I attribute this to the fact that the staff is too large, and that we are paying our officers too much. We are paying a construction and maintenance engineer £800 a year. In Western Australia the State engineer, filling a similar position and carrying out similar duties all over the State, receives only £528 a year, and he is known to bo a competent engineer, who gives every satisfaction. We cannot continue in this way without finding ourselves in difficulties before the work is completed. Former estimates of the cost of the line approximated to £4,000,000, but I am afraid we shall find that the line will have cost nearly double that amount before it is built. I take advantage of this opportunity to say a few words upon the war and the raising of the means to carry it on. I agree with a good deal of the criticism to the effect that we have undertaken a task which, later on, will be found to tax our means of raising revenue to the uttermost. I am very far from believing that the taxation for which we have been making provision in the last few days will be sufficient to meet the expenses of the war. In my opinion, it will be impossible for us to avoid the imposition of an income tax, and as such a tax would fall upon all sections of the community, I should prefer it to any other imposition for war purposes. The taxation proposals with which we have already dealt may be justified from other points* of view, but I am satisfied that when we have realized the enormous expenditure which the war will entail, we shall see that further taxation will be forced upon us. We are sending Expeditionary Forces to the other side of the world, and later we shall have a pensions bill to meet. When the war is over, and we see wounded men in the streets of our cities, and are able to count up the number who have been killed and the amount which will be required to provide for their dependants, it will be seen that the revenue for which we have already provided by taxation measures will cover but a very small amount of the total cost. I believe that the imposition of a drastic income tax would be justified. Those who should pay taxation will not be able to dodge their obligations under such a tax as easily as they may do under some of the measures we have passed.

Senator Guthrie - An income tax may be very easily dodged.

Senator DE LARGIE - I am satisfied that we shall be able to get at the rich men of the community more effectively under an income tax than under many of the taxes we have recently been considering. When I tell honorable senators that in Western Australia a proposal was made under which some of the rich men of the community would he called upon to pay something like £260 a year on an income of a trifle over £.1,000, they will recognise how modest the Commonwealth Government have been in the proposals submitted at the present time. We cannot expect that the war will be fought without funds.

Senator Senior - Or without sacrifice.

Senator DE LARGIE - That is so, and to pay up is about the only sacrifice which the rich man who does not go to the front can make. He will not be doing his duty if he does not pay up, and we shall not be doing our duty if we neglect to impose taxation which will compel him to do so. To incur a tremendous war debt and pass it on to the next generation would be to adopt the practice which too many of the State Governments have adopted in respect to other matters in the past. To shirk our responsibilities in that way would be to violate the policy of the Labour party.

Senator Bakhap - Let us increase the population.

Senator DE LARGIE - We have just listened to the objection urged by Senator Bakhap to a proposal which would encourage the increase of the population.

Senator Bakhap - I could quote a Labour journal in Tasmania to the effect that such a thing would give no stimulus to the increase of the population.

Senator DE LARGIE - Those who talk in that way must be very wealthy. We are not increasing our population at the present time. We are sending away from Australia the flower of our manhood, and many of those who are being sent away may never come back again.

Senator Needham - Does the honorable senator not think that rich men with military titles should either go to the front or pay up?

Senator DE LARGIE - Some of them might be more valuable here. Perhaps they could help us better with their purses than with their swords.

Senator Needham - They would be much safer here than at the front.

Senator DE LARGIE - That might be so, but the honorable senator should not forget that it is necessary that we should keep a certain number of men here to defend us should Australia be invaded. I look forward when we meet again to the introduction of further taxation proposals. Our friends opposite will have to prepare for another dose of the medicine they have been getting during the last few days. I am reminded, by an article appearing in the Economist, a well-known financial newspaper, that possibly we may be living in a fool's paradise, so far as our estimate, of the financial position of the enemy is concern pd. The article to which I refer shows (hat Germany is in a much better financial position than many of us dreamt of. We were disposed to think that the one thing which would most seriously hamper the enemy would he a lack of the sinews of war. In it the striking statement is made that Germany is the only nation engaged in the war, which, from its inception, experienced no difficulty in financing it. The Germans were the only people who had a gold fund in readiness for such an emergency. They have just raised the largest loan in connexion with this war that has ever been raised in the world's history. We have been accustomed to refer, with bated breath, to the enormous indemnity of £200,000,000 which was paid by France to Germany a few years ago, but quite recently the German Reichstag authorized a loan of £250,000,000 for war purposes, and within a few weeks no less than £230,000,000 of it was subscribed. The finances of Germany are in so good a condition that whereas, upon the outbreak of hostilities, the Bank of England and the Bank of France had to reconsider their position to issue paper money to an extent hitherto unknown, and to resort to a, moratorium, the Germans had to. adopt no such expedients.

Senator Bakhap - They have always had a sum of money put on one side for war purposes.

Senator DE LARGIE - Yes; they have always had a war chest to the extent of about £40,000,000. But that is a small sum compared with the enormous loan of £250,000,000 to which I have just "referred. I would also remind honorable senators that, whilst in England and France the rate of interest, immediately upon the declaration of war, mounted to 10 per cent., in Germany it never exceeded 6 per cent.

Senator Gardiner - Nobody will lend Germany money, because her security is not good enough.

Senator DE LARGIE - I have just been pointing out that the finances of Germany are in a better condition than we have been accustomed to think, and that this gigantic loan was subscribed by her people in record time. All this points to the fact that we have a long war ahead of us. According to the Economist, German bank deposits have increased from £47,000,000 in July to £135,000,000 in September. The gold reserve increased from £62,000,000 in July to £85,000,000 in September. The President of the Reichs Bank boasts that Germany is the only country at war that did not resort to a moratorium and whose increased paper money had been cheerfully accepted.

Senator Senior - The total amount '-f the loan which the honorable senator has mentioned would not cover the cost of one year's warfare.

Senator DE LARGIE - I am well aware of that. But the very fact that it is the largest war loan raised in history, and that it was floated in record time, show* how well the Germans were prepared. Consequently, the criticism of taxation measures introduced into this Chamber W tlie Government in which honorable senators opposite have indulged, is childish in the extreme. Financially we have not done our duty up to the present moment. I see no escape from a heavy war tax in the near future. The only proposal for meeting the extraordinary emergency with which we are faced that has so far emanated from the Opposition has been one to levy taxes upon tea and kerosene.

Senator Bakhap - I do not think that t lie honorable senator is just. No such proposal has ever emanated from the Opposition.

Senator DE LARGIE - A very prominent member of the Liberal party, in the person of Sir John Forrest, has advocated the adoption of those duties.

Senator Bakhap - That does not bind me. I will agree to no tax on kerosene unless there is a tax imposed on electric light.

Senator DE LARGIE - The party with which the honorable senator is associated has endeavoured to bring about the taxation of tea and kerosene for quite a lon" time. In the almost immediate future we shall be obliged to levy a tax on incomes, which is the fairest form of taxation which can be imposed. We have entered upon this war, and there is no person in the community who does not think it is the most justifiable conflict iri which Great Britain has ever engaged. That being so, it is our duty to do our share in assisting the Empire. Personally, I do not think we have done all that we can do, and we shall have to increase our efforts in the future.

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