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Wednesday, 2 March 1932


Mr MCGRATH (BALLAARAT, VICTORIA) - The honorable member cannot speak for Victoria.


Mr HOLLOWAY - I am speaking for that State. I have said that Victoria's financial position is just as precarious as that of New South Wales, while Western Australia, South Australia, and Tasmania are in a similar predicament.


Mr Cameron - In those States a real effort is being made to balance the budget.


Mr HOLLOWAY - I am aware of that. Yet, if the next conference between the State Premiers and representatives of the Commonwealth Government cannot induce the Commonwealth Bank Board to take a step forward in the direction of a progressive alteration of our monetary system, and to assist the States, it will mean either a cancellation or temporary suspension of some of the external debt or internal revolution. I say these things, not because I want to see them come about, but because if a member believes a thing he should give voice to his opinion.

I am honestly of opinion that all the States in the federal union are on the brink of being in the same difficulty as New South Wales . They desire to " play the game ", and to exhibi t the highest sense of financial morality; but if the Commonwealth Bank Board will not help the Commonwealth Government to save all the States financially, before next winter has passed, they will be pointing out that they cannot pay their debts. In my opinion, such n contingency could be avoided. I be- lieve that the only institution that can overcome the difficulty is the Commonwealth Bank. It could relieve the whole situation, just as did the right' honorable member for Cowper (Dr. Earle Page) five or six years ago, when he caused additional credit to be issued to assist the primary producers more quickly and successfully to market their goods overseas. The circumstances then, I admit, were not so difficult and menacing as they are to-day; yet surely the Commonwealth Bank can come to the assistance of the people at a time when all the States, apparently, will be forced to take up an attitude similar to that adopted by the New South Wales Government. It is the duty of the Commonwealth Government, in conjunction with the Commonwealth Bank Board, to come to the rescue of the people of Australia.

This bill involves a raid on the revenues of a State. It attacks the very basis of the sovereignty of the States, and must, in my opinion, as I have already said, violate the Commonwealth Constitution. I would very much like to hear what the honorable member for Fawkner (Mr. Maxwell) has to say on this point. I have always had the greatest respect for his knowledge of legal matters. I again express my regret in having to say that greater patience should have been exercised than has been shown by the present Government, and that it should have followed more constitutional methods in dealing with the position of New South Wales instead of resorting to a measure which is abhorrent to the instincts of the people. I believe that the bill originated largely because of personal feeling towards the Premier of New South Wales. I admit that Mr. Lang is a difficult man to negotiate with, and likes to play a lone hand. If I were a member of a conference which he attended, I would object to his tactics.


Mr Maxwell - How does the honorable member suggest the Commonwealth Government could deal with him?


Mr HOLLOWAY - I have already indicated that it should have proceeded on the lines proposed by the late Government, and I do not remember the honorable member for Fawkner objecting to that measure. We should let the High Court decide the issue. I believe that the decision whether the Lang Government should remain in office, should be made by the people of New South Wales. The liberties of the people of Australia would be violated, if this Parliament took the drastic, tyranical and undemocratic action contemplated under this measure. Even if this action were declared by the High Court to be constitutional, it would never be enforced. Any attempt to enforce it would not improve the situation in New South Wales, but would make it infinitely worse. I oppose the bill.







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