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Wednesday, 4 May 1932

Mr SCULLIN (Yarra) . .-This subject is becoming almost threadbare, but. the bill represents the most serious step yet' taken by the Government in connexion with its policy of enforcing payment by the Government of New South Wales. I venture the opinion that if the Commonwealth Government had known to what measures it would be forced to have recourse in order to save its face, it would have hesitated to put this plan into operation, and Ministers would not have bee/i so full of assurance that their method was the easiest and most expeditious way of recovering the amounts due by the State of New South Wales to the Commonwealth. The Prime Minister (Mr. Lyons) laid emphasis upon the justice of the Commonwealth's claim to be reimbursed the moneys paid by it on behalf of New South Wales. With his remarks I agree; the moral obligation of the State cannot be denied. But I differ from the Commonwealth Government regarding the method which it is employing. The Prime Minister said that the bill is necessary to strengthen the hands of the Government. This is a further amendment of the law, and it is required only because each step taken by the Commonwealth so far has been ineffective. I am throwing no bouquets at the Premier of New South Wales for having resisted the law.

Mr Rosevear - He does hot need them.

Mr SCULLIN - He does not deserve them. The members of the Lang group are now reaping the harvest of their alliance with the present ministerial party.

Mr James - If the right honorable member's Government were in office it would be attempting just what the present Government is attempting to do.

Mr SCULLIN - I cannot allow the party I lead in this Parliament to he misrepresented. If I were in office I would be taking steps to make the Government of New SouthWales honour its obligations; hut I would not be taking the steps that this Government is taking. The Government has acted hastily. Its supporters sneered at the methods of my Government, stating that they were too slow and cumbersome, but the present Government is learning that the process of recovering moneys from a defaulting State is not so simple as they imagined. The State Government of New South Wales also is learning that the Lang plan is not a success. Both plans have failed, and the people, particularly the citizens of New South Wales, are suffering. One cannot escape the belief that both the resistance by the State Government, and the enforcement measures of the Commonwealth Government, are inspired by political motives. Whenever I have discussed the relations between the two Governments, my language has been deliberately guarded, but I repeat what I said last week, that there are things of more importance than money in the life of the community. Peace and good order are worth more than millions of pounds.

Mr Stewart - Is not the reputation of a State worth something?

Mr SCULLIN - Undoubtedly, hut peace and good order are at this juncture more important. Both the Commonwealth and State Governments are following courses which are calculated to do irreparable damage to Australia unless our people show that they have more sense than have their politicians. That is my earnest view, as the result of considerable experience.

Mr Maxwell - The right honorable gentleman has not a monopoly of earnestness.

Mr SCULLIN - No, but at least I am at liberty to express my own feelings. It is easy to follow blindly - to say that

Lang is right or that Lyons is right; to show that there is a wiser middle course is more difficult.

Mr Abbott - Does the honorable member propose to state what that course is?

Mr SCULLIN - I am expressing the view of many thousands of people. Recently the returned soldiers' organization in Canberra adopted the following motion, which, I believe, would be endorsed by every branch of the organization throughout Australia -

Recognizing that Anzac Day is a symbol of unity amongst ex-members of the Australian Imperial Forces, and, therefore, amongst all the States of the Commonwealth, the League appeals to the Prime Minister of Australia, and the Premier of New South Wales, in the names of those who fought and those who died, to suspend their political differences in the interests of Australia. With unity Australia conquered; without unity the Australian Government cannot survive.

I agree with that, and I endorse the request to the Governments of the Commonwealth and of New South Wales to compose their political differences.

Mr Stewart - Any criminal might make the same request in a court of justice.

Mr SCULLIN - Every criminal is entitled to a trial.

Mr Lane - The right honorable gentleman could not compound with Lang.

Mr SCULLIN - After the default of last year my government did effect a settlement with the Government of New South Wales. "We induced it to do what other State governments were doing in respect of the payment of interest. Mr. Lang agreed to the Premiers plan, and if he has not carried it out in its entirety, the recent report of the experts shows that the Government of New South Wales honoured some of its undertakings at least as far as some of the other States. To that extent we succeeded in securing unity at a difficult period in Australia's history. In view of Mr. Lang's subsequent action, I will not say that his acceptance of his financial obligations was bona fide. Having entered the Premiers Conference and the Loan Council he should have remained in them, and carried out honorably his undertakings to the representatives of other governments. Probably along the lines adopted by my government somethingcould be done to place the relations of the Commonwealth and the State of New SouthWales on a more satisfactory basis. That State does not consist of one man, but the legislation of this Parliament is tending to elevate Mr. Lang into a hero in the estimation of many thousands of people.

The Commonwealth Government made a fundamental blunder in consulting with the Leader of the Opposition (Mr. Stevens). Conferences are held mainly between governments. If State leaders of oppositions are called into consultations they should not be consulted apart from the State governments. When, in an intergovernment dispute, the Ministry in one sphere confers with the Leader of the Opposition of the same political complexion in another sphere, the conference is tainted with a suspicion of party politics. Mr. Stevens went hurriedly to Melbourne and later to Canberra to confer with the Commonwealth Ministers. Both ho and the Prime Minister were ill-advised in creating the impression, whether it had foundation or not, that their action was prompted by partisan politics. The Commonwealth is in a serious position; it is not recovering the amounts due to it by the State, and, incidentally, is not collecting federal income taxation in the largest State of the federation. In consequence the federal budget will be seriously prejudiced. I do not say that the Government of New South Wales is justified in ignoring the decision of the High Court, and locking up the income tax papers; but the Commonwealth is suffering more than it is gaining by precipitate and provocative action that is likely to do great harm. I cannot justify default; nor have I any faith in the sincerity of the pleas of Mr. Lang's followers regarding child endowment and widows' pensions. Their resort to such pretences merely proves that the Lang plan has failed, and should be abandoned; but the Commonwealth Government has made no effort to induce Mr. Lang to change his view, or even to afford an opportunity to the best elements in the Government of New South Wales to assert themselves.

Mr Stewart - Are there any?

Mr SCULLIN - There must be some with whom discussions could take place. The trouble is that this problem is approached with political bias. There are some who would rush this country into a desperate position rather than try to bring about a sensible and reasonable solution of the problem.

Mr Stewart - What would the right honorable gentleman do if he had the opportunity?

Mr SCULLIN - I forecast what would happen if the Government persisted in this line of action. Now honorable members opposite ask me for advice to assist the Government to extricate itself from an impossible position. My advice is that it should retrace its steps.

Mr Maxwell - And hand back the £400,000 that it has attached?

Mr SCULLIN - The Government if making but little progress if it has obtained only that amount out of the three million odd pounds.

The Prime Minister stated that this bill is primarily intended to attach railway revenue. That is because the income tax resources of New South Wales are locked up, and other sources of revenue have disappeared. Differentiation is to be made between working expenses and interest. I have no doubt that it will be a simple enough task for the Treasury officials to work out the respective amounts on paper. It is quite another thing to devise some process by which the moneys can be attached, and to find a person from whom they may be collected. The position is so desperate and chaotic in New South Wales that, I understand, under instructions moneys are being paid to and retained by stationmasters, among others, instead of going to head office or into the banks. That is a deplorable condition of affairs.

Mr Hutchin - Yet the right honorable gentleman contends that the policy pursued by this Government is provocative.

Mr SCULLIN - Of course it is.It has provoked the Government ofNew South Wales to resist one step after another. I have warned this House time and again that it is not dealing with a subordinate body, but with a Government that possesses sovereign powers.

Mr Maxwell - All criminal law is provocative.

Mr SCULLIN - And sometimes defenders of criminals are provocative. It is all very well to say, " Go ahead ", and to set the juggernaut moving; but it is necessary to contemplate the result. From whom is the Government to obtain this revenue ? The honorable member f or Kennedy (Mr. Riordan) put a pertinent question to the Prime Minister when he asked what steps the Commonwealth Government proposed to take if the essential transport services of New South Wales ceased. The honorable member did not throw out any improper suggestions, nor can his words be interpreted to defend the non-payment by a State of its obligations. I am confident that no suggestion can be made in this House regarding future drastic actions by the Government of New South Wales that has not already been contemplated by that Administration. Apparently, no action can be too reckless for that Government.

Mr Stewart - The people of New South Wales will take the necessary action if the transport services are stopped.

Mr SCULLIN - What will that be?

Mr Stewart - To change the Government.

Mr SCULLIN - The people of New South Wales are entitled, by taking the proper action at an election, to change their government. That is a matter entirely in their hands, and I shall not comment upon it. What I want to know is if the Government of New South Wales continues the irresponsible attitude that it has adopted in recent months, and stops its railway services, what provision has the Commonwealth Government made to feed the people of the great city of Sydney? This Government is carrying on a war, and, whether its enemy is honorable or dishonorable, it must consider the people, the neutrals.

Mr Stewart - When carrying on a war one does not generally broadcast one's intentions.

Mr SCULLIN - Evidently the honorable member has something up his sleeve that is not known to the Prime Minister. The Prime Minister indicated that there is no justification for the Government of New South Wales to hold up its railways.

With that I quite agree. But does the honorable gentleman suggest that that Government can justify other actions that it has taken? Does he justify that Government withholding the payment of child endowment and superannuation? The lack of justification has not prevented the Lang Government from taking that action.

Mr Lane - Who could stop it?

Mr SCULLIN - I do not know; but this Government now proposes to take a step that is more serious than the attaching . of moneys in banks, one that may lead to the stopping of railway services.

Mr Stewart - It would not be the first time that the railways have stopped, to be re-started.

Mr SCULLIN - Perhaps the honorable member refers to a railway strike that occurred in the past, for which, he may suggest, there was no justification. When a strike takes place, however unjustifiable it may be, the Government concerned negotiate, and endeavour to settle it in a reasonable way; not by holding a pistol at theheads of the strikers. I have yet to learn that, prior to taking these drastic steps, the Commonwealth Government made any attempt to negotiate with the Premier of New South Wales and his colleagues with a view to bringing about some reasonable settlement. This proposal is the most serious that has yet been put forward. The objective of the Government is to force an election in New South Wales, with the hope that the people may solve the problem; but this is a poor method of bringing about an election. I reiterate, the Government is taking the most serious and dangerous step so far contemplated, and I accept no responsibility for what may follow.

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