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Wednesday, 4 May 1932

Mr BAKER (Oxley) .- In introducing this bill, the Government is continuing its spectacular duel with the Government of New South Wales. The measure will serve to intensify the severity of the conflict between them, irrespective of and careless of the interests of those who may bo injured in the struggle. Three months ago the members of the Labour party stressed the fact that there was already legislation on the statute-book by which the New South Wales Government could be made to meet its obligations. We urged that that Government should be dealt with on the lines laid down by the last Commonwealth Government; but the present Government would not accept advice from the Opposition. During the last election, members of the party opposite boasted that Mr. Lang would bo out of power within a fortnight. The present legislation has been accompanied by the lack of success which was prophesied by the Opposition. The sum owing by New South Wales to the Commonwealth when this legislation was first brought down was in the vicinity of £1,000,000, and the debt now amounts to over £2,750,000.

Mr Stewart - The honorable member is prepared to allow the debt to grow.

Mr BAKER - I have suggested that the Commonwealth Government should pursue, the policy adopted by the last government, whose methods were successful. The sum now owing is over £2,750,000. It is almost five months since the election, and more than two months since the first so-called Financial Agreements Enforcement Act was passed ; yet we find ourselves slipping further and further into arrears in our accounts with New South Wales. The Prime Minister said to-day that, but for party considerations, the case for the Commonwealth Government was unanswerable. I believe that the Government is pursuing its present policy largely for party reasons, hoping to gain some political advantage. Strength is lent to this, suggestion by the action of the Government in inviting the Leader of the New South Wales Opposition to Canberra in order to consult with it. The policy of the Government, however, is defeating its own purpose, because everything it i3 doing is merely enhancing the prestige of the Premier of New South Wales. As we on this side of the House pointed out some time ago, the Commonwealth Government has now placed Mr. Lang in a position in which he can pose before the people of New South Wales as an object of persecution. As a result, he is exciting much sympathy, and is able to hold monster meetings of his supporters in Sydney. The Federal Labour party does not support Mr. Lang or his policy, but we do not favour making a martyr of him, which is all the Commonwealth Govern-, ment has succeeded in doing up to date. That, and the further unpaid bill of £1,750,000 due by New South Wales, is the net result of this clumsy policy.

The Government's latest proposal is to attach the railway revenue of New South Wales. The Prime Minister said that the Government's intention was not to take the revenue required for discharging working expenses, but only that portion which represents a surplus over working expenses, and which should be devoted towards the payment of interest charges. As a matter of fact the railways are not 'now making enough to pay working expenses and interest on capital invested, so that any revenue the Commonwealth might derive from this source would not even be sufficient to pay the interest due by New South Wales on its railway debt.

Mr Stewart - Is that any reason why we should allow whatever surplus there is to remain in Mr. Lang's hands?

Mr BAKER - When it was pointed out that Mr. Lang might stop the trains from running, the Prime Minister said that, in that case, the responsibility would rest upon the Government of New South Wales. Perhaps so, but that will not help thu- Commonwealth very much. It does not matter whose is the responsibility, if the railways cease running, and members of the Commonwealth Parliament are unable to reach Canberra, it will be necessary either to alter the place of meeting, if the Constitution permits, or go to very considerable expense in providing other means of transport for members and public servants -who travel backwards and forwards between Canberra and the other cities. Moreover, some means of transport must be- found for bringing to Canberra foodstuffs and other necessary commodities. The Government displays a childlike faith in Mr. Lang if it believes that he must necessarily keep the railways in operation, if it leaves him just sufficient revenue to pay working expenses.

Though this bill now before us, the third of its kind, consists of nine clauses, the Government's main reason in introducing it, I believe, is to have enacted the provisions contained in clause 9. This clause amends section 21 of the principal act, sub-section 3 of which is as follows: -

The punishment for an offence against this act shall be as follows: -

(a)   If the offence is prosecuted summarily - a fine not exceeding One hundred pounds or imprisonment for a term not exceeding six months, or both; or

(6)   If the offence is prosecuted upon indictment - a fine not exceeding Five hundred pounds or imprisonment for a term not exceeding two years, or both.

Clause 9 of the bill provides that if a Minister of a State, or a member of a proclaimed public authority, offends in certain particulars against the act, the punishment, if the offence is prosecuted summarily, will bo a fine not exceeding £500, or imprisonment for a term not exceeding one year, or both ; or, in the case of a corporation, a fine not exceeding £1,000. If the offence is prosecuted upon indictment, the punishment is to be, in the case of a Minister of a State, or a member of a proclaimed public authority, a fine not exceeding £1,000, or imprisonment for a term not exceeding three years, or both; or, in the case of a corporation, a fine not. exceeding £2,000. This amendment is simply a gesture by the Government, intended to frighten members of the Government of New South Wales. Under the amendment, persons may become liable to these drastic punishments, not necessarily for any offensive measure against the law, but merely for disobeying in any particular, however slight, instructions issued under the act. Of course, except in unusual circumstances, no court would impose the maximum penalty, so that the amendment is not really of much value, and is merely another instance of the Government's bluffing.

An honorable member asked by way of interjection what course I would suggest should be followed. I have already said that this Government, should follow the policy of the last Government. It is not yet too late to draw back; it is often a bigger thing to retrace our steps when we have gone off the right, track, than not to have strayed at all. If the Government is big enough to realize into what a morass it is leading the Commonwealth there is yet, time to retrace its steps. Thomas Paine has said that " Time makes more, converts than reason." Time will bring to the same way of thinking as ourselves many honorable members opposite whom we have failed to convince by our arguments.

Mr.ROSEVEAR (Dalley) f**1]Needless to say I am opposed to this bill, as I have been to all previous instalments of this legislation. The Prime Minister (Mr. Lyons), when introducing the measure, said that it was designed to strengthen the hands of the Government. If I remember rightly, a similar measure was introduced lust week, for the purpose of strengthening the hands of the Government. I suggest that, before very long, the Go vernment may need something to strengthen its tottering knees, because it is obviously meeting with very little success in its endeavours to enforce this legislation. The Leader of the Opposition (Mr. Scullin) also opposed the bill, but he did so, i think, merely because he was Leader of the Opposition. He had no other reason that 1 could discover from the remarks he has made. The fact, is that, had he been . Leader of the Government, he would probably have been forced into much the same position as the Government is in now, or he would have had to take his stand behind the Premier of New South Wale3 in support of what, is the only policy that will get Australia out of its difficulties.

I, and those honorable members associated with me, make no apologies for our opposition to the bill. We support the policy of the Government of New South Wales, and it is interesting to observe that, while the official Opposition in this Parliament verbally opposes this enforcement legislation, it is generally found supporting the Government when it comes to a real show-down on economic issues. As a matter of fact, there is very little difference between the financial policy of the Scullin party and that of the Government. Much was made by the Prime Minister and the honorable member for Gippsland (Mr. Paterson) of the failure of the Government of New South Wales to pay interest ou its internal debts. I remind honorable members, however, that there was no default in respect of such payments until the Commonwealth sought to put into effect, its enforcement legislation. It was because the Commonwealth Government realized just what was the financial position of the Government of New South Wales that this legislation was introduced in the first place. The Loan Council had refused loan moneys to the Government of New South Wales. The Federal Government had ceased its monthly payments to that State, and the Lang Government was entirely dependent upon its local taxation resources. This Government has caused the State Government considerable embarrassment in the collection of taxes, so there is nothing remarkable in the fact that it has been forced to default to local bondholders. Under previous legislation the Commonwealth Government sought to seize the income taxation of New South Wales, and, as a counter-move, the State Government closed its taxation offices. As a result of that action the State Government, as well as the Commonwealth Government, has lost taxation revenue. 1 venture to say that the Commonwealth has lost more of its own taxation revenue than it has seized in that State. Regulations were issued to enable the Commonwealth to seize taxation papers, and the other day we had the Gilbertian situation of federal officers, with all the pomp and ceremony surrounding such occasions, demanding from the State Income Tax Commissioner all documents in his possession. Out of approximately 5,000,000 documents the Commonwealth officers received 110. It is worth mentioning that the taxation papers handed over related mainly to wealthy tax-dodgers who usually support the United Australia party, and if the Commonwealth Government wishes to use those documents and recover the outstanding taxes it will have to sue some of its own supporters. The Prime Minister has said that he is not responsible for the non-payment of mother endowment and pensions in New South Wales, but surely he knows that those payments are made through the banks.

Mr Stewart - They can still be made through the banks.

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