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Wednesday, 4 May 1932


Mr HOLMAN (Martin) .- During the course of this debate, we have heard three most striking speeches from honorable members opposite, all urging that there should be some other ultimate settlement of the dispute between the Commonwealth and the Government of New South Wales than that which is being sought by means of the Enforcement Act, an amendment of which is now under our consideration.

May I, without presumption, point out to those honorable members who have so ably advanced that view, that there is an independent tribunal available, and that the right honorable the Leader of the Opposition (Mr. Scullin), when Prime Minister, appealed to the High Court on this issue. He carried the litigation to a certain stage, and then - I do not know for what reasons - agreed to a settlement.


Mr Scullin - The reasons were given.


Mr HOLMAN - I am not suggesting that there was any secrecy about the matter. I take it that the right honorable gentleman found that the possibilities of delay in the procedure of the High Court are so great that he could not hope for a settlement within a reasonable period, and so he agreed to a compromise.


Mr Scullin - That was not the reason for accepting a settlement. I explained to this House that the settlement was effected to enable the representatives of the seven Governments of Australia to come together to formulate a rehabilitation plan.


Mr HOLMAN - Whatever the reason, the right honorable gentleman has never disagreed with honorable members on this side as to the ethics of the situation, or as to the righteousness of the claim of the Commonwealth. Apparently, however, he despaired of enforcing that claim by ordinary process in the High Court. The Attorney-General (Mr. Latham) has explained broadly what are the difficulties in the way of rapid procedure in a matter of this kind, and I conclude that they were the reasons why the then Prime Minister (Mr. Scullin) came to a settlement.


Mr Scullin - That is not so.


Mr HOLMAN - I am glad to be corrected on that point. The fact remains that the best opinion that this Government was able to obtain, and that those members of the legal profession who are advising it were able to give, was that the procedure of the High Court presents many difficulties. The possibilities of delay are great, and there is no certainty of arriving, within a reasonable time, at the sane conclusions so much desired by the honorable member for Melbourne Ports (Mr. Holloway). It was therefore decided by this Government, with the full support of honorable members on this side and of the Country party, to propose a more rapid method of procedure. Avowedly, when the Financial Agreements Enforcement Bill was introduced, it in no way altered the rights of either party; it merely substituted one method of enforcing those rights for another. If honorable members opposite wish now to convince the House that that measure has been a failure, it is for them to show that it is not leading speedily and satisfactorily to a vindication of the rights which the Commonwealth Government unquestionably possesses, and which the Leader of the Opposition admits.


Mr Scullin - Does the honorable member claim that the measure is operating speedily and satisfactorily?


Mr HOLMAN - I do. The right honorable gentleman followed the ordinary course of litigation and, after the lapse of several months, thought it desirable 'to effect a settlement.


Mr Scullin - That is not so. Proceedings were begun in April, and suspended to enable the Premiers to meet us in conference in June.


Mr HOLMAN - There was a period of litigation during which nothing was achieved, and the end was a settlement. But, although the Financial Agreements Enforcement Bill was introduced less than eight weeks ago there is already in the coffers of the Commonwealth Treasury, as a result of its operation, the sum of £440,000, which is more than the Leader of the Opposition and his colleagues succeeded in obtaining for the Commonwealth from New South Wales during the whole of its litigation through an independent tribunal.

Mr.Rosevear. - Does not that amount include Commonwealth taxation?


Mr HOLMAN - No. It represents New South Wales revenue which has been attached under the new procedure provided for by this legislation, which has been pronounced constitutional by the High Court.


Mr Scullin - Does the honorable member suggest that, by adopting this method, the Commonwealth Government has not lost a considerable sum in federal income tax?


Mr HOLMAN - It has lost nothing. The right honorable member knows that when a new field of legislation like this is entered, there are bound to be certain defects in the first measures which are carried ; but these experience will disclose and teach us how to remedy. The two amending bills which have been introduced are the fruits of such experience, and close certain gaps in the net which were, of course, not foreseen, and have been discovered only by trial and error. Nothing will be lost of the income tax clue to the Commonwealth, and nothing finally will be lost of the income tax actually due to the . State of New South Wales, which has not been collected, because of the dishonest attempt of the Government of that State to defraud the Commonwealth of that to which it is legally entitled. There has been delay, but that was unavoidable in viewof the fact that this is the first measure which has been passed by the Parliament under the authority of a section of the Constitution which was agreed to by the people only three years ago, and had not been subject to the interpretation of the High Court, so that its exact meaning was difficult for even the most eminent members of my profession to determine. Considering those difficulties and the experimental nature of this legislation,- it is amazing that in the first six weeks of the operalid u of the act the Commonwealth Government has succeeded in getting into its coffers almost half a million pounds that have been wrongfully withheld by the State of New South Wales. Nothing like that was achieved by the Government which the present Leader of the Opposition had the honour to lead. To the right honorable the Leader of the Opposition (Mr. Scullin) the Premier of New South Wales (Mr. Lang), in Micawber-like fashion, gave in effect an I 0 TJ, which drew the remark, " Thank God, that's settled ".


Mr Scullin - Did any other State Government do more than issue the equivalent of a promissory note to meet its obligations?


Mr HOLMAN - There is an amazing difference between a State which undertakes to meet its obligations and one which repudiates its commitments, and there is a very great difference between getting a valueless I 0 TJ and getting £440,000 of real money. I beg the Leader of the Opposition not to imagine for a moment that I am in any way directing my remarks to an attack upon him, because I fully appreciate his attitude; I am for the moment engaged in endeavouring to cheer him and to inspire him with confidence that, in our endeavours to solve this problem, we are really following a better track than any hitherto discovered.

With the object of imparting more animation to the thoughts of those who are disposed to pessimism, I shall refer to a difference between the Leader of the Opposition and myself on the floor of the House some little time ago. The right honorable gentleman said when the original enforcement bill was before the House that it would- be possible by legal chicanery and attacks in the High Court on the validity of the bill to delay to ah almost, indefinite degree the date when a conclusive judgment would be delivered by the High Court in relation to this new, and, as we thought, more expeditious procedure. I was bold enough as one who, although a new member of the House, had some acquaintance with the habits of the High Court, to say th»+ T. did not think that any attacks that could be made upon the validity of the measure would involve a delay of more than three weeks. I took the trouble the other day to read my reported observations on that subject. What I said was that it was possible that a week's argument and a fortnight's consideration of that argument by the justices of the High Court would be ample to permit the court to give a decision as to whether the legislation was or was not within the authority of section 105 a of the Constitution. The honorable member for Dalley (Mr. Rosevear), who, in view of the story he told us, will not be surprised when I describe his group as the party of undertakers, also doubted whether my prediction would be borne out by results. What is the situation now? The utmost efforts were made in the High Court to obtain a declaration that the Enforcement Act was invalid. One of the very ablest members of the New South Wales bar was retained by the State Government, and he had ample assistance and support. I am assured by legal gentlemen who were present at the hearing of the case that the most able and exhaustive arguments were submitted to the court with the object of proving that the act was invalid. The matter was considered for only a few days, and well within the limit of throe weeks the court had given a decision that the act was entirely within the authority which the people gave to this Parliament in the new grant of power under section 105 a.. I beg honorable members -on both sides of the House to realize that we are not spinning this legislation, out of our own bowels. It is not our own creation, it is the legislative interpretation of a grant of power given by referendum of the entire Commonwealth. I remind the honorable members of the No. 2 Opposition, that the people of New South Wales favoured by a very large majority the granting of these additional powers to the Commonwealth, which we have been exercising, and which have resulted in so much money being rapidly brought into the Commonwealth Treasury. The rate at which money will flow into the Commonwealth coffers in the next few weeks, it may be reasonably forecast, will be very much more rapid than it has been, for the reason that the new measures that are being passed cover a larger field, and provide for greater efficiency. Certain additional revenues are now being attacked, and attached for the first time, and certain flaws in the legislation to which I have alluded are being removed. It was inevitable that these loopholes would be discovered in a new measure affecting an unworked field ; but now that they have been closed, and additional revenue attached, we shall cover twice the area with twice the efficiency.


Mr James - The honorable member is assuming that the railway revenue will be maintained.


Mr HOLMAN - I am not counting on the railway revenue at all, but on revenue from certain other fields of taxation which the New SouthWales Government will find itself, under pressure of the law, compelled to hand over to this Government. Honorable members must realize that sooner or later the State Government will have to recoup the Commonwealth Government for money which has been spent on its behalf.

Surely not even honorable members opposite can imagine that honorable members like myself who represent New South Wales, wish to do anything that will impede the real progress or diminish the welfare of our State. We are not cold-blooded or cold-hearted. We are not callously indifferent to the well-being of the State that sent us here. It would be ridiculous to say that we are. I suggest to honorable members opposite that New South Wales showed its true feeling at the last election when it returned to this Parliament an overwhelmiing majority of its representatives to support this. Government.


Mr James - A good many things contributed to that result.


Mr HOLMAN -I invite the honorable member for Hunter (Mr. James) to compare his position at the last election with the position he held a couple of years ago. Two years ago the honorable gentleman was returned to this House without opposition. In the highly important and intelligent electorate which he represents there was not one person strong or bold enough to oppose him; but at the last election his return was not assured until the votes had been counted for a second, and then a third time.


Mr James - Not a third time.


Mr HOLMAN - Anyhow, the honorable member was returned with a majority of a mere 100 or so.


Mr James - The working-class vote was bigger in my electorate at the last election than ever before, but it was split among different representatives of the workers.


Mr HOLMAN - The fact cannot be gainsaid that the honorable gentleman did not enjoy the undivided confidence and affection of his constituents as he had done formerly. Two years ago none were for the party and all were for Rowley; but things were very different last year. Let us take as another example, the position of the honorable member for East Sydney (Mr. Ward), who has not graced this chamber with his presence recently, no doubt because he has some more important labours to do elsewhere - in the vineyard. The East Sydney electorate was represented in this chamber for very many years by my esteemed friend, the late Mr. West, who, when he last faced the electors, was returned with a majority of about 13,000 votes - I speak subject to correction. But the honorable member who now represents East Sydney was actually defeated at the general election last year by a member of the United Australia party who, unfortunately, died before he could enjoy the fruits of his victory. At the subsequent by-election the honorable gentleman only just managed to defeat a young and inexperienced candidate by a couple of hundred of votes. I know the honorable member for Dalley (Mr. Rosevear) gained a substantial win; but there were other contributing factors in that case. I mention these facts to direct the attention of honorable members who represent the Lang party to their own personal position. Although these honorable gentlemen are here at present - and I am sure we are glad to see them, and to listen to their not infrequent contributions to our debates - it would be profitable for them to realize that their position in their constituencies is not anything like so strong as the position which Labour candidates held in them some years ago.

This Ls not a dispute between oneState and the Commonwealth. It is not die case of another South Carolina, raising the flag of secession and having to be brought back by armed force. Our fight is not between the people of the State which I represent, and the people of the other States of the Commonwealth, lt is a fight between honesty and dishonesty throughout New South "Wales and Australia. Those are the only elements which arc arrayed in our antagonisms.


Mr James - What about humanity?


Mr HOLMAN - I have no doubt that Mr. Edward Kelly occasionally pleaded that he was engaging in his various activities in the interests of humanity; but, even so, it was necessary for the authorities to suppress him. We arc hearing a good deal too much about humanity on this occasion. The devil can cite scripture for his own purposes. The enemies of Australia may raise the flag of humanity to aid their buccaneering - I do not say that honorable members opposite who are opposing the Government on this occasion are engaged in buccaneering; but those are the tactics, which are being pursued to-day by the leader of their party in New South Wales, whom they idolize. We are not acting in hostility to the people of New South Wales. The trouble is that the people of that State are cursed with political leadership which is having an injurious effect, not only upon New South Wales, but upon the Commonwealth. The evil results of this leadership are apparent to a marked degree. I do not pretend to be acquainted with the present political feeling in New South Wales. I have not the gift of prophecy, and do not assume to prophesy ; I simply remind honorable members that the people of New South Wales agreed by a very large majority to grant to the Commonwealth Parliament the power conveyed by section 105a of the Constitution, under which this Parliament is acting, and they also returned with a very large majority the Government which is at present exercising that power.


Mr James - - -They would not do so tomorrow.


Mr HOLMAN - Here is an honorable gentleman who is willing to prophesy! He has a perfect right to his opinion, as I have to mine. But the people of New South Wales must be judged by the representatives that they have returned to this Parliament, and in this connexion they have shown beyond question that they are in entire harmony with all that' is being done by the Commonwealth Government to put an end to the policy of fraud and repudiation which is being pursued by the New South Wales Government, and which has brought Australia from one of the highest, positions among the countries of the civilized world down to the level of an insignificant South American republic. Not only did we hold one of the highest positions in the estimation of the people overseas, but our people enjoyed a standard of living which was the envy of the people of most other countries. Under the political leadership which had gained us those advantages, Australia was both happy and honest. Now these honorable members are calling upon us to decide between the two alternatives. Theyare being told that if they remain honest they must become bankrupt. It is being said that Australians can only play the part of ordinary decent people in the eyes of the world by condemning their children to starvation, and sending their women to the streets. Honorable gentlemen know that that is absolutely untrue. If the hindrance to better conditions, due to the existence of the Lang Government in New South Wales, were once got rid of, Australia would immediately set her face towards the goal of prosperity, and traverse the road \that would lead to that goal. The only thing holding Australia back at the present time is the impossibility of getting common sense or reason out of the present Premier of New South Wales.

We are asked to-day whether we are prepared to follow the Leader of the Government in the paths that he has marked out for us. One honorable member did me the honour of mentioning me by name, and asking if my silence was to be regarded as indicating a growing doubt as to the possibility and reasonableness of the Prime Minister's policy. I had no desire to break that silence-. I felt that I can help the Government much more, in this time of stress, by being ready to give a loyal and silent vote than by constant speaking on the floor of the House; but, in the circumstances to-day, I have spoken for a few minutes only. I beg to assure the honorable member for Dalley (Mr. Rosevear), that my sentiments are quite unaltered, and that my opinions are unchanged since I took part in the first debate in this chamber on this legislation. There is no remedy for the present evils until the stumbling block has been removed, and until the powers of the law have been asserted. I recognize that the present New South Wales Government includes some individuals who are estimable and worthy men ; but I also realize that that discreditable and dishonorable Government as a whole has deserved the epithets which L have applied to it. We must try to convince it that the law is not futile, that it cannot laugh at the resolutions of this Parliament, and that the small tricks which have helped it for a few weeks, such as carrying money from one hiding place and putting it in another, sending officers away on holidays, and locking up rooms where documents are deposited, will be of no avail in the end. Although those practices may put off the evil day for a few weeks, or even a month, they will not serve that Government indefinitely, because this Parliament, acting on behalf of the great majority of the electors of Australia, is determined ,to restore honesty, in government, and to sweep from its path all obstacles to the attainment of that purpose.







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