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Tuesday, 22 November 1938

Mr BARNARD (Bass) . -In my opinion, the budget was not received throughout Australia with any great enthusiasm. It provides nothing of a progressive or constructive character for the great mass of the people. The high level of prosperity so often spoken of by the Treasurer (Mr. Casey), and other Government supporters, is not shared by the people. It is true that the Treasurer has been able to collect more revenue. That is due not to any greater prosperity among the people, but to a higher measure of prosperity among those on larger incomes, and to the imposition of excessive taxation, mainly indirect.

The Treasurer has occupied his present position for some years. Like many treasurers of his party who preceded him, he has followed rule-of-thumb methods of finance. He has disregarded the changing times, and paid no regard to such great social factors as the meehan- ization of industry, which has resulted in the displacement of man-power in all phases of manufacture.

Indirect taxation has reached record heights. Over a period of years, the Treasurer has reduced taxation on those enjoying high incomes, while the burden of indirect taxation has been maintained and increased. For instance, the reductions of sales tax over the last few years were of a kind that could not be passed on to the people. They benefited only from actual exemptions. The following table shows how the burden of indirect taxation has increased: -


Indirect taxation bears most heavily on the masses of the people, yet this is the kind of budgeting for which the Government stands. The actual amounts collected in indirect taxation for those years were as follows : -


Indirect taxation falls with equal severity on the employed and the unemployed. No one escapes, whether he be on sustenance, on relief work, or in regular employment in receipt of a regular income. The returns from customs and excise' duties on tobacco have steadily mounted. In 1934-35, these duties yielded £4,960,000, while in 1937-38 they yielded £5,153,000, an increase of practically £1,000,000. This year it is expected that the sales tax will yield an extra £1,000,000. The Treasurer has certainly created some records, but the extra revenue has been, for the most part, collected from the less fortunate sections of the community. It has been truly said that he has shifted the load from the top to the bottom.

What does the Government propose to do for the unemployed? I have searched the budget, and the Treasurer's comments thereon, but have found in them no reference to provision for the unemployed, except in so far as their lot may be alleviated by expenditure on defence. In general, the Government persists in its attitude that the care of the unemployed is a matter for the States; yet, in 1934, the Prime Minister, in his policy speech to the electors, is reported in the press to have made the following statement : -

The Government is concerned with the question of taking further steps to help in the solution of the tragic problem of unemployment. A continuance of the conditions to which I have referred will menace the morale and future usefulness of a great part of our population. Hitherto the responsibility for the relief of unemployment has- been allowed to rest with the States. After months of careful study of the problem, the Government hai decided that in the national interests the Commonwealth should take a larger share of this responsibility. The States have already exhausted their financial possibilities in an wholehearted effort to overcome it but the task is almost beyond their resources. The Commonwealth Government proposes to increase its efforts to deal with this problem. The Federal Government makes this announcement in the direct interests of those who are so unfortunate to be unemployed and also is the indirect interests of every section of the community. The Government proposes that practical and enlarged efforts to relieve unemployment, with particular reference to the needs of youth, will take precedence over other Commonwealth activities. This will be supplemented by a swift and detailed survey of all that has been done. Comprehensive cooperative planning between the Commonwealth and the State Governments will follow.

Despite the fact that the Prime Minister said in 1934 that the States have. become exhausted - I suppose that the right honorable gentleman meant financially exhausted as well as otherwise - the solution of the problem is still being left to them. Not only is that the case, but also, at the end of last month, the Commonwealth Government asked the State governments to forgo, in the interests of defence, their loan programmes by which many of the people mainly are kept in employment.

In introducing the budget, the Treasurer said that the national debt had increased by £S0,000,000 in the last six years mainly as the result of borrowing by the States. In common fairness he should have set out parallel to that the statement that the States borrow to provide employment for the people. It is paradoxical that, on the one hand, the Treasurer should accuse the States of increasing the public debt by borrowing, and, on the other, take credit for the increased amount of employment that has been given as the result of that borrowing. If the Commonwealth has the right to claim some credit for the improved employment position, it must accept some of the responsibility for the increased debt.

I recently asked the Treasurer what had been done to liquidate the accumulated deficit for the four years up to 1930-31 of £17,216,000, and was informed that £7,000,000 had been liquidated and that £10,000,000 was still debited against temporary advances from the loan funds. According to the figures, which have been supplied to me, no effort has been made to liquidate this outstanding debt. Since 1930-31 the CommonwealthGovernment has utilized its surpluses towards the reduction of the accumulated deficit as follows: -

The accumulated deficit on 30th June,1931, was £17.216,340.

The accumulated deficit was reduced as follows: -


The accumulated deficit at 30th June, 1938, is £13,658,588.

The following table sets out the surpluses that the Commonwealth Government has enjoyed since 1931-32: -


The excess receipts were dealt with as follows : -


During the years when this Government had surpluses only about £1,500,000 was paid off the accumulated deficit and the amount still outstanding remains as a debit against the Loan Account.

An extraordinarily large sum of money is due in taxes, despite the efforts of the Taxation Department to collect it. The following table sets out the position in the last five years: -


The point I wish to make is that if we are living in days of greater prosperity the people whose incomes are higher must be relatively better' off than they were, in spite of which fact about onethird of the income tax and one-fifth of the land tax remain to be collected. The Treasurer told me in answer to a question that -

Recovery of the overdue tax,either by institution of legal proceedings against the defaulter, or in appropriate cases by garnishee, is a constant and continuing activity of the Taxation Branch. Collection of these arrears of tax issubject to the regular scrutiny of the Auditor-General.

That sounds all right, but the facts speak for themselves. The amounts of taxes outstanding are far too great, and some greater attention to the matter seems necessary.

Four outstanding matters which merit greater consideration by this Government are decentralization, markets, population, and monetary reform. There is no need for me to do more than mention the fact that 47 per cent, of the Australian population is situated in the capital cities. Thirty-three per cent, of the population is situated in Sydney and Melbourne. To say the least, that is disquieting. I was one of those honorable members who took advantage of the opportunity to visit the Small Arms Factory at Lithgow at the week-end. At Lithgow, we saw the results of the centralization of the steel works. Some time ago Hoskins' steel works moved from Lithgow nearer to the sea, but it is a great pity that it was allowed to do so.

Mr Lane - The honorable member would like to see the works in Tasmania.

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