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Wednesday, 30 November 1938

Mr BLACKBURN (Bourke) .- The first quarrel I have with this measure is the method adopted in presenting it to this Parliament. In a scheme such as this the Commonwealth Parliament should play the principal part, but that will not be so if this legislature is to be treated in the present manner. The position is that a scheme was adopted by the Commonwealth Government in cooperation with the representatives of the States. The resolutions which were adopted at a conference of Commonwealth and State representatives should have been placed before this Parliament for discussion, and after the scheme had been approved, the necessary legislation could have been introduced into the State and Commonwealth Parliaments. That course, however,, was not followed. Measures have already been passed by the State parliaments and now, in the dying hours of this session, a bill has been introduced. Members are being forced, by the pressure of time, to dispose of the measure rapidly, and have no opportunity to discuss the proposals fully.

In spite of the statement to the contrary by the honorable member for Gippsland (Mr. Paterson), it is within the power of this Parliament to control the price at which flour or bread is to be sold, because this legislation depends upon the willingness of the Commonwealth to give money to the States. The effect of this legislation will be that money will be granted by the Commonwealth to the States, either out of Consolidated Revenue, as suggested by the Leader of the Opposition (Mr. Curtin), or out of funds raised by a tax imposed for that special purpose. It is perfectly clear that the Commonwealth, in granting that money to the States, can attach whatever conditions it thinks fit. It can inform the States that the money will not be granted unless prices are fixed to the satisfaction of the Commonwealth. The honorable member for Warringah (Mr.

Spender) drew attention to this fact in a recent speech dealing with constitutional reform. He said that the Commonwealth Parliament had indirect powers under which it could do things for which no direct authority existed. He referred to the use of the fiscal power, of the Commonwealth; that is, the power to raise and expend money in whatever manner it pleases. Section 96 of the Constitution gives power to grant money to the States, and to impose any conditions which it thinks fit in connexion with the expenditure of the money. This legislation is apparently an exercise of that power. The Commonwealth Parliament has power to annex to the grant proposed under this bill, any conditions which it desires should be imposed. The Administration of which the present Minister for Commerce (Sir Earle Page) was joint leader was responsible for the Federal 'Aid Roads Act, upon which the High Court decision to this effect was given. The State of Victoria contested the right of the Commonwealth Parliament to grant money and attach conditions to the federal aid roads grant. The High Court held that the Commonwealth Parliament had power, under Section 96 of the Constitution, to pass the legislation and to impose conditions in relation to the expenditure by the States of the money raised by the Commonwealth and passed over to the States. It is, therefore, quite competent for this Parliament to say that it is prepared to grant money to the States for the purpose of rehabilitating the wheat industry and paying a home-consumption price for wheat, and to lay down, conditions under which the money is to be expended. Before this legislation was introduced, legislation had ' been passed through the State parliaments but no price for bread has been fixed. It is of no use to the ordinary consumer of bread merely to have the price of flour specified. The price of bread itself must be fixed. As a matter of fact, in Victoria, members of the State Parliament contend that the price of flour has been fixed at an extortionately high figure. I say that this House would be entitled to reject the measure upon the fact alone that this Parliament, which has complete power over this matter, has been relegated to a subordinate role in connexion with it. The States have done the work of determining what shall be the policy, and the Commonwealth comes in and says, " We shall vote the money ". The honorable member for Gippsland says that the States alone are responsible for the fixing of prices. I say that the Commonwealth Parliament is responsible for prices, because, before voting the money, it-Ban lay down the conditions upon which the States are to receive it. h could say to the States, "You must pass legislation with which the Commonwealth is satisfied before the money is handed over ", just as it said, in connexion with the federal aid roads grants: "You shall build the roads as the Commonwealth thinks fit, and you shall have the money under our conditions only." That is perfectly clear.

The Government knew that under section 96 of the Constitution, it had power actually to occupy the whole of this field, and to say that it would grant the money to the States only on certain' conditions which it could there and then set out. lt could say to the States, "If the States will make provision for the fixing of the prices of wheat, flour and, especially, bread, the Commonwealth will grant the money; if not, it shall not ask this Parliament to take up that position. But it has not done so because it does not want the responsibility of controlling prices. I repeat that if the Government has power to grant or withhold the money it has power to state the conditions on which that money shall be paid. The Constitution expressly provides for that.

Now I come to the policy of the legislation. I am perfectly prepared to see the policy of a home-consumption price in this emergency in the wheat industry tried as a temporary expedient, but before this country commits itself finally to that policy it should act upon the recommendation made by the Wheat Commission that the policy of a homeconsumption price in all its bearings should be considered by an expert committee. The Wheat Commission said that if every other industry is to get a homeconsumption price the wheat industry should get it - if butter gets it, and if fruit gets it, wheat should get it. What is a home-consumption price? One of the arguments- used in support of the home-'consumption price is that it is proposed to put the primary producers in the same position as the protected manufacturers and the workers of Australia. I say that it is proposed to do more than that, and its object is to put the primary producer in a much better position than the protected manufacturer or worker. Its object is to enable the primary producer to sell the whole of his product, and to fix an artificially high price for Australia so that what he cannot sell in Australia he can sell overseas at practically any price at all; in other words, he would be able to make up his loss overseas by his profits here. The protected manufacturer and the worker are not in that position. What would be the position if we had a home-consumption price for boots?

Mr Gregory - The boot manufacturer already has it.

Mr BLACKBURN - That is not so; his price is fixed by intense competition inside Australia. If we gave him a home-consumption price for hoots he would start out by fixing the price for boots so high that he would be able to get rid of his surplus by dumping it at a much lower price on the overseas market. Let us confine our consideration to primary industries. If a home-consumption price were provided for coal we should find that the colliery owner would get such a price for his coal that he could recapture his lost market in Chile or in South Africa.

Mr Paterson - I do not agree with the honorable member.

Mr BLACKBURN - I am concerned not with what the honorable member for Gippsland says now, but rather with what he has said in the past. I have heard the home-consumption price advocated in the past on many occasions as a means of enabling the producer to sell the whole of his product.

Mr Paterson - But never by me as a means of meeting the loss on export.

Mr BLACKBURN - It is, of course, not put that way. When we have an industry whose activities .are largely export activities, as in the case with the wheat industry, and we are asked to fix an artificial price for Australia, we know that that is going to enable the general exporter to sell his wheat at an artificially low price in competition with other people in the markets of the world.

Sir Earle Page - It does not give him a payable price over all.

Mr BLACKBURN - The bootmaker does not get a payable price for all of his goods; he gets for part of his possible product the Australian price which is fixed by keen internal competition, and not a regulated price. Let us take the worker. What is his position? The worker has to live by selling his commodity, the commodity which is in him, his labour-power. Does anything guarantee the worker the right to sell his labour-power? No worker is guaranteed the right to sell his labourpower. Only the employed person, the person who is for the time being in employment, can sell his labour-power. Only by getting a home market for every commodity can you ensure to the worker the right to sell his commodity.

Mr Anthony - Does that mean doing away with the arbitration awards?

Mr BLACKBURN - The honorable member is misunderstanding me. No arbitration award will give John Brown or William Smith the right to sell his commodity; if he gets a job, he gets the wage appropriate to it. The Arbitration Court does not give him the right to dispose of his commodity by -which he must live. We are told that it is degrading that men should have to come to this Parliament and ask for a bounty. How much more degrading must it be for a man willing to sell his commodity, his labour-power, to be told that he cannot sell that at all but that he must take a dole? The honorable member for Riverina (Mr. Nock) said that there was a time when the wheat-grower was in the fortunate position of enjoying cheap labour and cheap goods and of having to make no contributions for social services.

Mr Nock - And cheap machinery.

Mr BLACKBURN - -That is so. If this country remained in that happy position, there would not be anybody here for the wheat producer to sell to. He would have no market but the overseas market for his product. What gives the wheat producer his market here? The policy which this country has adopted of diversifying industry by means of a protective tariff, of giving the wage-earner better wages by wage-fixing legislation, of encouraging trade unions and of giving people who have no spending money assistance from the votes for social services. We have created industries which employ persons who, but for our tariff, would be working in other countries. They are working here and they are making the demand for the goods produced by the primary producer. Then we are told about cheap markets. I hold in my hand a book called The Case for Union, which was prepared by a committee consisting of Sir Robert Garran, ex-Senator Keating, Mr. Somerville and Mr. John Gilbert. It was prepared in reply to the case for secession for Western Australia. It examines the evidence that the Western Australian farmer is suffering by the protectionist policy of Australia. I advise the honorable member for Riverina to read it; I am sure that the honorable members for Swan (Mr. Gregory) and Forrest (Mr. Prowse) know it already.

Mr Gregory - Has the honorable member read the other side as well?

Mr BLACKBURN - I have read both sides. I have also seen the figures cited in the book. The whole examination of the case may be summarized in one sentence printed in large black type on page 60, which reads -

Whatever may be the dispersed costs of the tariff which the primary industries bear, it cannot be said that the direct costs of the tariff on the wheat-grower's plant are appreciable.

The committee shows that agricultural machinery and farm employment are cheaper in Australia than in New Zealand, where there is no duty, and in South Africa.

Mr Nock - They cost 100 per cent more than before the tariff was introduced.

Mr Gregory - They cost 35 per cent, more in Australia than in Canada.

Mr BLACKBURN - It is possible that the Australian price and the price of imported machinery may both be too high, but the choice is between the Australian price, which may or may not be fixed, and the fixed importer's price. In these countries like New Zealand and Argentina machinery is bought at prices fixed by the importer.

At page 59 of the book the committee says -

More illuminating, however, is the comparison of prices charged in Australia, and the prices paid in other countries for machinery of the same or similar description. In New Zealand, where duties are not charged on the articles listed, the price for a 6-ft. reaper and binder with transport and sheaf carrier is £3ti 15s., compared with £08 os. in Australia. Horse-mowers and horse-rakes arc also cheaper in Australia. In South Africa fifteen comparable implements are priced at figures in every instance much higher than in Australia. In Argentina, the most direct competitor of Australia in wheat production, prices in all instances are higher. In Canada comparable prices for some implements are a little higher, and for others a little lower, but on the whole, the difference is triflng

The committee goes into the question of wire netting also, and shows that there is no special burden borne by the primary producers; there is, at any rate, no burden that handicaps him in competition with other countries because the wheat commission has reported that the wheat exporter is handicapped by the home-consumption price for butter; that the export industries pay the butter home-consumption price and are hampered in competition with other countries by that price.

I want to say something now about section 92, which has been mentioned during this debate. I opposed any alteration of section 92 of" the Constitution, and I would oppose it again irrespective of what anybody thinks about it. I regard section 92 as a guarantee of Australianism, as something that says that every Australian can move himself and his goods all over Australia without being held up by State boundaries. I would object to these State boundaries being raised by State or Commonwealth legislation. We have heard quite a lot of talk in this Parliament about national sentiment. There is very little national sentiment in this place. We come together as a conference of people representing the different States and the different interests identified with those States. A number of honorable members in this House would be quite willing to cut Australia into any number of States if it suited the interests they repre sent. Section 92 and its corresponding sections are sections which, while preserving -the States, as governmental agencies, say that the members of the Australian nation may move freely about Australia, may take their goods freely about Australia, and shall not be discriminated against in any one State. For instance, Western Australia may not pass a law against a man simply because he is a Victorian. I opposed the marketing proposals of the Government, because I felt that more effective arrangements could be made than those suggested, as, for example, something in the nature of what is being done now. I feel that I was perfectly right in pointing out, during the campaign on the marketing referendum, that the policy df the Government was designed to set up self-governing bodies of primary producers which would have the exclusive power to determine the prices for which their products should be sold. The present Minister for Works (Mr. Thorby) admitted that the policy enunciated by the honorable member for Wide Bay (Mr. Bernard Corser) when he moved a motion in favour of such bodies, embodied the policy of the Government.

But apart altogether from the Government's marketing policy, I opposed - any alteration of section 92 of the Constitution, because I felt that it would break up the unity of Australia. The Privy Council said, in effect, that the words " absolutely free", which are used in the Constitution, meant " absolutely free ", or nothing else. It was detached from Australian " political discussion " and from the policies of rival economic interests and political parties in Australia, but it held that section 92 forbade any Australian parliament, Commonwealth or State, to interfere with the liberty of our people to move about Australia as freely as they desired, or to move their goods about the country without any hindrance. I wish that that provision had relation to transport. Australia is a unity, but for certain purposes of administration, State governments have been permitted to continue. The paramount consideration of our people, however, is not that they live in New South Wales or Victoria, or in any other State, but that they live in Australia. They are Australian citizens, and they are entitled to move themselves and their goods about Australia as freely as they like, without being subject to any discriminatory action in respect of State boundaries. Section 92 of the Constitution is a guarantee which we cannot afford to forgo.

I am prepared to give the proposal for a home-consumption price for wheat a trial as a temporary expedient, but I am not prepared to permit it to be the integrated policy of this country. It is true that the Wheat Commission recommended that a home-consumption price should be fixed for wheat, but, subsequently, it reviewed the matter and said in effect: - " We are now doubtful about the wisdom of our recommendation that a homeconsumption price should be fixed for wheat. We consider that the whole matter should be re-examined by an expert committee before it is finally adopted. But we think that as a home-consumption price is fixed for other products it should also be fixed for wheat." I have always said that I do not think that tariff protection should be granted unless prices, as well as wages, are regulated. One of the first statements made by the present Leader of the Opposition (Mr. Curtin) after he was appointed to that position was that it should be understood that the policy of the Labour party in respect of protection was that not only wages and conditions, but also prices, should be fixed. One of the reasons for the partial failure of our efforts to stabilize some of our industries is that an effective means has not been applied to the fixation of prices. We are, at least to some degree, in the position of the people who live on a certain island in the Pacific Ocean, in that every body lives upon every body else by the simple means of taking in one another's washing.

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