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Friday, 19 May 1939


Mr NOCK (Riverina) .- There is no difference of opinion among honorable members with regard to one point, namely, the obligation upon the Government to secure the safety of the Commonwealth and its people. The difference of opinion arises with regard to the methods that should be taken, and with regard to the degree of urgency that exists. There is the pacifist section, which believes that if we are peaceful we, in our isolated position, shall be quite safe, but I think the experience of Abyssinia, Czechoslovakia, Austria, Albania and China should be sufficient warning against hiding our heads in the sand, and pretending that the danger does not exist. We must face the harsh realities as they exist in the world to-day. The Government recognizes this, and it realizes that the matter is urgent. That is why this bill is before the House. Since 1914, when the Great War broke out, improved methods of transport have tended to annihilate distance, and we can no longer safely rely upon our isolation. Then we had months in which to prepare, to train our soldiers, and to provide them with equipment so that they might do their part on behalf of Australia and the Empire. To-day, there would be no time, and therefore this measure becomes urgent. Preparation must be made before the event. Never before has the scouts' motto, " Be prepared ! " had such real application as to-day. We have seen how the dictators have disregarded contracts when it suited them, and it is essential, therefore, that we should be in a position to protect ourselves. In September last, as the ex-Treasurer (Mr. Casey) has stated, world peace was balancing on the edge of a razor. There was real danger at that time, and to-day it is more than ever necessary that speed should be exercised to make up the leeway in our .preparations to ensure peace. We are now beginning to realize that preparation for war does not necessarily mean that war will come; it is, perhaps, the best way to ensure that it will not. Weakness is far more likely to invite aggression than is preparation for war. The dictators realize that when they have weak or unprepared nations to deal with, they can carry out their designs unchecked. Armed strength is a condition which helps to prevent war. The Australian Government recognizes that it must do its part towards protecting Australia, and that it must act now. It is wise ito make our preparations before trouble comes, not after.

Since September last, there have been important changes in the administration of the Defence Department. The work of the department has been divided, and to-day five Ministers and Assistant Ministers, together with their various staffs, are engaged upon the various works related to defence. I believe that the Government is wise in dividing the duties. I agree that the military section should be kept separate from the others. I also believe that there should be a special department for the supply of military requirements, but I agree with the honorable member for Calare (Mr. Thorby) that the Works Department should be associated with the Supply Department. This would simplify administration, and promote efficiency. We have been told that the Minister for Supply will be responsible for the supply of clothing, aircraft, munitions, armaments, and equipment. He should also have under his control the works necessary for the production of those things.

The bill also provides for the making of economic preparations to meet an emergency. It has been said that industry provides the sinews of war, and that unless industry be kept going, there would very soon be chaos. Every day's delay adds to the risk of dislocation. We cannot afford to wait. During the early part of the last war, one small German cruiser, of less than 4,000 tons, operating in the Indian Ocean, was able, in six weeks, to capture or bottle up 200,000 tons of shipping. In another war, no merchant ship conveying Australian produce to overseas markets or bringing goods to Australia, would dare to put out into the open sea without a convoy; yet, with our limited navy, it would hardly be possible to provide convoys. Shipping services would be interrupted, and there would be tremendous congestion of products awaiting export. The Government must make preparations in advance for handling the produce that would pile up. It is necessary to provide adequate storage space for highly perishable produce. Wool is nonperishable, and can be stored wherever there is space. It will keep in good condition for years. Wheat is partially perishable. This year, the silos were so full that it was found necessary in New South Wales to stack the surplus wheat in bags in sheds. If it were necessary to store the production of two seasons, there would be serious congestion. The producers would have no income, and would suffer severe hardships. We must arrange for the storage of produce in suitable districts. Wheat cannot be stored in Sydney for more than three months without being ruined by weevils. It would be riddled with weevil from top to bottom of the stack unless it were constantly turned. Preparation must be made for the storage of produce in places where the climate is suitable, and where the commodities will be safe from pests. Cold storage for butter, which is another perishable product, is also limited. It would be tragic for the dairying industry if the Minister failed to look ahead and provide sufficient storage for this product to meet an emergency. Other perishable products for which emergency storage accommodation should be provided are eggs, fruit, tallow, wine and sugar. Reserves of metals, which are non-perishable, would also be built up. The Government must realize also that production of all these commodities cannot be carried on without adequate finance; if that is not provided economic chaos will result. The Government has acted wisely in appointing a separate Minister to take charge of this special department in order to ensure sufficient provision to meet any emergency. We must remember that 25 per cent, of the aggregate production of Australia is exported annually to meet our overseas commitments and to pay for our essential imports. How should we fare, if in a crisis we found ourselves short of rubber, tea, fuel, oil, jute - you cannot handle an Australian crop without jute for wheat bags, wool packs, chaff bags and cornsacks - tinned plate for the fruit industry, paper, sulphur and phos phate rock? We should build up reserve stocks of these commodities to meet emergency needs over the period of risk. Phosphate rock is non-perishable; it would not matter if we imported 1,000,000 or 2,000,000 tons of that commodity and stored it, so that we should always have sufficient of it for the manufacture of fertilizers. Another commodity of which we should provide sufficient reserve stocks to meet an emergency is timber of the kinds which we are obliged to import. The Minister should continually keep these matters before his mind.

Honorable members on both sides of the House have referred to our dependence on oil. It has been alleged that the major oil companies have exercised a sinister influence upon our exploratory work in this field. It would be wise and fair for the State governments which have granted leases of various areas for oil exploration and testing to cancel such leases in cases in which they are not satisfied that reasonable efforts are being made to develop these areas. The Royal Commission on Petrol was told that whilst the duty on petrol was 71/4d. a gallon, kerosene was not subject to duty, yet the price at which kerosene was sold to primary producers was only 41/2d. a gallon less than petrol. In . this way the oil interests are exploiting the farmers. Other evidence is available to show that the combine of oil companies is still preventing primary producers from getting at a reasonable price those commodities which are essential to production. I have here a letter, dated the 2nd May, 1939, written by the secretary of a tractor owners' association to country farmer members. It reads -

With reference to our supplying kerosene to the . tractor owners, we have to advise that through the combined action of the major oil companies, together with the Vacuum Oil. Company in particular, our truck of power kerosene for your tractor owners has been stopped, notwithstanding the fact that the truck was half loaded, and under a threat our supplier was forced to withdraw thirty drums of kerosene from the truck.

Action of this kind is definitely restraint of trade. The Government should prevent this combine from denying to the primary producers, at a reasonable price, commodities which are essential to the carrying on of their industries. It could take such action through Commonwealth Oil Refineries Limited, in which it holds a majority of the shares. Another illustration of the activities of this combine is provided in a letter written by an officer of the Farmers and Settlers Association of New South Wales to one of its members. This organization arranged with an independent oil company to supply power kerosene to its members, the organization acting in an agency capacity on behalf of its members, making payment to the oil company with each order. The oil company thus ran no risk whatever of losing one penny by bad debts. Under this arrangement users of power kerosene in the country districts were able to buy this product almost at the wholesale price. Within the last two or three weeks that organization reported to its members that, owing .to pressure 'being brought to bear upon it, this particular company could not continue to supply power kerosene under the old arrangement. I have here a bank cheque for £25 14s. 6d., representing the agency rebate allowance 2>aid on one truck of power kerosene ordered under this arrangement. This rebate represents a saving to the farmer of approximately Id. a bushel on the cost of producing wheat. The Government says that it is anxious to help the wheat industry, and it should be prepared to take action along the lines that I now suggest. Through Commonwealth Oil Refineries Limited it could step into the breach, and supply fuel to primary producers, acting as a city agent through an organization of the kind I have mentioned, thus enabling them to obtain this essential requirement at a reasonable price. If the Government did this it would merely be carrying out the proposals embodied in the second part of this measure, which deals with the maintenance of economic industries.

Clause 5, sub-clause le, provides that the matters to be administered by the department shall include, " arrangements for ascertaining costs and for the control and limitation of profits in relation to the production of munitions ". Compare that provision with paragraph d of the same sub-clause, which provides that the department shall also administer matters relating to "the

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acquisition, maintenance and disposal of stocks of goods in connexion with defence ". There is no safeguarding provision with regard to the prices of these goods. Let us assume that we run short of woolpacks, which we are now obliged to buy from some importer holding large stocks. Under paragraph d the Government will have power by regulation to commandeer existing supplies of that commodity, but it will have no power to fix its prices. On the other hand, it will have power under paragraph e .to fix the prices of munitions. If tie Government has power to do so under the Constitution I urge it not to limit the power, but to control the price of commodities essential to economic production so as to prevent profiteering. Reverting to the question of oil, sufficient quantities of that commodity should be stored to meet an emergency. We are aware of the assistance given by past governments in the development of Newnes, but progress in that venture is slow, and that source of supply would not prove very valuable should an emergency arise in the near future. Furthermore, reserves of oil should be situated in safe areas, and not, as is now the case, stored in big silver-painted tanks on the waterfronts, where they are conspicuous targets for hostile aircraft. The number of draught horses in the country has decreased largely during recent years. Should the supplies of oil and petrol become so short that sufficient quantities could not be made available for tractor owners and for engines in factories and power plants, much industry would be held up. I have listened with interest to the remarks of honorable members who have referred to the use of charcoal gas as a means of power. During the last two or three years, there has been considerable development in this direction; the experimenters are getting nearer to perfection, and costs of installation are being reduced. The biggest cost is that associated with the additional plant and alteration to engines for the use of charcoal gas. In Western Australia, I believe that a satisfactory suction gas plant has been evolved for use with trucks and tractors, and even motor cars. Anything that the Government can do to encourage the use of charcoal gas will assist towards the safety of industry and the defence of Australia. There is no limit to our supplies of charcoal, and if it "were used generally, the available supplies of petrol and oil in the country at the time of the crisis -would last longer.

The bill does not contain many precise provisions; most of the powers sought by the Government are to be given by regulations. There has been much objection to it on these grounds, but we should remember that every regulation comes before Parliament for approval, and any regulation which honorable members do not approve can be disallowed. The bill, I feel sure, will strengthen our protection against possible aggression and make for greater safety in the future.







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