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Friday, 25 September 1942

Mr COLES (Henty) .- I voice my approval of this bill to prevent black marketing. In times of stress, such as those through which we are going, when the ordinary methods of supply and demand cannot be allowed to operate because of governmental restrictions, transport difficulties and other reasons, I think that the most demoralizing factor is the activities of those people who are so devoid of national honour that they will attempt to sabotage the efforts of the Government in trying to equalize supplies in the community. One of the most effective controls that we have impost i since the outbreak of war is. price fixing under the control of the Prices Commissioner. The Prices Commissioner has; attempted to do a fair job of work by allowing the commercial community to operate free from fear that his powers would be used unfairly, hut he has been limited in his control by virtue of the fact that he is subject to the limitations of the National Security Act, and the fines or penalties that may be imposed under that act are either ridiculously small, or so large, with regard to detention, that magistrates are unwilling to apply them with sufficient severity. In attempting to impose a penalty that fits the crime the Prices Commissioner has had to have recourse to forcing offenders to return to purchasers all profit made beyond that which is allowed under the regulations. This acts very unfairly. Instead of penalizing the offender, it sometimes acts considerably in his favour. A trader who has made large excess profits and is forced to return the money to subsequent purchasers, obtains, in effect, a free advertisement.

Dr Evatt - And a contribution towards goodwill.

Mr COLES - Quite so. He adds to his goodwill by offering goods at lower prices. That is a penalty on his competitors who have observed the law, and it is bad enough, but a secondary effect of it in war-time that should not be overlooked, is that, instead of his actions helping the supply situation they have a contrary effect, for goods are offered to the consuming public at ridiculous prices. The public, naturally, is always ready to buy at bargain prices. This is serious in respect of goods in short supply. The Attorney-General has provided sufficient safeguards in this bill to enable the Prices Commissioner to deal with offenders. Looked at narrowly, the penalties appear to be somewhat dangerous, for, in certain respects, the provisions of the criminal code have been reversed, inasmuch as an offence is deemed to have been committed, and an innocent person, perhaps the director of a large company who has no knowledge of what is happening, may be sent to gaol because of the improper act of a servant. I agree with the Leader of the Opposition that this point requires examination.

Dr Evatt - That provision of this bill has become almost common in legislation of this nature. An accused person has to prove that he did not know of the act complained of, and that he took reasonable care to prevent such acts.

Mr COLES - I am not complaining about the inclusion of the provision, but I endorse the suggestion of the Leader of the Opposition that a committee composed of representatives of departments which will be involved in the administration of the provision, should be appointed to confer on cases.

Dr Evatt - Before the conclusion of this debate, I expect to be able to make an announcement which will satisfactorily meet the point raised by the Leader of the Opposition.

Mr COLES - I am pleased to hear the right honorable gentleman's statement. There should be some means of studying, before proceedings are actually instituted, whether an offence has been intentionally or innocently committed.

I agree with the Leader of the Opposition, too, that all possible steps should be taken to remove the administration of this law from the sphere of party politics, so that there can be no suggestion whatever of victimization in any prosecutions. The remarks of the Leader of the Opposition concerning the retrospectivity of certain provisions of the bill also deserve careful consideration. It is unfair to put into operation provisions of this kind of which the trading community had no warning whatever, particularly as such heavy penalties have been provided. It is human nature to bargain. The right to swap a horse on the best terms obtainable may be said to be a basic principle of trade in the British Empire, and, under existing conditions, we are taking away that right. It takes time to educate traders on such alterations of practice. Such changes come slowly to the knowledge of the general community.

Whilst there may have been some glaring offences against the prices regulations, the majority of the prosecutions have been for minor breaches.

Mr Blackburn - Only the small traders are prosecuted.

Mr COLES - It might impair the morale of the trading community if a law were passed rendering liable to prosecution a trader who, three or four months ago, sold, say, 1 lb. of potatoes at ½d. above the ruling price. The AttorneyGeneral should examine this point in the interests of the whole trading community, 95 per cent. of whom, I am sure, desire to observe the regulations and to do everything possible to destroy black marketing. It would be unfortunate if anything were done at this stage to destroy the spirit of goodwill that has been displayed by the trading community at large towards the Prices Commissioner, for he has a difficult job to do.

I am pleased that offences against rationing have been dealt with in this measure. Rationing and the control of prices and marketing are closely interwoven. Black markets arise primarily because there is a shortage of goods and a surplus of spending power, and because controls are not applied at the right time and place. Some honorable gentlemen seem to have an erroneous impression that the main purpose of rationing is to reduce the spending power of the people, and thereby make more money available for loans and taxation. Rationing may have that effect, but its chief purpose is to ensure that goods in short supply shall be fairly distributed over the community and that people who have time and money at their disposal shall not be enabled to hoard goods in short supply to the disadvantage of other people in the community. Rationing is required to meet shortages, whether they be real or artificial - that is whether they be due to goods not being produced, or to positive government action to cause a shortage. Shortages may be caused bya limitation of manufacture, or by transport difficulties. Every one knows, for example, that there is no shortage of sugar in this country. We have an ample supply of sugar to meet our own needs and also to comply with our obligations to Great Britain, New Zealand, the

United States of America and other countries which we have undertaken to assist for the duration of the war. Transport facilities are so limited in Australia, however, that the rationing of supplies appeared to be necessary to ensure that a reasonable quantity of sugar shall be made available in the southern States for all consumers and that stocks shall be accumulated in case our internal transport should be interrupted by enemy action. If strict government control were not applied to sugar when it passes from the Colonial Sugar Kenning Company Limited to the wholesalers, rationing would probably be of no effect whatever, for ways and means would doubtless be found by more or less unscrupulous traders to make sugar available under conditions which would amount to black marketing. Rationing must in every case be associated with a shortage of supply, otherwise black marketing will continue. I therefore urge the Government not to attempt to apply rationing to goods unless there is a definite shortage, in consequence of either the insufficiency of raw material or positive government action. I commend the bill to honorable members.

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