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Thursday, 27 June 1946

Mr FADDEN (Darling Downs) (Leader of the Australian Country party) . - The measure before the House is one to obtain parliamentaryappropriation for the expenditure of an additional £20,000,000 of revenue for war purposes. It has been made necessary by the fact that the budget estimates were less than the actual receipts from the various sources of revenue mentioned by the Treasurer (Mr. Chifley) in his secondreading speech. For example, the right honorable gentleman stated that the buoyancy of customs and excise revenue had indicated that the estimate of receipts from this source will be exceeded by £7,000,000, whilst increased sales of civilian goods, mainly due to the demobilization of the armed forces, may result in anincrease of the revenue from sales tax amounting to £5,000,000. It is also anticipated that income tax will yield £5,000,000 more than was estimated. An accurate forecast, which it is possible to make at this juncture, is that the receipts will exceed the estimate by approximately £20,000,000. The Government, for obvious reasons proposes to transfer from revenue to loan fund the sum of £20,000,000. The loan expenditure has exceeded the estimate by approximately £30,000,000. At last we have had the belated admission by the Treasurer that war expenditure is far greater, to an undisclosed amount, than he estimated that it would be in his budget last September. I have waited nine months for vindication of my assertion that revenue would be greater by some millions of pounds than the Treasurer was prepared to concede when he presented his last budget. Yet, at a time when revenue is estimated to be more buoyant than was anticipated by £15,000,000 or £20,000,000, the party in occupancy of the treasury bench is prepared to make what I would describe as a scandalous and. unwarranted exploitation of the Australian dairy-farmer, wheat-grower and wheat-producer. An additional £2,500,000 has been paid to the Commonwealth Government by the British Government on account of sales of butter overseas. That amount was derived as to £1,659,325, by the Government of Great Britain making a special grant to the Australian Government after that Government had represented to it that the Australian dairy-farmer was selling butter at less than the actual cost of production under Australian conditions.

Mr Chifley - That is incorrect.

Mr FADDEN - It was obviously on the basis of the representations that had been made by the industry to the late Mr. John Curtin and the Prices Commissioner, Professor Copland, when it was jointed out that the subsidy then being paid wa3 quite inadequate to. meet local costs of production. If that be not so, in what circumstances did the British Government make that special grant of £1,659,325 to the Australian Government during 1944-45, and in what circumstances has it promised to grant, and has the Commonwealth Government estimated that it will receive a further £1,000,000 in respect of the current year? r draw attention to .the estimates of receipts and expenditure for the year ending on the 30th June, 1946. The Government expected an expenditure of £7,500,000 by way of assistance to primary production under the heading "Dairying industry", because it placed that amount on its estimates. Of a total expenditure of £6,812,197, it expended only £5,152,372 from its own funds, the difference between the two amounts being the £1,659,325 which it had received from the British Government. The Australian dairy-farmers have not received from it the sum' of £6,S12,197. I have no doubt that the grant was made by the British Government in response to representations by the Australian producers, and that the British Government paid this amount of £1,659,325 in the belief that it was going to the producers. Altogether, £2,659,000 is being received from the British Government, and retained by the Commonwealth Government, whereas it should be paid to the Australian producers. The situation could be cleared up if the communications which passed between the Commonwealth Government and the Government of Great Britain were tabled.

The intention of the Government to wring the last penny out of the rural industries is evident from its treatment of the wheat industry. In this case, no less than £6,000,000 due to wheat farmers from pools Nos. 5, 6 and 7 alone has been' withheld. The honorable member for Indi (Mr. McEwen) raised this matter in the House more than once, and since he first did so certain adjustments have been made. In other words, the Government has admitted that it was withholding money which was due to the growers. The Government compulsorily acquired the whole wheat crop, and sold a part of it at concession prices which were lower than the true value, and it then expected the wheat-growers to bear the entire loss. The wheat-growers do not object to the making of concessions to the poultry-farmers, for instance, but they do object to those concessions being made entirely at their expense. They contend that they should be paid the full price realized on pools Nos. 5, 6, 7 and 8, as well as N6. 9 pool. Instead, we find that, by Government decree, the price of wheat for stock is less than the board's selling price, and wheat for breakfast foods and for power alcohol has to be supplied at concessional rate3. The Government has consistently baulked at compensating the Wheat Board for the deficiency resulting from this interference. At first it, offered to pay 6d. a bushel. Subsequently, as the result of pressure from farmers' organizations, the Government reluctantly produced another ls. Although values continue to rise, 1,000,000 bushels of wheat was supplied for stock feed during the drought at the concession price which, with ls. 6d. subsidy, amounted to 5s. 0$d. bagged at port. In January, 1944, the Australian Wheat Board was exporting wheat for 5s. 6d. a bushel, and by October, 1945, it was receiving as much as 9s. 2£d. The Government did not intend to make up the difference, but strong pressure from farmers' representatives forced from it an undertaking that suppliers of concession wheat to No. 7 pool only would receive a further payment to bring the price up to 6s. 5-J-d. at ports. Wheat-farmers are still some mil-lions of .pounds short of what they would have received if the board had been allowed to sell the wheat at export value ou the dates of release at the concession rates. The following table, compiled from accurate data, shows what wheat-farmers will lose if the Government continues to direct the board to sell wheat compulsorily acquired at prices below those which it could otherwise obtain : -


The total of £6,128,000 is the deficiency on Nos. 5, 6 and 7 pools only, and takes no account of interest. If pools Nos. 8 and 9 are included, together with interest, the loss would be much greater. For instance, in No. 8 pool - the drought crop - 4s. 1½d. has been paid for bagged quota wheat, and 3s. 9d. for the excess, although the export value was 7 s. 4d. a bushel at the time the crop was acquired. The figures which I have cited are seen to bear a relation to the figure of £10,000,000 repeatedly referred to by the- honorable member for Indi. Adjustments made by the Government have reduced the deficiency to £6,128,000. As I have said, the Government lias consistently turned down appeals for justice for the wheat-growers. When the Government, as a matter of internal" economic policy, orders the sale of wheat at prices below those which would otherwise be realized, it should in justice assume responsibility for making up the difference to the growers.

A position somewhat different in principle, but similar in effect, has arisen with regard to the wool industry. The amount involved here is no less than £7,000,000. During the war, the Central' Wool Committee accumulated large amounts of money out of activities associated with, but in fact outside of, the limits of the wool purchase plan as arranged between the governments of the Commonwealth and the United Kingdom. As I have said, there is at present a credit balance of £7,000,000 made up as follows : -


This amount of £7,000,000 will be substantially increased in the near future. The money came to the Commonwealth Government as the result of the disposal of the product of one of Australia's greatest, primary industries, but the producers will not receive one penny of it. > Instead, the Minister for Post-war Reconstruction proposes to fritter it away on one of his nebulous plans. He said recently that it would not be distributed to any section of the wool industry, but would be used for the benefit of the industry as a whole, particularly on research into methods for promoting the use of wool. There is no doubt that this amount of £7,000,000 was received for wool produced by the wool-growers of Australia, not by the Government or the Central Wool Committee. The growers are to have the money filched from them.

They have not been consulted regarding the disposal of what is, after all their money which was paid lor wool which they produced. The Government gave an undertaking that before any public announcement of its intentions with regard to this money was made, its proposals would be submitted to the woolgrowers, but this undertaking has not been honoured. The growers are already paying a heavy wool tax to provide funds for research, a tax which is expected this year, to produce about £600,000. If the Government remains adamant- in its refusal to hand back any of the £7,000,000 to the wool-growers it should at least suspend the operation of the wool tax, and use instead the £7,000,000 as long as it lasts.

The manipulations of the Government in connexion with three of Australia's greatest primary industries - dairying, wheat and wool- bear a striking resemblance. In each case, the Government stepped in and compulsorily acquired the product, which it either sold, or could have sold, at a profit of millions of pounds. That profit, representing about £2,500,0.00 in respect of the dairying industry, £6,000,000 in respect of the wheat industry and £7,000,000 in respect of the wool industry, has not been handed back to th« producers by the Government which has played the part of middle man. Instead, various ingenious excuses have been made for retaining the money. Despite the financial stratagems adopted, the fact stands out clearly that the man on the land is the loser every time. The party which I lead views this matter very seriously. Such financial manipulations are not in the best interests of the primary industries. Men on . the land should not be robbed of the incentive to produce to the maximum. The Government should state the fact* clearly, and publish its correspondence with the Government of Great Britain on the subject, particularly in regard to the dairying industry.

Sitting suspended^ from 6 to 8 p.m.

Mr FADDEN - I inform, the dairymen of Australia that, of the financial assistance their industry has obtained from the- Commonwealth, no less than £2,600,000 has been contributed by the Government of the United Kingdom, or, in other words, by the taxpayers and consumers of Great Britain. That grant from the United Kingdom Government was placed to the credit of consolidated funds and afforded great relief to the Government in its commitments to the dairying industry. The necessity for the introduction of this measure has been brought- about by the need to transfer buoyant revenue to the loan fund, as indicated in the second-reading speech of the Treasurer. I draw attention t" the indisputable fact that, whilst for the eleven months' ended the 31st May revenue from customs excise, sales tax and income tax has been buoyant, only £11,000,000 is estimated to be received for the year ending the 30th June, 1946, from the pay-roll tax, or £8S,000 less than that actually received for the previous year. That is evidence of the inefficiency and impracticability of the Government's attempt to implement its re-establishment and full employment policy, because if any figures should reflect an increase they assuredly are those relating to the pay-roll tax, which is assessed on the wages fund of industry. The fact that the amount estimated to be received from this source will probably be £88,000 less than in the year ended the 30th June, 1945, is clear evidence, if evidence is required, of the ineffectiveness of the Government's attempt to bring about the reestablishment of the 500,000 personnel who have come out of the fighting services and out of government war activities. These figures tell the tale of the static condition of employment and indicate the degree to which the Government has failed to implement its full-employment policy. The Treasurer has very belatedly admitted that war expenditure, which had been estimated at £360,000,000, will be exceeded in the current year. The right honorable gentleman says that this excessive expenditure is due mainly to the acceleration of demobilization. But in the estimate of expenditure for the year 1946-47, which the Treasurer presented to caucus and which, found its way into the press of Australia, no provision of an extraordinarynature was made which would account for the overlapping of demobilization costs from the year ending the 30th June, 1946, to the year ending the 30th June, 1947.

Mr Dedman - How does the honorable member know that that statement was made by the Treasurer?

Mr FADDEN - It has never been denied. I quoted it in an earlier speech; I reiterate it now and it is still not denied. According to the statement relating to Commonwealth taxation in 1946-47 circulated to the members of the caucus by the Treasurer in March last, expenditure on war and repatriation services, including the defence programme estimated at £60,000,000, was estimated at £176,000,000. That is the only reference made in the estimates given to caucus upon which we can assess the Government's financial commitments and responsibilities for the year ending the 30th June, 1947. Not one word was said of any other large commitments. Therefore the excuse that the estimate will be exceeded on account of acceleration of demobilization is a specious one which will not hear investigation in the light of the facts which I have placed before the House. It is regrettable that one has to go to the trouble of tedious research and minute dissection in order to arrive at a true estimate of the financial commitments and achievement of this Government. The Government's Financial statements are clouded and concealed in every- way -and do not represent anything like what one would expect from the National Government, having regard to the large amounts of the receipts and expenditure embodied in them. One would require the ingenuity of a black-tracker, rather than the discerning mind of an accountant, to prepare from the information supplied to us by the Treasurer anything like a true statement of the financial position of this Government.

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