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Wednesday, 24 July 1946


Mr MENZIES - The honorable member may be surprised to know' that for the first two years of the war I had a great deal to do with the maintenance of our economy. If he is under the illusion that it was only the present Labour Government which had anything to do with it, I shall disabuse his mind. Australia provided .many, goo.ds for use by the forces of the- United States of America at prices much lower than those at which similar goods could be provided by the United States of America itself.

Mr Archie Cameron - Blankets, for instance.

Mr MENZIES - That is a notorious example, because we are able to compare like with like. Apparently a balance has been struck on a purely book-keeping basis, no endeavour being made to estimate what was provided on each side in actual physical terms.

Mr BLAIN (NORTHERN TERRITORY) - That would be difficultto do.

Mr MENZIES - Yes, and I should have thought that the right way to deal with the matter would have been to say that we had been engaged in a joint enterprise, and to thank God that enterprise was successful. Perhaps the Commonwealth Government did contend that the right way to deal with the matter was to wash out the indebtedness on both sides. However, in the absence of detailed information, I remain sceptical as to whether the bargain ultimately struck was as good as the Treasurer . seems to think. I have thrown a bone of contention into the ring, but there is no reason why we should not have our own views on such a matter, even if it does concern a very great and friendly neighbour.

I now turn to the subject pf production and price control. The statement of the Prime Minister contained one-piece of information which, though very long delayed, was none the less welcome on that account. It was to this effect -

Greater all-round production of essential goods must be the central aim of economic policy now and for n long time to come. The war years have left' their toll in shortages, some of which will take years to remedy. We cannot get back, in a day all those standards of living and enjoyment which the .war compelled U3 to forego. Yet we can win them back and much more with them if we will make an effort.

Those words of the Prime Minister sum up in admirable terms what has been the constant theme of members of the Opposition for many months past. It is the central truth which makes unnecessary industrial stoppages a wanton injury, to the nation, which -renders the provisions of real incentive by tax reduction both vital and urgent, and makes it so deplorable that our opportunities for markets in what for us is the Near East have been' frustrated by, the activity of an uncontrolled Communist minority. In short, what the right honorable gentleman has said - and it is obvious that some of his supporters do not agree with him - is that the greatest problem we have before us is one of increased production of essential goods. This was one of the first times that it was mentioned by a member off this Government.

Mr Forde - That is not so.

Mr MENZIES - The Minister for the Army intervenes. I am bound to say in his favour that, having had the supreme fortune to follow him a few weeks ago into Western Australia, I found that he had said something the same there; but I venture to say that that was the first time he . had said it. Honorable members on this side of the House had been hammering at that vital problem for months before anybody on the Government side ever dreamt of admitting its existence.

Mr Conelan - Rubbish !

Mr MENZIES - The honorable member describes what I am saying as rubbish. Somebody else has said that it is sheer " hocus-pocus ". As I came to the House to-night my eye lit on a gentleman I know, the Premier of Tasmania. Have I the approval of the honorable member for Griffith to refer to Mr.- Cosgrove with impunity ?

Mr Conelan - -Coming events cast their shadows before them. The right honorable gentleman may well kiss himself goodbye.

Mr MENZIES - As. his former colleagues will remember, when the Premier of Tasmania, a few. months ago, made a statement on the same lines as that of the Prime Minister which I have quoted, and it appeared in the press, he was carpeted within 24 hours by the Hobart, Trades and Labour. Council for having said something that was completely inconsistent with Labour's policy.

Mr Barnard - What nonsense!

Mr MENZIES - I admire the facility with which honorable members opposite are able to follow one doctrine to-day hud another to-morrow. Only two month- ago we heard not a murmur from them about production; but now, because the Prime Minister, in, clear ' and sensible terms, has stated something about it which we have been saying for months they come to the conclusion that it must be pretty good. . The Prime Minister's statement continued -

Control of - prices in Australia has been a triumph of war-time administration.

On balance I agree with that statement. Price control was introduced by the Government of which I was Prime Minister within a few days of the outbreak of war, and the authority of the Prices Commissioner was at all times rigorously upheld.. All Australian governments maintained that system during the course of the war. Not only did we have price control ; we. also had investment control, increasing rates of . taxation, and a big volume of public borrowing. All of these economic controls were never during the war brought within the real area of dispute. All Australian governments during the war can therefore, in their own fashion, share in the credit for what has been a fine achievement in relation to price control, an achievement which, I would like to say in passing, has been largely rendered possible by some very competent administrators. The Prime Minister further stated -

We shall not gain the full value of this achievement unless it can be carried on into the peace years when the balance of production and demand can be trusted to look after price levels.

That pronouncement deserves some analysis. It means in the first, place that price control cannot terminate abruptly. Having regard to some serious representations that have been' made from time to time by the ' supporters of the Government as to the termination of price control, I should like to' say at once that I entirely agree with that. Price control came into existence in order to meet an emergency, and it cannot now be terminated abruptly without causing some-, thing like chaos. [Extension of time granted]. In the second place, it means that price control should not continue indefinitely, but only until the production of goods has been so restored that it can cope with the. demand created by increased, .purchasing -.power. The third implication is that price control is not some artifice which of its own force can operate permanently, but is something which is designed merely to hold the pass while the forces of production move up. [ make that brief analysis of the right honorable gentleman's statement not to establish some disagreement with it, but ro point out my agreement with the implications' contained in it. Some people talk about price control as a panacea, as if for the next 20 or 30 years we could play ducks and drakes with our economy and still rely upon price -control as something that would save us from disaster. The right honorable gentleman has made it clear that the function of price control is to hold things together until production itself achieves such volume as to destroy the real danger of inflation of currency by an increase of price levels. I have indicated that there has been some propaganda on this matter, suggesting that we on this side of the House are ad voca', ing something different from that. On the contrary, these propositions to which I have referred I venture to describe as good Liberal doctrine.

Mr Barnard - But not in every State of the Commonwealth.

Mr MENZIES - What is good Liberal doctrine here is good Liberal doctrine all over the Commonwealth, as the honorable gentleman will discover when he .goes "to meet his masters in the near future. Those who established during the war, not only price control, but also other economic controls are' not so foolish as to imagine that their function should expire just because the fighting has ceased. As I b:ivf said these controls were brought into existence in order to cope with an emergency, and as long as the emergency continues they are needed. The problem is not one of sudden termination but of tapering off as natural factors are restored.

Mr Lazzarini Mr. Lazzarini interjecting.

Mr MENZIES - The Minister for

Works and Housing - if he be still in charge of housing - mutters something about the referendum. He seems to have entirely forgotten that in thi.= House in 1944, on behalf of the Opposition, I moved an amendment which offered to support the Government in seeking a variety of powers, including the power to exercise such controls as were needed for the transition from war to peace. It is. not my fault that the Government was so purblind is not to accept that offer.

Mr Falstein - The. right honorable gentleman was not sincere then, and is not sincere now. '

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