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Wednesday, 24 July 1946

Mr SCULLIN (Yarra) .- The Leader of the Opposition (Mr. Menzies) opened his attack on the Prime Minister and Treasurer (Mr. Chifley) by complaining that the budget was not being introduced before the general elections. The right honorable gentleman displays considerable temerity or has a conveniently short memory. My recollection goes back over many budgets and many governments, and I can recall only one budget that was delivered before the elections in the election year, and I think that was in 1934.

Mr White - And in 1929.

Mr SCULLIN - And in 1929, too, but that was an extraordinary election.

Mr White - The right honorable gentleman ought to remember that. It was the year when he beat us.

Mr SCULLIN - Yes, I do remember it, and the budget had to be considerably altered after I became Prime Minister, because it was very much astray. With regard to the actual receipts being different from the estimates, I confess that I have never known of a government whose estimates proved to be absolutely correct when the balance took place. In nearly every case governments have underestimated their revenue. That is usually done by cautious treasurers. So .there is nothing new in that practice to warrant criticism. It was done by the right honorable member for Kooyong and his own government. Then the right honorable gentleman laid great stress upon the fact that the taxation revenue was £17,000.000 more than the estimate. Well, £11,000,000 of that came from indirect taxes. So it does.not prove that we shall get very much more income tax, when the rates are reduced. The right honorable gentleman also complained that the financial statement contained very little information. The Treasurer frankly said that the figures contained in the financial statement were not final. They are more or less relative but are a frank and honest display of the financial position to-day; they are not meagre or sketchy, but are very full. The only difference between these figures and those that will be contained in the budget will be perhaps a few slight alterations involving no large amounts, but of course the budget-papers will contain the details of each department. I concede that such information is important, but I do not. think that it will affect the general picture very much. If the right honorable gentleman will examine the estimates and the actual receipts and expenditure for last year, he will see that "they are remarkably close, considering that they cover the transition from war to peace, an abnormal year. Yet, even in normal years, every government's estimates have been proved to be incorrect when the final balance has taken place and the budget has been brought down. So that criticism is trifling. A review of the whole of the war years and of the colossal expenditure during those years, in my opinion, shows remarkable achievements . by 7,000,000 people, achievments. of which Australia should be proud. Of the £2,490,000,000 expended in that period, 38 per cent., that is £950,000,000, came from revenue. What human suffering and sacrifices are represented in those cold figures! Whilst they were achievements of the people of Australia, of the soldiers who went to fight and the workers in the factories who kept up the flow of armaments and tools to them, I remind the House that those people were led for five years by a Labour Government. Not a word of commendation is uttered by the right honorable gentleman for the remarkable control exercised by the Treasurer. The other side of the picture ought to be, and will be, told. Some of the facts that I shall give will reveal a part of it: We fought a war and we have to pay for it. There are people today who say - and some in different walks of life have said it to me - " I am afraid we did too much j we did more than our share ''. When the Japanese were hammering at our back door there was not one man in this House or in the whole of Australia who would have dared . to say, " We are doing too much ".

Mr Spender - Who said that?

Mr SCULLIN - It was said to me.

Mr Spender - By whom?

Mr SCULLIN - By a leading business man in Melbourne.

Mr Spender - I cannot imagine it.

Mr SCULLIN - He was a member of the honorable gentleman's party, too. The war has been fought and it has to be paid for. There is no good in moaning about the fact that we have to pay for it. The facts are there. We are not going to repudiate. We are going to meet the costs. Some main items of expenditure show what colossal costs we have to meet, compared with the pre-war expenditure. War -pensions, reconstruction, and interest and sinking fund payments on "the debt in respect of the World War. II. are set down at £80,000,000. War pensions, repatriation, and interest and sinking fund pay-, ments on war debts of the first world war will cost £20,000,000 this year. Listening to Borne people and reading the newspaper, one would imagine that when the war ended eleven months ago all war expenditure -ceased. The first world war itself will cost us £20,000,000 this year and it ended '28 years ago. Subsidies, payments towards the United Nations Relief Fund, payments due to the United Kingdom, payments to the States and social services, added to the £80,000,000 and £20,000,000 that I have mentioned, represent an expenditure of £280,000,000, every item of which is inescapable. Will honorable gentlemen opposite say that expenditure must be cut down?

Mr Spender - No one has said that yet and no one is likely to say it.

Mr SCULLIN - No, . but .. what honorable gentlemen opposite do say is " You have to get rid of the bureaucrats . who are piling up this huge expenditure ". I have something to say about the alleged. bureaucrats. Besides the heads of departments, large numbers of people outside the departments were brought in to assist in the abnormal activity of wartime. The Leader of the Opposition has claimed credit for having appointed a large number of those men and. has said that they were good men. So they were, and they gave of their best to Australia at a critical time. Some were men drawn from private enterprise, if honorable gentlemen opposite like that. Some were lent to the Government and others were engaged by it. There was quite an army of them, because there was great activity. Now the reward that these men get for six long wearying years of service to this country is to be sneered at as bureaucrats. But let us examine the accounts. Leaving out business undertakings like the post office, railways and similar enterprises, the administrative "costs of the Public Service amount to £8,000,000, about half of which is represented by the salaries of administrative officers, and that represents li per cent, of our total income. Where is there great extravagance in that? Where can great savings be effected?

The Leader of the Opposition rightly said that the important issue in this financial discussion is taxation. I agree that taxes are heavy. I have found them irksome. So has everybody else. But we all realize ;that, having fought a war, we must pay for it. I have read newspaper criticism that taxation this year is to be three times what it was before the war. So it will be, but our inescapable expenditure is four .times what it was before the war. The Leader of the Opposition laid great stress on the statement of the Treasurer about the importance of production, as if he had never said it before and had only awakened and realized the importance of production, whereas the Opposition had been hammering at it as its constant theme. The Treasurer, according to [the Leader of the Opposition, is a babe in the woods. The Leader of the Opposition flatters himself if he thinks that his constant, theme and the constant theme of honorable gentlemen opposite generally have taught the Treasurer anything about the importance of production. Actions speak louder than words. The Treasurer. has not, proclaimed his achievements to the country. I recall V-P Day, the 15th August, 1945. I heard the Prime Minister announce that Japan had surrendered. Only two hours after his words had floated over the air he was conferring with Treasury officials, taxation officials and other advisers and observers. The people throughout Australia were cheering in the streets, bands were playing, the offices emptied, and the occasion was a public holiday for every one except this little band of Ministers and " bureaucrats " who ar.e shaping a new budget in the light pf a return to peace-time conditions.

Mr Spender - We did not see any sign of it.

Mr SCULLIN - The honorable member for Warringah (Mr. Spender) is so seldom in hid place that doubtless he did not notice any sign' of it. I shall show him the signs. On V-P Day the Prime Minister summoned his service Ministers, and issued to them instructions, which they, in turn, issued to their departments. The instructions were, " demobilize as rapidly as possible ". Demobilization meant the restoration of our economy to normal production. Anticipating the effect of demobilization, the Treasurer then .issued instructions for an amendment of the income tax law.

Mr Bernard Corser - We have not yet had the' benefit of any reduction.

Mr SCULLIN - Every one knows that the tax payable on incomes was reduced by 124 per cent, per annum.

Mr Bernard Corser - The reduction was per cent.

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