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Thursday, 25 July 1946


Mr FALSTEIN (Watson) .- For sheer reckless mendacity and grossly indecent humbug, coupled with wickedly false misrepresentation, the speeches of the four ex-Treasurers on the opposite side of the House will remain unsurpassed in the annals of our parliamentary history.. [Quorum formed.] At the outset, I shall deal with some of the outrageous statements made by the right honorable member for. Darling Downs (Mr. Fadden). He told the House that the Government should have presented its budget instead of a financial statement. The right honorable gentleman finds it very convenient to forget that when the Opposition parties. occupied the treasury bench in 1940, neither a budget nor a financial statement was presented to the House prior to the general elections held on the 21st September of that year. It is for that reason that I categorize some of the remarks which havebeen made as wickedly false and indecent humbug. The right honorable gentleman proceeded to make a charge against the Government without a proper regard for truth and with complete indifference to facts. Honorable members will recall his statement that the Treasurer (Mr. Chifley) instructed the Treasury to cease collecting taxes after the budget estimate' had been exceeded. That, in fact, would presuppose that there was a conspiracy by the Treasurer and his departmental officers to manipulate or "cook" this financial statement so that the true figures would not be presented to theParliament. A little later in his speech the right honorable gentleman produced what purported to be a budget which he had compiled from the figures supplied to him in the Treasurer's statement. His attitude was entirely different from that of the honorable member for Warringah (Mr. Spender) who said that the figures given in the Treasurer's statement were too incomplete to enable him to comprehend clearly the exact position of the country's economy. The right honorable member for Darling Downs was able to prepare a budget from the figures, but the honorable member for Warringah found them to be inadequate. I leave it to the House to make its own judgment as to which of the two made a correct statement.

The next misrepresentation of the .right honorable member for Darling Downs was made in respect of the payroll tax. He said that a true indication of the number of .persons employed in industry was to be found in the receipts from that source; but he went on to say that, although the receipts had increased from £11,000,000, in the previous financial year, to £11,500,000 in the financial year just closed, that represented only a 5 per cent, increase in the ' actual number of people employed in Australia. No one knows better than does the right honorable member that the fact that. there was an increase of £500,000 in receipts from the payroll ,tax does not necessarily mean that there was an increase of only five per cent, in the number of persons employed over the whole year. The financial statement drew attention to the fact that demobilization did not begin until the 1st October, 1945. But it was not until the second half of the financial year that many people were being re-absorbed in industry, after having enjoyed their long leave. The receipt of only an additional £500,000 from the pay-roll tax could be indicative, not that only 5 per cent, more people were employed in industry, but that the increased payments related to employment in the concluding quarter of the financial year and that, probably, in that quarter the increase in the number of persons employed in industry was as much as 20 per cent. It is because of misrepresentation of this description that I considered it necessary to make some categorical replies to the questions that have been raised.

The right honorable member for Darling Downs also criticized and challenged the correctness of some of the figures given in the tables presented to the House by the Treasurer as a schedule to the financial statement. One point, however, that is abundantly clear is 'that these tables relate to the accounts of the financial year 1945-46 and do not in any way give, nor are they intended to give, any estimate of the accounts for thu year 1946-47. That must be obvious to any one who takes the trouble to read them. It is true that, in his statement, the Treasurer gave us a preview of what might be expected to result from the operations of the financial year ending the 30th June, 1947, but the accounts to which I have referred are records of moneys actually received and expended in the financial year just concluded. What the right honorable member for Darling Downs, did not tell us, but what the Treasurer had, in fact, informed him. was that although £45,000,000 has been realized from disposals already effected in the year just ended, only £15,000,000 had come into the accounts. That will leave the balance to be collected daring the current year and doubtless it . will be taken into account in the statements that will be presented after the 30th June, 1947. The plain fact of the matter is that a piece of gross humbug has been perpetrated by both the honorable member for Warringah and the right honorable mem- . ber for Darling Downs, both of whom have held the portfolio of Commonwealth Treasurer. They should understand that the accounts which show as a credit to war expenditure reveal only money already received which for disposals totals £15,600,000. But they insinuated thai other moneys which have been realized from disposals- have not been shown in the tables. They must be well aware that these tables had of necessity to be confined to amounts which had actually come to hand from the sale of capital goods. The honorable member for Warringah asked for some particulars about a credit of £62,000,000 which was shown as having been applied against general war expenditure for the financial year just ended. It is evident that he cannot have seen a copy of a letter which the Treasurer forwarded to the right honorable member for Darling Downs. I shall therefore quote some passages from it. It reads in part -

I refer to your letter of the 10th July, 1946, in which you requested certain information for use during your speech in- reply to my recent Financial Statement.

I have now had the following information prepared in response to each of your questions: -

The figure of £62,1 74,000 for Miscellaneous Credits in Table A attached to the Financial Statement is made up as follows: -

 

The statements in the letter are in sharp contrast to statements made in the course of the debate by the right honorable member for Darling Downs, who alleged that certain trust accounts were bankrupt and that figures published in relation to them must be regarded as mere book entries. He also said that certain credits in the form of treasury bills must be regarded as IO U's. He accused the Treasurer of saying, in effect, " I have leftIO U's in the cash box. If the money has to be found, we must look somewhere else for it ". The letter refers to repayments of £16,000,000 of advances made to finance trust accounts. Yet the right honorable member for Darling Downs challenged the Treasurer in regard to these amounts, and made certain sinister insinuations in regard to them.


Mr Spender - Is there anything in the letter about £27,000,000 due from the British Government?


Mr FALSTEIN - I regret that the honorable member f or Warringah seems to be unable to hear distinctly. I articulated my words clearly. The honorable gentleman should have been able to hear and understand them. However, to answer his point, there is no reference in the letter to £27,000,000. The letter which I have read deals with the points made by the honorable gentleman in regard to the amount of £62,000,000, which was more than half of the total last prewar budget, but I am quite satisfied that no explanation would be regarded as satisfactory by the honorable gentleman.

I wish to make a few observations on remarks of the Leader of the Opposition (Mr. Menzies) on the Financial Statement. His speech could be summed up by saying that he emphasized the needfor increased production. But he was so rash and foolish as to challenge the Government for not having raised a voice to express any desire for an increase of production in this country. Even a casual glance at the White Paper on full employment in Australia,- which was presented to the Parliament on the 30th May, 1945, will indicate clearly that the Government has adopted a policy of full employment which is designed to ensure a substantial increase of production. This is referred to specifically in Part V. of the White Paper. In fact paragraphs 1.07 to 120 - 13 of them in all - are devoted to the problem of the re-organization of production. The Government therefore has not merely clamoured for ah increase of production; it has caused a careful analysis to be made of factors essential to a' reorganization of industry which will result in benefits to all of us, and help to pave the way for an improvement of living standards and a more equitable distribution of essential goods.


Mr Spender - What does all this mean?


Mr FALSTEIN - I am sorry, but not surprised that the honorable member for Warringah does not seem to be able to comprehend the meaning of what I am saying. He does not seem to be able, either, to consider without bias a view different from his own. It would be impossible for any unbiased honorable member to accept the contention that production has not increased since the cessation of hostilities. The fast is that not only have about 450,000 more people been re-employed in industry, but that persons who have been so re-employed have come from the age groups which are most capable of doing a full day's work. That large number of people have been re-employed is also shown by the increased yield from indirect taxes, particularly sales tax. The Leader of the Opposition tried to make the point that the tax reductions, which were at the rate of £20,000,000 a year for the year ended the 30th June last and a further £17,500,000 for the current financial year, were made at no cost to the Government. In order to show how incorrect those comparisons are, I point out that the whole of the speech of the right honorable gentleman was directed to actual revenues, and did not include any comparison with expen diture, particulars of which are given in the financial statement. In it the Treasurer said- -

War expenditure in Australia was £340,000,000, compared with the budget estimate of £298,000,000.

That is an increase of £42,000,000.


Mr Spender - The net result is £60,000.


Mr FALSTEIN - Honorable members opposite have mentioned many different sets of figures, and have said that because certain amounts on one side of the accountcould be subtractedfrom other amounts, the budgetfor last year revealed a state of affairs no better than existed in the preceding year. All that I can say is that the facts differ from the figures cited by honorable members opposite. I cannot allowtheir statements to go unchallenged, particularly the statement by the Leader of the Opposition that the tax cuts, including those made in indirect taxes, were effected at no cost to the Government. Such a statement would be misleading at any time, but coming from a leader of a political party it is highly improper.

The right honorable gentleman then dealt with lend-lease matters. He wanted us to know that under lend-lease there had been a strict settlement of accounts, and that matters had been finalized in the spirit of the Aids to Democracy Act which was the foundation of the lend-lease arrangement, which, in turn, was a system under which the resources of the Allies were pooled so that each partner in the United Nations could prosecute the war to the maximum of its ability. The fact is that the £8,400,000 to bepaidby the Commonwealth, after the adjustment of lend-lease accounts, is being paid to the United States of America for certain goods in categories which I shall place before the House. I quote again from the letter sent to-day by the Treasurer to the right honorable member for Darling Downs -

You may, however, be interested in a more detailed . list of types of capital equipment which the Commonwealth Government agreed to purchase. The main items are as follows: - Machine tools, non-combat aircraft, canning equipment, locomotives, motor vehicles (civilian type), tractors, steam-wrecking cranes, cargohandling plant, &c. It is impossible, however, to assign to each of the above categories any particular portion of the purchase price of $20,500,000. Here again the United. States Government accepted my contention that an overall figure based on a general appraisement of the residual value of these items was the only practicable course.I can, however, assure you that the overall current value of these capital items amplyjustifies the price paid.

The remaining $6,500,000 . of the total of $27,000,000 is the purchase price for certain surplus property in Australia and adjacent areas which we have acquired from the United States armed forces. Here again overall deals have been made and so it is not possible to apportion any part of the $0,500,000 to the major types of goods acquired. These were as follows: - Earth-moving equipment, wharf and warehouse handling equipment, radio and signal equipment.

In view of the quantity and the types of goods purchased, the deal was highly satisfactory to the Commonwealth Government.

The Leader of the Opposition said that when certain proposals were submitted to the people at a referendum held in 1944 he was prepared to assist the Government by agreeing to Commonwealth control over prices. I interjected that he was no more sincere at that time than he is now. I believe that to be true. Only since the Opposition has seen the terrible effects of the relaxation of price controls in the United States of America has it shown any willingness' to retain price control in Australia.

I have dealt with the matters raised by most of the ex-Treasurers who have spoken, but the speech of the right honorable member for Cowper (Sir Earle Page) was so incoherent and silly that I can well understand why a former colleague described him as " the tragic Treasurer ". He made comparisons between the taxes collected in 1928 and those collected at the present time. Not much intelligence is needed to realize the futility of arguments of that kind.

The honorable member .for Balaclava (Mr. White) cited figures supplied by & member of the Victorian Parliament, but r have no means of checking' their accuracy. When I asked him to refer to the schedule he either did not think that the matter was sufficiently important to have a schedule showing the proposed tax reductions in his possession, or he was prepared to accept blindly the figures supplied to him. The honorable member said, that people with low incomes were the only taxpayers who would get a reduction of 401 per cent., and that it would amount to about a Id. a week.


Mr White - The honorable member should not misquote what I said.


Mr FALSTEIN - I could not draw any other inference from the honorable member's remarks.

Mr. ACTING DEPUTY SPEAKER (Mr. Mulcahy).- The honorable member's time has expired.







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