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Wednesday, 7 August 1946

Mr FADDEN (Darling Downs) (Leader of the Australian Country party) (2:45 AM) .- I am sure, Mr. Acting Deputy Speaker, that if Mr. Speaker had been in th'e Chair he, being conversant with the trend of the debate, and remembering the attitude that he adopted towards the honorable member for Deakin , (Mr. Hutchinson), would not have permitted the Minister for Commerce and Agriculture (Mr. Scully) to read a sentence of the statement that he has just presented to the House. It had nothing whatsoever to do with the bill now before us. The measure is one to provide for the appli- cation of certain funds. In order to understand the Government's attitude towards the disposal of this money it is necessary to have some knowledge of the factors which brought about the accumulation of moneys in the fund. The Treasurer (Mr. Chifley) said that the purpose of the bill is to provide for the application of certain moneys which had accumulated in the hands of the Central Wool Committee during the war in respect of activities outside the provisions of the wool purchase arrangement with the United Kingdom Government. He said that the subject was dealt with at some length in a statement in this House by the Minister for Post-war Reconstruction (Mr. Dedman) on the 11th April last. The Minister, after explaining how the moneys had accumulated, announced that the Government had decided they would not be taken, into Consolidated , Revenue and would not be distributed to individual growers, fellmongers, top ' makers and manufacturers concerned. They would, however, be used for thebenefit of the wool industry, particularly fo'r research and promotion of the use of wool. It is necessary to know something of the source of the £7,000,000 in the fund. The Central Wool Committee, in addition to handling the wool purchase arrangement for the United Kingdom "Government, has carried out other activities which have resulted in certain moneys being collected on behalf of the

Commonwealth Government. These moneys have mainly arisen from the following sources : -


These are provisional figures and. other transactions will probably bring the net accumulation to over £7,000,000. The Treasurer went on to explain how the profits arose. In regard to skin wools he said that when the wool purchase arrangement was commenced in1939, it was announced by thethen Prime Minister (Mr. Menzies) that wool derived from sheepskins would not participate in any adjustment over and above the appraised price which was to be the final and only price paid for such wool. This was necessary in order to enable the fellmonger, when purchasing woolled sheepskins, to fix afirm price for the wool content of such sheepskins. This was confirmed each season to all concerned by the Central Wool Committee. That referred to the fellmonger. As the result of activities in connexion with wool £2,400,000 profit has been made. That sum represents the difference between the appraised price paid to fellmongers and the purchase price received from the United Kingdom Government, and covers the transactions of six seasons. On the subject, of wool-tops, &c., exported from Australia, the Treasurer explained that the control of the export of wool-tops, noils and waste was vested in the Central Wool Committee under National Security Regulations. The overseas market in wool-tops to be supplied from Australia increased mainly because of the inability of the United Kingdom to supply India during the war. Top-makers were paid the cost of raw wool plus other charges and profit, and the excess price obtained from overseas buyers was collected by the Central Wool Committee. There were certain profits from the export of manufactured goods. Although these trans actions related to exports, the United Kingdom Government said that it was agreeable to the whole of this deferred payment being reclaimed by the Commonwealth Government, which, as I have said, wasthe constructive trustee for the. owners of the wool. Honorable members know that it is the duty of a trustee to account for his trust. The £20,000,000 to which the Minister for Commerce and Agriculture (Mr. Scully) referred resulted from the acquisition of wool. It is wrong for him to say that the present Prime Minister is carrying out an undertaking entered into by his predecessor. The £7,000,000 was a windfall, and it belongs to the wool-growers of Australia. During question time recently I asked the Minister about the disposal of the £7,000,000 and to-day I received from him the following letter : -

During question time on Thursday, you asked me without notice whether the accumulated funds, which had accrued from the activities of the Central Wool Committee in skin wools, wool-tops and noils, and the export of manufactured woollen goods, had been appropriated to a trust account within the meaning of section62a of the Audit Act. You also sought information as to whether the balance in such a trust fund had been used by the Government for general purposes.

I desire to advise you that these moneys have not been used for governmental purposes nor have they yet been appropriated to a trust account.

Clause 4 of the Wool Industry Fund Bill now before Parliament provides for the establishment of a trust account within the meaning of Section62a of the Audit Act, and for the appropriation from Consolidated Revenue of the moneys in question. When this bill is approved and becomes operative, the necessary action will be taken to give effect to the provisions which it contains.

I should like to know where the amount of £7,000,000 is to be found. The Treasurer stated that the money has not been expended, nor has it been included in the ordinary funds which constitute the moneys required for the ordinary purposes of government. On the other hand, he stated that it has not yet been placed to the trust fund. Obviously, the money has been received by the Government, and expended in the ordinary way. The aim of this bill is to establish a trust fund which will lead people to believe that the money is actually in existence and availablefor the purposes set out in the bill. Clause 5 provides that moneys standing to the credit pf the fund may be invested by the Treasurer in securities of the Commonwealth or of a State. The definition of " securities " in the Audit Act - and the trust account will come within the provisions of the Audit Act - includes treasury-bills. At the appropriate time, I propose to move an amendment to clause 5 designed to prevent the Government from investing the proceeds of the trust fund in treasury-hills and to ensure that they shall be invested in Commonwealth Consolidated Stock. The fund should be invested most advantageously, namely, in 3¼ per cent. Consolidated Stock. The Government has no right to utilize, for the ordinary purposes of government, money which it has received as trustee for the woolgrowers. Like other trustees it must account for moneys coming into its possession. I voice my protest against the method adopted by the Government in the distribution of these moneys and I support the efforts of honorable members on this side of the chamber to ensure that it shall be accounted for strictly in accordance with accepted accountancy practice.

Debate (on motion by Mr. Lemmon) adjourned.

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