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Thursday, 8 August 1946

Mr ABBOTT (New England) . - The amendment which the Leader of the Australian Country party (Mt. Fadden) submitted relates to the amount which the Prime Minister (Mr. Chifley) stated in his second-reading speech to be £7,000,000, but which it now admitted to be £8,000,000. The- Government refuses to pay that money to the legitimate owners, the wool-growers of Australia. Its attitude is contrary to all logic and reason-.

Mr Dedman - The honorable mem-' ber's remarks are not related to the clause.

Mr ABBOTT - My remarks are very pertinent to the clause. If this Government is defeated a few weeks hence, honesty will prevail, and the growers will receive the amount of £8,000,000 which belongs to them, but which is being filched from them under this proposal. The amendment is designed to provide that the money, while in the fund, shall be invested at the most advantageous rates pending the time that the Government is dismissed, so that honesty may prevail and the money be returned to its legitimate owners. The purpose of the Leader of the Australian Country party is to ensure that these funds shall be invested in consolidated stock, and the interest payable on them shall be at the highest rate possible for this class of investment. I remind the legitimate owners of these funds, the Australian wool-growers, that if the money is invested in treasurybills, the interest rate will be 1 per cent, as compared with the ' rate of 4 per cent, which it could earn in consolidated stock. An amount of £53,000,000, which belongs to the rational Welfare Fund, has been invested in Commonwealth treasUry-bills at 1 per cent., the interest amounting to £530,000 a year. If it had been invested in consolidated stock at 4 per cent. - the rate at which, we contend, the woolgrowers' money should be invested - the return would exceed £2,000,000. The honorable member for Perth (Mr. Burke) drew a distinction between the rate of interest payable on treasury-bills and that payable on investments for long terms. This amount of £7,000,000 cannot possibly be expended in the directions which the* Minister (Mr. Dedman) indicated., for a considerable time, even though the most rapacious, wasteful .and dishonest Government that Australia has ever experienced has its hands on the money. This is a story which shows the stark dishonesty of this Government. The point regarding the value of the- investment of this money in consolidated stock, which the honorable member for Perth so skilfully evaded, is that this slock is selling at par rates, and can be maintained at a par rate of value through the open market operations of the Commonwealth Bank. That institution is controlled by the Government, from which i*. receives its instructions. Therefore, the bank may contract or expand credit, and by its actions, can affect the interest rate on all Government stocks. There is not the slightest danger of the interest rates on long term Commonwealth securities falling so long as the central bank is prepared to maintain them. The honorable member for Perth told a very poor story indeed to the wool-growers, in his endeavour to convince them that they will receive the proper rate of interest on their funds. I contend that the interest rate should be 4 per cent. Then, if the wool-growers neve2- receive the capital amount in the fund, they will at least get considerably more benefit from the higher interest rate than they will from the mean return of 1 per cent.

Mr Dedman - Who said that the funds will be invested at 1 per cent.?

Mr ABBOTT - I ask the Minister not to interrupt me. He is endeavouring to prevent me from telling, the truth to the people. The whole of the arrangement contemplated in this bill creates a feeling of deep suspicion in the minds, not only of wool-growers, but of all primary producers. What has happened to one primary industry can happen ' to others. The wool-growers' funds have been filched from them. We do not know where this policy of the Government will end. When the bill to take over the accumulated stocks of wool was introduced, we were assured that the woolgrowers would pay only a very small contributory charge. But in the first year of operation, the amount of the contributory charge was fixed at 5 per cent., or five times greater than the woolgrowers expected. Goodness knows what charge the Government will fix in the second year ! The progression of charges in respect of this fund reminds me of the progress of Ned Kelly, during last century, when he took the funds of private individuals and applied them to his own purposes. That is exactly what the Government is doing .to-day. I strongly support the amendment, first, because it will ensure the. better investment of the fund; and secondly, because it will keep the money out of the hands of the Government. I fear that if this' considerable sum be not invested in Commonwealth, or State consolidated stock, the Government may divert it .from the use to which, even within the terms of this bill, it should be applied.

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