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Thursday, 26 November 1959


Mr McEWEN (Murray) (Minister for Trade) . - The honorable member for Melbourne Ports (Mr. Crean) has argued that because the £1,000,000 of capital that has been provided by the Government - which means, of course, this Parliament - has been invested by the corporation, it is not being used in the business. Those were his words. Let us examine the position. How can you use £1,000,000 in a business of this kind? Do you want to use this amount of capital to meet your expenses?


Mr Crean - I want to know why the corporation wants the £1,000,000 at all.


Mr McEWEN - I would like to be sure that you really want to know why the corporation needs it, and that you do not merely wish to conduct an argument about it. I take up the words of the honorable member again - to use the £1,000,000 in the business-


Mr Crean - To use it as working capital.


Mr McEWEN - The honorable member suggests that it should be used as working capital. This is an insurance organization. You do not want to use the capital to pay wages, surely?


Mr Crean - No.


Mr McEWEN - Very well, you would not want to do that. The corporation is, in structure and in numbers of staff employed, a small show. It has only a handful of people. Surely you do not want to invest the £1,000,000 in a building to house your dozen or twenty employees. The honorable member says, " Use it in the business ". If you do not want to use it in the ways I have suggested, what is left? Lose it in the business - that is the only other way to use it, other than to have it invested as a reserve. You can either invest it and have it or you can lose it. If you lose it you are using it in the business, but surely that is not what we want to do. The other way is to invest it and to have it as a reserve against the contingent risks that an insurance outfit undertakes.

We have heard the classic arguments by honorable members opposite. They will not feel offended if I call them socialists. We heard the classic argument from the honorable member for Lalor (Mr. Pollard). He said that with a government behind you you do not need money, that all you need is a guarantee by the government.


Mr Calwell - That is what the Country Party says.


Mr McEWEN - The Country Party has never said that. That is what the socialists say, and, without wishing to give offence, I repeat that that is what Major Douglas said. It is just not sound business. When the government of which the honorable member for Lalor was a Minister established the Industrial Finance Department of the Commonwealth Bank, it provided capital for it.


Mr Calwell - Of course it did.


Mr McEWEN - The honorable member for Melbourne, who was a Minister in that Government, says, " Of course it did "'. But there was no need for it to do so. On the thesis put before the Parliament tonight by the socialist members opposite, it could have been done on a guarantee. The late Mr. Chifley was too sound a businessman to conduct these business operations on water or air or paper; he conducted them on money. When the banking legislation was before the Parliament, I clearly remember, honorable members opposite argued that the Trading Bank and the Development Bank were not being supplied with sufficient capital. That was the argument of the honorable member for Melbourne Ports and of the honorable member for Lalor. But, on their thesis to-night, the banks do not need capital; they merely need a government guarantee. They are not really arguing to conviction to-night, 1 am sure, and I close on that note. I believe that they are putting up a political argument, and I will not proceed any further.







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