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Friday, 26 June 1914

Senator STEWART (Queensland) . - I am sorry that I cannot agree altogether with some of the remarks which have been made by honorable senators on this side with reference to what they are pleased to term the dying condition of the Senate. It was never so alive as it is at the present moment. To my way of thinking the Senate has rendered to the people of Australia one of the most useful services that were ever given to the people by a political party. It has driven the Cook Government out of power, and compelled that Government to go before its masters, the people. But for the existence of the Senate I have not the slightest doubt that the Cook Government would have hung on indefinitely with its slender majority of one, and instead of limiting its legislative aspirations to such minor matters as the restoration of the postal vote and the abolition of preference to unionists, it would have attacked some of the more important measures passed by previous Administrations. For that reason I think that the Senate at the present juncture, instead of being in a dying condition, is a very live institution, and has' rendered most excellent service to the people. The present situation is difficult enough, I think, to warrant the close and careful attention of members of the Senate, no matter with what political party they are associated. With regard to our finances, notwithstanding the clumsy arithmetic of the Treasurer, we find that during the financial year which is just ending our expenditure has very largely exceeded our income. That is not by any means a healthy position. The expenditure of nations ought to be regulated very largely by the wholesome principle which governs the expenditure of private individuals. Except on the rarest occasions, and in cases of particular emergency, the ex'penditure should not exceed the income. But one of the worst features in connexion with the present situation is the deliberate attempt made by the Government and by its Treasurer to hide the fact that we were -outrunning the constable. Speaking in New South Wales a few days ago the Prime Minister claimed that his Government, after spending very much more than the last Government had spent, still had a surplus of about £1,000,000. As a matter of fact the deficiency on the estimated revenue and expenditure for the current financial year amounts to £2,653,000; that is to say, we have gone that sum to the bad. I think it will be interesting if I quote the figures of revenue and expenditure from the Treasurer's Estimates for the current year. The estimated revenue was £21,462,000, while the estimated expenditure was £24,115,223, thus making the expenditure greater than the revenue by £2,653,223. It seems to me that the time has come when we ought to take stock of our position. I have pointed out here times without number that we are rapidly approaching a period of financial difficulty. I see that we are getting nearer and nearer that position every day. . We are getting, so to speak, in the rapids, and, if we are not careful, before we know where w© are we will be drawn into the whirlpool. Let us look at the principal sources of revenue. From Customs and Excise taxation we derive £14,900,000, and from the land tax £1,400,000, making a total of £16,100,000. Honorable senators will observe that 90 per cent, of the taxation is taken from the pockets of the poorest people in the Commonwealth by means of Customs and Excise duties, while only 10 per cent.- that is the £1,400,000 - is taken from the comparatively rich people in the Commonwealth. I think that the force of my remark will be apparent to every honorable senator, when I state that no person is subject to the land-value tax the unimproved value of whose property does not amount to £5,000. A person in possession of unimproved property valued at that sum cannot be said to be a poor person. As a matter of fact, those individuals who are fortunate enough to possess property valued at from £5,000 up to hundreds of thousands of pounds cannot be said to be within the poverty line; in fact, they are very far removed from it, and instead of paying only a tenth of the taxation levied in the Commonwealth, to my mind they ought to pay a very much larger proportion. As I have pointed out, 90 per cent, of our taxation is dragged out of the pockets of the poor; is taken off the tables of the poorest of our people. We tax the clothing of our women and children; in fact, we tax everything they eat, or drink, or wear to keep up our system of government, and while we do that we allow the rich people in our midst to escape with comparatively light taxation. I hope that if the Labour party is ever returned to power again, as I believe it will be in the very near future, it will see that our Customs and Excise revenue is reduced, and that our land value taxation is very largely increased; in other words, that it will take some of the burden off the backs of the poor, and place it on the broad, strong shoulders of the rich. We derive from taxation, as I have pointed out, £16,100*,000. From the Post and Telegraph Department the estimated revenue is £4,548,000, and from odds and ends £814,000, making a grand total of £21,462,000. Let us see how this money is spent. Taking the principal items of expenditure, the States get £6,300,000. I wish to direct the attention of honorable senators to this very important fact, that not only do we collect revenue for our own expenditure, but we are taxgatherers for the State Governments. I think it must be evident to every one that if the State Governments get such a large sum as £6,300,000 per annum from the Commonwealth Government they will be saved the necessity, to a large extent, of raising the necessary revenue for carrying on their own administration. I think the time is near at hand when State finance and Commonwealth finance should be distinct and separate, when the States will get no subsidy from the Commonwealth, and the Commonwealth will be in no way bound to raise money for the States. That is all I wish to say on that point at the present time. The system is unsatisfactory, and ought not to be continued after the end of the ten years' period for which the present arrangement has been made. I find that we spend £5,750,000 a year on defence. I have said before, and now repeat, that this sum is far too large for a small country like Australia. If the money were usefully spent, my objection to it would not be so great; but I consider that a very large proportion of this huge sum of nearly £6,000,000 is expended without adding one iota to the effective defence of the Commonwealth.

Senator Guthrie - It is not spent; it is frittered away.

Senator STEWART - The honorable senator can call it by whatever name he pleases. My opinion is now, and has been for a considerable length of time, that the money spent upon our Fleet might just as well be thrown into the ocean. We are not in a position in Australia to provide an effective defence upon the sea, and anything short of an effective defence is useless.

Senator Henderson - It is worse than no defence at all.

Senator STEWART - I will not say that; but I will say that the money spent in this way might well be profitably utilized in some other way. The people of Australia are in this position, and the sooner they recognise it the better : They are not able, on account of the small population of the country, to put a Fleet upon the waters able to cope with the Fleet of any Power likely to assail this country. That is the conclusion I have arrived at. Any money spent on Dreadnoughts, or other war-ships, might as well be thrown into the ocean, since our ships could be swept from the sea in twentyfour hours by the ships of any great Power. We cannot provide defence at sea and defence on -land as well. That is what we are attempting to do now, and by trying to achieve the impossible, we are doing nothing effectively. We have not an effective Fleet, and we have not an effective land force. Our circumstances are such as to make it impossible for us to have both, but we might have one.

Senator Guthrie - The first line of defence is sea defence.

Senator STEWART - Undoubtedly; and if we had nearly 50,000,000 of people, as Great Britain has, and endless money to handle, I should say by all means let us have a Fleet which will make Australia impregnable. But we cannot do that. We might as well try to scale the stars as to put a Fleet upon our seas sufficient to repel the attacks of possible invaders. The thing cannot be done; therefore, why attempt it? The folly of doing so is that by attempting to put a Fleet upon the sea, we are neglecting the one system of defence which we are in a position to provide; that is, land defence. If, instead of spending £6,000,000 on sea defence, which is not effective, we spent that money on shore defence, in training our youths and young men, providing armaments for them, we might put ourselves in such a position as would enable us to repel any invader. We might provide for the security of Australia in the most effective fashion. If the people of other countries knew that we had hundreds and thousands, not only of youths and young men from fourteen to twenty-six years of age, but also of the flower of our community, men from twenty-six to thirty-five years of age, in addition, they would be very careful about attacking us. What is our position with regard to armaments and ammunition? I believe that if we were attacked to-morrow, and found it necessary to call out our troops, we should find that there were no arms for them, or comparatively few; that our ammunition was very scarce, and that in every sense of the term we were unprepared for the great business of war. If we abandoned the foolish Navy scheme, and concentrated our efforts upon the establishment of an effective land force, we could provide for every contingency. It is quite within our power to make our land defence so complete and effective that any foreign power, knowing of it, would not care to attack us. We spent on pensions and maternity allowance £3,270,000. I know that if the Fusion Government dared, they would check this item of expenditure. The leading spirit of "the Government, the great central sun round which the minor planets revolve, namely, the Attorney-General, has declared in the strongest possible terms that he disapproves of the maternity allowance, and that we are pauperizing our old people by paying them old-age pensions. Fortunately for the people of Australia, the Attorney-General has not been able to get his way so far. But whilst the honorable gentleman is honest and aboveboard, we know that the general feeling amongst members of the Government party is against these payments. I can remember when the old-age pension proposal was passing through the Senate, the criticism that was levelled at it by the Conservative?, Liberals, or Fusionists at that time. They did everything they could to block -its acceptance. They poured ridicule upon it, and said that we would pauperize the people of Australia, and a whole lot of other nice things. But for a wholesome fear of the electors, which was ever before their eyes, I believe they would have knocked out the proposal at the earliest opportunity. The maternity allowance is a much later matter. We can well remember how honorable senators who at that time sat upon these benches, and some of whom sit here no more, said that the maternity allowance would be a premium on vice and encouragement to all sorts' of vicious misbehaviour and habits. Knowing these things, we must come to the conclusion that if the present Government had their way both the payments would disappear from our national balance- sheet. The expenditure on the Post and Telegraph Department brings the total expenditure of the Commonwealth up to £24,000,000 for the year. That is not a healthy state of affairs at all. Our income should be greater than our expenditure.

Senator Guthrie - They should balance, at any rate.

Senator STEWART - They should balance, at least. The Government, and any Government that may follow them immediately, must face the position that either expenditure must be reduced or income must be increased. I have suggested one direction in which expenditure might be somewhat reduced - that is in connexion with the naval arm of defence. I cannot see the possibility of reducing expenditure in any other direction. I do not think that the present Government would dare, if they were given a further lease of power, to interfere with either the maternity allowance or the oldage pensions. I am sure that the Labour Government we are going to have in the near future would not do so. If there is no other item but that of naval defence upon which a saving can be made, we are inevitably faced with the necessity of increasing taxation. The present Government are opposed to any step in that direction. I am, personally, in favour of increased taxation. I say that, instead of deriving £1,400,000 a year from the rich land-owners of Australia, the men or institutions who own rich city lands and large country areas, we should be getting a very much larger sum from them.. I hope that in the near future we shall have a Government in power who will do the right thing, and get a much more substantial share of the national income from that source than the present Government have derived from it. The present Treasurer, I believe, is .prepared to borrow for defence. I hope that no borrowing will ever take place for that purpose. We ought to be able to pay for the defence of the country out of current revenue. Borrowing for defence simply means lavish, extravagant, and unwise expenditure. I trust that nothing of that kind will be attempted. We hear a great deal about the cost of living, and I should have liked very much to go into the question and' present it in, perhaps, a somewhat unaccustomed light in the Senate, but the time at my disposal is very limited. While wages are going up, the cost of living keeps mounting with the increase of wages step by step. We are in the hands of a ruthless combination of trusts and combines. We have the Land Trust, the Sugar Trust, the Meat Trust, and dozens of other trusts and combines, and the members of the present Government are as well aware of that fact as are the members of the Opposition. Yet not only will they do nothing to interfere Avith the ravages of these combines, but they refuse an application by the Senate to submit the Referenda Bills to the people at the coming election. Why?

Senator Ferricks - Because they are afraid to trust the people.

Senator STEWART - They are not only afraid to trust the people, but they are afraid of offending the combines.

Senator Oakes - We trusted the people twice, and they turned the proposals down.

Senator STEWART - My reply to the honorable senator is that we should trust them a third time, and they may turn those proposals up. That is what the honorable senator and his party fear. These trusts and combines - and the Land Trust is the most serious of them all - are robbing the people of this continent. The party which is represented on the Treasury benches by Senator McColl and Senator Oakes lives and moves and has its being through these trusts and combines. It is the trusts which find the sinews of war for the political party opposite. They are the breath of its life and the bone of its body. No wonder that the Government refuse to send the Referenda Bills to the people. No wonder they advised His Excellency the GovernorGeneral not to exercise his prerogative to submit those measures to the electors. They could have done what we asked without adding very much to the expense of the elections. The expense of conducting an election alone will be almost as much as that of conducting an election and Referenda combined. That being so, there can be only one reason for their action, namely, their allegiance to the trusts. It appears to me that the land question is at the root of continued increase in the cost of living. The price of meat is daily going up, as everybody Knows to his or her cost. What is the position in all the States? While hundreds of men are anxious to take part in the work of producing meat only tens can get the opportunity of doing so. We have an artificially created scarcity of land in Australia, which is crippling this continent from end to end. The present Government will do nothing to alter the situation. An effective land values tax would do more to reduce the cost of living in a couple of years than would any other measure which could be adopted by this Parliament. But honorable senators opposite will not lift a little finger to assist in that direction. If the Labour party again assume office within the next few months I trust that .they will do something. As the time for closing my remarks has now arrived, I will not deal with any other matters. I had intended to address myself to several other questions, but as I cannot do them justice in the period at my disposal I must abandon the attempt.

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