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Wednesday, 16 December 1914

Senator SENIOR (South Australia) . - The Budget practically covers all the operations of government, because, whatever may be said of our legislation, we know that finance is at the base of the whole of it. To-day we find ourselves discussing the Budget in very exceptional circumstances. Not in the history of Australia has there previously been conditions surrounding the introduction of a Budget which have rendered the outlook so dark. Other Treasurers have been faced with drought and with deficits, but no other Treasurer has been simultaneously confronted with war and drought. It has been said that Australia is not feeling the effects of the war very much, but it cannot be denied that the titanic struggle which is now taking place in Europe is intensifying the evils resulting from the drought, and that the interruption of commerce, owing to the war, has led to great stringency in our finances. This afternoon the Government have been criticized for having introduced taxation measures for the purpose of increasing our revenue. I do not think that Ministers should have been so severely condemned under existing conditions. Sufficient allowance was not made for the unprecedentedly hard times through which we are passing. Had that been done, the criticism which has been levelled against the Government would have been of a milder character. Exception has been taken to their action in reference to taxation. But in what other "sphere could they have operated to enlarge the Commonwealth revenue? It may be urged that they could have imposed duties through the Customs which would have greatly increased our revenue. But they have already operated in that direction, and the Treasurer prepared his Budget upon those lines, so that an increased revenue will be derived through the Customs owing to the revision of the Tariff.

Senator Bakhap - Will an increase of Customs duties necessarily produce an increased revenue?

Senator SENIOR - In many respects it will.

Senator Bakhap - Then it is a revenue Tariff.

Senator SENIOR - That is a sample of my honorable friend's logic. Because certain duties have been imposed, he reasons that they have been imposed for revenue purposes. But I would point out that those duties have been levied to produce revenue only until such time as the protection afforded by the Tariff shall have resulted in the establishment of Australian industries. They are not intended to produce revenue. Their purpose is of an entirely different character. It has been stated that when an Englishman desires a holiday, he says, " Let us go out and kill something." It seems to me that the Conservative politician is prone to exclaim, "If we want to do any.4; n let us borrow money."

Senator Bakhap - Have no Labour Governments done that?

Senator SENIOR - My honorable friend must not put words into my mouth. He knows very well that Labour Governments have done it, but they have done it because Conservative Governments have previously neglected their duty, and, consequently, they have been forced to take action. One other suggestion has emanated from my honorable friends which we ought to examine. They have affirmed that, under existing circumstances, it is the duty of the Government to retrench. Now we know very well what has occurred in the past when retrenchment has taken place. We know what has been the aftermath of that policy. It has not been the prosperity which my honorable friends wish, and they could desire no better argument to use against the Ministry in the country.

They would be able to say, " There is your precious Labour Government. Directly they got into power they forgot all about the working man. They cut down the Public Service, and threw out of employment more persons than there were previously unemployed." I think that the opposite policy should be followed at a time like the present. When private enterprise dispenses with its servants, the latter naturally have a right to come to the State and say, " Having contributed to the revenue, through Customs and other taxation, we have now a right to ask the Government in times of stress to see that we are not driven from the State to seek our livelihood elsewhere, and that if we do remain here our living shall be in a measure assured to us." The only palliative offered by the Opposition is to contract a debt without any provision for repayment, and possibly even to borrow the money to pay the interest, as has been done in some of the States before to-day. I have even known public buildings to be erected out of loan money, and further sums to be borrowed to renovate or repair them. Those things were done by Conservative Governments, following out Conservative ideas which, to me, seem to lead to disaster. The methods adopted by the present Government are sound in principle. They hold that those who have profited in times of prosperity should come to the help of the Commonwealth in times of stress. While we are citizens of the Comonwealth we must uphold the Commonwealth. Whilst we enjoy the privileges afforded us by society we must return to society that share of our produce which is necessary to keep the community going. It has been objected that we are encroaching upon State preserves. I regret that it is necessary to do so, but in times of difficulty we must look round to see where our finances can be increased and the prosperity of the country secured. We must not forget the assistance that the Commonwealth has given to the States in ways other than those enumerated this afternoon by Senator O'Loghlin. When war broke out the money market became very tight, the States found it impossible to borrow, and the Commonwealth came promptly to their assistance. Yet some who occupy prominent positions in the States have taken exception to the action of the Labour party in increasing the land tax, alleging that the Commonwealth is acting in an altogether wrong direction, and forgetting that their own States were assisted by the Commonwealth to make ends meet. I regret that these people shut their eyes to the benefits they have received from the Commonwealth, and are not prepared to concede the demands which the Commonwealth may legitimately make on the people as a whole. It is said that we are duplicating taxation. In a measure that is so, but while it may mean a temporary increase in the cost of collection and the keeping of two sets of officers to do the same work, it may, in the end, lead to a very desirable reorganization of the work of the States and the Commonwealth.

Senator Ready - We want uniform land valuations.

Senator SENIOR - The honorable senator has pointed out an anomaly that undoubtedly does exist. There should be a uniform land valuation to become the basis of Federal, State, municipal, and district council taxation, and there should be one set of collectors to do the whole work. With a proper basis on which to levy all forms of land taxation, it would be possible to gather in the money at a very much lower percentage of cost, and the duplication and annoyance occurring at the present time would be saved.

Senator Needham - We must first get the referenda proposals passed.

Senator SENIOR - They have a very wide sweep, but they would not touch the re-organization of our present system of allotting and collecting taxation. The consent of the States would be necessary. It is just as feasible for the Commonwealth to do all the collecting with one set of officers, and then hand back their share to the States, as it is for the Commonwealth to collect the Customs and Excise revenue, and hand back a portion to the States. One of the stock cries of the Opposition is the necessity for increas- ing the population. They seem to regard that as the grand panacea for the cure of all the evils afflicting humanity, but they cannot be oblivious to the fact that the population already here is not fully employed. Until the present population is fully employed, we evidently do not need more workers. Senator Bakhap apparently wants to bring here more of the class of people who do not need to work.

Senator Bakhap - If there were only ten men in Australia, it is odds on thatone or two of them would be out of work.

Senator SENIOR - Then it follows that the men who were working would be keeping the others. Therefore, those who are working here to-day are keeping all those others who do not work or do not need to work, so that after all it is not the benevolent gentleman who employs people, but the benevolent gentleman who works for others, that is the real producer of wealth. It is illogical and unbusiness-like to have two taxing powers, and an understanding will have to be come to between the Commonwealth and the State Governments, possibly at a meeting of the State Premiers. It would be a good thing if they devised a system by which one power would both levy and collect taxation, handing back a certain portion to the States, just as is done now in the case of the Customs duties. Honorable senators opposite are very glad in their own hearts that they do not have to occupy the Treasury bench in these trying times. I sincerely hope that when they are reviewing the Budget outside, they will bear in mind the unprecedented situation in which the Treasurer finds himself. We cannot see the end of our difficulties, but we have made a beginning, and no one can charge us with imposing unnecessary taxation. We should be pursuing a policy condemnable in the strongest terms if we determined to meet our difficulties simply by borrowing. It would be a confession of absolute weakness and mental incapacity. We are undoubtedly borrowing some money, but that is for purposes which must be reproductive. We are making provision, not only to pay the interest, but to provide a sinking fund. Any Government that rushed on to the money market without a hope of paying back the money would be justly chargeable with committing an immoral act. Great as have been the difficulties confronting the Treasurer, he has so managed the finances that we are faced with a smaller deficit than might have been expected from the state of the finances only a few months ago, and for this the Government deserve, and should Be given, every credit.

Senator Bakhap - If we beat the Germans it will be a feather in the cap of Mr. Andrew Fisher.

Senator SENIOR - If we can conduct our internal business with one-half of the business capacity which the Germans have shown in managing their affairs, if we can develop the resources of Australia as Germany has sought to develop her own, we shall prove that we are capable of handling this great country as we ought to do. I know that my honorable friend objects very strongly to socialistic ideas.

Senator Bakhap - I do not object to technical education.

Senator SENIOR - Nor do I. I am quite as ardent an apostle of technical education as is Germany; but it must not be forgotten that, were a proposal brought before this Parliament to develop some of the mineral resources of the famed Island, Tasmania, the honorable senator would immediately raise the cry that it was socialistic, because it concerned his own little place. I notice that parochial Socialism is very strong with our opponents. What has Germany done? A very large portion of her revenue comes from mines which are State-owned. But nobody thinks of pointing to Germany as a wicked evidence of Socialism. Again, take the forests in Germany. A very large portion of them is State-owned. From those two sources Germany derives a very large amount of revenue. We may say that to-day we are combating the Socialism with which Germany has builtup a war chest to fight her battles. It is an unfortunate thing, and it seems to me that it is misdirected energy in that sense. The Socialism that would develop the resources of Germany is right, but the development of those resources for the purpose of annexing that which belongs to another is wrong. I take exception to the direction it has taken, but certainly not to the development of the resources. When we look round in Australia, we must recognise that, comparatively, we have only touched the fringe of it. We scarcely know what there is at any point beneath the surface. We can hardly tell what undeveloped mineral wealth may be revealed in a few years to come. Yet we seem to be scared and frightened by every attempt to develop them. Adverting to a matter that Germany has proved to be remunerative, I would ask, what is done in Australia in regard to forests? We demolish them as fast as we can; with axe and firebrand we level them to the ground. Our cry is all the time that we want the land to put somebody on. Although Germany has far poorer land to handle than we have - much of it is inferior land - she has made use of that land in such a way that to-day it is, as regards forests only, the means of supporting between 3,000,000 and 4,000,000 people. Over £1,000,000 of her revenue is derived directly from the forests. In these things it will be seen there is at least a lesson which, if followed, would make Australia a much better country than it is. I think that the Budget is one which the Treasurer may be commended for bringing down in such critical circumstances as now obtain.

Debate (on motion by Senator Grant) adjourned.

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