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Thursday, 15 April 1915

Senator GUTHRIE (SOUTH AUSTRALIA) - Are we not doing it?

Senator MILLEN - I am not saying that we are not, and the honorable senator cannot assume from anything I have said that that is the view I take. I trust that the speeches which will be made in this Parliament in connexion with the? war will be designed as much for the encouragement of public opinion as- for any influence they may be expected to have upon members of the Parliament. I have said that in my view the war overshadowseverything else, and it is for that reason I distinctly regret the announcement made by the Minister of Defence in reply to an interjection of mine in which he made it quite clear that it is the intention of the Government to proceed with their full party programme this session. That statement, whilst having all the authority of a Ministerial statement, has also been given to the country, though not in such a decisive form, by other members of the Ministry, and particularly by the Prime Minister. Yesterday an interjection was made hene, I believe by Senator de Largie, to the effect that there is no party now. Might I suggest to tha Government, and to honorable senators, that the cessation of party warfare in the presence of this overwhelming crisis muse surely be reciprocal. There cannot be a cessation of party warfare by one side simply ceasing to try to give 'effect to iti political views, whilst the other side insists on giving effect in the fullest extent to the political views it holds.

Senator Needham - The honorable senator would not accept that offer during the elections.

Senator MILLEN - I ,am glad to get that interjection, because I should like to say that we are to-day faced with an entirely different position. If Senator Needham refers to the proposal to abandon the elections, it was clearly shown at the time that there was no constitutional or legal means by which that could have been done. The question whether the people should choose those into whose1 hands they wished to give the administration of the country was one thing, but, the people having made their choice, the question whether' Parliament should h& called upon to devote all its energies, capacity, and patriotism to a united effort to . strengthen the hands of the Government in dealing with the big matters which now call for attention, or whether it should be compelled by the action of the members of the Government themselves to become the arena of heated1 party controversy is an entirely different thing.

Senator Guthrie - The honorable senator's party opposed these matters at the elections.

Senator MILLEN - What matters?

Senator Guthrie - The matters which the honorable senator has just mentioned.

Senator Russell - Can the honorable senator give us a word or two in explanation of the practical application of these principles manifested at Bendigo?

Senator MILLEN - I can; but I »m sorry to have to do so. During my visit to Bendigo there was placed in my hands a report of speeches by Ministers in which they used the war and matters associated with it for the purpose of influencing the votes of the electors on that occasion.

Senator Russell - We were accused of trading with the enemy.

Senator MILLEN - And I was accused of it in this chamber. We can leave that alone. I put to honorable senators and to the country a position which appears to me to be far more important than the little matters introduced by Senator Russell. I am pleading for a different state of affairs from that to which the honorable senator refers.

Senator Russell - I am pleading for the application of the principle.

Senator MILLEN - So am I. I have given my justification for the interpretation I placed upon it. The Ministerial statement which is before us admits that we are not, to-day, somewhat slightly interested relatives of Great Britain trying to help her in a struggle that is hers, but refers to the struggle that is taking place as " our war." And it is our war. That being the case, may I appeal to honorable senators to, as far as they can, put the Government in the best possible position to prosecute their portion of the. efforts made to carry the war to a successful conclusion. What is the position to-day? There is no one who lias had even a few months' parliamentary experience who will for a moment dispute the statement that there is sufficient work to be done in connexion with the war to exhaust the energy, and demand the most minute attention, of the most active Ministers who ever held office.

Senator Story - Should urgently necessary legislation be delayed simply because a state of war exists, though it may have a party aspect?

Senator MILLEN - No. Legislation which is urgently necessary must, in my opinion, be legislation connected with the war. Otherwise, I say it is not urgent. Nothing is urgent to-day but the adoption of the best means to prosecute the war to a successful issue.

Senator Story - What about the price of food?

Senator Watson - The cost of living is a very urgent matter.

Senator MILLEN - I decline to be drawn on one side to the consideration of matters apart from the general principle I. am enunciating.

Senator Long - There is another reason, and that is that it would be a little bit awkward.

Senator MILLEN - I quite understand that there is a type of mind which cannot for a moment recognise seriousness in an opponent, and that is unable to be serious itself in the consideration of even the most important questions. I aru entitled to put the position before the Senate, and I say that no one will venture to contradict the statement that matters arising out of the war are of sufficient magnitude and frequency to demand every moment of. Ministerial time. If there is any member of the Ministry who should be free to deal with these matters, he is, not even excepting the Prime Minister, the Minister in charge of the Defence Department. I am speaking with a knowledge of what happened during the first months of the war. Though we may assume that matters have to some extent fallen into a beaten track, there must be still a thousand and one new problems coming up for consideration by the Minister of Defence. In the circumstances it is, to my mind, little less than criminal that the mau charged with the conduct of our Expeditionary Forces, and the many matters involved in the control of the Defence Department during the present crisis, should be spending a single moment at the Minister's table opposite to me in this chamber. The Opposition have offered to place the Government m possession of the fullest powers for which they think it necessary to ask for the purpose of prosecuting the war.

Senator Long - The honorable senator's generosity overwhelms me.

Senator MILLEN - I say that the offer has been made, not by me. but by those who are entitled to speak for the party on this side, and made in all sincerity . I believe that even the more responsible members of the Labour party accept the offer in the same good faith in which it has been made.

Senator Long - We could do it without the assistance of the Opposition.

Senator MILLEN - It could be done without the assistance of the Opposition in this chamber, certainly. Am I to understand that, because we are iri a minority in this chamber, our honorable friends opposite scorn the co-operation of their political opponents in carrying the war to a successful issue?

Senator Long - No; I object to the honorable senator making a virtue of necessity.

Senator MILLEN - I am not making a virtue of necessity at all.

Senator Long - You are parading your generosity.

Senator MILLEN - It is nob a matter of generosity at all. I want to bring home to honorable senators opposite, and to Ministers themselves, this fact, that in my judgment Parliament ought not to have been called together to deal with anything except matters arising out of the war, and that beyond that Ministers should be set as free as possible to devote their energies and their time to the prosecution of this war. What has been done elsewhere? That is the course that has been followed in Great Britain. The Prime Minister there, speaking recently about the matter, said he assumed that any other course than that to which I refer would be received with a considerable feeling of anger by the people and the parties. In Great Britain, Parliament meets and passes the necessary war legislation, granting the Government the fullest powers possible, with the result that the Government there is in the position of an autocrat by reason of the power accorded to it by the united Parliament.

Senator Guthrie - Would the honorable senator pass that power over to our Government ?

Senator MILLEN - There would not be the slightest demur to giving the Government the fullest powers necessary for the prosecution of the war. That is a clear and specific statement. It does not appear to be at all reasonable, nor does it indicate anything in the nature of states-, manship, that the Government should use these immunities for the purposes of party propaganda. Not only would the Government be clothed with the fullest powers, but they would have the assurance that their political opponents would not be too critical of them in the exercise of those powers. Except in regard to the necessary legislation which we are bound to pass. Ministers should be set free from attendance in Parliament, and the harassment which must follow a heated party session. There is that alternative before the Government, and, according to the choice which they make, the country will be able to determine from the result whether they have been successful in placing the interests of the Empire before the interests of party.

There are two or three quite minor matters which arise out of the presentation of this document. The first is the publication of a list of figures as to the number of troops sent abroad and in training. I hope that the presence of this document and of those figures is indicative of the obligation resting upon the Government to adopt a more reasonable rule in regard to censorship than that previously existing. Not long ago, the military authorities were insisting that it was little short of criminal to disclose any figures at all connected with the movement of our troops, and in many other ways they imposed on the journals of this country measures of restriction in excess of the needs of the case.

Senator Pearce - There was reason existing then which does not exist now.

Senator MILLEN - I presume the honorable senator means the presence of enemy ships.

Senator PEARCE (WESTERN AUSTRALIA) - That is one reason.

Senator MILLEN - I am not going toeclosely into the details, but there were other reasons which animated the authorities in declaring that no newspapers should give particulars as to the numbers of the troops. Even if a parade took place in the city, newspapers were prohibited from giving any particulars,, and that, I say, was carrying the thing to a ridiculous extent. I am hopeful that time, experience, and calmer judgment will induce the authorities to relax their restrictions. I do not say that, we should publish information which would be of use to the enemy, but the temperament of the Australian people is; such that they would resent any refusal to give information the publication of which would not be detrimental in tha public interest.

Senator de Largie - We get information sometimes from the English newspapers.

Senator MILLEN - Yes ; I have known information to be banned here and to be sent out from England. Information concerning the movement of forces in the Pacific has been banned in Australia, and newspapers from New Zealand have

Arrived here giving illustrations and an account of those movements.

Senator Needham - There was the case of the Audacious.

Senator MILLEN - Yes; but that case was afterwards proved to be not so serious as was at first stated. The authorities here have allowed an excess of zeal to carry them beyond the requirements of the situation ; but I am hopeful, now that the figures have been published, that the powers of censorship will be used in a more reasonable manner.

There is one other matter to which I want to refer, and, next to the war, it is the most serious question with which we are confronted. It is closely connected with the war. I refer to the matter of finance. We shall have shortly an opportunity, on the presentation of the Budget, or of a Supply Bill, to go more fully into the matter; therefore, I propose only to indicate one or two aspects which are of a disquieting nature. It is evident that our expenditurehas gone up beyond the anticipations of a few months ago. I am merely stating the fact, not criticising the expenditure, as indicating the financial responsibility we shall have to face before long. The point that I wish to bring before the Senate, as showing the seriousness of the position, is that not a single penny of the war expenditure has yet been found by Australia.

Senator Pearce - Australia is responsible for the expenditure.

Senator MILLEN - Yes; but there is a difference between what a man or a country borrows to-day and what it may be called upon to repay when the loan becomes due. We are incurring a liability which will add to our annual outlay later on, and we are nob receiving sufficient income to meet our ordinary expenditure. As we are not paying anything towards the cost of the war, and shall have to do so eventually, the position is this : that our annual income being insufficient to-day to meet our expendi ture, when we add to it the amount that will be involved in the redemption of the loan, we shall find ourselves confronted with very serious financial difficulties.

Senator Pearce - That is assuming that none of that obligation is taken off our shoulders by the payment of a war indemnity by our enemies.

Senator MILLEN - Even if some of the obligation is taken off our shoulders - and we may as well recognise that it will be one thing to put down an amount in a document-

Senator Pearce - It is a possibility.

Senator MILLEN - I have no doubt that an indemnity will be demanded, and if the matter rested in my hands, I would see that the amount was so heavy that those who brought about this outrageous war would not be anxious to repeat it at an early date. In my opinion, no indemnity can be placed on any nation to-day which will in any way meet the cost of the war; the figures are too big.

Senator O'LOGHLIN (SOUTH AUSTRALIA) -Colonel O'Loghlin. - You did not view with any favour last session our taxation proposals to meet the deficit.

Senator MILLEN - The only objection I raised last session to the proposed additional taxation was that not a single penny of it was to go to meet the cost of the war. I never discussed the merits of the new taxes, but what I did was to point out then, as I do now, that, so far, we have not done a single thing to raise a penny towards meeting the cost of the wax; in other words, we are financing the war out of borrowed money. I am making no objection to that, and I do not know that anything else could have been done. My purpose in referring to the matter was merely to point out that on the termination of the war, instead of borrowing money, we will have to pay back at least some portion of what we have borrowed. Remembering also that there is a deficiency to-day between ordinary revenue and expenditure, it does occur to me that the financial position ahead is one which is gloomy in the extreme.

Senator Russell - Do not overlook the fact that we are a lender as well as a borrower.

Senator MILLEN - But the Government are only lending what they have borrowed from another source.

Senator Russell - Pound for pound.

Senator Lynch - No fear.

Senator MILLEN - We are going to lend the States £18,000,000. What are the Government doing? £10,000,000 they are going to get from the hanks, and in proportion as the States pay us back we have to pay back to the banks.

Senator Russell - Do not forget that the banks have a security worth £50,000,000.

Senator MILLEN - Security for what? Not for £50,000,000, but for £10,000,000. The banks have given the Commonwealth £10,000,000 in gold, and the notes are not worth more than that amount. Honorable senators must recognise this fact, and the Government recognise it by the agreement they made with the banks, that on the termination of the war the notes are to flow back to the Treasury, because they made a stipulation with the banks not to present the notes until after the close of the war.

Senator Russell - Is that the only consideration ?

Senator MILLEN - The amount we are lending to the States is the amount which we shall be called upon to pay back to the banks. Now the banks are entitled to present their notes for redemption at the end of the war. The States are not going to be called upon to make their refund so soon, because it would bankrupt the States if the Commonwealth Government took that course. The States will have to be allowed a longer period in which to repay.

Senator NEWLANDS (SOUTH AUSTRALIA) - So will the Commonwealth.

Senator MILLEN - The banks are entitled under their agreement with the Commonwealth Government to present the notes the moment the war is over.

Senator NEWLANDS (SOUTH AUSTRALIA) - Will they do it?

Senator MILLEN - They are entitled to do it. I have not the slightest doubt that when the war is over - and it is a question of whether it will not be before - this rather inflated note issue of to-day ' will be found to be in excess of the requirements of the people.

Senator de Largie - But it is not inflated. ,

Senator MILLEN - The Government themselves, I say, by the agreement with the banks, have been fearful all along - or shall I say prudently cautious - of the natural tendency of the notes to go back to the Treasury, because one of the terms of the agreement was that the banks would help the Government by not presenting the notes for redemption.

Senator Pearce - It is beyond argument that we will have to finance the- £10,000,000.

Senator MILLEN - That is so; but some honorable senators seemed to think that I was criticising the actions of theGovernment. I was endeavouring, on the other hand, simply to state the facts. I. wish honorable senators would get that into the back of their heads, and not immediately assume when I state facts that I am criticising the Government.

Senator Russell - It is not your facts to which I take exception, but yourstatement of facts.

Senator MILLEN - What has been wrong in the statement of facts I havemade here to-day ? The Minister of Defence has just admitted that the Government will have to redeem the loan of £10,000,000 from the banks. I conceive - that we are entitled to still keep this problem in view in order that we shall balance matters as far as we can see mentally in considering what action we are to take in the future. I want to point out that, apart from the assistance of theImperial authorities which has been for the purpose of financing the war, the key to the Government's finance has been the note issue; there is no question about that.

Senator Lt Colonel O'loghlin - You are glad that you helped it along.

Senator MILLEN - That, I think, is a little ungenerous on the part of the honorable senator. The key to the Government's finance, I repeat, has been the issue of notes. And that being so, I want to quote a phrase from this document on page 7-

The Australian Notes Fund could not have been used in the manner indicated without the assistance of the banks.

I do not know whether any one will assume that I am interpreting that phrase too widely when I take it as an admission that the Notes Fund by itself, and without the help of the banks, would have been practically of little use to us at the present moment.

Senator de Largie - We have the power to legislate so that we could attain the same result.

Senator MILLEN - Yes, the Commonwealth Government could have commandeered the gold in the banks, and, as a last resort, they would be entitled to tlo it. In a national emergency I do not question the power of the Government to do anything. ' I am not dealing with that issue now, but am pointing out, first, that the key of the Government's finance was first the issue of the notes; and, second, that this document contains an admission by the Government that the notes by themselves would have been of little value. It is the action and the cooperation of the banks, with their supply of gold, which has enabled the Government to use the Notes Fund as advantageously as they have done.

Senator Findley - Where would we have been if there had been no note issue ?

Senator MILLEN - Where would the Commonwealth Government have been but for the banks? This document admits that the Notes Fund could not have been used in the manner indicated but for this vitalizing influence supplied by the banks. It is not the Government who are assisting the banks to-day, but the banks which, on the admission of this document, have been enabling the Government to impart to the Notes Fund an extent of usefulness which would have been entirely absent but for the cooperation of the banks. The financial obligations will intensify as time goes on. On the other hand, our resources for meeting them, so far as the Notes Fund is concerned, are, as I think I will show from this document and other sources, nearly exhausted. Some honorable senators may argue that by drawing further on the supply of gold we could place the Government in a position to issue a further amount of notes, but I think it is quite evident to those who have read this document that even the Government recognise that they have reached the limit at which notes can be safely issued. According to this document, the Government have just now not only borrowed from the Imperial authorities for the purposes of the war, but have borrowed £3,500,000 from them for the purpose of carrying on public works. If the Government were in a position to issue an additional amount of notes with- safety, there was, I submit; no reason why they should have gone to the Imperial authorities for money for any purpose outside the prosecution of the war. But the fact that they have borrowed for public works to the extent of £3.500,000 is, I think, va recognition by the Government that they cannot pursue the policy of issuing notes to an unlimited extent, and that they are getting sufficiently near the margin of safety to render it prudent on their part to call a halt, and look elsewhere for the money they need for public works. That seems to me to be the position, and I am not alone in that view. In reading the accounts of the Political Labour League's Conference at Sydney, I noticed that Mr. Holman, in discussing that interesting document - the Norton-Griffiths agreement - referred to the claim of those present that the note issue could be exploited to a greater extent. Mr. Holman said " he did not believe in the issue of a large amount of paper money beyond a certain limit, and that limit was fast being approached." I think that he" was stating a simple fact. In my opinion, this document shows that the Government themselves recognise that they cannot proceed along the road which they have travelled to a much greater extent, otherwise they would surely abstain from borrowing, not for defence, which I put in a different category, but for the purpose of public works in Australia, if they had the money available from the Notes Fund ?

Senator Guthrie - Can you tell us when the war is going to end ?

Senator MILLEN - The honorable senator is aware, of course, that neither I nor anybody else knows that.

Senator Guthrie - That is our position, and we have to look out for that.

Senator MILLEN - The Government to-day are entitled to call up 7,000,000 sovereigns from the banks. With that gold in the Treasury, the Government would be entitled to issue £28,000,000 worth of paper money. If the note issue is capable of an unlimited extension, the Government, instead of borrowing £3,500,000 from the Imperial authorities for public works, could have used the money in the Notes Fund for the purpose of carrying on public works. I am not quarrelling with what Ministers are doing. I think that they show a proper recognition of the facts of the situation when they recognise that we cannot go on issuing notes to an unlimited extent.

Senator de Largie - No one ever said the opposite, either.

Senator Guthrie - Mr. Holman did" not say it.

Senator MILLEN - No; but it has been alleged, and is to-day affirmed and believed by a large number of persons throughout Australia, that the Government could, by the issue of paper money, finance public works to any extent.

Senator NEWLANDS (SOUTH AUSTRALIA) - No Labour man made that statement.

Senator MILLEN - The sole purpose of my observations has been to try to bring home to honorable senators that today we are financially in a position which is going to call for the most careful thought and the most prudent action on the part of those charged with the responsibility of managing our affairs. That is the position, and I do not know that, I have said a single word to which honorable senators, if they are prepared to dispossess themselves for a moment of party prejudices, can take any exception. It appears to me that the big national questions for the moment - the war and its financial problems - are going to make the heaviest demand on our administrators, and, in spite of what they can do, I venture to say that, without the hearty co-operation of all sections of the community, and loyalty on the part of both private and public men in rallying together to endeavour to face the trials ahead, we shall find, not merely our parliamentary concerns, but our national affairs, in a very parlous condition indeed. At any rate, no harm can be done in considering them as far as we possibly can before we are called upon to deal with them. I have invited the Government's consideration as to whether even now, at the eleventh hour, they would not be better advised to try to limit our work here to those matters which are associated with the war, in order that Ministers could have their hands free for administrative purposes, in order that they could absolutely shut out all party feeling from the walls of Parliament, and assure themselves of the hearty support and cooperation of those who ordinarily are opposed to them. I still think that there should be made known outside as widely as possible the serious results which are attendant upon the war. and in consequence of that there will be a continuation of that intention and determination to support the Government in anything they can do to see that Australia loyally and energetically discharges the obligation in respect to the war which she has taken upon herself.

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