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Wednesday, 4 August 1926

Senator McLACHLAN - Is it not a bad principle that State Treasurers should be allowed to budget ou annual payments by the Commonwealth.

Senator H HAYS - I do not know. During the first ten years of federation they were encouraged to budget in that way, and they were further induced to do so by the passage of the Surplus Revenue Act, -which provided for the capitation payments. It is regrettable that the Commonwealth's proposals are now being forced upon the States. We, in this Parliament, represent exactly the same people as those for whom the State Parliaments legislate, and since Commonwealth and State taxpayers are identical, why should there be such an urgent desire to separate Commonwealth and State finances? It seems to me that the best results are to be obtained by the closest co-operation between the State and Federal authorities. The State Governments have borne the heat and burden of the day. Although Australia has made great progress under federation, the Commonwealth as a whole is indebted to the States for the spade work that they have done. They have their commitments to meet, and rather than do anything to cause hostility between them and the Commonwealth, we should endeavour in every way to work harmoniously with them. Proposals such as the withdrawal of the per capita payments under the present bill certainly create friction.

Senator Thompson - Could the States be made the sole taxing authority?

Senator H HAYS - It is generally agreed that each government should be responsible for raising the revenue that it expends.

Senator McLachlan - The closer to home the taxing authority is, the better.

Senator H HAYS - All governments waste money; but the States have to give much closer scrutiny to their expenditure than is the case with the Commonwealth. The expenditure of public money can as safely be entrusted to the States as to the Commonwealth.

As details of the Government's housing scheme are not yet available to honorable senators, I shall refer to it only in a general way. While I do not say that there is no necessity, for a housing scheme, I point out that each State has its own organization already in existence, and that this work could with advantage be undertaken by them rather than, by the Commonwealth. With the Commonwealth Government embarking on a housing scheme, conflict between the State and Federal authorities is inevitable.

Senator McLachlan - The Commonwealth has not been particularly successful with its housing ventures in the past.

Senator H HAYS - I do not propose to refer to that now. The Commonwealth Government was at one time responsible for providing homes for soldiers in Tasmania, but I believe that that work is now entrusted to the State.

Senator Crawford - Under an agreement with the Commonwealth.

Senator H HAYS - That shows that, in the opinion of the Commonwealth Government itself, the best authority to undertake this work is the State Government. If schemes of this kind are to be undertaken by governments, it is preferable that the States, and not the Commonwealth, should carry them out. The Commonwealth should deal with questions of a purely national character. Important as housing may be, it is, nevertheless, not the function of the Commonwealth Government. Rather than embark on this undertaking, the Commonwealth should make cheap money available to the States to enable them to supplement the schemes already in existence.

Senator Grant - Does the honorable senator suggest a subsidy?

Senator H HAYS - I am pointing out that, in order to avoid duplication and increased overhead expenses, which must necessarily affect the cost of houses, the work of providing homes for the people should be left to the States. There are many other matters calling for attention by the Commonwealth Government.

As an opportunity will be given later to deal with the Government's road policy, I shall not make detailed reference to it now. I desire, however, to say that, while the Commonwealth Government is to be commended for its recognition of the necessity for good roads throughout the Commonwealth, this also is a matter which, in my opinion, should be left to the States, which already have the machinery necessary for carrying out the work.

Senator Pearce - The Commonwealth has not interfered with chat machinery.

Senator H HAYS - I recognize that; but the Commonwealth proposes to make the money available only under certain conditions. The works to be undertaken must first be approved by the Commonwealth. Moreover, the States are required to contribute 15s. for every £1 advanced by the Commonwealth; the original proposal was on a £1 per £l basis. In the case of Tasmania, £75,000 will have to be provided by the State. The Commonwealth proposes to raise the money which will be expended in roadmaking by means of a tax on petrol. I shall not refer to that other than to say that, in my opinion, no more equitable way of raising the money could be found than by the imposition of a tax on petrol. Nevertheless, as the tax will be paid by the motor users in the several States, it would be better if the Government were to make the money available to the States, imposing no conditions other than that it should be expended in road construction. Why should the Commonwealth require the States to contribute 15s. for every £1 advanced to them? It would be sufficient if the States were required to submit annual returns showing how the money had been expended. That some of the States object to the Government's proposals is not to be wondered at. They are not so much concerned with the source from which the money is obtained as with the conditions under which it may be expended.

Senator Foll - The suggestion of the honorable senator is that the Commonwealth Government should collect the money, and hand it to the States, and yet have no voice in its expenditure.

Senator H HAYS - There is no reason to suppose that the States will expend the money less wisely if they are not subject to some control by the Commonwealth.

Senator Foll -Judging by the way some of the States spent money in soldier land settlement, some control appears to be desirable.

Senator H HAYS - I do not propose to deal with that subject now; but I remind the honorable senator that the Commonwealth Government was not entirely free from criticism in relation to some of its repatriation activities. The making of roads is distinctly the function of the States. In this connexion they have done good work in the past. That they did not do more was due entirely to their restricted revenues. Until about five years ago Tasmania spent from loan as much money in making roads and bridges as did all the other States combined. Successive governments in Tasmania, realizing that in broken country with a wet climate good roads were necessary for the development of the State, constructed many excellent roads.

Senator Crawford - The other States constructed their roads out of revenue derived from rates.

Senator H HAYS - The rates levied in the other States do not exceed those levied in Tasmania. Tasmania is not so much concerned with the making of new roads - in that respect she has been ahead of the other States - as with the necessity for maintaining in good condition roads already in existence.

The Treasurer's speech contains a reference to prospecting for oil. I have no complaint to make regarding the money that has been expended in boring for oil in Australia. I think that every effort should be made to ascertain if there is flow oil in the Commonwealth. The results so far do not encourage the belief that there is; but our oil shale deposits are enormous and of immense (value to the Commonwealth. Hitherto they have not been successfully exploited because suitable retorts have not been employed; and I believe that I am correct in saying that no official in the employ of the Government has had any experience in retorting. It is of the utmost importance that this business should be developed on sound lines, because there are millions of tons of shale in both New South Wales and Tasmania rich in oil content, which, I am sure, will one day prove of great value.

Senator McLachlan - Does the honorable senator think that our shale oil propositions will be able to compete with flow oil?

Senator H HAYS - Yes. This matter should be investigated by the Council for Scientific and Industrial Research. It properly comes within the province of that body. Those who have been engaged in the business for the past fifteen years have been beset by difficulties which, with scientific handling, should be solved. I hope that something will be done in this direction in the near future.

Turning now to the Postal Department, I direct attention to the desirability of providing better postal and telephonic facilities for people living in outback districts. The adoption of the slot telephone bureau system would be appreciated in country centres where, under present arrangements, an opening fee is charged if a person wishes to use the telephone after the ordinary closing hours. I understand that the department does not view this proposal with favour. I agree that a good deal has been done already to improve tlie services in many country districts, but it is very desirable to encourage settlement by providing the most modern facilities for the people. Silting suspended from 6.27 to 8 p.m.

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