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Wednesday, 28 March 1928

Senator KINGSMILL (Western Australia) . - Honorable senators who have taken part in this debate have already considered in detail the agreement which it is proposed to ratify under the bill which we are now discussing. The agreement is the culmination and the crystallization into the language of an act of Parliament of negotiations that have been in progress for many years. At every Premiers' conference one or other of the provisions contained in it was considered by representatives of the States, fortified with the carefully weighed opinions of their financial advisers. Whatever its political aspect may be, I am satisfied that its financial aspect and its probable effect on the States have been well considered by disinterested people who as much as any member of Parliament, have at heart the interests of the Commonwealth and the States. In the circumstances we may very well ratify the agreement. I repudiate the talk about coercion of the States, and I do so because matters have turned out more happily than I had supposed possible when the States Grants Bill was under the consideration of the Senate. At that time, I must confess, I did not take as hopeful a view as the Government did; I did not think that the States would come to a conference when they were, apparently but not really, facing a blank wall. I now quite understand the reason that prompted the Government to reject an amendment that I proposed in the States Grants Bill - an amendment which embodied one of the principle features of the agreement now under consideration, namely, the provision for taking over the State debts, and the imposition of a compulsory sinking fund. I fully recognize that it is only right that a Government should not have any matters of policy suggested to it by a private member. If that was in the mind of the Government, it rightly rejected my amendment, which is now one of the not least important parts of the agreement. The accusation of coercion is unfounded; it is unjust to say that such an idea was ever in the mind of anybody. The States having the assurance of the Prime Minister (Mr. Bruce) - an assurance that I think they have every reason to respect - that their interests would not be jeopardized, met again and acted absolutely as free entities.

Senator Lynch - Free agents?

Senator KINGSMILL - Free entities. The quotations made by Senator Sampson from the report of the last conference of Commonwealth and State Ministers point to that.

Senator Lynch - He read parts of the report only.

Senator KINGSMILL - Exactly ; but on reading the whole report, one finds that the contention that there has been coercion by the Commonwealth is not tenable. Certainly on one or two occasions there was some question of coercion by certain of the States; but that, of course, was a plan that would not work. Seeing _ that the agreement has been arrived at, not hurriedly, not in a month or a year, but as the result of careful and cautious consideration, not only by the Premiers and Treasurers of the States, but also by their responsible officials, wc may dismiss the fears for the present and the future that have been expressed by some honorable senators. It is quite true, as has been said that the protection of the States is the special care of this chamber, but let me point out that on no subject, that I am aware of, have the States had so much opportunity to protect themselves as they have with regard to this' agreement. Under these conditions I have not the least objection to the bill ; indeed, I have every desire to support it. In so doing, I emphazie that the agreement embodied in the schedule is not a hurried one, and further, that any amendment to the schedule would necessitate throwing the whole agreement into the melting-pot.

Senator Lynch - A good job, too!

Senator KINGSMILL - That .is a matter of opinion, not of fact. An honorable senator, holding certain views strongly, may try to influence, but is not likely to endeavour to coerce, other members of this chamber. Believing the bill to be for the good of Australia, and beneficial to the separate States, I have not the least hesitation in supporting the second-reading.

SenatorPAYNE (Tasmania) [5.40 J. - This measure is of such far-reaching importance that every honorable senator is justified in making a contribution to the debate, no matter how small it may be, in order that the people may know the views of their representatives. Coming, as I do, from a State that has had very great financial difficulties for many years, not through any fault of its own, but through circumstances over which it has no control, I find that the subject matter of the bill is of vital interest to the people of Tasmania. I have endeavoured to look at the measure from the point of view of not only a Tasmanian, but also a citizen of Australia, and a representative of one of the States of the Commonwealth. .It has been said to-day, and I heard it remarked prior to this debate, that the Commonwealth Parliament is morally bound to continue the original payments to the States for an interminable period. Quotations have been read to-day from speeches delivered by the late Sir Edmund Barton, and many others, that would convey the idea that their impression was that that was the intention of the founders of the the Constitution. It should be generally realized, however, that it was never the intention under the Constitution to make any arrangement regarding financial assistance to the States interminable, because it was definitely provided that the payments to the States should continue until the Parliament otherwise provide. The day arrived when it was found necessary in the interests of the Commonwealth that the distribution of the customs revenue should be ended, and a new system known as the per capita payment of 25s. was instituted. But even that was not made interminable. Those who have had the idea that these arrangements should last for all time, fail to realize the possibilities of Australian development. We have had to meet liabilities that' could not have been foreseen. I particularly refer to the enormous liabilities incurred owing to Australia's participation in the Great War. Such liabilities as these have made it necessary to do something to ensure, first of all, that the States would not be losers, and in the second place, that the Commonwealth would be able to carry out its programme of development. I have looked through the agreement carefully, and I find one item - it was mentioned by Senator Carroll - that needs close attention. I refer to the fact that the Commonwealth will relieve the States immediately of one-third of their loan obligations, and with regard to future loans, will take the responsibility for half the amounts borrowed.

Senator McLachlan - If the honor-' able senator calculates that on the basis of Senator Needham's figures, he will see what it means.

Senator Findley - How are the States to be relieved in regard to immediate borrowing ?

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