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Friday, 9 October 1936

Senator J V MACDONALD (QUEENSLAND) - I am Quite unable to follow the reasoning of Senator Leckie. In this instance, those in an advantageous position under the Constitution are being asked to assist those not so favorably circumstanced. During the debate it has been suggested that Queensland is a rich State, but a study of the figures show that there is a possibility of Queensland being regarded as one of the poor relations.

Senator Dein - Perhaps the conditions in Queensland are due to bad government.

Senator J V MACDONALD (QUEENSLAND) - Not at all. But for the wealth which the sugar industry produces, Queensland would have to ask the Commonwealth Government for £2,000,000 annually.

Senator Hardy - New South Wales is also thinking of submitting a claim.

Senator J V MACDONALD (QUEENSLAND) - I would support its claim if it could be substantiated. The report of the commission clearly discloses that New South Wales and Victoria have benefited by federation at the expense of the other States. Prior to federation, manufacture in Queensland was increasing, but immediately tariff barriers were removed the position changed.

Senator Leckie - The Queensland Government has taxed manufacturers out of existence.

Senator J V MACDONALD (QUEENSLAND) - It has not. The unsatisfactory position in which Queensland manufacturers are placed is due to the competition from mass producing industries in Victoria and New South Wales. The Queensland manufacturers have the same complaints concerning the competition from those States as Senator Leckie has against British manufacturers. It is only the protective tariff which enables mannufacturers in the States I have mentioned to produce at a profit. Sir Hal Colebatch, who has given close attention to the financial position of the States, said that but for the sugar industry Queensland would he in a financial position similar to that of Western Australia.

Senator Dein - What Queensland factories have been closed down ?

Senator J V MACDONALD (QUEENSLAND) - The output of boots and shoes, to give one example, is decreasing rapidly?

Senator Dein - The working conditions and wages are practically the same in Queensland and Victoria.

Senator J V MACDONALD (QUEENSLAND) - The existence of an anti-sweating league in Melbourne shows that sweated labour is employed in Victorian factories. Under conditions slightly different from those obtaining to-day, Queensland would be seeking financial aid from the Commonwealth.

Senator Arkins - Yet Senator Brown has said that Queensland is particularly well off.

Senator J V MACDONALD (QUEENSLAND) - When Australia has been seeking loans overseas, we have all read statements to the effect that the whole continent is a land flowing with milk and honey, but we know that, as a matter of fact, one-third of it is desert.

Senator Arkins - The honorable senator seems to think that New South Wales is the bee that sucks the honey.

Senator J V MACDONALD (QUEENSLAND) - I have no prejudices against New South Wales, but there is no doubt that it gathers a lot of the honey, in this respect being second only to Victoria. Senator Leckie who is usually fair in his utterances, was certainly somewhat hard on the claimant States. It is not true that they are simply demanding so much money, the property of the non-claimant States. Hearing some honorable senators, one would think that New South Wales and Victoria came into possession of all this money in a manner quite apart from their trade and industrial relations with the other States. The fact is that the strong financial position of Victoria and New South Wales is due mainly to their very advantageous trade relations with the smaller States. There is no doubt that financia'l interests in Victoria and New South Wales have a tremendously strong hold upon the economic activities of the rest of the Commonwealth. When I visited Western Australia for the first time, I was surprised to learn that there was no Western Australian bank. There had been one, I was given to understand, but it had been absorbed by the Bank of New South Wales. Even the mercantile associations in Western Australia are largely controlled from South Australia and Victoria. This financial dominance by the eastern States is so strong that the other States must always be liable to get the worst of the bargain. It have had to listen to many attacks on the Queensland sugar industry, but I remind honorable senators from Victoria and New South Wales that, though they could probably buy cheaper sugar from Java or Cuba, they would never be able to sell to those countries anything like the same quantity of manufactured goods that they sell to Queensland.

I have addressed myself to this subject of grants to the States on many occasions, and I have never quibbled about the amount of the grants. We should not bother about a few hundred thousand pounds one way or the other. The great need is to put an end to this talk of secession, to remove the feeling of discontent that undoubtedly exists in some States. Some of the representatives of Victoria and New South Wales have spoken of the claimant States as if they were beggars crying for alms - as if they were seeking something to which they were not entitled. I submit that the claimant States are entitled to all the grants they have ever received. We should not forget that the industrial interests of Victoria and New South Wales, by virtue of being first in the field, obtained a start which they have maintained up to the present time. Even in Queensland, the pastoral industry was largely developed by capital from Victoria, and we know that those who invest money in such enterprises always take their full share, and more, of the profits. I trust that the economic position in Western Australia will improve. The increased price of wheat will undoubtedly help both Western Australia and South Australia, but if the Western Australians can show that they should receive even greater assistance, the representatives of the other States should not quibble over the amount to be given. There is no doubt that Western Australia has been badly hit. The production per head of population is higher in Western Australia than in any other State, but it is all primary production. I intend to vote for Senator Marwick's amendment, and I hope that it will receive the support of other honorable senators. I have no sympathy with those honorable senators who ask how much longer the claimant States will seek financial assistance from the Commonwealth. I do not think that under our system of federation, there will ever be a time when one or other of the States will not be in need of financial assistance of some kind.

Senator Herbert Hays - There is no escape from it.

Senator J V MACDONALD (QUEENSLAND) - Senator Leckie,who is usually a model of good sense and brevity, adopted a wrong attitude in this regard. In my opinion, a financially weaker State is quite justified in approaching the federal Government for a grant to compensate it for its disabilities under federation. If the people of Victoria or New South "Wales suffered a great disaster from flood, fire, or other cause, their fellow Australians of Other States would be perfectly willing to assist them in their hour of travail by subscribing to a relief fund on their behalf; but the payment of grants to States, in competition for disabilities, is a far more important matter. Any State which considers that it has suffered financial injury owing to federation has the right to appeal for assistance. There has been ample evidence in recent years to show that if that right is not recognized, the existence of thu federation itself will be endangered.

Senator Dein - Nobody denies the right of the States to appeal for assistance.

Senator J V MACDONALD (QUEENSLAND) - (Senator Leckie has done so. He asked how much longer would these grants to the smaller States continue, and how much longer would they make appeals for assistance? Up to date, Queensland has been fortunate enough not to require a disabilities grant, but the day may come when some disaster, economic or otherwise, may overtake it. If the necessity should arise for that State, to appeal for aid, its people would deeply resent any insinuation from, another State that it had no right to ask for assistance from the Commonwealth.

Senator Herbert Hays - The other day the Premier of Victoria said that his State was being bled white by the Commonwealth.

Senator J V MACDONALD (QUEENSLAND) - I read that passage, which, in my opinion, waa pure nonsense. Undoubtedly, some nasty statements have from time. to time been made iri respect of Commonwealth grants to the weaker States. The explanation, I think, is that persons like Mr. Dunstan - and there also may be some of them in Queensland - do not really understand the position; if they were taken to task for their statements, they would probably express regret for having made such foolish remarks. In my opinion, the payment of grants to the financially weaker States is inescapable under the present federal structure, and, until the tide of prosperity turns, such States must continue to appeal for Commonwealth grants. I sincerely support the amendment moved by Senator Marwick, and I hope that it will have the approval of the majority of honorable senators.

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