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Friday, 1 May 1942

 

That represents a net reduction during the year of £19,616,660. During the same period governmental and municipal advances by the nine trading banks increased by £21,600,000- from £22,100,000 to £43,700,000. Treasury-bills increased by £14,400,000- from £23,900,000 to £38,300,000. The total increase amounted to approximately £35,000,000. Why should treasury-bills be issued to the banks? They are merely undated promissory notes, and the banks have the right to go to the Commonwealth Bank at any time and change them for notes. I remember the chairman of the associated trading banks saying on one occasion that he was sorry that the interest that he received for treasury-bills in London was only 10s. per cent., whereas in Australia he could get 30s. per cent. from the Commonwealth Government. That is the manner in which the private banks have managed the financial affairs of this nation. During the period which 1 have mentioned, the interest paid by the citizens of the Commonwealth to the nine trading banks amounted to £972,000 made up by 3½ per cent. on securities totalling £21,600,000, and l½ per cent. on treasury-bills totalling £14,400,000. This amount of nearly £1,000,000 per annum is added to taxation, whereas if it were provided bythe Commonwealth Government, it would be deducted from taxation as all profits from the Commonwealth Bank go to Consolidated Revenue, national debt reduction, or reserved funds. During the same period, government and municipal advances made by the Commonwealth Savings Bank increased by £263,841- from £141,149,782 to £141,413,623. I have urged on many occasions that our national credit should be fully utilized. The following is a system for utilizing national credit which has been prepared by one of Australia's leading accountants -

£1,000,000 FOR PRODUCTION OF CONSUMPTION GOODS.

(Profits are not shown for the sake of clearness, but they do not materially affect the position. )







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