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Wednesday, 3 June 1942

Senator COURTICE (Queensland) . - I support the bill because there can be no doubt that the Commonwealth

Government is responsible for the defence of this country. I accept the assurance that the Commonwealth has full power to take the action provided for in this measure, and to take priority over the States in regard to the raising of money for defence purposes. I listened with interest to the debate on this measure both in the House of Representatives and in this chamber, and I do> not propose to occupy the time of the Senate by discussing it at length. However, I was interested in Senator Spicer's contribution to the debate this afternoon. The honorable senator certainly made a very good speech in his customary professional manner. He stressed all the disadvantages of this scheme, but was unable to discover even one redeeming feature. I am sure that Senator Spicer cou'd be quite eloquent on the subject of the disadvantages of multiple taxation, and no doubt he is prepared to admit that a great deal could be done towards the simplification of existing methods. In fact, I should be surprised if Senator Spicer did not become a strong advocate of a scheme of this kind some time in the future. He was at great pains to convince the Senate that Victoria would suffer great disadvantages under these proposals. I refuse to accept the suggestion that the plan is to be of a permanent nature. It cannot be fairly claimed that the Government intends that it shall continue to operate after the war. .Senator McBride. - The honorable senator must be the only government supporter who holds that view.

Senator COURTICE - I think that many responsible parliamentarians, including supporters of the Government and members of the Opposition, would say that the proposals relate only to war expenditure. Senator Spicer stated that 50 per cent, of the revenue in Victoria was obtained from sources other than income tax, and he made a comparison between the State land tax collected in Victoria and that received in Queensland. The tax obtained in Victoria amounts to 5s. 2d. per capita of the population, whilst in Queensland it represents Ss. per capita.

Senator Spicer - I made a comparison between Victoria and New South Wales.

Senator COURTICE - Does the honorable senator now wish to shift his ground? Revenue from stamp duties amounts to 10s. 3d. per capita in Victoria as against 10s. 6d. per capita in Queensland, whilst Victoria received 15s. per capita from probate and succession duties as compared with 10s. lOd. per capita in Queensland. A considerable number of Australians spend the closing years of their life in New South and Victoria, although they may have amassed wealth in other States, with the result that the death duties collected in Victoria are greater per capita than in a State like Queensland. Victoria expends 17s. 6d. per capita on health services, hospitals and charities, whilst Queensland expenditure in that direction amounts to £1 4s. 3d. per capita. Hospitals in Queensland are maintained partly by the local governing authorities. Victoria imposes State income tax amounting to £3 9s. 7d. per capita as against £6 2s. lid. per capita in Queensland. Would Senator Spicer like war expenditure to be allocated on a per capita basis? Victoria, of course, would not then have a great advantage over Queensland. It is difficult to make any satisfactory comparisons between Queensland and Victoria. The latter is a small compact State and is a much older State than Queensland, which is of immense area; Queensland has a greater mileage of railways per capita than any other State. I regret that the people of Australia generally have not forgotten State boundaries, so that railway and similar services could be developed as they should be.

These proposals may not be 100 per cent, fair to all of the States, but they are, as I have said, only of a temporary nature. There must be no limit to the resources available to the Commonwealth Government for the prosecution of the war. The subject of war-time finance has been discussed frequently in this Parliament, and it would have been creditable to all political parties if mutual arrangements had been made which would have obviated the necessity for this legislation. War expenditure lias resulted in buoyant revenues to the States, and it is only reasonable that full powers should be given to the Commonwealth authorities to obtain, by taxation, money required by it to finance the war. The complacency regarding the war situation that is noticeable in some parts of Australia is not to be found in the far north of Queensland. I believe that Australia has had a narrow escape from invasion, and we are not yet out of the wood. Therefore, the whole of the resources of the country must be at the disposal of the Government. The argument advanced that these bills represent an attempt to deprive the States of their rights will not bear investigation. If we were not at war we should not now be discussing measures of this kind.

Much could have been done to improve the situation from the constitutional aspect. I remember the discussions that took place prior to the establishment of federation to induce the States to enter the union. It was never anticipated that the Commonwealth Parliament would have to wear swaddling clothes indefinitely, and it is a reflection on governing bodies in Australia that arrangements have not been reached to give increased powers to this Parliament. We need a Commonwealth in reality. The people were assured, at the establishment of federation, that the motto would be " One nation, one people, one destiny " ; but it seems to me that the States have still a long road to travel before complete understanding between them will be reached. Why should this' Parliament be suspected of being prepared to do an injustice to the States? The objection to an increase of the powers of this Parliament is based entirely on suspicion for which there is no foundation. I do not think that honorable senators would sincerely suggest that the carrying of the present proposals would endanger the position of the States.

Senator Spicerreferred to the position in New South Wales with respect to child endowment. If provision were not made for New South Wales to receive an amount of over £1,000,000 in respect of child endowment, it would experience a deficit of over £1,000,000, and that would cause financial difficulty to that State. If the present proposals were to be of a permanent nature, they would not be constitutional.

Senator McBRIDE (SOUTH AUSTRALIA) - Why not?

Senator COURTICE - I do not propose to discuss these proposals from the constitutional aspect. I heard a fine speech on that phase of the proposals in the House of Representatives by the right honorable member for Kooyong (Mr. Menzies) and another good speech by the honorable member for Warringah (Mr. Spender), who spoke in opposition to the view propounded by the right honorable member for Kooyong. That indicates that legal men can take up any side in a discussion and present a fairly good case. During the last war, Sir Isaac Isaacs, then a member of the Commonwealth judiciary, made the following remarks : -

A war imperilling our very existence, involving not only the internal "development of progress, but the array of the whole community in mortal combat with the common enemy, is a fact of such transcendent and dominating character as to take precedence of every other fact of life. It is the ultima ratio of the nation. The defence power then has gone beyond the stage of preparation, and passing into action, becomes the pivot of th» Constitution, because it is the bulwark of the State. Its limits then are bounded only by the requirements of self-preservation.

I subscribe to that view. I believe that Australia is in great danger, and that all that we hold dear is at stake. In my opinion, we in this country have been fortunate in that Japan did not attempt to invade our shores before attacking Burma. Had the Japanese forces concentrated on Australia two or three months ago, when we had hardly a popgun with which to resist them, they might have established a hold on our territory and been most difficult to displace.

I do not say that it would be impossible to carry on the war without giving effect to the proposals of the Government; but I do say that the Government, having given the matter serious consideration, believes that some such scheme is necessary in order to provide the funds required for the defence of Australia. For that reason I support the measure. Senator Spicer's suggestion that the incidence of taxation should be altered, and revenue obtained from other sources, opens up a big question. The honorable senator may be right. I believe that every individual in the community should accept some responsibility to contribute to the revenue of the country; but it is ridiculous to expect a man on the basic wage, who has a wife and family to maintain, to contribute by means of direct taxation. It is not economically possible for such a man to do so, and it would be morally wrong to force him. From a mathematical point of view, it may be all right to say that incomes below £400 per annum should be taxed, but, in putting forward that argument, Senator Spicer did not tell us how many people are in receipt of less than £4 a week and are finding it hard to make ends meet. Although these people may escape direct taxation, they contribute a considerable amount through indirect taxation. The workers expend nearly all that they earn in keeping body and soul together and in contributing to the country's revenue by means of indirect taxation. We could not get very much more from them. I shall support the bill, because it is necessary to enable the Commonwealth Government to obtain funds for carrying on the war.

Reference has been made to the subject of unification, but I do not believe that the Government desires to introduce unification at present. There was a time when I was a keen unificationist, but since I became a senator I have learned that there can be too much centralization. In the matter of war expenditure, Queensland has been forgotten. Until comparatively recently, there was scarcely a gun along the whole of the long coastline of that State. Ever since the war began most of the war expenditure has been in the southern portions of Australia. It may be that that was the most suitable place for the work to be done. Australia's fiscal policy has led to the establishment of numbers of secondary industries in Victoria, and so, when the war broke out, there was in that State a nucleus for the establishment of war industries. The people of Queensland do not complain of that; but I say in all seriousness that, if this country is to develop, there will have to be a reorientation of powers and responsibilities in many respects. We cannot maintain a White Australia if our population remains small. Those parts of Australia which are crying out for development should be developed along proper lines. I predict that, if we come through the war successfully, large numbers of people will gravitate to Queensland,, with the result that the development of that State. will be so great that the cost will not represent so great a problem as it does to-day. There has been a good deal of foolish criticism regarding taxation in Queensland. It must be remembered that Queensland is a vast State. In my opinion, the development which has taken place there is a credit to the government and the people of Queensland. I remember when Queensland had only a few " niggers " on its coast; to-day large numbers of the best men and women in Australia are to be found there. Queensland has not received from the Commonwealth the consideration to which, it has been entitled, and consequently the criticism by the Premier of that State, Mr. Forgan Smith, of the proposals of the Commonwealth Government are understandable. He is judging these proposals by what has happened in the past; he is afraid of the treatment that might be meted out to his State.

Senator McBRIDE (SOUTH AUSTRALIA) - By a Labour government?

Senator COURTICE - No. Comparisons are difficult in matters affecting taxation, especially when those who make them are not acquainted with all the. circumstances. Many who speak of the high rates of taxation in Queensland, are unaware that the hospital and medical services of that State are probably the best in the Commonwealth. That reputation could not have been gained without the expend! iture of considerable sums of money. During the last eight or ten years, very many maternity hospitals have been built in north-western Queensland under Labour administration. Such services confer great benefits on the community, but they require the expenditure of considerable sums of money. Those who criticize the taxation legislation of Queensland must take into consideration what has been achieved. Money wisely expended is of benefit to the nation. I believe that these proposals will assist the nation's war effort. "When the war is over, the whole question of the relations between the Commonwealth and the States should he discussed, with a view to arriving at an understanding which will enable the Commonwealth to tackle the problems confronting industry so that the things which retard development may be removed. I am confident that the passing of this and the other cognate measures will be in the best interests of Australia.

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