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Wednesday, 3 June 1942

Senator COOPER - The electors of South Australia are satisfied to re-elect them.

Senator AYLETT - That does not surprise me, because, so far as I know, the only guide which is available to electors in that State is the daily press, which is most one-sided. If those people have only the speeches of men like the honorable senators representing South Australia to guide them in these matters, it is no wonder that they re-elect their representatives in their Parliament.

Senator McBride - I do not like the honorable senator's chances at the next general elections.

Senator AYLETT - If this legislation plays any part in the matter, I am confident about the result of the next general elections so far as Tasmania is concerned. Honorable senators opposite have had much to say about equality - They know perfectly well that under existing State taxation systems, in spite of rebates and other adjustment devices, some taxpayers are paying over 20s. in the £1 tax. Only last week, I met a man who told me that his rate of tax was 20s. 6d. in the £1. Such anomalies cannot possibly be adjusted so long as the present multiplicity of taxation systems remain. When this legislation is put into operation no person in the Commonwealth will be obliged to pay tax at the rate of 20s. in the £1. Every one on the same income will pay the same rate of tax. The Treasurer (Mr. Chifley) estimates that under these proposals the Commonwealth will receive an additional revenue of from £12,000,000 to £15,000,000. Honorable senators opposide contend that that additional revenue would be collected in any case. I point out that, but for this legislation, it would be divided between the States and the Commonwealth and, consequently, the advantage to the Commonwealth would not be very substantial. However, 1 cannot follow the argument of honorable senators opposite that the States are in need of additional revenue, when it is understood that the Commonwealth is transferring increasing numbers of employees, of the State governments to war work. The States do not share the cost of war production in any way whatever. No honorable senator opposite has looked at the scheme from that viewpoint. The honorable senator who has just resumed his seat declared that the present war emergency was being used by this Government merely as a pretext to secure the passage of this legislation in order to give effect to Labour's policy of unification. The obvious advantages which will accrue to our war effort are sufficient recommendation for this legislation. The special committee estimated - that under these proposals public expenditure amounting to £601,000 annually will be saved. No State will lose financially under this legislation. In addition, 1,000 men will be made available for war work. Senator Sampson declared that man-power for war production, and not money, should be the Government's main concern. If only for the reason that these proposals will release an additional 1,000 men for war work, its passage will be justified. In view of the fact that we require 300,000 additional men for our war industries, that is surely worthy of consideration. The argument of honorable senators opposite that these measures are designed to enable the Labour party to give effect to a policy of unification is also refuted by the fact that specific provision is made that this legislation shall operate only for the duration of the war, and for twelve months thereafter. I need hardly remind them that the previous Government, which they supported, made that the basis of many of its decisions, for instance, its contracts for the acquisitions of various commodities. Thus this Government is merely following the example of the previous Government in applying measures of this kind for the period of the war and twelve months thereafter. Honorable senators opposite have also had much to say about interference with State rights. I did not hear any of them protest against the Government's decision to commandeer 'manpower, including State government employees. Is that not interference with State rights? Further, does not the Commonwealth also interfere with State rights when it commandeers railway accommodation for the transport of Commonwealth materials?

Senator Cameron - Honorable senators opposite are concerned only about profits.

Senator AYLETT - They are eager to preserve only the selfish rights of vested interests which they represent in this Parliament. That is proved by the fact that they have opposed the provisions under these measures reducing the rate of tax on incomes in the lower ranges. Apart from the constitutional aspect, no sound argument has. been advanced against these measures. However, legal critics of this legislation are divided. I for one am not very much impressed by the legal opinion of men who now claim that legislation which has been in operation for the last twenty years is unconstitutional. I doubt whether any State government would have the audacity to challenge the constitutionality of this legislation in a time like the present. The British Government would certainly frown upon any State government which forced this matter to the Privy Council under existing conditions. Such action would be ridiculous in view of the repeated declarations of the States that they are wholeheartedly co-operating with the Commonwealth in our war effort. Surely no State would contemplate taking such action when, as Senator Sampson has said, we are fighting for our existence. It would he senseless for any State government to dispute this legislation, which has been carried by a very substantial majority in the House of Representatives, and will be carried by a substantial majority in this chamber.

Senator JAMES McLACHLAN (SOUTH AUSTRALIA) - Very often the minority is right.

Senator AYLETT - I agree with the honorable senator. Senator Sampson declared that Australia has been in danger for years. In 1937, the present Prime Minister (Mr. Curtin), when Leader of the Opposition, advocated the building up of a strong air force in Australia as our first line of defence, in preference to the construction of naval units. The Labour party was then -in a minority, and its policy in that respect was laughed at by th.e majority.

Senator Keane - And the Prime Minister enunciated that policy as far back as 1934.

Senator AYLETT - Yes, and Labour emphasized it at the general elections in 1937. However, the majority at that time declared that it was ludicrous to think of defending Australia with aeroplanes. They said that we could defend this country only with battleships. That was an instance in which the minority was proved to be right.

The DEPUTY PRESIDENT (Senator Brown). - I ask the honorable senator to connect his remarks with the bill.

Senator AYLETT - I was about to say that the Commonwealth Government urgently requires the additional £12,000,000 to £15,000,000, estimated to be raised under these proposals, for the construction of a strong air force, as was advocated by the Labour party in 1937. In view of the fact that the Commonwealth Government proposes to spend approximately £360,000,000 on defence during the next financial year, I think that the place to start to economize is at the top. The Government is setting an example of economy by the introduction of a uniform income taxation scheme. One result will be that the services of nearly 1,000 officers will no longer be required in the taxation offices and the consequent saving in salaries and other expenses will he £600,000 a year. Further, an additional revenue of between £12,000,000 and £15,000,000 will be made available to the Commonwealth Government for the prosecution of the war.

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