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Friday, 25 November 1910

The PRESIDENT - Order. Senator Long is not in order in accusing any member of the Senate of " shuffling." I would further remind him that interjections are disorderly at any time.

Senator Long - I withdraw the remark, and shall content myself with saying that Senator St. Ledger's statement is not in accordance with fact.

Senator ST LEDGER - The honorable senator says that my statement is not in accordance with fact. That may be so. The honorable senator is at liberty to refute it if he is able. I extremely regret that during the current session the Government have done nothing in reference to the transfer of the State debts. At the last election a large majority of the people assented to the proposition that the Commonwealth should be empowered to take over the whole of those debts, and not merely the debts which existed prior to the establishment of the Federation. One of the gravest questions which can possibly confront this Parliament is involved in the transfer pf the State debts, and any Government which successfully grapples with that question will render a great service to Australia. But it is necessary that the subject should be at once attacked, because, despite what some honorable senators may say to the contrary, there is bound to be another borrower either on the London or the Australian market, and that borrower will be the Commonwealth. Otherwise, all the consideration which' we recently devoted to the Northern Territory and to the Federal Capital site was merely so much make-believe.

Senator Rae - Suppose we have a million pounds to spare from the revenue to be derived from the land tax?

Senator ST LEDGER - The land tax is, for my honorable friends opposite, the last refuge from financial shipwreck. I admit that -it will afford substantial assistance, but there is a limit to land as well as to every other form of taxation. Senator Rae's interjection is in accord with another which was made earlier in the session when an honorable senator on this side was discussing the enormous expenditure to which the Commonwealth is being committed. We were then- informed that there is a revenue of ,£20,000,000 or £30,000,000 lying to the hand of any Government that has the courage to seize it. Notwithstanding the fact that we shall receive a large accession of revenue from the land tax, even that source of taxation has its limits ; and they must be exceeded if we are to carry out the schemes, to the consideration of which Parliament has been asked to devote weeks and months of its time. How are we to find the money which will be necessary to build the Northern Territory railway, and the railway from Port Augusta to Kalgoorlie ?

Senator McGregor - We do not build railways with money, but with sleepers and rails.

Senator ST LEDGER - That is the kind of flippancy we get when we are talking what might not unfairly be called high finance. We can only build these railways with golden sovereigns, and we have first to find the sovereigns. In view of the limits to direct and indirect taxation, by a process of exhaustion in reasoning it is clear that we can only hope to carry out the gigantic works policy which has been outlined by becoming borrowers. Yet we are doing nothing to strengthen the position of the States in the conversion and consolidation of their debts, and the redemption of loans which are_ falling due, and for which they must be responsible. If this problem be grasped firmly and comprehensively, we may be able to find means, not only to give effect to our own works policy, but to greatly strengthen the position of the State Governments when they go, as they must, to the London market for the money required -to carry out their works policies. The conversion of the State debts is a most difficult and complex problem, and the best financial brains in the Commonwealth, and -outside, will need to be called in for its ;successful solution. Several members of the Commonwealth Parliament have, at different times, outlined schemes for the redemption, conversion, and consolidation of the State debts; but they have all been contingent upon the consideration of the question by a competent Commission. One Federal Government after another has promised to consider the matter; and yet, during a long session, we have not had the slightest indication of the intentions of the present Government in this regard. We have to consider, further, what we are going to do in connexion with the transferred properties. The Government have not only proposed to .take from the States all they can get, but, if I may be permitted to say so, have almost by a subterfuge defeated the object of the Braddon section of the Constitution. In all the circumstances, the Commonwealth Government must expect, when the opportunity presents itself, a severe account from the State Governments in respect of the properties which we have been using for the last ten years. The people of Australia have been behind the Commonwealth Parliament in telling the State Governments that they must be content with far less money than they have had before, and perhaps rightly so ; but, on the other hand, they will be behind the State Governments when they submit a counter claim in respect of transferred properties, and will demand that the Commonwealth Government shall deal fairly with them. I say, with some fear and trembling, because it is a matter in anticipation, that the Commonwealth Treasurer must shortly expect, from the whole of the State Treasurers, acting together, a demand for an account. If the Common^ wealth Treasurer will not meet them, there is a simple way by which a State Treasurer, or the State Treasurers acting together, may issue a writ asking for an account in connexion with this matter. It will be deplorable if there should be such a conflict between the Commonwealth and State Treasurers, but the State Treasurers will not be justified in the interests of the people of the State in deferring the settlement of the matter. It is the duty of the Commonwealth Treasurer to avoid such a conflict, and he should set to work to determine whether the claim is a just one - and I do not think that it will be argued that it is not - and then to seek to effect a reasonable settlement in a constitutional way by friendly arbitration. It is in the interests of the States that this matter should not be deferred any longer, when we see in this Budget that the Federal Government have millions to play with, and, in their peculiar temptations, it may be millions to burn.

Senator ALBERT GOULD (NEW SOUTH WALES) -Colonel Sir ALBERTGOULD (New South Wales) [12.0].- I had hoped that some honorable senators on the other side would have had something to say on the first reading of this Bill. I intend later to deal with one or two matters of rather more importance than those on which I propose to speak now. I wish to say a word or two with regard to the congratulations which the Government have heaped upon themselves as to the amount of work done during the present session. I recognise, as every member of the Senate must, that there has been a large amount of legislation transacted since this Parliament met in the beginning of July last, and that a great deal of it is of the first importance. My complaint with regard to much of this legislation is that it has not been placed before Parliament in such a way as to give honorable senators a proper opportunity of dealing with it on its merits as representatives of the people. While the Government may claim, that they have done a great deal of work, it must be admitted that this has been made possible because of an entire abandonment of parliamentary principle in dealing with the legislation submitted for the approval of the representatives of the people. We have had the unique spectacle, for the first time in the history of any British Parliament, of a Parliament within a Parliament. We have had an opportunity of seeing the Cabinet system extended to the Caucus system. In accordance with the recognised principles of representative government, the members of the Cabinet meet and decide on matters of the first magnitude to be submitted to Parliament. When they come before Parliament with their proposals they do so as a unanimous body, prepared, whatever may have been the differences of opinion existing amongst them when considering the proposal in Cabinet, to push forward the legislation they have determined upon as the best in the interests of the community. But in this Parliament that principle has been departed from, and the Cabinet has been extended to take in the whole of a party bound by pledges, ties, and caucus.

Senator W RUSSELL (SOUTH AUSTRALIA) - Last year the honorable senator, though a Free Trader, joined the Fusion of Protectionists.

Senator Lt Colonel Sir ALBERT GOULD - My views may have been in accord with those of the Fusion, but I did not become a member of it. The Government now meet together with the whole of their supporters in this Caucus, this secret Parliament to which only one class of the representatives of the people are admitted. They discuss there various matters, and arrive at a determination as to what shall be submitted, not for the consideration, but for the approval, of Parliament. It is a very easy matter under this system for the Government representing the dominant party in Parliament to pass the legislation they propose. If they submitted their proposals to Parliament, and their supporters were free to express their individual opinions, even though they should find excuses for voting in an opposite direction, we should at least have the benefit of the honest opinion of the individual members of the Ministerial party.

Senator Guthrie - Do we not get them now ?

Senator Lt Colonel Sir ALBERT GOULD - On matters of little or no importance supporters of the Government will, no doubt, hesitate before they vote in opposition to their real opinion. When the Government will meet its majority in secret caucus to determine what it shall do as one body, and they come here and vote in one way, the legislation may be expected to be entirely opposed to the opinions of the majority of the people. Under the operation of such a system the Government can very readily put through legislation of the first magnitude with a minimum of debate and a minimum of information for the public generally. It is regrettable that a system has been introduced which, if adopted by each Government, will ultimately reduce Parliament to the farcical position of being only a recording instrument for the majority who meet together and sink individual differences in order to " down " the other side.

Senator Findley - The honorable senator would have a good meal if he were to read the leading article in to-day's Age.

Senator Lt Colonel Sir ALBERT GOULD - Acting on my honorable friend's suggestion, I shall read the article, not while I am speaking, but later. A complaint has been made with regard to the lack of opportunity which has been afforded to honorable senators to consider the position of the finances. I do not wish to suggest that the present Government is a special offender in that respect. I recognise that the consideration of the Estimates has nearly always been held back until the end of the session, and no reasonable opportunity has been available to honorable senators to offer that criticism which, in my opinion, the Estimates always call for. The late Government made an innovation, which, I think, would be of great value if it were followed up: Last year an opportunity to debate the general financial policy of the Government was created by its representative laying theBudget papers on the table of the Senateand submitting a motion that they be printed. But to what extent during the present session have honorable senators had an opportunity, on the motion to print the papers, to debate the financial policy of the present Government? Although the Budget papers and the Estimates were laid . on the table early in the session, and the Vice-President of the Executive Council made a brief financial statement, no proper opportunity for a general discussion on the finances has been afforded. Even, according to the admission of the Minister, the only opportunity available for that purpose was the one which was afforded yesterday afternoon. But the consideration of the Estimates in another place had then advanced' too far to give any value to that opportunity, independently of the fact that we were under the shadow of the prorogation. Although, apparently, we have been given an opportunity to debate the Budget, yet we have actually been denied the right to express our views at a time when they could be seriously considered. Senator Millen has pointed out that during the session a great deal of time has been spent on the Navigation Bill. I admit that it is a measure of immense importance, but honorable senators must not forget that it was debated with the full knowledge that it could not be advanced beyond the Senate during the session. The time consumed on that Bill might have been well given to other matters which, as a fact, we have had to deal with rather hurriedly.

Surely it would have been far better to have spent some time in considering the financial proposals of the Government ! The financial policy of the Government is expected to be laid before the country in clear and definite terms. We have been gradually building up charges against the Treasury without having had a clear exposition from the Government as to how they intend to finance their proposals. Take, for instance, the first financial proposal with which we were called upon to deal; that is, the payment for the Naval Unit. The late Government proposed one method, and that was to borrow the money and to repay it by annual instalments, or by means of a sinking fund. In accordance with the pledges which they gave to the people the present Government took early steps to repeal the Naval Loan Act, but did they attempt to explain how its repeal would affect the finances generally? No; they merely said, " We will pay for the Naval Unit out of the general revenue, and the work of construction will occupy a couple of years." Surely that was a large financial question which was worthy of the attention of the Treasurer and his representative in the Senate when the financial proposals of the Ministry were under consideration. Not only were we told that £3,500,000 would have to be paid out of the general revenue for the Naval Unit, within a period of two years, but we were also told that the proposals of the Government involved an increased expenditure on old-age and invalid pensions.

Senator McGregor - The honorable senator would not expect the Government to borrow money to pay old-age pensions.

Senator Lt Colonel Sir ALBERT GOULD .- Certainly npt, but the Senate ought to have had a proper statement as to how these matters were to be financed. Apart from the expenditure on the Naval Unit, we find that the expenditure on naval defence is to be considerably increased. I agree with the Government that that expenditure ought to be met out of the current revenue. As regards the immense increase in the expenditure on military defence, I agree with the Government that it is an ordinary annual service which should be defrayed out of the current revenue. But the expenditure has been increased to such an extent that we are entitled to a full explanation as to the manner in which the Government intend to finance their proposals.

Here are three or four proposals of first magnitude, which, I contend, ought to h.\ve been dealt with by the Minister in a financial speech, so that the exact position of the country could be grasped. Again, the acceptance of the Northern Territory will involve a large expenditure. All these matters should have been explained in a succinct statement, so -that if the Government intended to increase the expenditure by £5,000,000 or £10,000,000, we could know how it was to be met. I admit that at present I am in darkness as to how the Government intend to finance the whole of their proposals. I know that they have made certain suggestions, but I want to see reasonable estimates as to how much revenue will be received, and how much we can reasonably expect to spend during this year, and probably during next year, on new works, however proper they may be. What is the course pursued by a business man when he is thinking of laying out money in different directions for purposes which he considers are pertinent to his business ? He does not pledge himself to spend so much in this, and so much in that direction, and so gradually build up an additional expenditure, without first taking counsel and ascertaining what amount of money he can reasonably expect to derive from his current resources, and from the resources which he may reasonably hope to create by speculation. Naturally he considers how much he can afford to spend. If he wants to expend £"1,000,000 within a year, he has to inquire whether he can get the money together, and whether, if he did, its expenditure would land him in the Bankruptcy Court, or drive him to the money-lender. If he finds that he cannot finance the speculation without resorting to unfair methods, he will probably say, " I shall not begin to expend during the current year," or if he finds it necessary to make a beginning during the year he will say, " I will cast about and see by what means I can reasonably overtake this obligation, without unduly harassing or hampering myself." But the Government have not pursued a course of that kind. We are absolutely in the dark as to what their policy is to be. Senator Millen says that the Government will obtain £5,300,000 more revenue than their predecessors had. But we do not know whether even that will be sufficient to enable us to meet the obligations that we are so lightly undertaking.

As to the transferred properties, I have only to say that, the Braddon section having practically expired, and the Government having undertaken to pay to the States only 25s. per head of the population, the Commonwealth is certainly not entitled to enjoy the use of the properties taken over from the States and pocket the revenue derived from them, without undertaking to pay the interest on the cost of their construction. At present the States have to pay this interest, and receive nothing in return. We are not justified in allowing this matter to stand over until we deal with the transfer of the State debts. Let us assume that, when that question is dealt with, Parliament sees fit to accept the transfer. There will still remain unsettled the question of the payment of interest on the transferred properties. That is an obligation which we cannot avoid, and we must be prepared to deal with it in a just and equitable manner. I do not say that the Government do not desire to deal with it fairly and equitably, but they should also be prepared to deal with it promptly, so as not to place the States in a very much worse position than they were while the Braddon section was in operation. It is possible that the Government may determine to deal with the question during recess, and they may next year submit to Parliament Supplementary Estimates, providing for an amount of money to be paid to the States. I urge them to look at the matter from that point of view. I may say, in passing, that I did not support the proposal submitted to the electors at the last election to amend the Constitution in reference to the State debts. I held the opinion that, until we had determined clearly and definitely the basis upon which we should proceed, it would be better to leave the matter in abeyance. We have to recognise that the States have at present in hand many important public works that will cost enormous sums of money - far more than they will be able to pay out of current revenue. New South Wales, for instance, has in hand very important works for the opening up and development of the country. It is impossible for us to take away from the States the right to go upon the London market if it becomes necessary to borrow money for such purposes. Until an agreement is arrived at by which the States will be amply protected in respect to their borrowing rights, it will be unwise for the Commonwealth to take any action that will be likely to place hindrances in the way of the development of their territories. As to defence, I should like to say that, whilst the Commonwealth may be doing what is regarded as a reasonable thing, in providing a unit for the Pacific Fleet, and undertaking a larger measure of responsibility for the defence of Australia, nevertheless, it appears to me that it will be necessary, at no distant date, to still further increase our expenditure in reference to naval matters.

Senator W RUSSELL (SOUTH AUSTRALIA) - Surely the honorable senator does not want us to overdo it?

Senator Lt Colonel Sir ALBERT GOULD - No; but, at the same time, we cannot afford to underdo it.

Senator W RUSSELL (SOUTH AUSTRALIA) - It may mean another land tax.

Senator Lt Colonel Sir ALBERT GOULD - We shall have to undertake a much larger share of responsibility for the defence of the Empire than we have hitherto done. European nations are rapidly increasing their naval strength. The twoPower standard upon which we relied a few years ago is hardly in existence today. People in England are undoubtedly uneasy with regard to the concentration of naval power on the part of some of the most powerful nations in the world. Some experts say that the position in the Mediterranean, from a British point of view, is far weaker than it ought to be, in consequence of the necessity for concentrating the Fleet in Home waters. We know that the trade routes of the Empire must be kept open in time of war. The very life of Australia is dependent upon keeping them open. As time passes, we shall find ourselves compelled, not merely to contribute a small quota towards the cost of protecting those trade routes, but shall probably have to keep open on our own behalf the ocean roads along which our commerce passes. The sooner we consider this problem the better it will be for the interests of Australia. It is generally agreed that we want a larger population. Not only will population do much to enable us to take our share in the defence of the Empire, but we need more people if we are to develop our natural resources and manufactures. The Government may congratulate themselves on the buoyancy of the revenue, and undoubtedly that is a good thing. But, unfortunately, we have not a sufficient number of men to enable our factories to complete the orders that they can obtain. One can hardly pick up a newspaper in one of our big cities without finding in it evidence of the shortage of labour. The wages conditions of this country should make it an attractive place for good artisans. We have taken steps to insure the payment of fair and adequate wages to those employed in our factories. But notwithstanding that, there is a dearth of capable men. One Melbourne manufacturer has explained in one of the newspapers how difficult it is for him to carry on his business under present conditions. I find that the same sort of thing is occurring in New South Wales. There is work for many more artisans than are at present available. That situation is largely due to the excellent seasons we have had, and the abounding prosperity that has obtained.

Senator Findley - Owing to the Labour Government.

Senator Lt Colonel Sir ALBERT GOULD - Whatever respect one may have for the Labour Government, we must recognise that good seasons have had more to do with our prosperity than political changes. It would take an extremely bad Government to sprag the wheels of the progress of this country. No Government can do so much for the prosperity of a country as Providence does. The Government ought to render every possible facility for making known the advantages that Australia offers to immigrants. We should learn from Canada to undertake an extensive system of advertising in the Old Country.

Senator Guthrie - To-day's newspapers say that sufficient ships are not available to accommodate all the immigrants who desire to come to Australia -

Senator Lt Colonel Sir ALBERT GOULD - Simply because the vessels have not been specially constructed to accommodate them. Only the other day, I read a statement to the effect that the passages of 3,000 immigrants had been booked to Western Australia, and that 2,000 of them would arrive before Christmas. But we cannot talk of such a stream of immigration as a " mad rush " to the country. We need to attract population in a much stronger volume than that. I have no hesitation in saying that in Australia there are opportunities awaiting a large number of immigrants if they are willing to accept employment, and to commence at the bottom of the tree. We require artisans in this country as well as fanners and farm labourers.

Senator McGregor - The more we get, the better it will be for the Caucus.

Senator Lt Colonel Sir ALBERT GOULD - I do not care whether or not the Caucus benefits, so long as -we secure the introduction of hard working, enterprising men.

Senator Findley - The honorable senator wants cheap labour ; why should we not have cheap law ?

Senator Lt Colonel Sir ALBERT GOULD - I have no objection. But I know what cheap law is generally worth.

Senator Givens - Cheap labour is usually not worth much.

Senator Lt Colonel Sir ALBERT GOULD - I quite agree with the honorable senator. I do not propose to dwell upon the Bill at further length. At this stage of the session, it will be quite impossible for the Senate to seriously consider the Estimates in detail. Honorable senators have frequently pointed out that the Senate possesses co-ordinate powers with the other branch of the Legislature, and that it is not a nominee Chamber, or a Chamber which represents only a limited number of the electors. It cannot be too frequently stated that it represents precisely the same people as does the other Chamber. n The only difference between the Senate and the House of Representatives is that, whereas the former represents the people of the States as a whole, the latter represents the people who are resident within State divisions. But I regret to say that, so far, the Senate has never made any real attempt to assert itself. Of course, I recognise that there are difficulties in the way of it doing so at this stage of the session. At such a time, honorable senators are naturally reluctant to accept responsibility for creating a crisis. It is because this Chamber has never determinedly asserted its powers that to-day it has no satisfactory voice in the control of the financial affairs of the country. It is true that it has made one or two stands in that connexion. The first was made in regard to the form of the preamble to a financial measure, which was similar to the form of the preamble adopted in Bills introduced into our State Parliaments, notwithstanding that the Legislative Councils either represent only a limited number of electors, or are nominee Chambers. As a result of that stand, the preamble of our financial measures was amended to read -

Be it enacted by the King's most excellent Majesty, the Senate and the House of Representatives of the Commonwealth of Australia, for the purpose of appropriating the grant originated in the House of Representatives, as follows : -

On another occasion, it was proposed that, in the matter of the salaries of its principal officers, the Senate should occupy a subordinate position to the other Chamber. But the moment the Senate asserted itself in that connexion the strength of- its claim was recognised. Beyond these two instances, this Chamber has failed to take up the position that it ought to take up, in view of the great powers with which it is clothed. I feel perfectly certain that if honorable senators could be induced to brush aside party feeling, the position occupied by this Chamber in regard to financial legislation would be very different. In the early days of the Federation, it was said that the Senate would be the dominant House. But while we proceed as we have been doing, that prediction will never be fulfilled. People have frequently asked me what powers the Senate can exercise, and my reply has always been that, if it chooses, it can exercise very great powers. It is clothed with co-ordinate powers with the other branch of the Legislature, and if it fails to occupy the. position that it ought to occupy, the fault will lie with those honorable senators who are not prepared, irrespective of party considerations, to stand up for its rights and privileges. In my judgment, the Senate is more truly representative of the electors than is the House of Representatives. Whereas its members are returned by a majority of the electors of the whole of a State, the members of the other branch of the Legislature are returned only by majorities of the electors in divisions of a State. If honorable senators would only bestir themselves,. I feel sure that the Senate would become almost as strong a body in the political life of Australia as the Senate of the United States is in the political life of that great country.

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