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Thursday, 3 March 1932

Mr LYONS (Wilmot) (Prime Minister and Treasurer) . - I move -

That the bill be now read a second time.

I do not. intend to delay the House by speaking at length on this bill. I intimated to honorable members, in discussing the Financial Agreement Enforcement Bill, that the Government would accept the suggestion of the right honorable member for Cowper (Dr. Earle Page) that that portion of the Financial Agreement Enforcement Bill which dealt with the Commonwealth Government's acceptance of liability for the payment of interest due on behalf of the States to the bondholders should be embodied in a separate measure. That bill is now before the House, and the reason for it is simply, as has already been stated, that doubt has arisen as to the liability of the Commonwealth Government to the bondholders. In November last, Sir Edward Mitchell issued his book on the Financial Agreement, and in it he pointed out that such a doubt existed. Although some legal opinions suggest that there is no doubt, others clearly indicate that there is a doubt. In these circumstances, the Government felt that the matter should be put beyond question, because there is a moral obligation resting on the Commonwealth to accept responsibility to the .bondholders of the States. The Leader of the Opposition himself, I think, pointed out that in this bill we are aiming, so far as we can, at putting the matter on a permanent basis, and to that extent we are justified in separating this measure from the provisions of the other bill, which may not be permanent, and concerning the validity of which some doubt, which may have to be fought out in the courts, may arise. Since the principle embodied in the present bill has the support of the whole of the people of Australia, whatever their political views may be, it is almost inconceivable that a future Parliament would remove the measure from the statute-book. In submitting the bill, therefore, I feel that the whole of the Parliaments and the people of Australia are behind us.

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