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Wednesday, 1 August 1906

Senator KEATING (Tasmania) (Honorary Minister) . - Most of the properties that will be acquired by the Comwealth from the States, or that have been acquired, have been paid for by the States out of loans which are of different denomination, but which, it is estimated, average in interest about31/2 per cent. Of course, in the case of the individual, . if we said that the moment his compensation was detemined it had to bear31/2 per cent. interest we should undoubtedly offer to him an inducement to treat the Commonwealth as a banker to some extent.

Senator Millen - He might be paying 5 per cent. to his own banker.

Senator KEATING - But, in many instances, the individual would find it advantageous to leave the money with the Commonwealth at 31/2 per cent.

Senator Dobson - Not in one case in a dozen.

Senator KEATING - In many cases that would be found to be so. What we desire is to expedite the lifting of the compensation.

Senator Dobson - And, therefore, it is proposed to pay an unfair rate of interest?

Senator KEATING - Not at all; it is a very reasonable rate of interest. As I say, the average rate of interest paid in connexion with properties likely to be transferred, or which havealready been transferred, is something like 3.5 or 3.6 per cent.

Senator Dobson - It is about 3.70 or 3.80 per cent.

Senator KEATING - For the reason I have stated, it has been decided that the compensation to the States should be at the rate of31/2 per cent. ; that is the present law which the Bill does not propose to alter.

Amendment negatived.

Clause agreed to.

Clause 43 agreed to.

Clause 44 (Deposit of compensation in the Treasury).

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