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Tuesday, 25 September 1906

Senator GIVENS (Queensland) . - I -desire to say a few words to explain why I do not propose to vote for the Bill at this stage. I approach the matter from an entirely impartial stand-point. Unlike some honorable senators who have spoken, I am strongly in favour of the Commonwealth taking over the debts of the States. I think it would be a great advantage, not only to the Commonwealth, but to the States themselves, if the debts were taken over. But it will be time enough for us to proceed to alter the Constitution when it sets bounds to our action. So far it has set no bounds whatever to what we have desired to do. We have not yet acted within our limits. Why should we proceed to exceed the present limits when we have not acted up to them? Senator Best says that the Bill only gives Parliament power to act, and that therefore there is no danger in it. If that be so, where is the necessity for the Constitution to contain any provision at all regarding "the "States debts ? All that would be necessary would be to call Parliament together, ' and allow it to work its own sweet will.

Senator Best - That is what section 105 says.

Senator GIVENS - Our duties and restrictions are set forth in the Constitution, and if Senator Best was right in what he said, there would be no necessity for the Constitution. Before we alter the Constitution in the way proposed, some very cogent reasons ought to be adduced. This is a most intricate subject ; and I regret exceedingly that the Government should have planked down this Bill on the table at this late hour of the session in what is practically a dying Parliament, and asked us to submit this question to the electors without that consideration and full' discussion its great importance deserves. Most of the electors have but a very imperfect knowledge of the financial problem. They are unacquainted to a large extent with the details, troubles, and difficulties of the question ; and I do not see how they are to give an intelligent vote when it is submitted to them. The only means to educate and enlighten the electors is a full discussion at an early date - a discussion which may be commented on by the press from one end of Australia to another. The electors would then be enabled to study the speeches as reported in Hansard, and from these, and the comments in the press, would be able to form an intelligent judgment as to what ought to be done.

Senator Pearce - The honorable senator is very optimistic if he thinks the press will report the debates on an important subject.

Senator GIVENS - I do not say that the press would report the debates, but that the question would be discussed in the press. The press in Australia is not confined to one party, nor even do the newspapers of the same party hold the same views, especially on questions which are outside party politics, as I contend this question ought to be.

Senator Pearce - There is only one party that is solid on the question here.

Senator GIVENS - I do not know what party that is, and would be obliged for the information. The public ought to have a clear understanding of any question submitted to them in the way in which it is proposed to submit this question. It is quite true that by the Constitution we are limited as to . the time in which we must pass a Bill of this kind before submitting it to the electors. Such a Bill must be passed no longer than six months, nor a shorter time than two months before the referendum is taken, so that there are only four months in which to deal with it. This, however, need not in any way limit the discussion, because the Bill could be introduced earlier, and fully discussed, and the third reading held back until a convenient time, so as to fit in with the date of the elections. Although six years have elapsed since the Commonwealth was established, no feasible scheme has been placed before the public by either the Commonwealth Government or Parliament ; all the proposals, so far, are nebulous. Schemes have been put forward by Sir George Turner and Sir John Forrest, and there have been papers by Mr. Higgins, Mr. Knox, and Mr. Harper, while various other gentlemen have written about the matter in the press. But up to the present time there has been no scheme which commends itself to general acceptance. That being so, I think it is premature, and paltering with the question, to introduce this Bill, seeing that we have done nothing so far in the way of exercising the powers we already possess. We have been told about the advantage of taking over the debts of Victoria and New South Wales as they mature; but I think there is a simple way in which much could be done in that direction without any alteration of the Constitution. There is considerable dissatisfaction and disappointment in the States because, although the Commonwealth has been in existence six years, no arrangement has as yet been arrived at for the payment for transferred properties. If the Government are sincerely desirous to take over the debts maturing next year, they could easily do so by taking over the debts of each State to an amount corresponding to the value of the transferred properties in each State. Instead of squabbling over the price of this or that transferred property, the Government should proceed to make some arrangement of the kind I have indicated. There need be no squabbling about valuations, because the same people who owe the money will have to provide the interest, and pay the debt. When the Commonwealth was instituted the debts of the States amounted to £[2o'2, 000,000, and at the present time the amount is £[236,000,000 odd. Why should we bother ourselves about the have taken no steps whatever in connexion with the £202,000,000? Until we have made some arrangement for dealing with the matter so far as we have power at the present time - until we reach our limitation - where is the necessity for removing the limitation? Supposing I were bound to walk a mile in a straight direction, and there was no obstacle or hindrance in the way, why should I first proceed to remove a fence half-a-mile further on? There is one aspect of this question which appeals to me more strongly than any other. What I fear may be the outcome of this Bill is that, instead of making our security better - instead of organizing and systematizing our borrowing - it may lead to greater confusion, and, perhaps, very seriously injure and diminish our credit. When a State is relieved from a certain portion of its liabilities under this Bill, a new borrowing boom may set in, and the State may proceed to lavishly waste money, as many States have done in the past. Until some arrangement is arrived at by which the powers of the States to borrow will be strictly limited, it is practically useless to take over the debts. As Senator Smith very forcibly pointed out, it would be like bailing out a ship in which there was an enormous hole, through which the water came in faster than it was removed. We should have to be continually taking over States debts almost at the very moment when they were incurred, and the result would be to encourage some States to indulge in extravagantborrowing, while careful, prudent States would be made responsible. Once the Commonwealth has taken over the States debts, if a State, although it may indemnify the Commonwealth, does not pay the interest, the Commonwealth will be liable for the whole, and thus a premium will be placed on lavish borrowing and waste.

Senator de Largie - With the power of taxation the Commonwealth has?

Senator GIVENS - Even then.

Senator de Largie - I think we could very quickly shut down on any extravagance.

Senator GIVENS - What could we do? I agree with Senator de Largie that we could extract more money out of the people's pockets by taxation, but that would be just the same as if I had power to take money out of a man's pocket, while he could continually run and pawn all his property - he would be rendered none the less extravagant because I, as well as other people, was robbing him. My desire is that when the Commonwealth takes over the debts, the power of the States to further involve the Commonwealth in fresh indebtedness, should be severely curtailed and restricted, and that the Commonwealth should have supreme control in this connexion. For the reasons I have stated, I do not think we need trouble to pass a Bill of this kind asyet.

Sitting suspended from 6.30 to 7.45 p.m.

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