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Tuesday, 2 October 1906

Senator CLEMONS (Tasmania) . - I do not think that any one can deny that the debate on this Bill has been productive of some good: If it has attained no other useful purpose, it has, at any rate, elicited a clear and unmistakable declaration from the Government that the object of this Bill is notstrictly and alone to furnish means for the payment of old-age pensions.

Senator Playford - It is practically limited to that.

Senator Findley - The debate has brought out this fact : that while honorable senators opposite profess to be supporters of old-age pensions, they are opposed to all methods of raising funds to pay them.

Senator CLEMONS - When an amendment was proposed which had the clear and definite object of ear-marking the revenue to be raised under this Bill for a special purpose, the Government opposed it, because they refused to allow the Senate so te limit the future operations of special duties. The Government, therefore, intimated to us quite openly that, in their opinion, it was desirable that a free opportunity should be given to them - or some other Government, at some future time - to apply to purposes not mentioned, but merely hinted at, the funds that would be derived from special duties.

Senator Playford - It is not a question of the Government, but of the Parliament which must provide the funds.

Senator CLEMONS - I am perfectly willing to substitute "Government''' for " Parliament." I am dealing with the avowed object of this Bill as introduced by the Government.

Senator Playford - The object of the Bill is to provide a fund for old-age pensions, but we are not to be bound and prevented from using it for other purposes.

Senator CLEMONS - I hope that every word Senator Playford has used will serve as a declaration on behalf of the Government regarding the Bill. He now says - " Our primary object is to provide an old-age pensions fund."

Senator Playford - And there is no other purpose that we know of at present.

Senator CLEMONS - But. as the Minister also interjects, the time may come, when the Government will want the Bill for some other purpose, and, therefore, he says in just as clear and unmistakable language, that it is for other purposes as well as to provide for old-age pensions. I think it well that the debate has cleared up that point, at any rates. Whether honorable senators like it or not, let us be quite clear as to what we are doing. Under this Bill we are abrogating, to some extent, the Braddon section of the Constitution. I do not hesitate for a moment to say that I object to any abrogation of it. I recognise that some honorable senators think it desirable that the Braddon section should not be continued ; but it would be far better for us to wait until the time arrives when, under the Constitution, we shall have to deal with the question. Rightly or wrongly - I think very rightly - the framers of the Constitution imposed a fixed limit of ten years within which the Braddon section must end. At the expiration of that term they left, it open .for Parliament to make other provisions affecting the financial relations of the Commonwealth and the States. Any attempt to go behind, or to upset such a clear intention of the Constitution is an attempt that we should all deprecate and resent. That remark applies as much to those honorable senators who think that the Braddon section is what it was once called - "a blot" - as to those who approve of it, and think that the term " blot " was a misnomer. At any rate, the Constitution is very clear on the point, and has imposed a time limit of ten years. We should respect it. Let me turn for an analogy to that other important provision known as the bookkeeping section. The framers of the Constitution provided that,' for five years., the distribution of revenue should be on a bookkeeping principle. I venture to say that no man in this Parliament will attempt, until those five years have expired, to alter that section. It is well known that many of us have the strongest objection to it. Many of us think that we shall never accomplish a true Federal spirit until the bookkeeping section is done away with. But no one, whether in favour of it or against it, would make any attempt, before the expiration of the five years, to modify it in any respect. But that is not the kind of treatment we are 0 01 na to apply to the Braddon section. We are now saying that, though the ten years have not expired, we will pass such legislation as will alter it in important particulars. It should require an extremely strong case - circumstances of an extraordinary character - to induce this Parliament to think of altering that section until the ten years' period has expired. But we find in the present case, that although nothing has happened in the nature of a crisis, the Government deliberately wishes to break through the Braddon section, in order to establish an old-age pensions fund. I have said already that the amount of money that we can derive will be entirely inadequate for the purpose. I do not think that there is the slightest doubt about that. No one in the Senate has ventured to say that, if we pass this Bill, we shall secure what we want. Indeed, it has been admitted that if we ear-mark the special duties contemplated for the special purpose in view, we shall not have achieved our object. We can only achieve it by imposing duties so enormous as to make them far more protective than revenue producing in their character. We have heard the argument that, so far as kerosene is concerned, if we attempt to raise money by a high duty, we -shall -fail, because people will not consume kerosene, and the consequence will be that there will be no fund.

Senator Playford - We have heard all this four or five time's.

Senator CLEMONS - I do not wish to elaborate the point in detail, but I am showing what the effect of this Bill will be. I cannot imagine that any one will gainsay the statement that we shall provide an inadequate amount for old-age pensions from duties on tea and kerosene. How are we going to provide the balance? We shall have to get it in some other way. But that is a very poor way of legislating. Are we to trust to chance - to" a sort of casual financial accident - to supply at least one-half of the total fund we require? The most confident supporter of the Bill1 in the Senate has not ventured to assert that we shall derive from the duties contemplated more than -^"7^0,000. It is asserted that we shall require £1,500,000. From what source is the balance to be derived? Some honorable senators say that we are going to get it from a direct tax on land. That may be so ; but, as I have said before, if we are going to derive revenue from a tax on land, we shall simply be imposing what the Labour Party want to impose - a tax which at least one of them in the Senate lias asserted to be a revenue producing tax, whilst others have asserted that it will' be penal in its object. I have heard at least one member of the Labour Party say that he would make up the deficit by such a tax as forms part of the platform of the Labour Party. That would produce £750,000, which is the balance required. The only other alternative suggested is that we should take the money out of the extra one-fourth which the Commonwealth at present retains of the Customs and Excise revenue. Any senator who has followed the course of financial expenditure and revenue during the last few years must recognise that the amount and value of the surplus of one-fourth is rapidly and continuously decreasing. It is quite impossible for any business man to attach any value whatever to the expectation that we shall be able to provide the ,£7 50,000 out of the one-fourth of the revenue. I was going to add another reason, but. seeing _ that the first is' so conclusive. I shall not occupy further time on the point. We are faced with the fact that this Bill will not do what we desire. There are a great many honorable senators in the Senate who do not believe that the revenue ought to be devoted to such a purpose - that this is not a proper source of income out of which to pay old-age pensions. When I put it mildly in that way, I am stating something with which every honorable senator, irrespective of his views, thoroughly agrees. I do not care to elaborate the subject further. The question has been well debated, but we have the consolation that the debate has been productive of some good. The question has been given the consideration which it thoroughly deserves, but which it wholly failed to get elsewhere. One of my chief objections, apart from the futility of the whole scheme, is that it simply represents a make-shift or temporary expedient - that it shirks the whole question 'of the financial relations of the Commonwealth and the States. If we pass the Bill it will simply operate as a means of checking or stopping the solution of our financial difficulties, which it has been the paramount duty of the Commonwealth to effect ever since 1901.

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