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Wednesday, 8 August 1906
Page: 2478

Mr JOHNSON (Lang) . - It would be a good thing if we could all share the cheerful optimism of the Treasurer, and accept his views regarding the present condition of Australia, and the outlook for the future. No doubt the figures which he presented in support of the statements made in his Budget speech afford abundant evidence that the present condition of Australia, so far as its commercial, industrial, and manufacturing enterprises are concerned, is such as should give cause for the liveliest satisfaction, and the fact that for the last three years we have enjoyed such great prosperity completely refutes the statements of Ministers and their supporters that destruction of industries, ruin, and general desolation threaten this country. The Treasurer's! Budget speech is also a striking commentary on the theatrical agitation at present being carried on by the honorable member for Melbourne Ports and others associated with him in his fiscal policy, who are visiting the Melbourne factories, and addressing the workers there upon the pressing need for increased duties, in order to stop what they term the continuous decay of Victorian and Australian industries. When the working men who have been the subject of so much political attention at their hands read the Treasurer's Budget speech - if they ever do so -they will wonder what was thepurpose of the visits to them of these energetic politicians on 'the eve of a general election.

Mr Mauger - They will wonder why they have not shared in the general prosperity.

Mr JOHNSON - Undoubtedly. I am about to deal with that point. The honorable member is assiduous in his endeavours to have the Tariff raised, in order to save the country from the ruin which he and those associated with him assert is threatening it; but I wonder that he does not point out to the working men and wage-earners whom he addresses that there is very little likelihood of the advantages resulting from the higher Tariff he is advocating being shared by them. It is manifest that no Tariff ever has been, or can be, devised which will increase the rates of wages by a single fraction.

Mr Mauger - The honorable member should read the last report of the Chief Inspector of Factories.

Mr JOHNSON - Whether the wages of employes in protected industries will be increased will depend largely upon the benevolence of their employers, and not upon any Tariff. High protective duties, by raising the prices), of commodities to consumers, give our local manufacturers opportunities to increase their profits } but their employes do not necessarily receive a corresponding, or, indeed, any advantage in higher rates of wages. In spite pf a high protective Tariff, Wages Boards had to be established in Victoria for the purpose of increasing wages. During the period when the protective duties in force in Victoria were at their highest point, allegations of sweating were most frequent. It was during that period that commissions were .appointed to investigate charges of sweating, and Wages Boards were created to get rid of the evil. Those facts strongly support my contention that increased wages do not necessarily result from high Tariffs. Increased wages may come about naturally, or may be brought about artificially by special legislation. The latter, however, affects only men actually in employment, since it would be compel men by Act of Parliament to give employment to others. These are facts which some of our mis* guided protectionist agitating friends who sit on the other side of the Chamber would do well to ponder over. I doubt very much whether any of the employers for whose benefit they wish to increase the Tariff would voluntarily sacrifice the advantages derived therefrom by increasing the wages of their employes to the extent of the full benefit of the duty. I doubt whether any one of them would voluntarily make an arrangement with his employes, giving them the benefit of any increase in the duties which may be brought about as the result of the present agitation. Indeed, I mightgo further, and say that I doubt whether, if it were a condition precedent to the raising of the Tariff that the advantages to be secured from higher duties were to go to the workers, the manufacturing employers would enthusiastically support proposals for higher duties. I venture to say that if the honorable mem ber for Melbourne Ports and other Ministerial supporters who are assisting him in this much-advertised and theatrically conducted agitation, were to make these proposals to the employers in the various industries, the facilities which they now enjoy for addressing the workers would not be so readily afforded to them. The employers would not thank them for conducting the agitation. In spite of the marvellous progress and prosperity to which the Treasurer has pointed, this fiscal agitation is being conducted for the purpose of creating a false impression in the minds of the wage-earners, and with a view to inducing them to vote for an increase of taxation. They are asked to believe that the condition of affairs is not as good as it should be - and I do not pretend that it . is, so far as they are concerned - and that by increasing the taxation on their stomachs and their backs, they will add to the prosperity, of the country, and to their own material comfort and financial well-being,. The whole thing is a huge electioneering farce, and if the workers were not such arrant fools, as many of them undoubtedly are, they would see through so transparent a device. Among the figures referred to with pride by the Treasurer of the Protectionist Government were those relating to Inter-State free-trade. The returns show that since the establishment of Inter-State free-trade, industry within the States and commercial intercourse between them has expanded to a marvellous degree. In the pre-Federation days of New South Wales, we were told by our protectionist friends that we should specially direct our Tariff restrictions against the neighbouring States of Queensland 1nd Victoria, whose goods were being dumped into New South Wales to the injury of the local producers. I believe that the Minister of Trade and Customs, when he was in the State Parliament, was a great supporter of that policy, and assisted tto actively promulgate it. When, however, Federation loomed on the political horizon, the politicians who had so strongly opposed the free admission of goods from the other States, suddenly "turned round and pointed out that great advantages would ensue if the Tariff barriers were knocked down, and the products of neighbouring States were freely admitted.

Mr Wilks - The stock fax was a notable example of the restrictions imposed upon free intercourse between the States.

Mr JOHNSON - Exactly. The very same politicians who were in favour of measures of that kind entirely renounced all their previous arguments and convictions, and advocated Inter-State free-trade, which they claimed would have the effect of enhancing, the prosperity of New South Wales. That was an argument that the free-traders had always used, but which the protectionists always scouted. The figures quoted by the Treasurer showed that the removal of Inter-State barriers has resulted in giving the producers of all the States a much more extended market.

Mr Poynton - Perhaps now that the honorable member for Gippsland is here, the honorable member will repeat what he stated about the stock tax.

Mr JOHNSON - I should have not the slightest hesitation in doing so, were it not already known to him. The honorable member for Gippsland is daily receiving fresh light.I believe that by continued association with men of advanced economic ideas, he will come to see the error of his protectionist ways. I feel sure that in view of the evidence before us of the extent to which Victoria has been benefited by free-trade limited, the honorable member for Gippsland, the honorable member for Laanecoorie, and others, will begin to inquire whether greater advantages would not flow from free-trade unlimited. If free intercourse between small communities is good, it should be mutually beneficial when it takes place between larger communities. If it is a good thing for two towns to freely trade with each, other, it must be beneficial for two provinces to do the same thing. If it is good for provinces it must be good for States, and the same principle is capable of application to the fullest extent, until it embraces all the nations of the universe. If it is a good thing for the States of the Commonwealth to trade freely with each other, I claim that the extension of the same principle to countries outside must inevitably result in the greatest possible benefit to all concerned. The undoubted evidence afforded during the past five and a halfyears of the prosperity and progress which result from the removal of restrictive barriers between States such as ours, should encourage us to extend the principle of free-trade beyond the shores of Australia, rather than agitate for the imposition of new duties to restrict and hamper trade.

Mr Webster - The honorable member's leader has been silent upon that question for ten years.

Mr JOHNSON - That is incorrect; but even if it were true, it does not affect the principle.

Mr Wilks - The fact that the honorable member is now taking up astrong attitude upon the subject shows that he is a free man, and can speak as he likes.

Mr Webster - He may speak as he likes, but he cannot vote as he likes.

Mr JOHNSON - The honorable member is again in error. His freedom to vote as he thinks is destroyed, but 1 am perfectly free to vote as I choose. Honorable members on this sideof the Chamber are so liberal minded that there may be wide divergences of opinion amongst them on certain points without affecting their relations one to the other or their solidarity. Ourleader is one of those generous, liberal-minded men, who is able to sympathize with and appreciate the perfect freedom of thought and independence of action, which is the great characteristic of his supporters - a characteristic which distinguishes them from members on the other side of the Chamber.

Mr Webster - Why does the honorable memberspeak of something that is impossible?

Mr JOHNSON - I have no doubt that such a possibility is incomprehensible to the honorable member's limited understanding, even though he possesses such a plastic temperament, and such elasticity of mind and conscience, that he can adapt himself to all kinds of political circumstances. I happen to be very well acquainted with the honorable member and his political career, but I do not wish to be led away into a discussion which may result in. less amicable feelings than those which now exist. As we are now in the last session of this Parliament, I think it is desirable to preserve the friendliest possible relations between honorable members in all parts of the House consistent, of course, with political differences of opinion.

Mr Webster - Then the honorable member ought not to introduce the fiscal question.

Mr JOHNSON - The honorable member is imposing an impossible condition, because the fiscal question is raised by the Treasurer's Budget speech, which contains a proposal to increase the taxation upon the backs of the people. I may be safely relied upon to resist such proposals by every means in my power.

Mr Webster - Is the honorable member referring to the proposed spirit duties?

Mr JOHNSON - No. I am referring to the specific duties mentionedinthe Budget speech. Reverting to the subject of Inter-State free-trade, I may say that it is very gratifying to me, as a representative of New South Wales, and of perhaps the most truly free-trade constituency in that State, to find that it is the best customer for the products of all the other States.

Mr Tudor - That is due to the fact that New South Wales is far behind the other States in the matter of her manufactures.

Mr JOHNSON - The honorable member is entirely wrong, for the figures show that New South Wales is also the largest exporter to the other States, a fact which supplies the most complete answer to the interjection of the honorable member for Yarra.

Mr Tudor - What does she export?

Mr JOHNSON - The honorable member caneasilyascertain that information by reference to the Year-Book of Australia, although I am quite prepared to rely upon the figures which have been supplied by the Treasurer in his Budget. From these I gather that New South Wales annually takes goods from the other States to the value of £14, 864,911. In other words, she purchases goods from them to the value of nearly £15,000,000 per annum, and she exports to them commodities to the value of £12,263,472. Further, New South Wales imports from the other States goods to the value of . £5,484,880 in excess of Victoria, that is to say, she purchases the manufactures and products of. the other States to the extent of nearly £5,500,000 more than does Victoria, and thus leads the way in showing the true Federal spirit.

Mr Tudor - That is because we manufacture goods for our own requirements.

Mr JOHNSON - Victoria manufactures goods mainly for her own limited population, and yet aims at becoming an exporting country. She prided herself upon the high protective duties which she enjoyed prior to Federation, and now clamours for the restoration of those duties, mainly upon the plea that she wishes not only to supply her own home market, but to become a large exporting country ; but outside of Australia she would have to compete in an open market and must fail. The Treasurer himself, who, I understand, is a protectionist

Mr Wilks - Is the honorable member certain that he is a protectionist?

Mr JOHNSON - I am not quite sure about it. If he was a protectionist previously, he cannot surely remain one now after having presented the figures which he did to the Committee. The right honorable gentleman has shown in his Budget that, despite all the advantages which Victoria enjoyed for upwards of a quarter of a century, in the shape of much higher duties than are now being collected, New South Wales, which has always been the freetrade State of the group, has, in the matter of her exports to the other States, been able to beat her by a very large margin. I have already shown that her imports from those States exceed those of Victoria . by £5,500,000, and that her exports to them are £3,533,285 in excess of those of Victoria.

Mr Webster - Is that result due to free-trade ?

Mr JOHNSON - Yes; Inter-State freetrade. It is due to the removal of the fiscal barriers which formerly existed' between the States, and which prevented the free interchange of commodities between them.

Mr Webster - It is because of the protective duties which New South Wales at presentenjoys.

Mr JOHNSON - No.Ifthat were so Victoria should certainly show a lead, as she had a long start with much higher duties. Her population is not very far short of that of New South Wales, and she has had all the advantage - not of six and a half years' experience of a comparatively low Tariff, such as exists at the present time-

Mr Mauger - I am glad to hear the honorable member admit that. .

Mr JOHNSON - I mean a low Tariff from a protectionist stand-point. If the high protection which Victoria enjoyed for upwards of a quarter of a century had really been beneficial to her. she ought to show to decided advantage in the matter of her exports to the other States as compared with New South Wales, instead of which we find that her Inter-State export trade is over £3,500,000 behind that of New South Wales. In Victoria, too, we hear a constant clamour for more protection. But in New South Wales we have no such clamour, and in this connexion; it must be recollected that New South Wales has never demanded the Tariff which is in operation to-day. As a matter of fact, she would be glad to get rid of it, as was shown when the electors were .invited to record their votes last election on the fiscal question.

Mr Webster - In voting for the Bill, they voted for a protective Tariff.

Mr JOHNSON - The honorable member is attempting to mislead the Committee. They voted for the Bill, but they did not intentionally vote for a protective Tariff.

Mr Webster - The adoption of a protective. Tariff was involved in the Braddon blot.

Mr JOHNSON - That was a danger that I and others who opposed the acceptance of the Bill unavailingly pointed out. Did not Sir Edmund Barton, the present Prime Minister, and the Minister of Trade and Customs, wHen they were endeavouring to persuade the people of New South Wales to vote for the Constitution, assure them thai it would not be a protective Tariff which would be imposed by this Parliament, but a Tariff which would suit alike free-traders - by which I presume thev meant revenue Tariffists - and protectionists. When we who opposed the Bill pointed out that the acceptance of the Constitution would saddle New South Wales with increased taxation, wo were answered by these gentlemen with the declaration that it would do nothing of the kind.

Mr Webster - The honorable member himself has said that the Tariff has benefited New South Wales

Mr JOHNSON - I have not said anything of the kind ; but she has progressed in spite of the Tariff, not because of it. I say that even under existing conditions that State shows to better advantage than does Victoria or any of the other States. I mentioned Victoria in particular, because she is the next largest State - from the stand-point of population - to New South Wales. In the figures presented by the Treasurer, Victoria shows to great disadvantage as compared with New South Wales, both in regard to her imports and her exports, so far as the Inter-State trade is concerned.

Mr Wilks - She never shows up badly when there is a bit of loot on the board.

Mr JOHNSON - Some Victorian manufacturers do not show up too well. That the bad' points associated with the desire to grab more than one's fair share always come to the surface, has been evidenced in connexion with many matters which have been before this House during the currency of the present Parliament.

Mr Wilks - I would not leave that theme now, because the honorable member has warmed up honorable members opposite.

Mr JOHNSON - It is a very good thing that I have been able to accomplish that. I hope that their consciences will be warmed to an appreciation of the fact that for many years they have been pursuing a wrong course, and that, prosperous as the treasurer has shown the country to be, that prosperity has not been brought about by restrictive Tariff legislation, but in spite of it. It has not been due to any legislation enacted by this Parliament, or by the States Parliaments, but is the result of the natural productiveness of Australia, its boundless resources, its good seasons, the immense advantages which it offers to. capital and labour for the purposes of exploitation, and to the industry, energy, pluck, and perseverance of the people who are settled here. Having regard' to the natural advantages which we enjoy, a very great deal of extremely pernicious legislation would be required to seriously set back this country for any protracted period. The fact of the matter is that our progress is due to a number of other agencies which are wholly unconnected with legislation of any kind. Whilst we enjoy good seasons, and are possessed of a land which contains millions and millions of untold wealth, only awaiting the hand of labour to pluck it from the bosom of the earth, we must continue to prosper. The principal needs of this country are, first, the destruction of land monopoly, and secondly, the opening up of our territory to a sturdy population of yeomanry - to persons who will settle upon a free soil, and develop all our primary resources, without State coddling or spoon feeding,- thus creating a solid foundation for prosperity for all time. I do not see any proposals in the Treasurer's Budget which are likely to bring about that result. Certainly I give some honorable members of the Labour Party credit for realizing; that the two needs to which I have just referred are primary essentials to our prosperity. In so far as they realize that, I am heartily in accord with them. It is only when they come to deal with the problem of how we may best bring about the conditions which are desirable, that I find myself very reluctantly compelled to part company with them, and to oppose their proposals, because they seem to me to be entirely wrong. Of course, I may be wrong myself. None of us can say absolutely that any honorable member is right in his opinions.

Mr Carpenter - The honorable member is getting on.

Mr JOHNSON - At any rate, from my point of view, the socialistic proposals of honorable members opposite are wrong, and for that reason I must oppose them. At the same time there are many things which they advocate with which I am very much in sympathy. Broadly speaking, I am more in sympathy with a good many honorable members sitting upon the opposite side of the Chamber - and especially with those who occupy seats in the Labour corner - than I am with some of those with whom I find myself associated. Of course, I am speaking in a political, and not in a personal sense. The trouble is that the Labour Party advocate measures utterly destructive of freedom, and impose conditions which make it . impossible for men of democratic tendencies to become permanently associated with them, which is a matter of very great regret to me. I now pass to another phase of this question which presents itself to my mind. The Treasurer's figures eminently satisfactory as they are so far as they go, do not necessarily indicate that the people of the country, as a whole, are prosperous. The volume of trade and the receipts from taxation are not the most reliable dataupon which to found a correct estimate of the condition of the people as a whole. Especially is this the case in regard to taxation, because when we point to our Customs receipts, or to receipts from other sources of taxation as an evidence of general prosperity, we are very likely to be misled. This fact will be patent to anybody who has studied the figures which Treasurers in other countries are able to produce, and which are not indicative of the general condition of those countries. It often happens that in countries showing the best returns in respect of taxation the people themselves are living upon the verge of starvation.

Mr Wilks - As in China.

Mr JOHNSON - We may take the position of the people in Russia, China, and almost any country where great poverty prevails

Mr Webster -Does the honorable member assert that poverty exists in China ?

Mr JOHNSON - If the honorable member has read anything about that country he will know that, except amongst certain classes, great poverty prevails there. Are we not accustomed to hear the protectionist members of this House, including, the honorable member himself, asserting time after time that we should havehigh Customs duties to prevent the competition of goods made by Chinese pauper labour? Is it not common for them to refer also to thepauper labour of the Chinese within the Commonwealth ? That being so, is it not fair to assume that if Chinese are prepared to work for pauper wages here, it is because those wages represent agreat advance upon what they would be able to earn in their native land?

Mr Wilks - Many of the Chinese here are merchant princes.

Mr JOHNSON - As compared with their fellow-countrymen in China, doubtless many of them are. Statistics relating to revenue and expenditure, and trade, com mence andfinance, do not necessarily afford a fair indication of the condition of the- people. It may well happen that, notwithstanding that such statistics show a great increase in the Customs revenue, and in production, manufactures, commerce, and other directions,a very ' large proportion of the population are not enjoying the benefit of the progress thus disclosed. We have unemployed agitations in Victoria and elsewhere.

Mr Wilks - But the agitation is keener in Victoria than in any other State.

Mr Mauger - Rubbish.

Mr JOHNSON - We have not in New South Wales such keen agitation on the part of the unemployed as prevails in Victoria, although I do not say that New South Wales has not an undue proportion of men who find it difficult to make ends meet. The problem of dealing with the unemployed is one to which politicians, having any claim to be considered statesmen, should address themselves. I commend this to the Treasurer, who is exceedingly optimistic.

Sir John Forrest - Perhaps I have been able tojudge the position better than the honorable member. Foolish optimism would not last for ever.

Mr JOHNSON - I do not say that it is foolish. Optimism is a very happy trait of character.

Sir John Forrest - It is scarcely correct to say that I am recklessly optimistic. I have not embarked on non-paying enterprises, and I have held office for twenty


Mr JOHNSON - The right honorable member has been living in a State which owes it prosperity to the discovery of rich gold deposits within its borders. As a result of that discovery its population has rapidly grown, and it has obtained the cream of the workers of other States, and more particularly of Victoria.

Mr Webster - That discounts an argument that the honorable member has already addressed to the House in regard to the falling away of the population of Victoria.

Mr JOHNSON - On the contrary, the fact that so many Victorians have gone to Western Australia shows that the highly protective Tariff imposed by the State Parliament did not raise wages sufficiently high to enable the State to retain its population. The effect of that high Tariff was to drive out of the protected industries of Victoria a number of men who have been replaced by women and children, and many of those men went to Western Australia.

Mr Mauger - The men who went away were miners.

Mr JOHNSON - The men who ought to have been developing Victoria were forced, owing to the legislation of this State, to go where they could work under different conditions.

Mr Mauger - The honorable member has not studied the question.

Mr JOHNSON - I claim to have studied it perhaps a little more thoroughly than has the honorable member.

Mr Mauger - But not in relation to the position of Victoria.

Mr JOHNSON - I am afraid that I cannot compliment the honorable member on having made more than a superficial study of this question. The high Tariff imposed by Victoria did not enable her to retain her population. There was an exodus from the eastern States, and particularly from Victoria, to Western Australia, which has reaped the advantage of the influx of population so obtained. The right Honorable gentleman^ as Treasurer of Western Australia, also reaped the ad vantage of the prosperity which followed in the wake of that increase of population, and the discovery of rich mineral deposits which led to profitable employment being obtainable there.

Mr Webster - Does the honorable member mean to infer that none of the prosperity of Western Australia is due to the right honorable gentleman?

Mr JOHNSON - I should not like to say that; I know that the right honorable gentleman has done a great deal for that State. But he had to get the people there first. When I visited Western Australia last year, I saw one- of the gigantic works carried out on his initiative, and which has enabled the people of the goldfields more particularly to live under better conditions than previously obtained. I do not think the people of the other States will grudge Western Australia that prosperity, nor the right honorable gentleman the elation which it causes him. When interrupted, I was about to show that the Savings Banks returns furnish a far better guide to the condition of the people than is obtained by a study of statistics, such as have been furnished by the Treasurer, in relation to taxation, production, and trade. The Savings Banks are popular institutions to which recourse is had by men whose means are too small to enable them to take advantage of the ordinary banks of issue, and the returns relating to them afford us a somewhat better indication of the general conditions of the ' people than do statistics relating to trade and commerce.

Mr Poynton - They are very unreliable.

Mr JOHNSON - I do not assert that they afford an absolutely correct guide.

Mr Poynton - For instance, a man might own a house, and have nothing in the Savings Bank, whilst another having a few pounds to his credit might no real estate.

Mr JOHNSON - Notwithstanding that fact, for which I make allowance, I hold that the Savings Banks returns offer us a better indication of the condition of the wage-earning classes than do the figures relating to trade and commerce. My study of the Savings Banks returns leads me to believe that they, might well be more satisfactory than they are.

Mr Webster - Are not the prison re- - cords also a guide in this regard?

Mr JOHNSON - I do not think they show as well as do the Savings Banks returns the condition of those who are the thrifty workers.

Mr.Webster. - Are there not thrifty men in prison.

Mr JOHNSON - Those in our gaols are mostly men who have been industrious in exploiting the property of others. That is a kind of thriffiness which we ought to discourage. I have taken from the Budget some figures that have enabled me to compile a return showing the ratio between the population and the savings of the people, as indicated by the Savings Banks returns. The returns quoted by the Treasurer, and also the Y ear-Book, from which, I presume, they were originally taken, show that the total population of New South Wales is 1,491,763.

Mr Webster - It is over 1,500,000.

Mr JOHNSON - I am taking the Budget figures. They are sufficient for my purpose; but if the actual population is that which the honorable member has stated, it emphasizes the point I wish to make. As against the population of 1,500,000, in round numbers, there are 361,383 depositors in the Savings Banks of New South Wales ; so that out of the total population of 1,500,000, 1,130,380 are non-depositors in Savings Banks. According; to the Budget, Victoria has a population of1,218,571, while the number of depositors in its Savings Banks is given as 461,345, showing that there are 757,226 non-depositors in the Savings Banks here.

Mr Poynton - What is the percentage?

Mr JOHNSON - I have not worked it out. Victoria shows a larger number of depositors in Savings Banks in proportion to its population than does New South Wales. But although in Victoria there are 99,962 more Savings Banks depositors than there are in New South Wales, the aggregate amount of their deposits is much less than the sum deposited in the savings banks of New South Wales.

Mr Webster - That is because the maximum amount upon which interest is paid ishigher in New South Wales.

Mr.JOHNSON.- The Victorian maximum is £250. and the New South Wales maximum, which was formerly £200, has now been increased to £300, so that it is higher.

Mr Webster - That accounts for the difference.

Mr.JOHNSON. - It makes no difference, so far as these figures are concerned.

Although in Victoria there are 99,962 more savings bank depositors than there are in New South Wales, the amount of their deposits is less than the amount of the New South Wales deposits by £2,449,969. In New South Wales the number of depositors in savings banks is 361,383, and the amount deposited by them £13,797,284, while in Victoria the number of depositors is 461,345, and the amount deposited by them £11,347,215.

Mr Webster - The honorable member forgets that they have Wren's tote in Melbourne.

Mr JOHNSON - The existence of the totalizator here may very largely account for the difference, and, if so, " it shows what a great evil it is to the community to have established in its midst institutions affording facilities for gambling. The population of the Commonwealth is estimated at 4,052,475, of whom 1,152,506 are depositors in savings banks, the aggregate amount of their savings being £37,205,039. Therefore, there are 2,899,969 persons, or, in round figures, nearly 3,000,000 persons, who have no moneyinsaving banks. I suppose that over 80 per cents of our population belong to the working classes, and these figures therefore show that the prosperity of the industrial section of the population might well be much greater than it is. Of course, an allowance must be made for the fairly large number who are endeavouring to secure houses or other property for themselves, and have no margin for saving left after they have fulfilled their obligations in regard to mortgages, and so forth, in carrying their plans into effect. There are, no doubt, many persons so situated, who do not use either savings banks or banks of issue. But, allowing for them, and also for those in better positions in life than are occupied by the ordinary wageearners, who use banks of issue, putting them at, perhaps, 1,000.000. there are still left more than 1,750,000 who have no savings either in banks or in other property.

Mr Storrer - Allowance must also be made for women and children.

Mr JOHNSON - In all calculations of this kind, allowance must be made for women and children, though it is to be remembered that many of the depositors in savings banks are women, and that many accounts are opened in these institutions on behalf of children. No doubt the figures indicate a tendency to the accumulation of wealth in the hands of a few, and .1 think that that tendency is further indicated by the figures relating to the business of the other banks. I have tried to obtain, in regard to banks of issue, figures similar to those which I have given in regard to our savings banks, but. unfortunately, they are not available, those in charge of our private banking institutions being either unwilling or unable to give such figures. I have ascertained, however, that the amounts deposited in banks, of issue aggregate ^106,000,000, as compared with the ^37,000,000 deposited in the savings banks, belonging for the most part to the members of the working classes, who form the largest section pf the community. The savings bank deposits average about £37 for each depositor, which is not very much to boast of. The honorable member for Bland last night made some reference to this aspect of the question, and, without going into details, suggested that we cannot take the statements of the Treasurer as an absolutely reliable index to the condition of the masses of the people. There is a great deal to be said for his contention. He has made certain proposals designed according to his ideas to bring about an era of improved prosperity, with which I shall not deal on the present occasion. I recognise the - unfortunately misdirected - zeal and energy which he has displayed for bettering the condition of the masses of the people; but I am not in agreement with him as to the means to be adopted to this end. Coming now to a matter affecting the administration of the Public Service of the Commonwealth, I wish to point out that, although the Customs revenue has increased in New South Wales by about £200.305, a cheese-paring policy is being pursued in regard to the payment of increments due to Customs officials. ' It has come to my knowledge that there are several officers, admittedly deserving and capable, who are entitled to promotion and to higher salaries, but for some reason or another the Estimates have been kept down to a point which does not admit of higher salaries being paid. This seems to me not warranted, in view of the expansion of the revenue of the Department. If there is such a large surplus that the Treasurer feels justified in proposing, to scatter money broadcast among the States, beyond what they are legitimately entitled to receive, I think that we ought to consider the position of the public ser- vants attached to the various Departments of the Government. I bring this matter under the notice of the Treasurer now, an!d, later on, will bring it more directly under the notice of the Minister of Trade and Customs. The cheese-paring to which I allude is taking place, not only in regard to the Customs Department, but in regard to other Departments as well. In yesterday's Argus the following information was published under the heading ' ' Federal Public Service: Increments for Ensuing Year " :-

In conformity with the policy laid down last year, Federal Ministers do not purpose paying increments automatically to members of the Federal Public Service. In the subjoined state- ' ment the intentions of the Cabinet are plainly set out : -


Unless a very special reason can be shown for depriving officers of their increments, these increments should be paid. I could understand that there might be reason for caution and economy if there were a danger of the Commonwealth being on the wrong side of the ledger; but, as the Treasurer is able to point exultingly to the existence of a large surplus on the transactions of last year, and to estimate a surplus on the transactions of the present financial year', I think that these increments should be paid. I commend this matter to the consideration of the Treasurer, in the hope that he wilT bring it under the notice of the Public Service Commissioner.

Sir John Forrest - Salaries cannot be increased except upon the recommendation of the Commissioner.

Mr JOHNSON - Perhaps not, but the Treasurer can ask the Public Service Commissioner to give his reasons for making these recommendations in the face of an expanding revenue. If our revenue were decreasing, I could understand that the Commissioner would do well to recommend the exercise of caution in regard to the payment of increments.

Sir John Forrest - I think that the Commissioner is increasing the salaries fairly well.

Mr JOHNSON - What I complain of is that 'there is a tendency to increase salaries in the one direction - to add to the incomes of those who are at the top of the tree and to ignore the interests of those who are in the lower grades of the service. I want to see the principle of granting increments more generally applied, and to secure the advantages of the system to those whose salaries are paid upon the lower scale. I am not at any time a warm advocate of the reduction of salaries, but if caution has to be exercised, and salaries have to be cut down below the amount which perhaps might be regarded as justly due to the officers, the most generous consideration should be given to those who are in the lower grades of the service. I commend this matter to the favorable consideration of the Treasurer, in the hope that he will bring it under the notice of the Public Service Commissioner. I do not wish to deal with this matter exhaustively at the present stage, because I shall have another opportunity to do so when the Estimates of the Customs Department are being considered. With reference to the Post and Telegraph Department, some most important proposals have been made. Although the Treasurer is able to point to last year as a most prosperous one, I think that there is every indication of a falling off in the Post and Telegraph revenue in the coming years, and that it behoves honorable members to give their serious attention to the proposals now being put forward. I notice that the Treasurer stated, as reported at page 1995 of Hansard -

There were extraordinary payments made during the year 1904-5, principally in Western Australia, for savings bank work bv the States, amounting to ,£18,000. But for this, the total increase on account of the Post and Telegraph "Department would have been about ,£209,000 instead of £191,631.

I should like to have some explanation of this item, because it seems to me that under ordinary circumstances, the Commonwealth should have had the benefit of that payment.

Sir John Forrest - The States paid us for certain work which we did for them in connexion with the States Savings Banks. They are now doing the work for themselves.

Mr JOHNSON - I have referred to the disabilities under which some officers in the Customs Department labour in regard to increments. I have also had brought under my notice the fact that many of the officers in the Post and Telegraph Department labour under similar disadvantages. Complaints are continually being made with regard to the grading of officers in the Post and Telegraph Department, and the salaries allotted '<-to them. There is no doubt that much dissatisfaction exists, and, although it is impossible for us to say positively whether or not it is justifiable, there must be some reason for the complaints that are repeatedly being brought under our notice. I have been informed upon more than one occasion, that it has become the practice in the Postal Department to employ clerical officers to do the work of general officers in the lower grade. I do not know how matters stand in other States, but it has been pointed out that in the General Post Office in Sydney clerical officers have been appointed to the mail branch to do work which should be performed by officers in the general division, and that when vacancies occur in clerical positions which these officers would be quite capable of filling they are overlooked. It has been explained that this injustice is due to the reluctance of the officers in charge of the branch to part with men who are thoroughly efficient at their work, and1 to thus run the risk of having them replaced by others less competent. That seems to me to be very unfair to the officers affected. If the representations made to me are correct, the verv efficiency of the officers is proving an effective bar to their promotion. This is another of the matters which ought to be brought under the notice of the Public Service Commissioner, with a view to the removal of any anomalies that may exist. I wish also to refer to the employment of railway station masters as postmasters, without the payment of any special remuneration for the work performed by them outside of their ordinary duties.


Batchelor). - I would suggest to the honorable member that he could more appropriately deal with details such as he is now discussing when the Estimates of the Department come under consideration.

Mr JOHNSON - I had not intended to elaborate the matter at this stage. I shall content myself by saying that it seems to me unfair to deny remuneration to railway station masters for work performed by them as postmasters. I shall also have occasion to refer at a later stage to the insufficiency of letter carriers in certain districts. I will now pass on to the question of telephone extension. While we are giving away so much of our surplus revenue to the States, and the money is in some cases being squandered, we might very well apply some of it to the cheapening of our telephone system, and the extension of telephone facilities to districts which now either have none at all, or are very incompletely served. With regard to the penny postage proposal, I am not altogether opposed to the establishment of a penny postage, but I think that the Government contemplate too wide an application of the principle at the present time. To my mind, every effort should be made to unify the postal charges throughout the Commonwealth, and perhaps we might extend the same principle to New Zealand. But when it is proposed to go beyond the Commonwealth, and extend the penny postage to parts beyond the seas, I think that, in view of the large loss of £200,000 which it is estimated will be incurred, we ought to think twice about adopting the Government scheme. A penny postal rate within the Commonwealth would be very beneficial to the whole of the people, because of the frequency with which letters are sent from one part of a State to another, and from one State to another. A penny postal rate, however, as applied to parts beyond the Commonwealth would not be of any appreciable advantage to the great mass of the people, because letters are not sent abroad with any great frequency bv the same person, except, of course, in business circles. An exception, however, might be made in the case of New Zealand, in which Colony many of the people of the Commonwealth have near relatives. I do not think that the general puBlic have experienced any special hardship in having to pay 2'd. postage upon letters sent beyond the seas, and I think that for the present we might very well adhere to that rate for correspondence despatched outside the Commonwealth.

Sir John Forrest - We have to pay some regard to the interests' of the Empire.

Mr JOHNSON - I am as enthusiastic as is the Treasurer in desiring to promote the interests of the Empire, but 1 do not think that the interests of the Empire are adversely affected by the present postage rate. The amount that itf is estimated we should lose by the adoption of penny postage is £200,000 per annum - a sum which is equal to our annual contribution to the maintenance of the British Squadron stationed in Australian waters. I think that we should regard this proposal very seriously. So far as, the Commonwealth is concerned, I am quite prepared to support a scheme for the establishment of penny postage, but from the knowledge at present in my possession I am inclined to oppose at the present time the extension of that system beyond the limits of Australia, and possibly Qf New Zealand. I do not think that we are justified in incurring such a heavy loss unless it can be shown that there is some distinct advantage to be gained from the scheme - an advantage which, so far, has not been disclosed. I notice that, in the memorandum of the Postmaster-General, reference is made to the success of the penny postage system in other countries. He specifically mentions the United States of America, Canada, Egypt, New Zealand, and France in this connexion. But he must recollect that there is a very wide difference between the population of older countries and that of Australia - a fact which is worthy of special notice, because upon the volume of the business transacted must largely depend the success or failure of the experiment. The only country to which he refers whose population approximates nearly to our own is that of Canada, and it must be remembered that her population has been on the up-grade ever since the establishment of the system. Further it should not be forgotten that, although the results of penny postage in that country show to advantage in comparison with the results of the rate which was formerly charged, the revenue returns from her Post and Telegraph Department - notwithstanding that she has a population of 6,000.000 as against our 4,000,000 - do not show to anything like the same advantage as do the returns of the Commonwealth. Again, whilst Canada's population is 2,000,000 in excess of that of Australia we must remember that her population is steadily increasing, whereas ours is more or less stationary. Consequently, Canada can afford to indulge in experiments which, in the light of our vital statistics, we should not be warranted in undertaking. I repeat that whilst I am prepared to support a proposal for the establishment of a uniform system of postage throughout Australia, and for the issue of Federal postage stamps, I do not feel inclined at the present moment to commit myself to supporting a proposal to extend that system beyond the limits of the Commonwealth. For the present, however, I will keep an open mind on the question. I observe that the Government propose to ask for an increased vote of £7,000 in connexion with the Tasmania mail service. As the Treasurer has pointed out, this will entail an additional expenditure on the part of the Commonwealth of £5,600 as. a guarantee to the Cable Company against any loss which may be incurred by reason of the reduction of the telegraph rate, which, under the right honorable gentleman's proposal, will be is. for sixteen, words, instead of is. 8d. as hitherto. This increase of £7,000, in addition to the £5,600, will make a total of £12.600. I do not wish to raise any objection to the granting of increased mail facilities to Tasmania, or to a reduction in her post and telegraph rates. Indeed, I think- that the policy which it is proposed to adopt in this connexion is one which ought to be pursued with a view to obtaining uniformity in all these matters throughout the States. I do not object to the increased expenditure proposed, especially in view of the fact that Tasmania has suffered a very serious diminution of revenue since she entered the Federation. But whilst I do not object to the contemplated reduction of rates in the case of Tasmania for the purpose of affording her very-much-to-be-desired facilities, I cannot understand why so much liberality is exhibited by the Department in some directions, and so much disregard of the public convenience in others, and particularly in the matter of telephonic communication. I experience the greatest possible difficulty in procuring anything like reasonable telephonic conveniences for my own constituents who happen to live out- side a certain area, and I think that the time has arrived when the whole of our telephone arrangements ought to be revised, when the whole of the regulations ought to be redrafted, and when we should secure a cheaper and more extended system throughout Australia. In some centres - and I have particularly in my mind a place in my own district which is only about thirteen miles from Sydney - extortionate rates are charged for telephonic communication, notwithstanding that they are only just outside the metropolitan radius. It seems to me that where population is concentrated that radius ought to be extended so that people who now suffer disabilities by living outside it might enjoy the benefits conferred by being called upon to pay only metropolitan rates. I now come to the question of the return of surpluses or balances to the States. In this connexion I desire to say that the practice which has hitherto prevailed of returning to the States revenue in excess of the three-fourths of the Customs and Excise receipts to which they are entitled under the Constitution has been a bad one. It is a policy which should never have been inaugurated unless we were in a position to continue it, .and! it is one which, as the Treasurer has admitted in his Budget, cannot be continued. What will happen? By-and-by, when we are no longer able to return to the States anything in excess of their three-fourths' of the Customs and Excise revenue, an outcry will be raised bv them against the niggardliness of the Commonwealth. They will have come to regard it as a prescriptive right that they should receive something in addition to the three-fourths of the revenue to which they are entitled under the Constitution. The policy of handing over to the States surpluses of revenue, which have aggregated £5,233,000 is an entirely erroneous one. The Treasurer has admitted that it cannot continue, and he has pointed out that in the near future we are likely to incur increased obligations. I say that we ought to conserve our funds for contingencies of that kind. Whilst we have the-opportunity we ought to make provision to meet these prospective increases, and, possibly, some unforeseen expenditure. Instead of doing that Ave have been handing over these balances to the States, with the result that some of them are able to point in their financial statements to surpluses. I have always maintained that a surplus of revenue in the hands of a Treasurer is more indefensible than is a deficit. My reason for making that statement is that when there is a margin upon the wrong side of the ledger there is always a tendency to economize and to careful administration, but when a surplus exists there is always a direct incentive to extravagance, which is bad for all concerned. Further, it often happens that when an election is approaching a Treasurer who has in hand an immense sum which is not required for governmental purposes is enabled indirectly to bribe constituencies.

Mr Wilks - Does the honorable member think that the present Treasurer would do that?

Mr JOHNSON - The present Treasurer has the reputation of being an honorable gentleman, and so far as I have been associated with him he has well sustained it. When I speak of the possibility of surpluses being used in the direction I have indicated, I wish it to be distinctly understood! that I make no personal reference to the right honorable gentleman. Nevertheless, we must have regard to the ordinary tendencies of human nature, and we know that human nature is very much the same in every individual. I repeatthat surpluses offer a direct incentive to Governments - especially to corrupt Governments - to confer undue advantages upon constituencies which .are represented by their own supporters. That danger ought to be guarded against. Moreover, the existence of a surplus is indicative of over-taxation, and so far from tapping new sources of taxation it should be our duty to ascertain in what direction we can reduce the burdens of the people, so as to make our revenue and expenditure approach to correspondence. I do not see any proposals in the Treasurer's Budget which show that 1 lie Government desire to reduce taxation. On- the contrary, I find that the right honorable gentleman intimates that after a certain period of years an attempt will be made, in the face of an increasing revenue, to increase taxation. There is no justification for that. On the contrary, we should, wherever possible, reduce taxation. The fact that, in addition to the three-fourths of the Customs and Excise revenue to which they are entitled, the States have received, since the establishment of Federation, nearly £5,233,000 - money which has. been squandered by being distributed broadcast among the States - shows that our taxation has been too heavy.

Mr Wilks - And we have not yet taken over all the services that we are entitled to control.

Mr JOHNSON - No regard seems to have been paid to that fact. If our taxation- be not reduced to the extent of the surplus annually distributed amongst the States, the money might well be retained to meet contingent liabilities that will have a tendency year after year to increase. But we have been throwing away the annual surplus, and enabling the States in some cases to show an excess of revenue over expenditure, which otherwise would not have been possible. In any circumstances, such a policy is mischievous. Last year the Commonwealth expenditure was ^4,494,841, being £111,432 less than was estimated ; and °to my mind the people of the Commonwealth were overtaxed to that extent. According to the Treasurer's statement, the Commonwealth, was entitled to spend last year £5,324,766. As a matter of fact, however, only £4,494,841 was expended, leaving a balance of £829,926, which was handed over to the States as a voluntary present. The amount which has been paid away in that manner to the States during the last six and a half years is £5,233,591. That was an enormous sum for the Commonwealth to throw away when it was unnecessary to do so, and when it might have been utilized to much better advantage in other directions. It is estimated that the revenue for 1906-7 will show an increase of £90,157 ; but against that we have an estimated increase of expenditure totalling £525,374, or £435>2I7 in excess of the estimated increase of revenue. This discloses a very serious position, and one which, notwithstanding the optimism of the Treasurer, should receive the most careful attention, in order that it may be discovered whether something cannot be done to arrest the tendency to fling away money as recklessly as has been done. Although we have to provide for a loss in respect of the penny postage proposals, and also for improving our coastal defence, which is a matter of supreme importance that does not appear to receive the attention it demands, we have unnecessarily paid away huge sums to the States during the period to which I have re- ferred. Not content with this, the Government propose to hand over to the States this year a sum of £311,228 in excess of the constitutional three-fourths of Customs and Excise revenue, to which alone they are entitled. I hope that, in view of the necessity to meet the large expenditure that is projected, this will not be done. I come now to the question of bounties, concerning which I shall have more to say when the Bounties Bill is under consideration. The payment of bounties for the encouragement of industries may be, in certain circumstances, justifiable, but the general adoption of the practice is pernicious and indefensible, though less objectionable than that of levying protective duties. There are only two points in favour of the bounty system. The first is that, when we apply it to the encouragement of industries, we know exactly what we are paying ; whereas, when we impose protective duties for that purpose, we do not. In the second place, the payment of a bounty in respect of certain goods, unlike the imposition of a protective Tariff, does not increase the cost of these goods to the consumer. These are the only two recommendations in favour of bounties as against Tariffs that are levied to encourage local industries. If a bounty may be rightfully given to one individual at the expense of the whole community, to encourage the establishment and development of an industry, why should not the system be applied to. every one? Why should only certain industries' be selected for such treatment? I have never been able to understand on what principle the practice of singling out a few industries to receive a benefit at the expense of the general community, and to the exclusion of the rest, can be defended. Whilst I fully recognise that in certain circumstances - as, for instance, in the case of a great national industry, from which the whole community would derive, either directly or indirectly, a benefit - the payment of a bounty would be justifiable, I have never been able to satisfy myself that the application of the system* in the manner proposed by the Government is justifiable. I am not in accord with the present bounty proposals of the Government. If we are to expend public money to encourage private industries - and especially if it is intended to encourage rural industries - the best course to pursue is to establish experimental farms and agricultural and technical colleges. By means, of such institutions we should be able to impart instruction in the., latest scientific methods of production, and in regard to all matters pertaining to the soil. In that way we should do far more than we could accomplish by granting bounties to different individuals to enable them to conduct experiments with respect to industries! which might or might not be successful, and which, even if they ' were, could not be continued, perhaps, unless further bounties were ..granted, or protective duties were imposed to take their place. There is no guarantee that the industries in respect of which bounties are to be paid will be able to continue without further assistance. When an industry survives the period in respect of which the payments are made, a demand is almost invariably made for an extension, or for the imposition of a protective duty, to prevent it from languishing or perishing. In voting for the payment of bounties for the encouragement of industries, unless we look far enough ahead, we may place ourselves in a false position in which, as free-traders, we will have ultimately to vote for the imposition of protective duties to enable those bounty -created industries to continue. I think that the money proposed to be paid away in the shape of bounties could be more profitably expended in establishing a Federal Department of Agriculture, to work in conjunction with the States. Such a Department could obtain the most up-to-date information with regard to the nature of our soils, the best fertilizers and implements to use, and the crops most suited to the soils and climatic conditions of different districts. Information of various kinds, which would improve the knowledge of those engaged in our primary industries, could in this way be obtained. Farming has been brought to the highest pitch of perfection in America and Germany, not by the granting of bounties to individual producers, but by the expenditure of public funds in the establishment of colleges of the kind I have indicated. There are many such colleges in Germany.

Mr Ronald - What is that system but the giving of a bounty ?

Mr JOHNSON - It is a very different thing. It does not mean the giving of a bounty direct to the individual, such as is proposed by the Government. It has been pointed out that in some cases industries were started merely for the purpose of securing bounties offered for their establishment, and that thev died away as soon as the bounties ceased. It was stated the other day by an honorable member that some time ago a bonus of £5,000 was offered by the Victorian Government for the local production of 5,000 yards of worsted; that the 5,000 yards were so produced, and that as soon as the bounty had been paid the industry vanished. The giving of bounties in this haphazard fashion has a tendency to create mushroom industries, which, after a brief existence, are never heard of again. In preference to the granting of bounties, I should like to see an expenditure in the direction I have indicated. By that means, not merely one or two, or even half-a-dozen, individuals would be benefited; but the whole of those engaged in our rural industries, and, indirectly, the community at large, would be advantaged by the expenditure.

Mr Henry Willis - The honorable member suggests the establishment of technical colleges?

Mr JOHNSON - Yes. I recognise that the Commonwealth should not come into competition with the States in this matter.

Mr Henry Willis - Why should not the Commonwealth take over the agricultural Departments of the States, and establish a Federal Bureau of Agriculture?

Mr JOHNSON - In my opinion, we should try to come to an arrangement with the States under which there can be established a Commonwealth Department of Agriculture, to work in conjunction with the Departments of the States, the Commonwealth arranging for the financial support of the necessary institutions, and the States providing the land and buildings required for experimental farms and colleges' of instruction. With such mutual co-operation, we should be able to provide facilities 'for improving the knowledge of those engaged in primary production, and enabling them to work under the very best conditions - facilities such as have been afforded in Germany and America, where farmers have been taught to obtain crops from land which, previously to the application of scientific processes of cultivation, was thought to be absolutely useless. " In this way large tracts of country, which might otherwise have remained idle for manygenerations to come, have been brought into use. If it had been proposed to spend money in that direction, it would have shown a more statesmanlike grasp of the needs of the community than' has .been shown by the proposals embodied in the Bounties Bill. I shall, however, have more to say on the subject of bounties when we discuss the Bill in Committee. I wish now to say a few words in regard to the Treasurer's proposals for the building of lighthouses. The right honorable gentleman wishes to provide for the transfer of the control of lighthouses to the Commonwealth at the earliest possible moment, and has indicated that a large expenditure in the building of new lighthouses should take place in the near future. New lighthouses would cost anything from £.10,000 to £20,000 apiece, and in providing for the ten or a dozen additional lighthouses which the right honorable gentleman thinks will be required within a very short space of time, we must reckon on spending from £100,000 to £200,000. At the very least £100,000 must be provided for, because ten lighthouses at £10,000 each - and I doubt whether buildings containing the latest and most improved lighting appliances could be built for that sum - would cost £100,000. Notwithstanding that the honorable gentleman thinks such an expenditure necessary, and that there must be large expenditure in connexion with military and naval defence, he proposes to continue the practice of returning to the States more than three-fourths of the revenue obtained from duties of Customs and Excise.

Sir John Forrest - The Constitution compels us to return any unexpended balance,

Mr JOHNSON - But there is no need that there should be such a balance.

Sir John Forrest - The honorable member means that he thinks that the Commonwealth should spend it?

Mr JOHNSON - Yes; if the expenditure is necessary. " If it is not necessary, then there is over-taxation. If, as the Treasurer thinks, the works to which he has referred could be carried out later on, why not spend any balance which we may have in commencing them now ? It seems to me that our coastal and harbor defences are being almost entirely neglected by the authorities, and, instead of handing over any balance to the States, we might well expend the money on works necessary to meet the Commonwealth requirements. The Treasurer anticipates that more lighthouses will be needed because of the probable increase in our shipping, but the Government of which he is a member, and the party to which he belongs, have been instrumental in passing legislation whose effect will be to diminish our commerce, and, therefore, our shipping. I refer to the restrictive provisions of the Commerce Act and he Australian Industries Preservation. Bill, for example. The effect of such provisions must be to decrease the volume of our trade, and, consequently, the number of mail and freight steamers coming to Australia from abroad. If that happens, the probability is that in the future, instead of needing more lighthouses, we shall need fewer, because of the decrease of shipping in Australian waters. I should like to know why it is proposed to expend £8,000 in purchasing a trawler. This seems to me the initiation of the socialistic scheme proposed by certain honorable members for the acquisition bv the Commonwealth of a fleet of steamers. Perhaps this is the Treasurer's way of entering upon that socialistic proposal. I should like to know from him if "the trawler which is to be acquired will form the nucleus of a magnificent fleet of Commonwealth steamers ?

Sir John Forrest - A trawler is to be acquired in order to explore our coastal seas, with a view to seeing where fish may best be obtained.

Mr JOHNSON - It is well that we should obtain information on this point, because sometimes an innocent item of expenditure means a great deal more than is apparent, and the proposal to expend £8,000 for a trawler may ultimately develop into the acquisition by the Commonwealth, first, of the fishing, fleets on our coasts, and, later, of all means of communication by sea.

Sir John Forrest - That is not the intention.

Mr JOHNSON - It may not be the present intention, but, later on, the right honorable gentleman may be reminded that his Government initiated Commonwealth owning of steamers by the acquisition of this modest little trawler. Then £10,000 is to be expended iri' providing for wireless telegraphy. This seems to me a very serious innovation from the Ministerial point of view. It was pointed out by the Minister of Trade and Customs that one of the main reasons for the introduction of the Australian Industries Preservation Bill was the need for preserving our existing industries. I would therefore point out to the Treasurer that the substitution of wireless telegraphy for telegraphy by means of wires would seriously injure a very large number of industries. In the first instance, it would injure .the mining industry, by diminishing the demand for the metals of which wire is made. Next, it would injure the wire-making, industry, because less wire would be required ; and, lastly, it would injure all those industries providing occupation to timber getters, to carriers, to linesmen, and to many others. Therefore, the Commonwealth Government may find itself being brought to book under the provisions of one of its own measures for having taken action interfering with and seriously injuring Australian industries. I merely allude to the fact im passing, to show the Treasurer that he is skating on very thin ice, and that there is no knowing where he may ultimately find himself, if he continues to adopt the latest scientific appliances for telegraphic communication. In connexion with the defence proposals, I should like to know what has been done in regard to the armament of the Fremantle forts?

Sir John Forrest - One fort is finished.

Mr JOHNSON - When the Estimates were under discussion last year, a very animated debate took place in regard to the armament of these forts, on which it was then proposed to mount 9.4 guns. Some of us contended that smaller guns would be good enough, because the peculiar situation of the fort makes long-range guns unnecessary, if not useless. The original intention was to mount 7.5 guns, and I myself think that 6-inch guns would be quite large enough.

Sir John Forrest - I understand that the question is not vet definitely settled.

Mr JOHNSON - Then I shall have an opportunity of discussing this matter more fully when the Defence Estimates are under consideration. On the question of defence generally, I may say that I do not object to every provision being made for maintaining our Military Forces at a proper standard, both as regards efficiency and' equipment. But I think there is a ten.dency, not peculiar to the present Government only, to pay too much attention to our military defences and to neglect the matter of coastal defence. Although we have an unprotected coast line of 8.000 miles, it does not seem to have yet been realized that our first line of defence is the British. Navy, that our next line should take the form of coastal defences, and that the Military Forces, upon the maintenance of which all our energies are sow concentrated, is the element upon which we should have to rely only in the last emergency. I think that we might devote some of the money that we are now handing over to the States, in excess of their three-fourths share of the Customs and' Excise revenue, to providing coastal and harbor defences. My view of the matter is that we should enter upon the construction of torpedo boats and destroyers, with a view to rendering our more vulnerable harbors safer from attack by the cruisers of any nation with which we might, unfortunately, become embroiled. I see that it is proposed to vote £1,000 towards the expense that will be incurred in sending an Australian rifle team to take part in the contest for the Kolapore Cup at the next Bisley meeting. I should like to know whether it is intended by the Government to send Home a team which will be of a national character, and will properly represent Australia, or whether the riflemen will be permitted to proceed to England as private citizens. If a team is to be sent Home to represent the Commonwealth, it seems to me that the amount of £1,000 will not besufficient.

Sir John Forrest - We propose to subsidize private subscriptions £1 for£1 up to , £1,000. That is better than nothing.

Mr JOHNSON - Perhaps it is better than nothing, but I maintain that if the team is going Home in a representative capacity, it should not be called upon to pay any portion of its expenses. In view of the fact that we' have such a large amount of revenue to expend in other directions, we might very well bear the whole of the cost.

Sir John Forrest - The team is going Home' under the auspices of the National Rifle Association, and are being assisted by the Government.

Mr JOHNSON - I still think that the Government might very well have borne the whole of the expense. However, if the National Rifle Association is satisfied, I need say no more. The Treasurer referred to the employment of Australians and New Zealanders upon H.M.S. Challenger and other vessels of the Australian Squadron. He said -

At the time that the agreement was under consideration, it was fearedby some that Australians would not accept service in the Navy, but that statement has been controvertedby the fact that already 518 Australians and New Zealanders have been enlisted, and are now doing duty on H.M.S. Challenger and the three drill ships. The Government have had under consideration the recommendations of the Imperial Defence Committee as to the best means of protecting Australia from invasion or aggression.

He also said -

I have been, informed that there are difficulties in the way of training men here for the higher ratings, because there are not in existence in Australia the technical schools necessary to impart the required knowledge; but these difficulties are likely to be overcome by sending men to England for instruction in the same way in which officers are being sent.

I should like to know what obstacle there is in the way of our establishing such schools of instruction here. We could secure the necessary instructors from England.

Sir John Forrest - We are told that we cannot.

Mr JOHNSON - Surely if sufficient inducement were offered we could obtain the services of the men we require.

Sir John Forrest - We are otherwise informed.

Mr JOHNSON - I think that some of our surplus revenue might be devoted to the establishment of technical schools for the instruction of naval officers. It is in the highest degree desirable that we should make provision for the training of naval officers and men, because in the very near future we shall have to man our own war vessels. It must be a matter ofvery great satisfaction to every one to know that the trade of the Commonwealth has increased to a very considerable extent. There does not, however, seem to have been a great increase in the volume of our imports.In 1903 our imports were valued at £38,835,682, whereas in 1905 they were valued at only £38,346,731, or a reduction of £488,951. I refer to this matter because recently we were hurriedly called upon to pass a measure which was intended to prevent dumping. We were then told that our markets were being flooded with imported goods and yet it is plainly evident from the figures submitted by the Treasurer that there has been an actual decrease in the imports as compared with 1903. In the face of these returns, what becomes of the allegations as to wholesale dumping which were made to justify the introduction of the Australian Industries Preservation Bill. I merely refer to this matter in passing in order to show how reckless are some of the statements made by the Minister of Trade and Customs and honorable members opposite when they have any particular purpose to serve. When the Bill in question was before us we were unable to obtain information with regard to a single instance of dumping. Now the reason- is clear, because the figures before us afford a complete answer to all the allegations that were made by the Minister cf Trade and Customs, and those who were supporting him. It is interesting to note that two-thirds of the imports into the Commonwealth come from British Possessions. From this it is abundantly clear that the restrictive provisions contained in the Australian Industries Preservation Bill, in the Customs Act and the Commerce Act are directed, not so much against foreign competitors, as against those of our own flesh and blood in other parts of the Empire. That was the view taken by honorable members on this side of the Chamber when the Australian- Industries Preservation Bill was under discussion, and the figures now before us afford the fullest justification for the statements made by them. I notice that it is proposed to vote £500 for the purpose of assisting the people of the New Hebrides. This appears to me to be little short of an insult to the people of our own race who have settled in those islands. I do not intend to enlarge upon this subject, because I have already spoken at length upon it. But I desire to point out that something more than is now proposed is due to those who are endeavouring to establish British influence in the islands. Some time ago inducements were held out to settlers from Australia to establish their homes in the New Hebrides, but almost immediately afterwards we raised Tariff walls which absolutely shut out these men from the only market available for the produce which they are compelled to grow in order to tide them over the period - ranging from seven to ten years - during which their cocoanut trees were becoming sufficiently matured to yield .them some return. They were obliged to cultivate products such as maize, and immediately they did so they found themselves excluded from our markets. Because bv our legislation we have ruined some of them, we now offer the settlers a miserable sop of £500 - an amount which, when distributed amongst them, will represent only a very paltry sum to each individual. It is little short of an insult to make a proposal of that kind, instead of submitting a statesmanlike proposition to remove the barriers which prevent the admission of their products to Australia, and to recognise them as citizens of the Commonwealth. I notice that in the Treasurer's Budget no mention is made of a progressive land tax. It would be interesting to learn what attitude the Government intend to take up in regard to that matter. Sooner or later they will have to declare themselves, and in view of the fact that the question of the settlement of population upon our soil is a vital one, and that no mention whatever is made of any proposal to grapple with that problem-

Sir John Forrest - A good deal has been said about it.

Mr JOHNSON - A good deal of noncommittal talk has been indulged in - talk which is of no value to anybody. But the leader of the Labour Party and his followers have certainly made some attempt to grapple with it. Their proposal is bound to end in a fiasco, and certainly it is one which does not commend itself, to my sense of justice. At the same time, I must credit them with having made 4a proposal, even though a crude and unsuitable one. The Treasurer himself will admit that the crying need of Australia to-day is population - more especially a rural population. I could submit certain proposals to the right honorable gentleman if he would only act upon them. It is a problem which does not present any difficulties to me.

Sir John Forrest - I should like to hear the honorable member's proposals.

Mr JOHNSON - I should be very pleased to provide a solution of the problem for the Treasurer if he would only give effect to my suggestions. If he is really desirous of having some practical scheme formulated which will bring about the desired result, I shall be only too happy to have a conference with him upon the subject.

Mr Maloney - The honorable member would propose the adoption of the single tax.


Mr Carpenter - I thought it would be something which is impracticable.

Mr JOHNSON - My proposals would be practicable, and based upon, the principle of justice - a principle which cannot be claimed to underlie the progressive land tax proposals of the party with which the honorable member for Fremantle is associated. I have spoken at greater length than I had intended, although I do not think that I have occupied the attention of honorable members for an undue period, in view of the importance of the Budget statement, and the multiplicity of subjects it embraces. Whilst we must all find cause for gratification in the healthy condition of trade, industry, and finance, we must admit that there is room for improvement in many directions, and that the practice of returning to the States the balances in excess of the three. fourths of the Customs and Excise revenue to which they are entitled under the Constitution should not be continued. These balances, during the past six and a half years, have aggregated £5,233,000. The Treasurer himself has shown that that money might be profitably used upon imperative Commonwealth needs. I would suggest that in future, instead of these balances being returned to the States, they should be spent in perfecting those coastal and harbor defences in the advantages of which the States would participate, both individually and collectively. I have just been reminded that I have omitted to say anything in reference to the conversion of the States debts, and the several schemes which have been propounded for dealing with them. . I am sorry that I neglected to deal with this question in the earlier portion of ray speech ; but I do not think that I shall now trespass upon the patience of honorable members further than to say that, in my opinion, some serious attempt ought to be made to finally settle this question during the currency of the present Parliament. If we indorsed the Treasurer's proposals, I fear that our decision might be absolutely reversed bv a succeeding Parliament.

Mr Watson - I hope so.

Mr JOHNSON - In that connexion I may say that the criticism which was offered last night by the honorable member for Bland commends itself in many respects to my judgment.

Sir John Forrest - What did he say?

Mr JOHNSON - The Treasurer was present, and heard what the honorable member had .to say. I shall not enter upon the matter now, because, at a later stage, when concrete proposals are under consideration, I shall have an opportunity of fully expressing my views upon the question.

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