1932-05-13 13 1 2 SENATE 721 0 Senate. 1932-05-13 The President (Senator the Hon. W. Kingsmill) took the chair at 2.15 p.m., and read prayers. 721 Questions 721 Arms and Ammunition. 721 JYB 0 0 DUNN, James Patrick Digger Senator DUNN - Has the attention of. the Minister for Defence (Senator Pearce) been drawn to the report published in a Sydney newspaper of a statement by Mr. Eric Gamp bell, leader of the New Guard, that the council of that body was in a position to obtain information regarding arms and ammunition in New South Wales belonging to the Commonwealth Defence Forces, and had .done so? Does the Minister intend to take action against the leader of the New Guard, and the executive council of that body, for having obtained military information of a secret nature? 721 K0F 0 0 PEARCE, George Senator Sir GEORGE PEARCE - If the assertion made by Mr. Campbell, as reported in the press, is that he has secured information from the Defence Department, or from any officials of that department, the statement is absolutely and totally incorrect. Mr. Campbell has been given no such information. Among the documents reported to have been seized, and alleged to have been in the possession of members of the New Guard, are certain papers which purport to contain such information.' Not having had- an opportunity to peruse those papers, I am not in a position to say whether that is correct or incorrect, but I can say definitely that no such information -has been supplied by the Defence Department to the New Guard or to any similar organization. 721 Australian Delegation : Choice of Mr Duffy 721 JYB 0 0 DUNN, James Patrick Digger Senator DUNN - Will the Minister representing the Prime Minister give the names of the trades and labour councils in the capital cities of Australia that have endorsed the . Commonwealth Government's action in sending Mr. Duffy, a member of the Commonwealth Bank Board, to the. Imperial Economic Conference at Ottawa, to represent at the conference the- trade unionists of the Commonwealth of Australia? Will the leader of the Australian delegation to the COUference make a statement to the press in Canada to the effect that Mr. Duffy does not represent the workers of Australia by a vote of the Australian workers ? 721 K0F 0 0 PEARCE, George Senator Sir GEORGE PEARCE - I am not aware that the Prime Minister or any other member of the Government has' eversaid that Mr. Duffy was selected by. the trade unions of Australia. 722 JTL 0 0 DALY, John Senator Daly - Nevertheless, a better man could not have been chosen. 722 K0F 0 0 PEARCE, George Senator Sir GEORGE PEARCE What was said was that Mr. Duffy was invited by the Government to accompany the delegation to Ottawa, because of his long association with Labour organizations in Australia. It was thought that he would be a fitting person to give advice on any matter that may arise at the conference in which Labour is particularly interested. 722 Prices and Quantities Supplied 722 KOF 0 0 HAYES, John Senator J B HAYES asked the Minister representing the Minister for Trade and Customs, upon notice - What is the number of tons of phosphates supplied by the Phosphates Commission to manufacturers in Australia during the year ended 30th June', 1931? What is the total price charged for same, f.o.b. at port of shipment? What are the freight charges on same, per ton? 722 K0F 0 0 PEARCE, George Senator Sir GEORGE PEARCE The replies to the honorable senator's questions, are as follow:- Three hundred and ninety-three thousand tons (including 125,000 tons obtained from sources other than Nauru and Ocean Island). Nauru, 19s. 6d.' per ton.;. Ocean Island, 22s: per ton. The total charge (including cost, freight and insurance) to manufacturers in Australia for phosphate supplied from other sources was 45s. per ton. Freight and insurance, 20s. 9d. per ton on phosphate from Nauru and Ocean Island, plus 3s. 6d. per ton to cover excess cost of phosphate from other sources. 722 Request of Kempsey Municipal Council. 722 JYB 0 0 DUNN, James Patrick Digger Senator DUNN asked the Minister representing the Prime Minister, upon notice - Is it the intention of the Government to grant the urgent request of the Kernpsey municipal council for £10,000 for. the purpose of improving their electricity supply; if so, upon what date, during the months of May or June of 1932, will the amount asked for be granted? As such a grant would relieve a large number of unemployed, will the Government treat the matter as urgent? ' 722 K0F ALP; NAT from 1917; UAP from 1931 0 0 PEARCE, George Senator Sir GEORGE PEARCE - . The Prime Minister has supplied the following answer: - The- request of the Kernpsey municipal council will receive early consideration by the Employment Council, in conjunction . with applications by other bodies, and all recommendations by the Employment Council will be promptly dealt with by the Treasurer. Sitting suspended from2.23 to2.35 p.m. 722 bill Bill received from the House of Representatives. Motion (by Senator Sir George Pearce) proposed - That' so much of the Standing and Sessional Orders be suspended as would prevent the bill from being passed through all its 'stages without delay. Motion (by Senator Foll) put - That the Senate do now divide. The Senate divided. (President - Senator Hon.W. Kingsmill.) 17 7 Majority......10 AYES NOES Question so resolved in the affirmative. In division: 722 JYB 0 0 DUNN, James Patrick Digger Senator Dunn - This is a prostitution of power. 722 10000 0 0 KINGSMILL, Walter The PRESIDENT (Senator Hon W Kingsmill - The honorable senator's con- . duct, if persisted in, will cause me to take measures against him. He must withdraw that remark. 723 JYB 0 0 DUNN, James Patrick Digger Senator Dunn - I withdraw nothing. 723 10000 0 0 PRESIDENT, The The PRESIDENT - I regret to have to report the honorable senator to the Senate. 723 K0F 0 0 PEARCE, George Senator Sir George Pearce - Do I understand, Mr. President, that you have called upon me, as Leader of the Senate, to take action at this juncture? 723 10000 0 0 PRESIDENT, The The PRESIDENT - Not until the division is over. Question - That the Standing and Sessional Orders be suspended - put. The Senate divided. (President - Senator the Hon. W. Kingsmill.) 18 7 Majority.... 11 AYES NOES Question so resolved in the affirmative. Standing and Sessional Orders suspended. 723 10000 0 0 PRESIDENT, The The PRESIDENT - I regret to have to report to the Senate that Senator Dunn has contravened Standing Order No. 48, in that he has used objectionable words, and has refused to withdraw them. He may now rise in his place and make any explanation or apology he thinks fit. 723 JYB 0 0 DUNN, James Patrick Digger Senator Dunn - I thought that the action of the Government Whip (Senator Foil) in suddenly jumping up to curtail a debate of this nature, without giving the Acting Leader of the Opposition (Senator Dooley) an opportunity to speak, was premature, and in the heat of the moment I used words which, if they offend against the dignity of the Senate, I. withdraw. I apologize for having used them. Declaration of Urgency. Motion (by Senator Sir George Pearce) put - That this bill be considered an urgent bill. The Senate divided. (President - Senator Hon. W. Kingsmill.) 18 7 Majority...... 11 AYES NOES Question so resolved in the affirmative. Limitation of Time. Motion (by Senator Sir George Pearce) proposed - That the time allotted in connexion with the bill beas follows: - For the initial stages of the bill up to, but not inclusive of, the second reading of the bill until 3.10 p.m. this day. For second reading of the bill, until 3.30 p.m. this day. For the committee stage of the bill, until 3.45 p.m. this day. For the remaining stages of the bill, until 3.50 p.m. this day. 723 JVF New South Wales 0 0 DOOLEY, John Senator DOOLEY . - I trust that the Senate will not agree to rush this important legislation through in this manner, for while the Government may declare it to be urgent, it is only fair that, irrespective of their positions in this chamber, honorable senators should be given an opportunity to study the bill. If the Opposition is to be ignored the Government might at least give its supporters a chance to read the measure. It was placed in our hands only five minutes ago, so if it is to be rushed through, we shall be voting absolutely in the dark. The State legislation which it is designed to combat is not known to honorable senators. The only information we have concerning it is to be found in the daily newspapers, and that, I submit, does not warrant the Senate in giving the Government carte blanche. Members of the party which I have the honour to lead temporarily should be given time to consider the bill, and judge it on its merits. The Government might very well postpone its consideration until to-morrow, or extend the time allowed for its discussion until train-time to-night. There is no great urgency for it. Officially, we have no knowledge of the contents of the New South Wales legislation against which this bill is directed. Although a number of honorable senators occupied seats in another place this morning during the discussion which took place there, no one can say definitely what its effect will be. We are obliged to depend upon reports that have appeared in the newspapers, and not infrequently these are so garbled that one cannot be guided by them. While this bill is aimed at the State of New South Wales, it will actually affect every State in the Commonwealth. 724 KRZ 0 0 LYNCH, Patrick Senator Lynch - Surely the honorable senator knows what has been done in the New South Wales Parliament? 724 JVF 0 0 DOOLEY, John Senator DOOLEY - The only knowledge which any honorable senator can have at this stage must have been gleaned from the newspapers, unless he has some inside information, because I understand the legislation in question was not due to pass through the Legislative Council until 2 o'clock this morning. 724 KP8 0 0 JOHNSTON, Edward Senator E B Johnston - I do not think it has been passed yet. 724 JVF 0 0 DOOLEY, John Senator DOOLEY - Nor can I say. Again I appeal to the Government. Since it is the duty of the Senate to protect the rights of the States, we should be given reasonable time to study the effect of this legislation. Senator Sir HAI COLEBATCH (West measure of which it might be said that- If it were done, when 'tis done, then 'twere well It wore done quickly. If I thought that this bill would "do" for Mr. Lang, or even afford protection to those large sections of taxpayers in New South Wales upon whom Mr. Lang is imposing taxation, monstrously unjust so far as the individual is concerned, and obviously unwise in the interests of the State, then I should be inclined, by complete silence, to expedite its passage. But I have no such confidence, and that being the case, I feel myself bound to consider its implications, and to ask if they are of a character which I think the Senate is justified in passing without adequate consideration : if it is justified in dealing with the bill within the 'time specified in the motion now before the Senate. I am well aware of the disabilities which this isolated city of Canberra imposes upon honorable senators and members of another place in the discharge of public business, but I shall endeavour to show that the issues involved in this bill are so important that no matter at what cost in personal inconvenience, we should be prepared to give them adequate and full consideration. It is impossible to escape the conclusion that the bill implies the stripping of the States of the first essentials of self-government in a federation, namely, the right of each State to impose taxation upon its citizens. Is the Senate prepared to accept such a principle without discussion or consideration? I shall not discuss the bill in its legal aspect, but I venture the opinion that none of us knows, and none will, with any confidence, dare to predict the decision of the High Court with regard to the constitutional validity of the measure, for we may be quite sure that it will reach the High Court. Therefore, 1 must ask that reasonable time be allowed for the discussion of its political aspect. From this point of view*, I would ask: Is it the . proper function of the Senate, created, as Senator Dooley has said, for the protection of the States, to seek to secure - whether or not we succeed is another matter - a judicial interpretation of the Constitution that must destroy a right without which States cannot function ? I am not concerned with any particular prohibition of taxation which this bill imposes, but I am concerned with the principle. So I affirm that if this Parliament can prohibit one form of taxation by a State, it can prohibit other forms, and, indeed, can prohibit any kind of taxation. The second question which the Senate should have time to consider is the probable consequences of this bill. To my mind, there are three distinctly weak points in the political fabric of Australia. One is the State of Queensland, because it has no Legislative Council, and no means of checking hasty and ill-considered legislation; the second is the State of New South Wales, because it has no effective Legislative Council. For these weaknesses I do not blame the Labour party for the simple reason that it has merely been giving effect to its declared policy. But I do blame other sections in politics for not seizing, at all costs, the first opportunity to establish an effective second chamber in both States. The third point of weakness in the political structure of Australia is the composition of the Senate,- which, although intended to be the protector of the States, has become a purely party House, and because of the nature of its franchise which differs entirely from that of second chambers in every other federation in the world, is liable to be swept at any time by any passing wave of public opiniou. If we establish this precedent we may at some future date, have an extremely socialistic government in power in both branches of the federal legislature, which would completely sweep away the rights of the States. Every step we take in the direction of depriving the States . of their powers will be a means of disintegrating the political solidity of the Commonwealth. This measure is of sufficient importance to justify full and complete discussion in this chamber. I feel so strongly on this matter that, however great may be the emergency, I urge that we should notdo anything that will have the effect of placing the States at the complete mercy of the Commonwealth. 725 KRZ 0 0 LYNCH, Patrick Senator Lynch - What is the remedy? 725 K7F 0 0 COLEBATCH, Hal Senator Sir HAL COLEBATCH - I am not talking of remedies. I am referring to the inadequate opportunities afforded to consider the measure to be brought before the Senate. If the Senate carries the motion, I shall be obliged to accept it as an indication of the fact that it does not deem it necessary to consider the proposals contained in the bill. 725 JYB New South Wales 0 0 DUNN, James Patrick Digger Senator DUNN .- Mr. President- Motion (by Senator Foll) put - That the Senate do now divide. The Senate divided. (President - Senator Hon. W. Kingsmill.) 18 7 Majority . . . . 11 AYES NOES Question so resolved in the affirmative Original question put. The Senate divided. (President - Senator Hon. W. Kingsmill.) 18 7 Majority...... 11 AYES NOES Question so resolved in the affirmative. Bill (on motion by Senator Sir George Pearce) read a first time. Secondreading. 726 K0F Western Australia UAP Minister for Defence 1 0 PEARCE, George Senator Sir GEORGE PEARCE [3.10]. - I move- That the bill be now read a second time. The Government could have adopted another attitude towards the measure introduced into the New South Wales Parliament. It could have garnisheed the revenue obtained under that measure and used it to meet the payments in respect of which New South Wales has defaulted, but it felt that it would be placing itself almost in the position of a receiver of stolen money. I ask honorable senators to use their imagination, and to consider the organization of individual activity and individual savings which the New South Wales bill attacks. It shows a complete lack of imagination to collect or speak of the institutions that regard the savings of the community as though they were giant parasites, things apart from, and opposed to the people. The banks, the insurance societies and companies, the trustee companies and building societies of Australia are no more than the repositories of savings, almost entirely made by the people of Australia. A few figures regarding them may serve to illustrate that point. The trading banks in New South Wales, other than the Commonwealth Bank, have, despite some flight of deposits to other States, £97,500,000 of deposits. These are entrusted to them by 122,000 depositors and 236,000 customers whose current accounts are in credit. There is a considerable overlapping of these groups, many a current account being in favour of a customer who has also a fixed deposit. It is probably safe to say, however, that the deposits represent the accumulated or working capital of 300,000 individuals. The average deposit is therefore about £325 per individual. In the light of that fact the banks are seen to be trustees for a great multitude of small holdings of capital. They are also administrators of the savings of a great body of shareholders whose funds are almost equally widely owned. The average shareholding is probably not as great, either in face or in market value, as the average deposit. Turning to the employment by the banks of the funds entrusted to them by so large a number of customers and contributors, we find a similar state of affairs. The advances by trading banks in New South Wales are greater than the deposits lodged in that State. They total £98,000,000. This is a very great sum, but it is distributed far and wide, in large and small amounts, between 75,000 customers, whose accounts are in debit or overdrawn. The average advance is, therefore, just over £1.300. About 75 per cent. of the total advances are backed by mortgages of interests in land. In order to appreciate further the intimate co-operation between those who save and those who employ the savings of the community as their working capital, I would remind honorable senators that a bank advance is not a fixed sum. Those who have advances from the banks are carried through the lean periods of the year. In particular, advances to farmers tend to grow between now and November while the farmer is putting in his crop and awaiting his harvest. Wheat-farmers are by no means the least important element in our community. The very living of many depends, during a period of the year, upon the advances of capital from the pooled savings administered through the banks. The life insurance societies and companies, to which the small but regular savings of professional and salaried men, and of many wage-earners, are entrusted, are another indication of voluntary collectivism. In New South Wales there are 900,000 policy-holders; in Australia as a whole, 2,500,000 - more than a third of the population in either case. The amount for which their lives are assured is, in New South Wales, £146,000,000- in Australia as a whole, £400,000,000. These amounts are built up by premiums collected year by year and by the results of the investment of funds in securities and on mortgage loans by the boards and officers of the societies. In Australia as a whole the amount invested by life insurance corporations on land mortgages is £35,000,000. It is a striking fact that whereas only about a third of the policyholders are in New South "Wales, foursevenths of the money lent on mortgages of land have been laid out in New South "Wales. Any step that jeopardizes or destroys the security of that investment would thus eat up the savings of people in other States. This is, indeed, generally true, apart althogether from the geographical distinction of the actual investment. All these institutions are Commonwealth-wide in their activities. They gather savings from all quarters and pool them for investment. To deplete that pooled fund is to attack the savings of the whole of the people of Australia. Half of those who have borrowed money on land mortgages from our life insurance corporations are residents of New South Wales- from 5,000 to 6,000 out of a total of about 12,000. The confiscation of money from life insurance societies on the basis of their previous assistance to men on the land or engaged in business in New South Wales would be a looting of the family endowments through life policies created by the care and affection of parents throughout the Commonwealth. Similarly with trustee companies. The amount of money lent on mortgage in New South Wales by these institutions is £12,000,000. The number of beneficiaries interested in these mortgages - the number who look to the interest on them for part or all of their living - is between 15,000 and 20,000. Thus the average sum lent on mortgage from a trust estate by the trustee companies is about £700, yielding an income of from £40 to £50 a year. These are the " bloated capitalists " at whom Mr. Lang is aiming this deadly blow. I have endeavoured to summarize, so far as I have been able to do so, an approximation of the total savings that would be represented by mortgages in New South Wales. They are somewhere in the region of the following: - A 10 per cent, tax on this amount would represent a total tax of £14,000,000. That sum would have ito be provided within one month. Such a tax would absolutely ruin the financial structure upon which the savings of the people of New South Wales rest. That is the justification for the bill, and for treating it as an urgent measure. 727 JVF New South Wales 0 0 DOOLEY, John Senator DOOLEY . - I feel sure that, having heard the statements of the Leader of the Government (Senator Pearce), the Senate will agree with me that my earlier protest was warranted, and that we should be given an opportunity to go fully into this question. I have had a hurried glance at the bill, but have not been able to study its effects, and cannot follow the right honorable gentleman's line of reasoning. I am at a loss to know whether a bank depositor is considered to be a mortgagee. The bill gives us no indication as to what its effects are likely to be. We all realize that taxation is borne more or less by those who are unable to pass it on, and that any increase is likely to place the worker in a worse position. To what extent the latest legislation of the State of New South Wales will operate in that direction, we cannot judge. An aspect that must not be overlooked Ls the political significance of this legislation. So far, it appears that the people of New South Wales are largely in favour of the stand that has been ,taken by the Premier of that State. All the legislation along these lines that has been brought forward by the Commonwealth Government has failed to bring to its coffers anything worth speaking of, and every step that it has taken has been frustrated by the New South Wales Premier. 728 JZD 0 0 FOLL, Hattil Senator Foll - Does the honorable senator approve of the New South Wales measure ? 728 JVF 0 0 DOOLEY, John Senator DOOLEY - I have not had an opportunity to read it. The only knowledge that I have of it was gained from what I read concerning it in the newspapers this morning. Is it, fair, therefore,to expect me to give a decision upon it? I am not in a position, nor is any other honorable senator, to decide the rights and wrongs of the case. The Leader of the Government probably has had an opportunity to study the New South Wales measure, and has first-hand information that we have not been able to obtain. We on this side protest emphatically against the rush methods that are being employed by the Government. I believe it is safe to say that many of its own supporters have not read the bill. Is that the way in which the business of the Senate should be conducted? The matter is not so urgent that it could not be postponed until to-morrow. I should like it to be postponed with a view to seeing whether there is not some other way of overcoming the difficulty. I think the Government will agree that all its efforts in the past have failed, and that day after day fresh proposals have had to be brought forward. Is it not time we sought some other means of overcoming the difficulty? I see grave danger to the Commonwealth in this form of legislation. This guerilla warfare is to-day being waged by the Commonwealth with New South Wales. To-morrow, some other State may be involved. 728 KTR 0 0 MCLACHLAN, Alexander Senator McLachlan - Who is the gorilla ? 728 JVF 0 0 DOOLEY, John Senator DOOLEY - There seem to be two gorillas. There could not be a guerilla war unless there were two gorillas at war. The real sufferers are the people of the Commonwealth. During the last federal elections, the promise was made to the people that ample financial accommodation would be available if the present Government were returned to power. The excuse now offered for the failure of that promise to fructify is, "We cannot get the money because the Premier of New South Wales is standing in the way of this particular legislation. We have to pull him down first ". When Mr. Lang falls, will Mr. Tunnecliffe, in Victoria, or Mr. Forgan Smith, in Queensland, should either succeed at the impending State elections, be the next Aunt Sally to be knocked down to justify the failure of the Commonwealth Government to fulfil its promises to the people? 728 JYB New South Wales 0 0 DUNN, James Patrick Digger Senator DUNN . - I welcome the opportunity to say a few words in reply to the arguments of the Leader of the Government in the Senate (Senator Pearce). The right honorable gentleman prefaced his remarks with a reference to those whom the Lang Government, he said, regarded as parasites, namely, the holders of bonds or mortgages in the industrial life of the State. From 1901 to 1916, the right honorable gentleman was an advanced thinker and a leader in the Australian Labour movement, and a responsible Minister in Labour governments. He was a " red-ragger ", and the mover of motions on May Day. 728 10000 0 0 PRESIDENT, The The PRESIDENT - The honorable senator must address himself to the bill, not to the history, past or present, of any other honorable senator. 728 JYB 0 0 DUNN, James Patrick Digger Senator DUNN - The Lang Government does not characterize as parasites the business community of New South Wales, as the right honorable gentleman alleges. For a number of years, " capital levy" has been one of the planks in the platform of the Labour party. The history of various European countries shows that that is not a new idea in civilized communities. A capital levy was applied by the Government of France after the Franco-Prussian War, the peasantry and the business people being compelled to deliver up their gold and other valuables so that the indemnity exacted by Germany at the instigation of Bismarck might be paid. Coming to more recent years, we find that an appeal was made to <he people of Germany by Hindenberg, the present president of that country, to consent to a capital levy. In the existing internal depression, the Government of New South Wales believes that it is adopting the right policy in making the interests of its own people paramount, even though bondholders may have to wait for their interest. As Senator Colebatch has pointed out, the Parliament of New South Wales, acting within its constitutional and sovereign rights, has passed a measure that now awaits the assent of the State Governor. During the war period, attempts were made to conscript human lives for the defence of this country. Now, however, in an economic war, there is an outcry when an attempt is made to provide for 500,000 men and women who have to be fed. The Labour Government of New South Wales is prepared to erect constitutional machinery that will prove beneficial to the hungry and the down and out; yet our friends opposite, with the aid of a brutal majority, a political basher gang- The PRE SIDENT. - Order ! The honorable senator must withdraw the expression " political basher gang.". 729 JYB 0 0 DUNN, James Patrick Digger Senator DUNN - I withdraw it. 729 10000 0 0 KINGSMILL, Walter The PRESIDENT (Senator the Hon W Kingsmill - Order! The time allotted for the second-reading stage having expired, it becomes my duty to put the question. Question - That the bill be now read a second time - put. The Senate divided. (President - Senator Hon. W. Kingsmill.) 18 5 Majority...... 13 AYES NOES Question so resolved in the affirmative. Bill read a second time. In committee: Clause 1 agreed to. Clause 2 (Definition). 729 JYB New South Wales 0 0 DUNN, James Patrick Digger Senator DUNN . - I desire to move that this clause be struck out. The CHAIRMAN (Senator Plain).The honorable senator may vote against the clause. Clause agreed to. Clause 3 (State taxation on mortgages) : 729 K2Z Victoria 0 0 BRENNAN, Thomas Senator BRENNAN . - My time is limited, and I believe that I may not make any reference to a vote that has been taken", but as I did not have an opportunity to say what I desired to say on the general principles of the measure, I think that I can indicate my attitude sufficiently clearly on this clause. I realize that hard cases" make bad laws. 729 KTR 0 0 MCLACHLAN, Alexander Senator McLachlan - Sometimes good laws, as recent history proves. 729 K2Z 0 0 BRENNAN, Thomas Senator BRENNAN - I mean bad laws in the sense of being unlawful. I realize that a tremendously strong case has been, and can be, made out for the enactment of such legislation as is contained in this clause; but the sole question that affects me is: what are our powers to pass such a clause? This provision purports to nullify a State statute. The stand I take is that I fear this Parliament has no power to nullify a statute passed by a State if it is within the legislative capacity of the State to enact it. In spite of a good deal that has been said, this Parliament is not the guardian of the rights of New South Wales, or of any other State ; our powers are limited by the Constitution. It is beyond question that the Constitution confers a concurrent power of taxation on the Commonwealth, but that, it seems to me, does not mean that it can tax a certain instrumentality, and the State shall not. The State has its powers of legislation reserved to it by sections 106,' 107 and 108 of the Constitution. The sole question is whether the measure which has been passed by the New South Wales legislature is inconsistent with legislation passed by the Commonwealth Parliament. If it is, the Commonwealth law prevails. If this Parliament can do what it is attempting to do under this clause, and, perhaps, in a less degree under other clauses, it is clear that it can do the same in respect of every possible source of taxation covered by the 39 articles of section 51 of' the Constitution. In other words it can dry up the sources of revenue of all the States, and that seems to me to lead directly to the path of unification. At present we are a federation - an indestructible union of indestructible States, and much as . I sympathize with the object which the Government has in view, I feel that I cannot be a party to assisting in passing legislation which I strongly believe to be beyond the powers of the Commonwealth. 730 JTL South Australia 0 0 DALY, John Senator DALY . - I agree entirely with the remarks of Senator Brennan. Whatever views honorable senators may hold regarding the position in New South Wales, I urge them not to agree to this clause. Personally, I would have liked an opportunity, on the second reading of the bill, to explain my attitude, but that was denied me. I am much concerned as to how far this measure will affect the other States. If this clause is passed, what will be the position in South Australia, for instance, when the Treasurer is framing his budget? If he desires to secure extra taxation from mortgages, and this clause is valid, he will be unable to balance his budget, for the Commonwealth may dry. up his sources of revenue. What is there to prevent the committee from dealing with this bill to-morrow morning, except that certain honorable senators wish to catch their trains to-night? I am more concerned about the interests of my State than about meeting my personal convenience, and I urge that honorable senators from South Australia should have an opportunity to confer with the Government in that State, in order that South Australia's claims may be properly presented. We are not dealing with New South Wales alone. It would be a dangerous precedent to hurry this bill through the committee, merely to suit the personal convenience of members of Parliament. I strongly protest against such a procedure, and in order to test the feeling of the committee, I ask leave to continue my remarks. Leave not granted. 730 JYB New South Wales 0 0 DUNN, James Patrick Digger Senator DUNN . - I entirely agree with the arguments advanced by Senators Brennan and Daly. When we have a King's Counsellor from Victoria, and a member of the legal profession from South Australia on one side, and the Acting Attorney-General (Senator McLachlan) taking the opposite view, it shows the hypocrisy associated with this proposal. We know also that comrades Sir Harrison Moore and Wilbur Ham have been brought here by aeroplane to give the Government the benefit of their legal knowledge. Members of the Ministry have evidently become panicky and hysterical. It has been pointed out by Senator Brennan that the result of this measure will be to dry up the sources of State revenues. At the Premiers Conference, held a few weeks ago in Melbourne, the Premiers of Western Australia, Tasmania and Queensland told the people that within a few short months those States would have to default with regard to their interest payments. I shall vote against the clause. 730 10000 0 0 CHAIRMAN, The The CHAIRMAN - The time allotted for the consideration of the bill in committee has expired. Clause agreed to. Remaining clauses and title agreed to, and bill reported without' amendment. Report adopted. Third Reading Motion (by Senator Sir George Pearce) proposed - That the bill be now read a third time. 730 JZ6 South Australia 0 0 O'HALLORAN, Michael Senator O'HALLORAN . - This is the first opportunity I have had to speak to one of the most important' measures which has ever come before this Parliament. I protest strongly against the methods which have been adopted in rushing it through the Senate, for I feel certain that many of its provisions have not been considered fully by the Government, because of the hasty manner in which if has been prepared and dealt with. The title of the bill proclaims it to be " A bill for an act to ensure the peace, order and good government of the Commonwealth . . ". That description I can only describe as a legislative falsehood, for this legislation will not tend to ensure peace and order. On the contrary, it will seriously interfere with the rights of the States to collect revenue under the constitutional powers reposing in them as partners in the. federation. For a period of two years, the States will not be able to increase the taxation on mortgages beyond what it was on a certain date prior to the passing., of this bill. For, instance, . should the Treasurer of South Australia,- who is experiencing great difficulty in balancing his budget, desire to increase . the stamp., duty on mortgages - and that would not be a capital levy - ^this legislation would prevent Mm from doing so. 731 10000 0 0 PRESIDENT, The The PRESIDENT (Senator the Hon W Kingsmill - I regret to have to interrupt the honorable senator, but the time has now arrived when I must put the question. Question - That the bill be now read a third- time - put. The Senate divided. (President - Senator Hon. W. Kingsmill.) 18 5 Majority...... 13 AYES NOES Questionso resolved in the affirmative. Bill read a third time. 731 bill Bill received from the House of Representatives, and (on motion 'by Senator Greene) . read a first . time. 731 special adjournment Motion(by Senator Sir George Pearce) agreed to - That the Senate, at its' rising, adjourn till Tuesday next, at 3 p.m. 731 15:55:00 Senate adjourned at 3.55 p.m.