COMMONWEALTH GOVERNMENT.
DIGEST OFDECISIONS
AND ANNOUNCEMENTS AND
IMPORTANT SPEECHES
THE PRIME MINISTER
( THE RIGHT HON. J. B. CHIFLEY).
No. 134.
PERIOD 3w FEBRUARY, 1948, TO 24TH MARCH, 1948.
By Autihmmt,:
L F. Cmmonwealth Coveinmt Priar. Ckham
( Prined in Ausbuim.)
1860. c p il) z
PEACE.
-JAPAN-MINISTER'S STATEMENT, FEBRUARY, 1948.
-On 3rd February, 1948, the Minister for External Affairs ( Dr.
Evatt) said:
" Australia is concerned over the consequences following the breakdown
in the Council of Foreign Ministers at London in December,
1947, and the inability of the major Powers to reach an agreement
on the European settlement. These consequences are far-reaching,
and have serious repercussions on the whole United Nations Organization,
which was established on the assumption that there would be
early peace settlements and that the unanimity of the malor Powers
would be continued after the wvar. Another adverse result is that the
Japanese peace settlement is held up. Once again it is being
demonstrated by somewhat bitter experience that in international
affairs peace and justice are indivisible.
" The Australian Government believes in greater participation by
all those countries which actually participated in war and made a
substantial contribution to victory. It will be one of the main objects
of the discussions to, see how such participation can be most appropriately
effected in the interests of -world peace. Firsthand information
on the general situation from the Australian missions abroad, together
with the personal experience of the officers mentioned, should
be of great assistance in defining the scope and methods of Australia's
participation." ( ror earlier references, please see No. 108, page 40; No. 124, page 26;
No. 127, page 35; No. 129, page 9.)
On 4th February, 1948, Dr. Evatt said:
The Australian Government has kept the United States Government
continuously informed of its views on the Japanese settlement and
the procedure which should be followed in formulating the peace treaty.
After the British Commonwealth Conference at Canberra in August,
1947, I visited the United States and discussed Japan with President
Truman, the Secretary of State ( Mr. Marshall) and other American
leaders and officials. Further talks on Japan have taken place at
Washington since my return.
" Throug-hout, the Australian Government has emphasized the need
for a just and lasting peace based on the principles of the United
Nations Charter and -contributing to the security and welfare of all
the peoples of Eastern Asia and the Pacific. Australia has stressed
the urgency of reaching a definite settlement-an urgency to which
General MacArthuir and the Canberra Conference have also drawn
attenltion. Australia, because of her war effort and her position in the
Pacific, is entitled to be a party principal in these negotiations, and
our constant consultations with the United States Government are an
indication that our position has been recognized in the talks that have
so far taken place.
" The delay in formulating a treaty for Japan is most unsatisfactory.
The uncertainty as to the future of Japan is impeding the
attainment of stability in the Far East, and preventing the formation
of long-term plans by the countries of that area, including Australia.
The chief disagreement concerns the membership and system of voting
for the -peace conference. But the broad lines of the settlement itself
have been indicated by the agreements made at Cairo, Yalta and
Potsdam, and by the decisions of the Far Eastern Commission.
Therefore, the Australian Government does not accept the present
impasse as being in dny way final, and is taking every practicable
diplomatic step to overcome the deadlock and bring -about a conference
that will secure the agreement of all Powers which contributed
directly to the defeat of Japan."
JAPAN-PRIME MINISTER'S STATEMENT, FEBRUARY,
1948.
Ine Parliament.-On 19th February, 1948, the Prime Minister ( Mr.
Chifley) said:
" I regret that is not possible to announce a date for the assembling
of the conference to draw up the Japanese peace treaty. A deadlock
has been reached in regard to this matter. I believe that the Soviet
Government takes the view that the treaty should be dealt with in the
first place by the foreign ministers of the four major Powers. Of
course, that is not acceptable to Australia, and I believe that it is not
acceptable to a number of other nations. It is generally considered
that all nations which participated in the war against Japan in the
Pacific area should take part in the peace conference. Every endeavour
has been made to over-come the present deadlock, but I -cannot say
xhether the suggestions made are acceptable or not."
AUSTRALIAN POLICY-MINISTER'S STATEMENT,
MARCH, 1948.
On 21st March, 1948, Dr. Evatt said:
" The present situation can be described only as a ' drift' towards
war. In other words, no one wants war, no one can afford to suffer the
further losses of war and reduce living conditions even further-yet
nations can ' drift' to war. It is almost as though nations were
inanimate objects being carried inevitably down a stream, instead of
being human beings, with feelings, hopes and ideal;, with full control
through their responsible leaders of their destiny. The present condition
of drift is, therefore, a challenge to all responsible leaders. War
can come only as a result of absence of leadership in world affairs.
The United Nations is the main hope for peace and improved
living conditions throughout the world. The best positive help citizens
of goodwill can give in world affairs to-day is to throw their weight
behind the United Nations. The United Nations has its faults of
1860-2
procedure; but attacks made upon it now are reminescent of attacks
made on the League of Nations by those who found it expedient to
side-step the League and act independently of it, -and who contributed
to its weakening and to World War II.
The peoples of the world are entitled to a peace-a peace based
on justice. It is sheer defeatism to accept the pessimistic and sometimes
evil prognostications of those who light-heartedly anticipate a
third world war and the consequent destruction of civilization. Loyal
and consistent support for the United Nations offers a way out, providing
its machinery is employed to achieve settlements based on justice
and not on power. Australia has always taken, and will continue to
take, a lead in advocating this view. The United Nations, and it alone,
can arrest the drift towards war. This drift is now being welcomed
by the deadly enemies of the Allies of the war not yet concluded by
peace treaties-the open and secret followers of Ritlerism and
Fascism. Nothing that can be done should be left undone so far as Australia
is concerned to prevent the utter catastrophe of another war. The
people of Australia who still suffer from the terrible losses of human
life of World W-ar II., who still remember the cruel anxieties and fears
which accompanied the war, and who are now successfully restoring
in an economy of full employment the human and material losses of
the war, will welcome the constitution of a National Committee for
the United Nations in Australia, for it is only through the United
Nations that peace can be achieved.
There is no problem or dispute in the world which -cannot be
settled in terms of peace and justice. But the way to settlement is
through the United Nations, and not along the lines of power politics,
w. hich have no regard to the facts and justice of each dispute. We
rmust, at all costs, arrest the drift towards war, which is wanted by no
responsible human being in the world. In this high endeavour, Australia
and Australians can take as prominent a part as they did in the
long and still unfinished fight against Hitlerism and Fascism."
SERVICE PAY RATES.
CITIZEN MILITARY FORCES-PAY AND ALLOWANCES.
On 4th February, 1948, the Minister for the Army ( Mr. Chambers)
said-Rates of pay and allowances for the Citizen Military Forces have
been approved. They have been based on the pay code recently
approved for the Australian Regular Army and are as follows-
DAILY RAm~ s OF PAY.
Other ranks-
Private ( recruit), 1() s. 3 star. 21 star. 1 srtar.
s. d. s. d. d.
Private 15 0 1 3 0 11 0
Lance Corporal 16 0 14 0 11 6
Corporal 17 0 15 6 13 0
rnibest Others.
8. d. 8. d.
Otier rank&-continued.
Sergeant 19 6 18 0
After two years' service in rank 20 0 19 6
Staff Sergeant 21 0 19 6
After two years' service in rank 21 6 20 0
Warrant Officer HI. 22 6 21 0
After two years' service in rank 23 0 21 6
Warrant Officer 1. 23 6 22 0
After two years' service in rank 24 0 22 6
Officers-a.
Lieutenant Captain 1 12 0
Major 1 19 0
Major, after four years' service in that rank,
and qualifying for promotion to rank of
Lieutenant-Colonel 2 3 0
Lieu tenan t-Colonel 2 10 0
Lieutenant-Colonel after four years' service in
that rank 2 14 0
Colonrel 3 4 0
Colonel after four years' service in that rank 3 9 0
Brigadier commanding a brigade or equivalent
formation 250 0 0 per annum.
Major-General commanding a division or
equivalent formation 500 0 0 per arnn
ALLOWANrCES.
Rations and quarters to 1w~ provided free to members of the Citizen Military
Forces while attending camps of continuous training and approved courses of
instruction. Marriage and separation allowances be payable to members of the Citizen
Military Forces while attending camps of continuous training and approved
courses of instruction at Australian Regular Army rates.
Travelling allowance as for the Australian Regular Army be payable to
members of the Citizen Military Forces.
Uniform be supplied free to members of the Citizen Military Forces except
that officers who provide their own uniform be reimbursed at vocabulary rates
for items on the authorized tcale.
For the purposes of the pay code of the Citizen Military Forces, six hours
constitutes one day home training; three hours, a half day; and one and a
half to two hours, a night parade.
Rates and allowances are based on the following:-
Private: To be paid recruit rate until completion of recruit training.
During the first two years' engagement, privates, other than fully qualified
tradesmen enlisted as such, to be classified I star. Qualified tradelmen to
receive appropriate star grading after completion of recruit's course. A private,
other than a qualified tradesman, on completion of two years' service may be
classified 2 star or 3 star provided he qualified in ateordance wvith shl requirements
as may be prescribed.
Lance Corporal and Corporal: On promotion, unless already holding 2 or 3
star grading, to be paid as 1 star. Advancement to a stair be dependent on
pvesing for Sergeant. in addition to other qualifications.
Sergeant, Staff Sergeant and ' Warranst Offldei: To be appinited at " orl
promotion rate, that is the lowest prescribed for the higher rank. On
q ualification for higher rank, to receive first increment provided he has served
for at least two years in that rank.
Uniformn Allowance. Uniform to be free issue. Officers who provide their
own uniform may be permitted to claim a refund at vocabulary rates for Items
on the authorized scale.
Marriage and Separation Allowance: To be paid in camp or at courses when
pay is authorized at Australian Regular Army rated.
PERMANENT FORGES-RETIREMENT SCHEME.
On 16th March, 1948, the Minister for Defence ( Mr. Dedman)
said-" Cabinet decided to-day that legislation be prepared for submission
to the Federal Parliamentary Labour party to provide a
uniform scheme of retirement benefits for members of the permanent
naval, military and air forces.
" At present, the retirement provisions for the permanent forces
differ in the respective service, the provision for naval personnel and
air force officers being a system of deferred pay, while airmen below
commissioned rank and members of the permanent military forces contribute
to the Commonwealth Superannuation Fund. The deferred pay
system has unsatisfactory features, particularly in that it makes inadequate
provision for a member's dependants in the event of death or
invalidity. The recent reduction of the retiring ages of army officers
renders the public service superannuation scheme inappropriate for
application in their case.
In the formulation of the proposed uniform retirement scheme
regard has been paid to the retirement benefits provided for the forces
of Britain and other Dominions.
The scheme will be contributory, providing a rate of pension
appropriate to each rank. Pensions will be payable on retirement or
discharge, subject to the member's having completed not less than
twenty years' service after age twenty and, in the case of officers, to the
member's having reached the retiring age of his particular rank. To
cater for officers who enter the services some years later than the normal
ages of entry, pensions at reduced rates will be provided for officers who
reach the retiring age for their rank after completing at least fifteen
years but less than twenty years' service. Officers with ten years, but
less than fifteen years' service, from age twenty on retirement or discharge
will receive a refund of their contributions to the fund, plus a
gratuity equal to 150 per cent, of their contributions. The scale of
contributions will be same as under the Commonwealth Public Service
Superannuation Scheme, and the maximum pension will also be the
same. " The proposed scale of retirement pensions for officers ranges from
œ. 275 a year for an army captain and equivalent navy and air force
ranks retiring at or about age 45 to œ E845 a year for a lieutenantgeneral
and equivalent ranks retiring at age 60. The basic pensions
proposed for members below commissioned rank who are discharged
after age 40 after serving not less than twenty years range from
a year for a private -and equivalent navy and air force ranks, to œ 155
a year for a Warrant Officer, Class and equivalent ranks. Additional
amounts of pension ( from œ 6 a year for private to œ 8 a year for
warrant officer will be provided for each year of service beyond
twenty years' service for pension after age twenty, under definite
engagement. Pensions for naval warrant officers and officers commissioned
from warrant rank, and for army quartermasters, will range
from œ 300 a year for warrant officer ( navy) and lieutenant and quartermaster
( army), to œ 450 a year for lieutenant-commander ex-warrant
officer ( navy) and major and quartermaster ( army). The pension for
a naval commander ex-warrant officer wvill be œ 550 a year. Due to the
early retiring ages of members of the services as compared with civil
servants, payment of the pensions proposed will involve a substantially'
greater Commonwealth subsidy than is required in the case of the public
service superannuation scheme.
" The scheme provides that a member below commissioned -rank
who is not re-enlisted ou completion of his current engagement and who
has not qualified for pension will receive a refund of -his contribution
to the fund, plus a gratuity equal to 150 per cent. of the refund. The
gratuity will not be less than a sum calculated at the rate of œ 30 for
each completed year of service, subject to a proviso that the gratuity
payable to a member who retires before completion of twelve years'
service shall not exceed œ 120.
The scheme provides that where a member dies in the service, his
widow will receive one-half of the full pension which would be payable
at age 60 in respect of the contributions being paid by the member
prior to his death. On the death of a pensioned member, his widow
will receive a pension at one-half the rate which was paid to the
pensioner while alive. In cases of total permanent incapacity, it is
proposed that the member will receive a pension on the same basis as
would be payable in such circumstances to a contributor to the Commonwealth
Superannuation Fund. Where the degree of incapacity is
less than 60 per cent, benefits will be adjusted accordingly.
" It is proposed that all future appointees or enlistees to the
permanent forces ( except other ranks, initially engaged for less than
six years) will be compulsory contributors to the Defence Forces Retirement
Fund. Members already contributing to the Commonwealth
Superannuation Fund will transfer their existing rights to the Defence
Forces Retirement Fund. Deferred pay standing to the credit of members
of the naval forces and air force oficers will be utilized to purchase
full units of pension, and such members will contribute for the balance
of unit elements appropriate to the pay received. In the case of
present serving members of naval and air forces who may consider that
the existing deferred pay scheme is more advantageous may, at their
option, stay out of the scheme and accept one of the following
alternatives: To retain deferred pay at p~ resent at credit: this amiount to he paid with
interest at 31 per cent, on death or retirement. Member to contribute for
additional unit elements not covered by deferred pay and to receive ro rata
benefits only.
To continue uinder existing deferred pay scheme and make no contributions
to the Defence Forces Retirement Fuind.
" The advantages of the new scheme are so substantial that it is
anticipated that most members will elect to participate in it.
" Eligibility for full pension rights under the proposed scheme will
be subject to the member agreeing, if required by the service, to serve
on the reserve list maintained by the service of which he was a member.
1860-3
" The scheme now approved has been framed having regard to the
necessity of providing attractive conditions of service in all ranks, and
should ensure that those who makc service in the armed forces their
career are adequately provided for when their term of service has heen
completed." CITIZEN MILITARY FORCE S-CONDITIONS.
On 5th March, 1948, Mr. Chambers announced conditions of service
for officers and other ranks of the Citizen Military Forces. Officers
would he selected firstly from those who were on the reserve of officers
and who served during World War II., secondly from persons who
served as other ranks during World War II., and in the case of
technical arms and services, from persons who possessed the necessary
civilian professional, technical or academic qualifications. An officer
appointed from the reserve of officers would he permitted to accept an
appointment in the Citizen Military Forces in a rank lower than that
held by him on the reserve. Other ranks would he enlisted hetween
the ages of 18 and 35 for the Citizen Military Forces field force, and
between the ages of 18 and 45 for Citizen Military Forces fixed establishiments
on the mainland; the ages of discharge being 40 and 48
respectively. INDUSTRIAL.
UNEMPLOYMENT-FIGURES.
On 4th February, 1948, the Minister for Labour ( Mr. Holloway)
said that at 31st December, 1947, unfilled vacancies held by the Commionwealth
Employment Service numbered 43,000 for males and 30,000
for females, compared with 90,900 at 30th November, 1947. Recipients
of unemployment benefits were 2,797 males and 68 females. During
December, the Commonwealth Employment Service had referred
14,500 males and 4,800 females to employers, and had given advice
and information on various matters to 23,600 males and 5,400 females.
On 7th February, 1948, Mr. Holloway said that at 31st January,
1948, 3,823 males and 118 females were in receipt of unemployment
benefit or re-employment allowance. The total was nearly 1,100 higher
than that recorded at December, 1947, but the rise was more than
aecounted for by the normal seasonal movement in Queensland.
At 31st January, 1948, unfilled vacancies held by the Commonwealth
Employment Service numbered 55,300 for males and 36,900 for females.
The total was 19,200 greater than at December, 1947.
NETHERLANDS EAST INDIES.
POLICY-MEDIATION.
On 4th February, 1948, the Minister for External Affairs ( Dr.
Evatt) said-
" Following the recent truce agreement, negotiations between the
Dutch and Indonesians are continuing, but no result will be announced
until after the Committee of Good Offices has reported to the Security
Council. The conmittee has arrived at -New York. It is possible that
the council, after considering the report, will ask the committee to
remain in the Netherlands East Indies for a further period.
The sending, of fourteen Australian military officers to Java is to
assist in the carrying cut of the cease fire plan which includes an
agreement for the demilitarization of a certain area between areas held
by the Dutch and indonesian forces. The committee has called on the
Governments of Belgium, the United States and Australia to supply
personnel to carry out the dctails of the plan. The main task is to I
supervise the transfer of certain groups of Indonesian troops through
the demilitarized zone to their own area. The officers will be carrying
out a non-military function, but it is thought preferable to use military
men for such a task.
" Relations of the Australian representatives in Java with both the
Dutch and Indonesians arc excellent and Dutch Government representatives
at The Hague and Indonesian leaders have expressed appreciation
of their work
( ror earlier references, please see I-T. 128, page 32; No. 129, page 17; No. 130,
page 8.)
BANKING CONTROL.
LEGISLAT1ON-NATIONALIZATION, COURT REARING.
On 7th February, 194S, the Prime Minister ( Mr. Chifley) said-
" In view of the importance of the Banking Act case before the High
Court of Australia. the A ttorney-Gen eral ( Dr. Evatt) will lead for the
Commonwealth and the other defendants. Dr. Evatt and the Solicitor-
General ( Professor K. H. Bailey) will appear in their official capacities
for the defendants PRIMARY INDUSTRIES.
EXPORTS TO BRITAIN-LONG-TERM CONTRACTS, EGGS,
EXTENSION.
On 9th February, 194S, the Minister for Commerce ( Mr. Pollard)
announced that an agreement had been reached between the British
Ministry of Food and the Commonwealth for the purchase of Australian
eggs in shell, frozen egg pulp, and egg, powder. The existing contract,
which was to have been effective until 30th June, 1950, would terminate
on 30th June, 1948, and the new contract would commence with the
season 1948-49 and extend up to and including the season 1952-53.
The new contract envisaged that yearly progressive increases in production
and export should commence in .1948-49, the objective being to
a-chieve an export target of 105,000,0,00 dozens a season, in all forms.
In the event of Australian exports not expanding sufficiently to provide
a total shipment during 1949-50 and 1950-51 of the equivalent of
4,500,000 cases, the British Ministry would have the right to call in
January, 1951, for a review or revision of the quantities which it was
committed to accept from Australia for the balance of the contract
period.
To achieve before 1952-53 the full increase in egg exports as desired
by the British Ministry, Australian egg production must be increased
from its present level of 124,000,000 dozen eggs a year to about
180,000,000 dozen. That would mean an increase of 5,500,000 birds in
poultry flocks by 1952-53.
Prices to apply for 1948-49, 1949-50 and 1950-51 were-
Eggs in shell: 2s. 4d. a dozen; frozen whole egg ( egg pulp) Is. 8.9d. a lb.;
dried sugared egg: 5s. Id. a lb.; dried whole egg: 7s. a lb.
( These prices are for the 15 lb. pack: and prices for heavier or lighter packs
will be adjusted pro rata.)
Prices for 1951-52 and 1953 would be determined by further negotiation
not less than sixteen months before the season to which they applied
-at the beginning of the hatching season, which would substantially
determine the size of flocks for the season in question.
Oiling of shell eggs for export had been proved beneficial, and all
prices fixed for shell eggs included allowance to cover the cost of oil
processing. Maximum possible quantities were to be processed in
1948-49, and thereafter all eggs in shell would be oiled.
Only eggs which had not been washed may be included in the shell
egg pack. Packing of shell eggs must take place during the period 1st
June to 24th December in each year.
The British Ministry would be given first preference for all shell
eggs of export quality packed in Australia in the weight grades acceptable-
13 lb. to 17 lb. a long hundred-and Australian exports of shell
eggs in those grades to destinations other than Britain during the
period January to June in each year, shall not exceed 2j per cent. of
Australia's shell egg shipments to Britain during the preceding June-
December period.
AGRICULTURAL . COUNCIL MEETING-DECISIONS.
On 9th February, 1947, the Minister for Agriculture ( Mr. Pollard)
said that a meeting of the Australian Agricultural Council had been
held. Decisions were-
BRlTISH FOOD MIssIoN.-Council adopted a report from the Standing Comimittee
on Agriculture expressing the view that the possibility existed for an
expansion of food production in the Commonwealth to the mutual benefit of
Britain and Australia, and that all available resources necessary to achieve this
objective should be devoted to it by Commonwealth and State authorities.
Council, which would confer with members of the mission, accepted the committee's
view that it may be necessary, after the detailed objectives of the
ission had been clarified and its proposals further developed, to arrange a
special meeting to consider measures required to achieve increased production.
EXPORT OF FEED GRAIns.-Council considered the export of feed grains other
than wheat ( oats, feed barley, sorghum, imaize, millets and rye), and was of
opinion that they should be held in Australia in sufficient quantity to meet
the reasonable demands of the live-stock industry. Council considered that
export of established surpluses of such grains should be permitted and that each
kind of coarse grains should make its contribution to the live-stock feeding
programmes. Council was of the opinion that producers of those grains should
have the opportunity to share in both the domestic and export markets. Council
was of the opinion that the possibilities'he urgently examined of setting up a
coarse grains export authority to ensure equitable treatment to the individual
States and to producers of the various types of coarse grains in relation to the
exportation of those grains from the Commonwealth.
TOBACCO PRODUCrTIN.-Council considered the urgent necessity to increase
production of tobacco leaf in Australia, in view of limitations imposed on the
importation of tobacco from dollar areas. Council recommended that further
consultations take place between Commonwealth and State representatives and
technical officers to evolve definite plans for increased production of tobacco leaf
of suitable quality, and that appropriate consultation take place with the
Australian Tobacco Board.
ToBAcco MARKTING.--Council considered the position in States directly concerned
regarding uniform State legislation on the marketing of tobacco. All
tobacco-producing States were not in favour of the introduction of the necessary
legislation, and Council was of the opinion that, after the present season,
any stabilized marketing of tobacco leaf must be entirely dependent on action
taken by the respective States. Council recommended that representatives of
the Commonwealth Department of Agriculture, the Australian Tobacco Board,
the Prices Commissioner and the four State Departments of Agriculture concerned
should meet to devise plans to achieve some form of stability for sub-
Lmission to Ministers and consideration at the next meeting of Council.
POTATO MARIKETING.-Council noted that the functions of the Australian
JPotato Committee had been continued to cover the 1947-48 crop, but the comnmittee
could not continue to function. If organized marketing were to continue,
a State action would be essential in the near future and for effective action coordination
of the activities of the State organizations was necessary. Growers'
organizations had approached the Commonwealth requesting continuance of
Commonwealth guaranteed prices for potatoes. The Commonwealth would be
prepared to consider such a request, but would need to be assured that marketing
was organized on a basis that would ensure supplies being spread over the
season; give a fair allocation of available supplies throughout the Commonwealth;
and prevent over-supply to markets and depressed prices.
EGc INiDUsTRY.-Council noted that from the surplus funds of the Commonwealth
Egg Control, which would probably amount finally to between œ 700,000
and œ 750,000, the Commonwealth Government had already agreed to the distribution
of œ 300,000 between State Egg Boards on the basis of recorded
production in each State during the period of Commonwealth control up to
June, 1947. Council was informed the Commonwealth Government considered
that it should be reimbursed from surplus funds for losses directly incurred
in connexion with egg-drying plans since their introduction in the war period.
Council decided that this be agreed to up to a maximum of œ 100,000. As regards
the balance of the money, Council recommended that It be distributed to State
' ga Boards pro rata to contributions to the control fund.
POULTRY Co xEcEN.--Council decided to accept an invitation from the
Danish Government to be represented at the Eighth World Congress of Poultry
Breeders at Copeuhagen in August, 1948. The Principal of the Animal Health
and Nutrition Laboratory of the West Australian Department of Agriculture
( Dr. H. W. Bennetts), and the veterinary officer of the New South Wales
Department of Agriculture ( Mr. G. L. McClymont) would be in Britain at that
time, and an approach would be made to the Commonwealth Government to
include those officers in the Australian delegation. The Commonwealth Dairy
Officer at London ( Mr. A. D. Allanson) would attend the Congress.
SuprpnEiPosSATE.-Council noted that National Security ( Superphosphate
Industry) Regulations, which incorporated the Superphosphate Industry Committee,
were discontinued from 1st anuary, 1948, and that the Minister for
Agriculture ( Mr. Pollard) had approved of the committee continuing to function
a an advisory body. EXPORTS TO BRITAIN-RICE.
On 16th February, 1948, the Prime Minister ( Mr. Chifley) said-
Cabinet decided to-day that the Australian rice crop of 32,000
tons should be allocated to essential needs in Australia ( hospitals,
invalids, Asiatics and the like); to New Guinea, Papua and Pacific
Islands; to Malaya and other rice-deficient countries; with a shipment
to Britain."
WHEAT STABILIZATION SCHEME.
POST1WAR-CONTINUANCE, MINISTERS' CONFEREN( XkE.
On 11th February, 1948, the Minister for Agriculture ( Mr. Pollard)
said that Commonwealth and State Ministers for Agriculture had
considered stabilization of the wheat industry. The amended plan of
the Commonwealth Government was the basis of the discussion. Conference
also received a submission from the Australian Wheatgrowers'
Federation setting out its views. He had indicated to State Ministe,
that he would submit to Cabinet a suggestion that the period of the
plan be extended for one year to take in the 1952-53 harvest, thus
making the initial period of operation of the plan eight years from the
1945-46 harvest. He had indicated that if the findings of the Wheat
Industry Costs Committee proved that it was impracticable to have an
index formula for adjusting costs movements, or if application of itb
findings proved impracticable, the Government would make periodi?!
review of costs movements. The Government would determine the period
of review and the machinery of review at the appropriate time. He
had undertaken to recommend to Cabinet that a properly constituted
authority be set up to provide for and determine any refund to wheatgrowers
who had an equity in the Wheat Stabilization Fund if for an. N
reason they were arbitarily forced to cease wheat growing.
On some other points State Ministers were not prepared to commit
their Government, but considered it necessary to have further consultation
with them. That applied particularly to the federation's request
that a ballot on wheat stabilization legislation should be tak,-en of all
whcatgrowers of the Commonwealth who were registered and had sown
acres or more to wheat.
It was agreed that the matter would be discussed if desired after
State Governments had considered the matter further and determined
their policy on fundamental features of the plan.
(] For earlier references, please see No. 106, page 62; No. 129, page
No. 133, page 23.)
POST-WAR-CONTINIANCE, EXTENSION.
On 2nd March, 1948, the Prime Minister ( Mr. Chifley) said-
Cabinet to-day decided that the wheat stabilization plan be extended
by one season to cover five seasons after 1947-48.
Cabinet also approved the principle of setting aside up to half
the annual interest earned by the wheat stabilization fund to repay
approved eases in which a refund of tax payments is merited. The
latter decision covers ' hard luck cases. Further consideration will be
given to the constitution of an outhority to deal with these cases.".
BRITAIN.
FINANCIAL POLICY-PRIME MINISTER'S STATEMENT,
FEBRUARY, 19,48.
On 11th February, 1948, the Prime Minister ( Mr. Chifley) said-
" The fall in values of shares on Australian stock exchanges may
be attributed to various factors. These include the fall in overseas
prices for grain; President Truman's various statements that something
must be done to retard rising prices and costs; and Britain's difficult
economic position because the drain on . gold reserves has not been
reduced as hoped. Speeches and statements by the British Chancellor
of the Exchequer ( Sir Stafford Cripps), backed by facts, have made
it clear that the going will be difficult. As a consequence, profits are
not being reaped as they were before.
" What happens on Australian stock exchanges is a reflection of what
has happened in Britain and the United States, where there is every
indication that a recession is coming.
There is nothing more in it as far as Australia is concerned except
in regard to prices for primary products, although these are mainly
safeguarded by firm contracts. The second factor in Australia is
concern as to rising costs. Opportunities offering to Australia for
expansion and development are the greatest in history, and I am confident
that that will take place even allowing for an overseas recession.".
TAXATION.
COMPANY TAX-PRIME MINISTER'S STATEMENT.
On 12th February, 1948, the Prime Minister ( Mr. Chifley) said:
During the war, and since its conclusion, a good deal of adverse
criticism has been directed against the incidence of income taxation
on companies. Numerous published reports of annual meetings of
companies have contained references to the crushing burden of taxation,
its stifling effect on enterprise and the generally adverse economic
effects of the Government's taxation policy.
" Such comments have appeared so frequently that I am sure that,
by force of sheer repetition, they are accepted as representing the facts
of the position. So far as I am aware, no one has bothered to analyse
the burden of taxation on companies and to relate that burden to company
income levels. Obviously, taxation has increased as a result of the
war; but the incomes out of which that taxation has been paid have not
remained static, but have increased. The important factor is the relationship
between the incomes remaining to companies after payment
of taxation in the periods prior to, during, and subsequent to the war.
Australia's participation in the recent war necessitated that every
section of the community should bear a share of the tremendous cost
associated with the war. It was determined at an early date that as far
as possible Australia should, as a policy, attempt to meet war costs from
current income and so reduce borrowing to a minimum. Accordingly,
the rates and scope of all existing taxes were increased and new taxes
imposed so as to ensure as far as possible that equality of sacrifice
was achieved between the various components of the community. Row
successful this policy proved has now become part and parcel of the
financial history of the Commonwealth.
It was realized that the primary and most flexible source of war
revenue was income tax, since by a graduated income tax there is
achieved the maximum degree of equity between individual taxpayers
and equality of sacrifice. The rates of individual income tax wore
increased in 1940, 1941, and again in 1943, when they reached their
peak. Companies, in their turn, were called upon to make some contribution
to the cost of the war.
" Immediately before the outbreak of war companies were liable,
for Commonwealth purposes, to normal tax, imposed at a fiat rate of
is. 1. Sd. in the œ 1 on each œ 1 of their taxable income. A private
company, which mnay be broadly defined as a company which is under
the control of not more than seven persons and whiceh is not a company
in which the public is substantially interested, was liable for the additional
tax which would have been payable by its shareholders if the
undistributed amount had been distributed. In addition, companies
were liable to various income taxes imposed by the States.
" According to the Commonwealth Year Book ( Vol. 36, p. 745)
collections from companies in the financial year 1938-1939 were as
follows Commonwealth collections 4,300,0001
State collections 11,498,000 15,798,000
" Reference to the ' Twenty-second Report of the Commissioner of
Taxation shows that, for Commonwealth purposes, companies derived
a taxable income of œ 81,456,000 during the in-come year 1937-1938,
the year to which collections for the financial year 1938-1939 are
related. The variations between the States and the Commonwealth in the
manner of ascertaining taxable income would raise the total taxable
income to about œ 89,000,000 for all companies. Collections of
œ 15,800,000 on this taxable income represent an overall effective rate
of tax of 43.61d. or approximately 3s. Sd. in the For the year in
question, therefore, companies, after payment of tax, had a total
amount of profit available either for distribution or to place to reserves
of œ 73,200,000. For the financial years 1939-1940 and 1940-1941 the rates of
normal tax were increased to 2s. in the and in 1941-1942 the rate
was increased to 4s. in the In 1942-1943, -with the introduction
of uniform taxation, -companies were no longer subject to State income
tax. To compensate for suspension of State tax, the rate of normal
Commonwealth tax was increased from 4s. in the œ 1 to 6s. in the as
the average rate of tax imposed on companies by the States was about
2s. in the This point is frequently overlooked by critics who claim
that the Commonwealth rate of normal company tax has increased by
4s. 10.4d. ( that is, from Is. 1.8d. to whereas in reality, the rate has
increased by only 2s. 10.4d.
" Companies were, of course, subjected to other imposts in addition
to an in-crease in the rate of normal company tax.
" Private companies continued throug hout the war and to the
present time to be subject to the additional tax paid under' Division
7 of the Income Tax A-ssessment Act. The amount of this tax is
determined by reference to the amount of additional tax which would
have been payable by the shareholders of the company if the company
had paid the undistributed portion as a dividend. These assessments,
as a consequence, reflected the rates of tax payable by individuals,
which, as mentioned above, reached their peak in the financial year
1943-1944.
Much has been made of the incidence of this tax, it being claimed
that it involves very high rates of tax. This view has arisen primarily
because the Division 7 tax has been related to the undistributed amount
and not to the taxable income, which is the true haze.
The Twenty-sixth Annual Report of the Commissioner of Taxation
( page 12) shows that for the financial year 1943-1944 private
companies were assessed to œ 8,650,000 Division 7 tax on an undistributed
income of œ 12,560,000. The average rate of Division 7 tax
was therefore 165.3d. for each œ 1 of the undistributed amount. However,
the taxable income of private companies in that year was.
œ 51,486,000, so that the total Division 7 tax of œ 9,730,000 ( comprising
œ 8,650,000 actually assessed and œ 1,080,000 estimated to be assessed)
represents an average rate on the taxable income of 45.5d. in the œ 1.
Although it may be considered that even the average rate -of
45.5d. for Division 7 tax is high, it must be remembered that where
a dividend is paid by a private company out of profits which have borne
tax under Division 7 that dividend is virtually tax free in the hands of
the shareholders, as they are entitled to a rebate of the tax -attributable
to the inclusion of the dividend in the taxable income. No precise
figures are available as to the amount of such tax free dividends, but
some indication of their volume may be derived from the fact that in
the income year 1943-1944 resident private companies paid dividends
amounting to just over œ 19,000,000, the major portion of -which may
be assumed to have been paid from funds which had borne Division
7 tax. Non-private companies were also required to contribute their
share to the rising costs of the war. As from the financial year
1940-1941, non-private companies became liable for a super tax of
is. in the œ 1 on that part of their taxable income in excess of œ 5,000.
A super-tax rebate is allowed to avoid the dual payment of super-tax
on income derived by a company and on dividends paid by that
company to another company out of income on which super tax has.
been paid or is payable.
" From the financial year 1940-1941, non-private companies have
also been liable to a further tax of 2s. in the œ 1 on that portion of their
taxable income which has not been distributed as dividends. The yield
from this further tax has never exceeded œ-2,000,000 annually.
War-time ( Company) Tax was also imposed on non-private companies
for the financial year 1940-1941 et seq. This tax differed from.
the war-time profits tax imposed during World War I. and the British
Excess Profits Tax. These latter taxes adopted a standard of pre-war
profits and sought to drain off any profits in excess of this standard as
being attributable to excess war profits. The War-time ( Company)
Tax, however, was designed to levy tax on the basis of the percentage
of the taxable profit to the capital employed.
The number of companies which have been assessed to Wartime
( Company) Tax has never been large-in fact, only 757 companies
were so assessed for the financial year 1944-1945. These 757
companies were assessed to œ 4,390,000 on a taxable profit of
œ 28,500,000. The total taxable income of the companies concerned
amounted to œ 45,400,000, the War-time ( Company) Tax therefore
being imposed at an effective average rate of only some 23s. 2d. If the
total taxable income of all public companies, œ 98,621.000, is taken
into account in weighing the effect of War-time ( Company) Tax,
the effective average rate is only 10.7d. in the œ 1.
" In considering the incidence of War-time ( Company) Tax, it
should be remembered that, in determining the amount of War-time
( Company) Tax payable, the amount of super tax payable by the
company is allowed as a rebate from the War-time ( Company) Tax
otherwise payable. The allowance of the rebate has the practical
effect of rendering many companies non-taxable for the purposes of
War-time (' Company) Tax.
Having briefly surveyed the existing taxes on companies and
commented on their individual incidence, it may be of interest to set
out, as accurately as available statistics permit, the total weight of
taxation on both private and non-private companies. The main source
of these statistics are the Annual Reports of the Commissioner of
Taxation. " In the financial year 1944-1945 private companies were
assessed to the following taxes on a total taxable income of œ 55,500,000,
which was derived during the year ended June 30, 1944-
Normal tax at Gs. in the œ 1 15.690.000
Division 7 tax actually assessed to 30th June, 1946 2,289,000
Estimated to be assessed after 30th June, 1946 1,342,000 3,631,000
19,321,000
Thus, for the financial year 1944-1945, private companies paid
on their total taxable income, an average rate of 83.5d. in the œ 1.
" It must, however, be observed that the Division 7 tax payable
in respect of the financial year 1944-1945 was reduced by 75 per cent.
as a result of the introduction of the system of pay-as-you-earn.
Consequently, the ' average rate of tax arrived at above is not representative
of all years.
" The Division 7 tax payable in respect of the financial year
1943-44 ( in which year the peak war-time rates were first operative)
amuounted to œ 9,743,000 on a taxable income of œ 51,486,000 representing
the levy of Division 7 tax at an average rate of 45.5d. in'the E1.
If this rate is accepted as typical of the Division 7 tax payable when
rates were at their peak, the overall rate of 194445 would have been
113.3d., if the 75 per cent. rebate had not been granted.
Preliminary figures for the financial year 1945-1946 tend to
confirm this overall average rate, the tentative 1945-19-48 figure being
115.8d. It can be said then that the overall average rate of tax paid by
private companies when rates -of tax were at their highest approximated
9.6d. in the œ 1.
" For the financial year 1944-1945 ( income year 1943-1944), the
taxable income of public companies amounted to œ 98,621,000. These
companies were assessed to the following taxes:
Normal tax at Gs. in the œ 1 26,780,000
Super tax 3,803,000
Part lIIIA:
Actually assessed to 30th June, 1946 1,989,000
Estimated to be assessed after 30thl June,
1946 110,000 2,099,000
War-time ( Conipany) Tax -4,390,000 37,072,000
" The overall average rate of tax paid by public companies for the
financial year 1944-1945 was therefore 90.2d.
" Although public companies appear to have an advantage over
private companies in that the overall average rate of tax paid by them
is less than that paid by private companies, any dividends paid by
public companies are, in the generality of cases, fully taxable in the
bands of the individual recipient. On the other hand, dividends paid
by private companies out of funds which have borne tax under Division
7 may be regarded for all practical purposes, as exempt in the hands
of the shareholder.
11I think that it is, therefore, fair to say that the effective rate
of tax imposed on all companies over the war years would approximate
in the Li-or 7s. 6d. in the In the light of the sacrifices
and demands made upon other sections of the community, I do not
think that companies have been unfairly treated by the incidence of
income taxation, -In fact, when compared with the weight of company
taxation in other countries, companies in Australia have escaped lightly
over the war years.
But what has been the general effect on companies of the in-creased
rates of taxation? In 1938-1939, the combined collections from company
income tax by the Commonwealth and the States were nearly
œ 16,000,000; 1944-1945, Commonwealth collections from companies
amounted to œ 60,000,000. The initial reaction is that during the war
years, the profits avail-able to companies after payment Of tax must
have diminished considerably in order to meet the additional taxes
of some œ 44,000,000. But such has not been the case. Since 1938-1939,
the national income has increased by some 64 per cent., and companies
have enjoyed a similar increase in their taxabte incomes. The net
result h-as been that, despite the burden of war taxation, companies
have had more available, either for distribution to shareholders or to
place to reserve, than they had in pre-war years. This I regard as at
tribute to the manner in which my Government has financed the war
and created conditions of relative economic prosperity.
The extent to which net company profits have increased over the
war years is apparent from the following table which is based uponL
information contained in the ' National Income and Expenditure
1946-1947' In the table ' company income' is income af ter payment
ot indirect ( but not direct)
tax, less dividends received
life assurance companies.
income taxes, undistributed
tax. taxes of all companies subject to income
from other companies. It also excludes
' Non-personal direct taxes' represent
profits taxes and war-time ( company.) ( 6)
Net National Company Per centt. of Non-pvrmnl NetComplany
etlIncome. Income. to Direct Taxes. beaniue.
fn. LEM. em. Ern.
1938-39 803 89 11.1 16 73
1939-40 852 105 12.3 21 9
194()-4i. 1. 923 114 12.4 31 83
1941-42 1,075 120 11.2 47 73
194-43 1,229 128 10.4 .50 78
1903-44 1,279 140 10.9 52 88
1914-45 1,228 1398 11.2 610 78
1945-46 1236 I 135 10.9 I 55 I
1946-47 1 1,265 140 1 11.1 I 53 I 87
" From column it is apparent that companies, over the war
-years, have obtained practically a constant share of the national
income, so that they have benefited from the increased activity resulting
from the favorable economic conditions resulting from the policy.
of my Government during the war. More sig-nificant still is the fact
that despite the increase in taxes paid by companies ( Column the
net amount left to companies ( Column 6) has never fallen below the
1938-39 level.
" It is of interest. to sh-ow how these profits remaining -after payment
to tax have been dealt with-Undistributed Dividends
Dividends Profits and Total
Year. paid to seemuing to Undistributed Net Comnpuny
Residents. Residents. Profits payable Incomne.
Overseas.
Lm. im. 9M. 9Ms.
1938-39 24 34 15 7
1939-40 27 43 14 84
1940-41 30 39 14 83
1941-42 32 29 12 73
1942-43 31 35 12 78
1943-44 32 42 14 88
1944-45 30 35 13 7S
1945-46 32 35 13 so
1946-47 3: 5 1. 13 13 1 87
" It is noteworthy that dividends paid by companies to residents
have never fallen below the 1938-1939 level, and had, in fact, by
1946-1947, increased by nearly 40 per cent. Further, the undistributed
profits accruing to residents have at least been maintained over the
war year-s and are now displaying an upward trend.
" In the ligrht of these facts, I hope that the belief that the weight
of company tax has ruined companies and retarded economic progress,
will uow be scotched for all time. Companies% have, along with other
sections of the community, received the benefit of the Government's
policy of full employment, resulting in an expansion of all forms of
economic activity.
" That my Government is alive to the-important influence which
companies have on the economic life of the community is evidenced by
the fact that since the end of the war, the taxation of both private
Creceiavnde ndon -private companies has been reduced. Private companies have
the benefit of the greatly reduced rates of tax payable by
individuals in their Division 7 assessments. Non-private companies9
are no longer subject to War-time ( Company) Tax, a fact which should
prove of great benefit to newly established and expanding businesses."~
On 23rd February, 1948, Mr. Chifley said-
There has been some criticism of my recent statement on company
taxation. Most of the comment is extraneous to the main issue, being
directed at the weight of all taxation, the level of Government expenditure
and the extent of Governmental control. A statement on the
incidence of company taxation is not the appropriate place to deal with
such comment which will be replied to at the appropriate time and
place. " Other critics appear to have overlooked the fact that the statement
dealt only with the incidence of income tax on companies. at
has been argued, for instance, that because a rebate of company tax
isq not now allowed to shareholders on dividends;, companies are paying
more tax than pre-war. These critics appear to have found it necessary
to bolster their case by taking into account the tax paid by individuals-
a factor which is not relevant to the issue.
Another critic has pointed out that net company income ( that
is, after payment of taxes) as a percentage of national income has
declined from 9.1 per cent. in 1938-39 to 6.8 per cent, in 1946-47.
This comparison of percentages merely tends to obscure the real issue.
The fact that must constantly he borne in mind is that the actual level
of net company income, after payment of tax, has increased from
œ 73,000,000 in 1938-39 to œ 87,000,000 in 1946-47-an increase of
œ 14,000,000 or nearly 20 per cent.
Some of the criticism, however, calls for some reply. For instance,
it has been stated that companies are now unable to, pursue a policy
of development and expansion because undistributed profitb available
to companies in 1946-47 were only œ 5,000,000 higher at œ 39,000,000
than they were in 1938-39. It is claimed that this increase is inadequate
to meet present day costs of acquiring equipment and plant.
" In my opinion, the criticism overlooks certain important factors.
In the first place, undistributed profits are not the only source of
funds for development and expansion of companies. Secondly, the
undistributed profits available to companies during the war years never
fell below the 1938-39 level and actually rose as high as œ 42,000,000.
The Government has shown companies sympathetic consideration in
allowing them to retain these undistributed profits during the war.
It is certain that individual taxpayers did not have the same opportunity
of building up similar reserves during the period when individual
rates of tax were at their peak.
The total of undistributed profits accruing to companies during
and immediately after the war, amounted to some œ 180,000,000.
Shortages of man-power and materials have, up to the present, largely
precluded expenditure of these reserves on replacement or development
work. A reasonably large proportion of this accumulation should
now be available for this purpose.
Obsolete and outworn plant, and the like, are normally replaced
by means of a depreciation reserve which is built up over the life of
the plaiw. Thus a considerable proportion of the capital necessary
to replace existing plant and equipment should already be in the hand
of companies. In addition, they rould have recourse to their accumulated
undistributed profits.
" Further, the purchase of new, and replacement of obsolete plant
and equipment is encouraged by special depreciation provisions in the
Income Tax A. ssessment Act. These provide an initial depreciation
allowance of 20 per cent. ( in addition to normal depreciation) on
all depreciable assets acquired during the five years ended 30th June,
1950. The combined effect of all these factors is largely if not completely
to offset the higher cost of new machinery and equipment.
It has also been suggested that the average rates of tax payable
by companies, as calculated in my original statement, over the war
yei: rs are misleading, because some companies paid more and some less
tlian the average rate. This is inherent in all averages, but the average
rate of 7s. 6d. in the œ 1 paid by companies does indicate that the great
proportion of companies paid either this rate or less on the whole of
their taxable income.
None of the critics has been able to refute the facts contained in
my statement or to deny that as compared with other sections of the
community ( and with other countries), companies have received fair
treatment from the taxation viewpoint."
BRITISH COMMONWEALTH.
PROPOSED CONFERENCE.
On 13th February, 1948, the Prime Minister ( Mr. Chifley) said-
Nothing can be gained by holding a British Commonwealth Conference
at the moment. I cannot say what the future holds, as something
is taking place all the time. We understand the position on
finance and on the question of a production drive. First of all. production
is aimed at providing food for Britain. The more we enrouraqe
increased production the closer we are to the solution of all difficulties.
The fundamental thing is to get the best possible production to solve
the dollar crisis, our own shortages and the need for food. But at the
moment, on the informaticn available to us, there is nothing to be
gained by a special conference. What the future holds will be determined
in the light of circumstances.".
VISIT OF KING AND QUEEN TO AUSTRALIAANNOUNCEMENT.
On 6th March, 1948, Mr. Chifley broadcast over the national network.
Mr. Chifley said-
Men and women of Australia,
It is my most happy duty and privilege to make an announcement
to the people of Australia.
" His Majesty the King has commanded His Excellency the
r Governor-General to authorize me to make public the following bulletin
which His Excellency has received from Buckingham Palace, London-
In response to a suggestion made by his Prime Ministers in New Zealand
and Australia, the King has graciously consented to visit these countries in the
early part of 1949. His Majesty will be accompanied by the Queen and the
Princess Margaret.
" I know that the knowledge that Their Majesties and the Princess
Margaret will, at a comparatively early date, visit us will give the
greatest satisfaction to all Australians and I have asked the Governor-
General to express our gratitude to His Majesty. All will look forwar]
eagerly to the opportunity of showing here in Australia the feelings
of pride and affection we have for the Royal Family.
The Government of the Commonwealth will gladly join with the
Governments of the States and with public and private bodies in
ensuring that a fitting welcome be given to our Royal guests.'".
On 9th March, 1948, Mr. Chifley said-
" The Minister for Munitions ( Senator Armstrong) will he
Minister-in-charge of the Royal Visit to Australia in 1949."
The General Officer Commanding, Eastern Command ( Lieutenant-
General F. H. Berryman), will be Director of the Royal Visit to Australia
in 1949."
VISIT OF KING AND QUEEN TO AUSTRALIA-STAMP
ISSUE.
On 24th May, 1948, the Postmaster-General ( Senator Cameron)
announced that special postage stamps would be issued in Australia to
mark the visit of the King and Queen and Princess Margaret.
CONVERSION LOAN.
LONDON OPERATION, JANUARY, 1948, SUCCESS.
On 13th February, 1948, the Prime Minister ( Mr. Chifley) said-
" The loan for œ 12,870,300, issued at London to convert the New
South Wales 5{ per cent. loan, has closed with applications amounting
to œ 10,420,300. This leaves œ 2,450,000 to be taken up by the underwriters.
22
" This result is regarded as satisfactory in view of the adverse
factors which affected the market after the lists were opened. Since
the loan closed the securities have been quoted at a premium."
OLYMPIC GAMES.
On 16th February, 1948, the Prime Minister ( Mr. Chifley) said
" Cabinet to-day decided to make a grant of œ 4,000 towards the
expenses of the Australian team to the 1948 Olympic Games."
CONSTITUTION.
AMIENDMENT-REFERENDUMI, PRICES, DATE.
On 16th February, 19,48, the Prime Minister ( Mr. Chifley) said.-
" Cabinet decided to-day that the referendum for the amendment
of the Constitution in respect of rents, prices and charges shall bek
taken on Saturday, May 29, 1948." 1
( For earlier references, please see No. 132, page 22.)
J UTE.
POST-WAR-GOVERNMENT BUYING FURTHER
CONTINUED.
On 16th February, 1948, the Prime Minister ( Mr. Chifley) said-
" Cabinet decided to-day that Government purchasing of raw jute
and jute goods be continued in 1948-49. Approval was given for
the purchase of an additional quantity of 3,125 tons of raw jute for
1947-48. Purchases in 1948249 will be 102,000 tons of jute goods and
4,500 tons of raw jute, valued at about œ 15.000,000.".
DEFENCE.
POST-WAR-SERVICE EXPENDITURE.
On 16th February, 1948, the Prime Minister ( Mr. Chifley) said-
" The Board of Business Administration ceased to, function on
December 31, 1947, with the expiry of Defence ( Transitional) Act
Regulations. The board, which. operated with the Defence Division of
the Treasury, was responsible for the review of proposals by Service
Departments for works and supplies, for inspections and investigations
of financial and accounting matters and for co-ordination of matters
from a joint-services aspect.
" In November, 1947, Cabinet approved a procedure for review and
approval of works proposals, involving a review by a sub-committee of
Cabinet, assisted by an inter-departmental committee.
" With regard to matters other than works and to maintain the
established principle of review with modifications suitable to existing
circumstances. I arranged for discussions between the Treasury and
the Departments of Defence, Navy, Army and Air.
23
Cabinet decided to-day that the following review authorities be
set up:-
A Cabinet sub-connmittee. comprising the three service Ministers and
myself, and the Minister for Defence when necessary.
A Treasury Defence Review Committee comprising a Treasury representative
as chairman and the permanent head of each service department.
Matters to be referred for review will be-
Programme and st teiuits of requirements for annual Estimates purposes
under the defence plan and in respect of war commitments.
Any variations from the above required to be implemented during the year
in anticipation of next year's Estimates. ( This will include increases in numbers
of personnel as irovided for respective ranks in annual Estimates.)
Variations in the approved bases of provisioning; or the authorized equipment
tables. Any proposition not covered by the foregoing involving the purs,
chase of plant, equipment, motor transport, spare parts and supplies where the
expenditure involved would exceed œ 5.000.
r Questions involvinl variations in standards of issue of clothing and rations
and in standards of furniture, office equipment and departmental services
generally. Pay and conditions of service of members of the forces.
Any other expenditure proposals having a joint-service aspect.
Systems in relation to financial and store accounts.
HEALTH.
RADIOLOGY.
On 16th February, 1948, the Prime Minister ( Mr. Chifley) said--
Cabinet to-day approved, on the recommendation of the Minister
for Health ( Senator McKenna), of the establishment of a physical
service in radiology at Perth. to be a branch of the Commonwealth
X-ray and Radium Laboratory at Melbourne. The new project will
serve a useful purpose in standardizing diagnostic and therapeutic
x-ray equipment; the working conditions of persons engaged in x-ray
occupations, radium and other electro-medical equipment; and in the
distribution of radon. RESEARCH GRANT.
On 19th March, 1948, Mr. Chifley said-
The Government has agreed to contribute, through the National
Health and Medical Research Council, œ 20,000 towards the cost of
biophysical equipment to be installed at Melbourne at the Walter and
Eliza Hall Institute of Research in Pathology and Medicine. This
amount is in addition to the annual grant made to the institute by the
council from funds provided by the Commonwealth Government, and
amounting in the current year to œ 15,000.
This Commonwealth contribution will allow of adequate physicochemical
studies of viruses, enzymes and proteins, by the use of the
most modern analytical ultra-centrifuge and electrophoresis apparatus
AUSTRALIAN BROADCASTING COMMISSION.
REVENUE FROM LICENCES.
On 16th February, 1948, the Prime Minister ( Mr. Chifley) said-
" Cabinet decided to-day to approve expenditure by the Australian
Broadcasting Commission, during the three months ending 30th June.
1948, of an amount not exceeding one-quarter of the Commission's
estimated expenditure of œ. 1,304,500 for 1947-48; namely, œ 326,125
On the 16th March, 1948, Mr. Chifley said-
Cabinet to-day decided that the Australian Broadcasting Commission
lie authorized to expend during the present financial year, in addition
to œ 1,304,000 already approved, an amount not exceeding œ 20,000
to enable the commission to mreet additional costs involved in the application
by the Public Service Arbitrator of marginal increases to the
staff of the com~ mission".'
( For earlier reference, please see No. 127, page
INQUIRY-REPORT.
Onl 16th February, 1948, the Prime Minister ( Mr. Chitley) said-
" Cabinet to-day received the report of a committee, comprising
Messrs. A. A. Fitzgerald, chairman, E. G. Bonney and W. T. Harris,
who were appointed to consider the administration and financial
organization of the Australian Broadcasting Commission and to report
whether the powers, functions and obligations of the commission, as
prescribed in the Australian Broadcasting Act, are being discharged
with maximum efficiency, adequate control and due economy of expenditure
and whether any changes are desirable.
" Cabinet decided that the report be referred to the Cabinet subcommittee
on Broadcasting, comprising the Minister for Supply ( Senator
Ashley), the Postmaster-General ( Senator Cameron) and the
Minister for Information ( Mr. Calwell). The Cabinet sub-committee
will report further to Cabinet.
The committee has formed the opinion that generally the present
administration, control and organization of the commission is satisfactory;
that the financial and accounting procedures are well-designed
and effectively carried out; and that although some economies could be
effected, it would not be practicable for the commission to be financially
self-supporting unless revenue is substantially increased or activities
substantially curtailed SOCIAL SECURITY.
TUBERCULOSIS-CABINET DECISION.
On 16th February, 1948, the Prime Minister ( Mr. Chifley) said-
" Cabinet to-day considered recommendations for a plan to wage
war on tuberculosis, designed to reduce tuberculosis to a problem of
min-or importance within twenty years. Apart from its toll in human
misery and distress, tuberculosis involves vast economic loss to the
nation through loss of mnan-power hours in industry, lowering of the
birth rate and the expenditure of millions of pounds on treatment, convalescence
and social benefits. The disease demands national concern
both because its incidence fails very heavily on young adults in their
most productive and reproductive years but also because, being
infectious, it is a source of real danger to every person in the community.
If detected early it can usually be arrested and the patient
returned to useful citizenship.
he Federal Health Council, the National Health and Medical
Research Council and medical bodies have been advocating for many
years a vigorous attack on tuberculosis under Commonwealth leadership
and with adequate Commonwealth financial backing. The power conferred
on the Commonwealth Parliament at the last referendum to provide
medical services has opened the way to Commonwealth entry into
the field as well as imposing a high responsibility on the Commonwealth.
Principles and methods to be applied to the control of tuberculosis are
well established and have been effectively applied in other parts of the
world-notably in Scandanavian countries, Canada ( particularly
Ontario and Saskatchewan) and in most of the United States.
The recently appointed Commonwealth Director of Tuberculosis
H. W. Wunderly) has completed a survey of the facilities and
needs in each State in relation to this disease which, it is estimated,
atiects from 30,000 to 40,000 persons.
Cabinet authorized the Minister for Health ( Senator McKenna)
to draft legislation to effect necessary amendments to the Tuberculosis
Act. Senator McKenna stressed that no housing problem was of greater
urgency than that of housing in isolation in suitably equipped buildings
sufferers who: as well as needing to be saved from the disease, are a
nenace to the health and lives of their fellows unless precautionary
measures are strictly observed.
The co-operation of the . States will be sought in making a uniform
approach to the problem. Subject to agreement between the States and
the Commonwealth as to a general plan of campaign evolved in consultation,
the Commonwealth will provide the necessary money for new
buildings and equipment and will be prepared to provide a substantial
proportion of maintenance involved.
Dr. Wunderly's report will be circulated to the States as a basis
for discussion and Dr. Wunderly will argair visit all States in the near
future. A very brief summary of Dr. Wunderly's report shows that an
important element in an attack on tuberculosis is the education of the
, public to prevent the spread of the disease. In this, the Government
invites the co-operation of the press, the radio, the newsreels and
voluntary bodies who, with limited finances and facilities, have done
splendid work in combating the disease and making the public conscious
of tuhbrculosis. I am confident that this co-operation will be forthcoming.
The full co-operation of medical schools, teaching hospitals
and o. ther institutions is also desired. It is estimated that the Commonwalrh
will, from an early sage of the campaign, be involved in consi!
crable expendcture. Thli will in in addition to the amounts now being
expended annually by State governments. The Government is anxious
that there should be an immediate, vigorous and efficient approach to
the treatment, prevention and control of tuberculosis in this country".
( Tor earlier references, please see No. 107, page 47; No. 116, page 31;
No. 118, page
PHYSICALLY HANDICAPPED PERSONS.
On 16th February, 1948, Mr. Chifley said-
In 1945, Cabinet approved the development of an interim scheme
of rehabilitation under the Re-establishment and Employment Act to
cover ex-servicemen not eligible for medical benefits under the
Australian Soldiers' Repatriation Act and directed that a committee,
representative of the Treasury, the Department of Post-war Reconstruction
and the Department of Social Services should prepare a report on a
permanent scheme for the general community.
" Cabinet to-day approved the committee's recommendations as
follows:-Establishment of a rehabilitation scheme for the general community, providing
medical treatment and vocational training.
Persons from certain groups at present to be brought into the schemedisabled
ex-members of the forces covered by Part IV. of the Re-establishment and
Employment Act as at time of the commencement of the general scheme for the
rehabilitation of disabled persons; invalid pensioners or claimants for the invalid
pension; those receivinl or claiming unemployment or sickness benefits who may
become unemployed unl ss rehabilitation assistance is given.
A report to be presented within twelve months on the practicability and
desirability of including adolescents.
Adoption of the plrinciple of inclusion ultimately of recognized industrial
diseases groups within the scheme.
Eligibility to be restricted to cases drawn from the groups set out above
where the disability has already lasted thirteen weeks at the time of application,
appears likely to last at least a further thirteen weeks ( making 26 weeks
in all) and to he a substantial handicap to the person in securing suitable
employment; yet is remediable and allows of reasonable prospects of employ.
ability within two years.
During medical treatment, the pensioner should continue to receive his social
services benefit and also the actual cost of fares where he is required to travel
for treatment. The fares paid are not to be regarded as ' income' under the
Social Services Consolidation Act.
During vocational training, the trainee should receive a benefit at the rate
of, and subject to, a means test similar to that for invalid pensions, plus a
training allowance of 20s. a week, the actual cost of fares where he is required
to travel regularly for training, and a living away from home allowance as
outlined above.
Medical examination to determine eligibility to be free. Cost of medical
treatment to be borne by the Commonwealth only to the extent to which the
patient is unable to meet he expense. Medical appliances, and also books and
tools of trade supplied on the successful completion of training, to be a charge
to the patient on a basis to be fixed by the Department of Social Services and
the Treasury.
A bill to be prepared for submission to the Federal Parliamentary Labour
party. Pending the passing of legislation, the Government authorize the commencement
of the scheme as outlined to operate from 1st January, 1948, to permit of
continuity of the treatment and training of ex-service personnel accepted under
Part IV. of the Re-establishment and Employment Act as at 31st December,
1947
27
UNEMPLOYMENT BENEFIT-QUEENSLAND.
On 25th February, 1948, Mr. Chifley said-
In connexion with the payment of unemployment benefit to persons
involved in or affected by the present Queensland industrial dispute,
the Social Services Consolidation Act provides that benefit is not
payable to an applicant whose unemployment is due to him being a
direct participant in a strike.
In relation to other persons involved in or affected by an industrial
dispute, the Minister for Social Services has issued instructions which
are being observed by the Department of Social Services in Queensland
at present and throughout the Commonwealth. These instructions are
the outcome of a full consideration of the relevant parts of the Act of a
Cabinet sub-committee early in 1947. In brief, the instructions embody
the following principles:--
In respect of unions on strike and unions sponsoring a strike of its members in
key positions, member'. of these unions, whether directly participating in the
strike, or unemployed as a direct or indirect consequence of the strike, are not to
be regarded as eligible to receive unemployment benefit.
In respect of union not on strike. or apparently having no members on strike,
members of these unions are to he regarded as eligible to receive unemployment
benefit. A ersoin i-nit to be disquiialificd for iiieminployinmet benefit by reason only
of his refusal to undertake work available through a strike or lockout.
Persons eligible under these principles for benefit will, of course,
have to satisfy the other eligibility provisions in the Act
EXTERNAL AFFAIRS.
OVERSEAS REPRESENTATION.
On 16th February, 1948, the Minister for External Affairs ( Dr.
Evatt) said-
The Government is taking steps to raise the status of the Australian
missions in Russia, France and China. The fact that these three countries
have seen fit to accord the increased status to Australia is tangible
recognition of the increased role which Australia has come to play
in international affairs in recent years.
The status of the Australian mission in the United States was
raised from that of Minister to Ambassador in June, 1946, and this last
action, covering the remaining permanent members of the Security
Council, is in accordance with a decision taken in principle by the
Government at that time.
" The change, while not increasing either the size of staffs or
financial commitments, is largely to indicate the importance which each
country attaches to the other with which it has diplomatic relations,
and it is related to the seniority of the particular representative and
the facilities to be made available to him in the country to wnich he is
accredited ii
28
PARLIAMENT.
INCREASED MEMBERSHIP.
On 17th February, 1948, the Prime Minister ( Mr. Chifley) said--
The Federal Parliamentary Labour party to-day approved of legislation
to increase the number of senators from each State by four with
a corresponding increase, as provided in the Constitution, in the membership
of the House of Representatives.
The Federal Parliamentary Labour party approved of the principle
of the proportional representation system of voting being applied
to the Senate MUNITIONS PRODUCTION.
UTILIZATION OF PLANT-FURTHER SALES.
On 21st February, 1948, the Minister for Post-war Reconstruction
( Mr. Dedman) announced the following decisions:-
Munitions annexe at Lane Cove sold to Robert Corbett
Pty. Ltd., for the manufacture of chemicals.
Commonwealth annexe at Lidcombe leased to Australian
Forge and Engineering Pty. Ltd., of Lidcombe, for the manufacture
of forged axles and automotive spare parts.
Munitions factory at Tamworth sold to Amalgamated
Wireless ( A/ asia.) Ltd.
Munitions factory at St. Marys leases to Aldaco
Products Pty. Ltd.; Malvern Industries Pty. Ltd.; Sign A.
Life Pty. Ltd.; S. Epping and Co. Pty. Ltd.; R. E. Elko; Schultz and
Hill; Howletts Industries Pty. Ltd.; H. S. Kirkwood; K. H. Freeman;
Druco Tool and Engineering Co. Pty. Ltd.; J. Thurling.
JAPAN.
TRADE-PRIVATE TRADING.
On 22nd February, 1948, the Prime Minister) said-
Arrangements have now been completed with the Supreme Command
of the Allied Powers in Japan to permit the early resumption
of two-way trade on a limited scale between Australia and Japan
within the general framework of the Interim Sterling Payments Agreement
recently negotiated with Supreme Command Allied Powers by the
British authorities.
" The agreement provides for all private trade between Japan and
the sterling area ( excluding Hong Kong) to be financed in sterling
through special sterling accounts established in the name of Supreme
Command Allied Powers with British banks. The agreement to which
Australia is a party was concluded in November, 1947, but the necessary
banking arrangements have only recently been completed.
" One of the clauses of the agreement provides that unused balances
held in Supreme Command Allied Power's sterling accounts may be
innverted into dollars at six monthly intervals. Because of this clause
29
it has been necessary to treat Japan as virtually a ' dollar' country
for import licensing purposes and up to the present no licences have
been granted for the private importation of Japanese goods.
" Arrangements have now been made with Supreme Command
Allied Powers which will, to some extent, overcome the difficulties
created by the convertibility ejause and will permit two-way trade to
be revived on a limited scale. The basis of the arrangement is that
the Commonwealth Government will authorize the issue of licences
for the importation by private traders of certain essential goods from
Japan thus providing Supreme Command Allied Powers with funds for
the purchase of Australian wool and other products.
Stocks of wool in Japan are very low and exports of Australian
wool to Japan since the cessation of hostilities have been limited to a
single shipment of about 7,500 bales. Further purchases have not been
possible because Japan has not been able to finance them. As payment
is miade for Australian imports of Japanese goods under the arrangenient
now concluded Supreme Command Allied Powers will be in a
position to resume purchases of Australian wool through agents at the
auctions. An undertaking, has been g-iveni ly Supreme Command Allied
1Powers that the whole of the proceeds of permitted imports into Australia
from Japan will be used for the purchase of Australian wool and
other prodlucts and no question of conversion of marginal amounts into
dollars will therefore arise.
Cotton textiles and cotton yarn are excluded from the arrangement
because they are at present available only against dollar payments but
impiort lienfes will be granted for Japanese raw silk, rayon yarn,
milling silk and certain essential utility types of rayon textiles."
( ror earlier references, please see No. 128, page 24; No. 132, page 3.)
On 24th February, 1948, the Minister for Customs ( Senator
(' nurtice) said that since the cessation of hostilities, cotton textiles,
rayon yarn and raw silk had been purchased by the Commonwealth
Government from Japan, but it was not expected that further Government
cash purchases would be undertaken. Licences will be issued for
raw silk and rayon yarn direct to users, while licences for milling silk
would be issued to importers who had been obtaining their requirements
from other sources. Licences would be granted for suitable types of
porcelain insulators and. it was intended to restrict the issue of those
licences to electric light and power undertakings. Regarding cotton
piece goods, the occupation authorities still required dollars in payment
and import licences would not be issued.
INCOME TAX.
BOARD OF REVIEW.
On 23rd February, 1948, the Prime Minister ( Mr. Chifley) said-
Mr. G. J. J. O'Sullivan has been appointed a member of the
Taxation Board of Review at Sydney for seven years as from 1st
March, 19MS.'"
REPARATIONS.
' GERMANY-SCIENTIFIC PERSONNEL.
On 24th February, 1948, the Minister for Post-war Reconstruction
( Mr. Dedman) announced that arrangements has been made for the
admission of more German scientists to Australia to assist in research
and production problems associated with industrial development.
Before allotment to specific tasks, the Government would make the
experts available to industrialists for general consultation. They
included-Dr. R. Hoffnan. who specialized in the treatment of metal surfaces
especially for the electrical industry ( including the preparation of surfaces
anti-ccrrosive alluys, anodising electro-plating and sherardising) and the
technical application of electro-osmosis.
Dr. F. O. Weinert, who would advise on processes concerning the extracting
of salts from German potash deposits, new compounds for seed treatment, dyestuffs
and intermediates, tlerinclhemistry of iron from ores, magnesium and
production of intermediates.
Dr. J. Unterzaucher, a micro-analyst.
Dr. H. Ritter and a technical assistant, who were experts in the designing
and manufacturing of scientific instruments relating to nmasurement technique,
including those for geodetic, astronomic, optic and inter-ferometric purposes.
On 13th March, 1948, Mr. Dedman announced that arrangements
had been made for the admission of more German scientists to Australia
during March, 1948. They were-
Dr. A. Gross, chemist, qualified in research and manufacture of artificial
resins; Dr. T. Feuerriegel, expert on optical and similar instruments; Messrs.
H. Hock, specialist in design and production of machine tools; T. Schobel,
leading designer of electric meters, test equipment, motors; A. Seyler, expert
in radio, television, and telecommunications; Fieguth, leading engineer in
electro-technical and high frequency engineering.
( For earlier references, please see No. 122, page 49.)
RECONSTRUCTION.
WORLD ORGANIZATION-TRADE AND EMPLOYMENT
AGREEMENT.
In Parliamen.-On 26th February, 1948, the Minister for Postwar
Reconstruction ( Mr. Dedman) said-
I lay on the table the following paper:-
United Nations Conference on Trade and Employment-Memorandum
showing alteration of Tariff duties,
in substitution for the paper tabled on 18th November, 1947, by the
Minister for Commerce and Agriculture. This document, while including
all the information contained in the previous document, gives additional
information and should be of greater assistance to the House
when studying the tariff alterations resulting from the International
Conference on Trade and Employment."
( For earlier references, please see No. 132, page 3.)
In Parliament.-On 26th February, 1948, the Prime Minister
( Mr. Chifley) said-
The great struggle which democracy is having to-day to combat
the inroads of communism is due to the fact that the conservative
interests of the world have fertilized the soil in which communism has
grown over the centuries. The Labour party is just as concerned about
production as is any other party. It is actuated not so much by
political motives as by a desire to satisfy the need of the great mass
of the people of Australia for essential goods and to make the utmost
possible contribution to the welfare of other peoples of the world, many
of whom are starving. That is not a political creed; it is a humanitarian
creed.
" One has to cast one's mind back over events of recent years to
realize the source from which the Geneva trade agreement and other
matters have sprung. I recall the state of affairs in 1941-42, when the
people of Britain were standing -almost alone. Some method had to be
devised to secure help from the United States, and I think the idea
developed in the mind of President Roosevelt ' himself. It had to be
something which, to use the vernacular, he knew he would be able to
sell to the American people. Out of this idea grew at various times the
Atlantic Charter, the Mutual Aid Agreement, and the Lend-Lease
Agreement. I. am able to realize the very difficult position in which
Britain was situated and in which Mr. Churchill, the then British
leader, found himself in fighting for the preservation of his country.
Unless Britain and the Dominions had been able to obtain large quantities
of arms and goods from the United States and to take advantage
of the great industrial, financial, and man-power resources of that
country, it is very doubtful whether we could have won the war.
Civilization itself might have been destroyed. The Atlantic Charter,
the Mutual Aid Agreement, the Lend-Lease Agreement and Article
VII. of the trade charter, all arose in the first place from discussions
between President Roosevelt, one of the great men of history, and Mr.
-Churchill. " I do not believe that Mr. -Churchill was ever anxious to have
included in Article VII. any proposals for revision of tariffs.. He
knew that the United States had always looked with strong disfavour
on Imperial preferences, and he knew also that Canada had never been
keen on -contractual Imperial preference obligations. I think I may
thus interpret the utterances of the Prime Minister of Canada, who
has been the leader of that country for a l-ong time, without committing
a political libel. I do not say that he did not believe in some sort of
preference, but it is evident that he has never been enthusiastic about
being bound by contractual obligations.
" President Roosevelt had great political problems in his own
country at that time. For a long time, the policy of a great majority
of the people of the U nited States had been to, ' keep out of Europe
not to engage in any conflict on that continent, either militarily or
otherwise. Therefore, President Roosevelt had to offer to his people
something in return for what was one of the most generous gestures
in history-the provisions of the Lend-tease Agreement and the Mutual
Aid Agreement. On the other side of the bargain, we had a great
leader in Mr. Churchill, who realized the desperate straits of his
country. Re knew that Britain had been selling its foreign securities
to obtain credits, and that this reserve was becoming rapidly depleted.
32
Indeed, Britain had to make its purchases abroad on a cash-and-carry
basis. Mr. Churchill knew that if this situation continued there could.
be only one end-that Britain could not carry on the war. It was very
doubtful at that time whether 60 per cent. of the American people were
in favour of participation in a European conflict. Confronted with
these tremendous problems, Mr. Churchill and Mr. Roosevelt agreed to
insert into the Lend-Lease Agreement the conditions contained in
Article VII. which provided that consideration was to be given after the
war to a general reduction of tariff barriers. No doubt Mr. Churchill.
agreed to that provision reluctantly. At that time Australia was in a
most desperate position, and it had no alternative but to join in the
undertaking given to the United States by Britain. At that time
Britain could not help us because physically it was incapable of doing
so, and it was only because of the volume of aid supplied by the United
States in the form of personnel, aircraft, equipment and services that
Australia was not invaded.
" In the circumstances prevailing at the time the action taken by the
Australian Government was completely justified. Of course, if the
matter had been left to us, we should not have initiated a conference
to discuss the reduction of world tariff barriers, but, as I said
previously, we were bound by a contractual obligation. Moreover,
other factors entered into the matter. Britain desperately needed a
reduction of world trade barriers if its economy were to survive in the
aftermath of war. The Australian Government realized fully the
position of Britain, and because of that, and because of our. contractual
obligation-or, should I say, moral obligation-we agreed to the provisions
of Article VII. of the Lend-Lease Agreement. In any event, the
point of view of some of the other Dominions were opposed to ours.
Canada, for example, was most anxious that a conference to discuss
Empire trade preference should be convened. At that time, responsiblepeople
in Britain, irrespective of their political beliefs, did not believe
that Britain could survive economically after the war unless it could
export more goods into dollar areas; tariff barriers would have to be
lowered to enable it to export to countries outside the Empire so as to
compensate for the loss of its investments. It must be realized that
during the war Britain lost a large number of its overseas investments,
and was importing 50 per cent. of its imports from ' hard' currency,
or dollar, areas. Furthermore, I think that members of the British
Government believe that unless Britain received something similar
to the American loan, which was later granted to it, it would not be
possible to maintain even the lowered standard of living endured by
its people during the war. At that time, it was idle to speculate on
what Canada or South Africa might do after the war; the plain
fact was that unless Britain was to receive a loan such as that made to,
it later, its position would be unthinkable. The terms of the American
loan were not ungenerous. Certainly, they contained provisions with
regard to ' non-discrimination', but it must be remembered that the
President, the Government of the United States and particularly the
.1:
' K1
33
Department of State, had to ' sell the Anglo-American loan to the
American Congress. That loan had also to be approved by the United
States Senate; approval which could not easily be obtained.
" Had that legislation not been passed, I dread to think of the
position in which Britain would be placed to-day, more so when one
remembers the tremendous task of rehabilitation wvhich confronts that
country, and, indeed, the whole of Europe. I go further, and without
wishing to arouse any panic or unnecessary anxiety, I say that if the
legislation to implement the Marshall aid plans' is not enacted the
economic position of Britain will be most difficult before the end of the
present year.
" Australia participated in the International Conference on Trade
and Employment for three main reasons. In the first place, we were
morally obliged to do so because of Article VII. of the Lend-Lease Agreement,
* and in any event, we wanted the benefit of the favorable provisions
of that article. Secondly, the British Government was convinced
that an agreement, such as was eventually reached at the
conference, was absolutely essential to its economic existence, and
finally we had our own privileges to preserve.
I pay tribute to the members of the delegation which represented
Australia at that conference. I am convinced that our representatives
accomplished something really worth while, something at least comparable
with the achievement of the British delegation. It was no easy
task to assist the United States Government to convince its people
that it was justified in doing things for other countries. Australia
has suffered no, real loss as a result of the agreements or the tariff
schedules that will be discussed later. It has played its part in world
affairs and has contributed to the assistance of Britain.
The fact of the matter is that American production to-d-ay is
enormous; it amounts, I understand, to 55 per cent. of the total
secondary production of the world. Because the United States sold
three times as much as it bought, the dollars with which to purchase
the goods it produces are not possessed by other countries. We may
talk of our personal problems, hut it should be realized that the future
welfare' of the masses of the people of this and other countries is to
a large extent wrapped up in the solution of this world economic
problem. Australia can play -only a small part; it can only show
complete willingness to do all it can do to help. It is -all very well
to scoff at theorists and idealists, but many ideas of great benefit to
the world were conceived by people with ideal.
The fact that there seems to be an almost insurmountable barrier
to overcome is no reason why those who lead nations should not attempt
to surmount it. I realize the present situation of Britain probably
as well as any one in Australia, and I know the extent of the economic
i[: ssistance that is needed from * thE. United States. I have an appreciation
of the great difficulties confronting those who govern the rnited
Sotates, which is a country in which there are many conflicting interests
and many pressure groups. Human nature being what it is, there is
f
i 34
much difficulty in obtaining approval to measures such as the Anglo-
American loan agreement and the Marshall plan. In this world one
cannot take all and give nothing. We have not given very much
materially, although we have contributed a great deal through the
industry and ability of our representatives at international
conferences." NATIONAL UNIVERSITY.
VICE-CHANCELLOR.
On 2nd March, 1948, the Prime Minister ( Mr. Chifley) said-
Cabinet to-day approved of the recommendation of the Interim
Council of the Australian National University that the Australian
Minister to China ( Professor D. B. Copland) be appointed Vice-Chancellor
for a period of five years. The appointment is considered
urgent as Sir Howard Florey, Professor M. Oliphant, Professor W. K.
Hancock and Professor R. Firth, who, it is hoped, will be the directors
of the John Curtin School of Medical Research and of the Research
Schools of Physics, Social Sciences and Pacific Studies respectively,
will be in Australia in March, 1948, to confer with the Interim
Council and the Vice-Chancellor with respect to the establishment of
the Research Schools." WHEAT POOLS PAYMENTS.
No. 10 POOL-FOURTH ADVANCE.
On 2nd March, 1948, the Minister for Agriculture ( Mr. Pollard)
announced that a fourth advance of Is. a bushel on bulk wheat and
Is. 3d. a bag on bagged had been approved on 1946-47 crop wheat
in No. 10 Pool. The advance brought the payments in the pool to
7s. 7d. a bushel less freight for bulk wheat and 8s. Id. a bushel less
freight for bagged wheat. SHIPBUILDING.
DIESEL ENGINES.
On 2nd March, 1948, the Prime Minister ( Mr. Chifley) said-
" The Commonwealth Government marine engine works at Port
Melbourne ( Victoria) and Brisbane ( Queensland) were set up during
the war under the Australian Shipbuilding Board for the construction
of marine steam engines. Recently the Minister for Munitions
(. Senator Armstrong) approved of the two works being placed under
the General Manager of the Government Ordnance Factories so that
they might have access to a wider range of manufactures, including
the construction of diesel engines.
Cabinet to-day approved of the Department of Munitions, in
consultation with the Australian . Shipbuilding Board, undertaking
immediately the construction of six 3,000 horse-power marine diesel
engines, of which two are required in 1949 and the remainder at
intervals as may be required by the Board. A sum of œ 750,000 will
be allocated for the purpose. The Munitions Department will open
negotiations for the purchase of manufacturing information and use
of the patents of William Doxford and Sons Limited, of Sunderland,
England. The Munitions Department, in conjunction with the Board, will
arrange for the manufacture of standardized auxiliary machinery at a
value of œ 250,000. Auxiliary machinery includes small power plants
for lighting and ventilating, winches and hoists, steering gear, pumps
and the like." AUSTRALIAN MILITARY FORCES.
AWARDS FOR GALLANTRY.
On 5th March, 1948, the Governor-General announced the following
awards:-Associate of the Royal Red Gross-Lieutenants K. 1. A. Parker
and M. J. Anderson.
INTERNATIONAL WHEAT AGREEMENT.
On 7th March, 1948, the Prime Minister ( Mr. Chifley) said-
" For some weeks past, a special meeting of the International
Wheat Council has been engaged at Washington in the negotiation of
an International Wheat Agreement and advice has now been received
from the Australian representative that agreement has jbeen reached
among the partic ipating countries for submission to governments. The
main proposals of the agreement are-
" The agreement will he for five years commencing from 1st August,
1948. The range of prices will he from a maximum of two dollars a
bushel to a minimum of one dollar ten cent in ' the fifth year of the
agreement. The minimum in the first year will he one dollar fifty
cents, the second year one dollar forty cents, the third year one dollar
thirty cents, and the fourth year one dollar twenty cents. All prices are
on the basis of in store Fort William, Canada.
" Sales will be made between the maximum of two dollars, which
will operate for the whole of the agreement, and the minimumn applying
to each particular year. The Australian equivalents will vary
according to freight rates and whether sales from Australia are made
to nearby or distant markets.
" Under present conditions it is estimated that the Australian
equivalents are: maximum lie. 6d. to 12s. a bushel and minimum
from 6s. to 6s. 6d. a bushel in the last year of the agreement.
" The total quantities covered in the agreement are 500,000,000
bushels per annum, of which Australia's share will be 85,000,000
bushels annually; the other participating exporters being Canada and
the United States with shares of 230,000,00% and 185,000,000 bushels
respectively. Importing countries represented at the conference
numbered 33 and included Britain, India, France, Belgium, the
Netherlands and China.
36
Any wheat which exporters can make available above their share
Sof the 500,000,000 bushels can be sold outside the agreement at any
price which they can obtain on the market.
" The proposals will be placed before the Commonwealth Government
for approval at a very early date, as my information is to the
effect that several of the major importing countries, including Britain,
have already intimated that their governments have agreed and will sign
j the agreement immediately, while other delegates have recommended
acceptance of the agreement to their governments.
When it comes into operation the agreement will assure stability
to wheat-growers for five years ahead."
On 16th March, 1948, Mr. Chifley said-
Cabinet decided to-day that the Australian Ambassador at
Washington be ' authorized to notify approval of the International
Wheat Agreement, subject to ratification by the Commonwealth Government."
CIVIL AVIATION.
AELO-A'UTICAL RESEARCH COUNCIL.
On 9th March, 194S, the Minister in charge of Scientific and Industrial
Research ( Mr. Dedman) announced that an Aeronautical
Research Conference, attended by representatives of the British Commonwealth,
would be held in Australia in April, 1948. The conference
would be the first formal meeting of the British Commonwealth
Advisory Aeronautical Research Council which was set up by Britain
and the various Dominion Governments following a meeting of aeronautical
research workers at London in 1946. The council would
co-ordinate research programmes throughout the British Commonwealth
and plan collaborative programmes. It would act as a central
liaison agency for the dissemination of scientific information on aeronautics,
and the interchange and secondment of scientific staff. The
Professor of Aeronautical Engineering at Sydney University ( Professor
A. V. Stephens) would be chairman of the conference. The
Australian delegates would be-
The Air Member for Engineering and Maintenance of the R. A. A. F. ( Air
Vice-Marshal E. C. Wackett), 3Mr. MI. B. Wnodlfill, of thie Division of Aircraft
Production, the Chief of thie Division of Aero mautics of the Comncil for Scientific
and Industrial Research ( Mr. L. IP. Coombesi.
AERO CLUBS.
On 16th March, 1948, Mr. Chifley said-
In November, 1945, Cabinet approved assistance to aero clubs
b. ubject to review after twelve months' operations.
Cabinet to-day approved of recommendations for assistance for a
period of four years and five months from February 1, 1947, to June
1951, on terms and conditions to be determined by Mr. Drakeford
and to be based generally on conditions originally -approved by
Cabinet.".
i.
37
On 23rd March, 1948, the Minister for Civil Aviation ( Mr.
Drakeford) announced details of increased subsidies to aero clubs.
The scheme would operate from February, 1947, to June, 1951, and
would cost œ 40,000 a year. It was designed to subsidize clubs at a rate
of œ 1 14s. 6d. for every hour flown. That would be achieved as
follows MlAINT1ENAZNcE GRAN-.-Increase from los. to œ 1 anll our for each hour flown.
Previous limit of 200 hours an aircraft was removed, but there would be safeguards
to prevent individual club members from enjoying unlimited pleasure
flying at government expense. For flying away from home base, clubs would
receive 30s. an hour South Australian and Tasmanian clubs would receive
an hour for all flying until 30th June, 1948.
Issua BoNus.-For each new pupil trained to " All licence standard, the
bonus would he increased from œ 50 to For pupils trained in country
centres ( away from base) thre bonus would be raised from œ 60 to œ 90.
B RENEWVAL BoNus.-For each licence renewed an club aircraft, the renewal
bonus would be unchangaed at œ 10 for home base flying and œ 12 109. away from
home base.
RESERVE FOR BRPLACM[ ENT OF AxacmRrF.-The Government would accept a
contingent liability to contribute at the rate of 10s. an hour towards the cost
of replacement aircraft. Clubs would be required to build uip funds for thst
: 1 purpose. ( ror earlier reference, please see No. 108, page 51.)
COMMONWEALTH BANK.
POLICY-ADVANCES.
In Parlia-ment-On 10th March, 1948, the Prime Minister ( Mr.
N Chifley) said-
" The need to restrict the activities of non-essential enterprises must
be apparent. In view of the shortage of labour and materials, it would
hardly be proper to permit the erection of unnecessary structures such
as picture theatres and amusement parks, thus diverting building
materials from more undertakings such as housing. Actually there has
been a substantial increase of bank advances in this country, as I shall
show later by quoting figures. Let me first make this point clear: The
instructions relating to advance policy have been issued at the instance
of the Commonwealth Bank, but I say at once that they have the
endorsement of the Government.
" Cabinet does not interfere with the policy of the Commonwealth
Bank. When the Governor of the Commonwealth Bank put the posituated
by excessive advances, I, as Treasurer, intimated on behalf of
teGovernment that I endorsed the proposal. I say that the instructios
wreissued with the full approval of the Governor of the CommonwalthBank;
that they were discussed with him; and that on
behalf of the Government I agreed with the bank's decision. With
more than 200,000 people required to do essential work throughout
this country, it would be highly undesirable for the Commonwealth
Bank, through the private banks, to facilitate the expenditure of large
sums of money on non-essential enterprises. The aim of the instructions
is to ensure that the increased money being made available in
bank advances shall be directed into -channels which will provide the
greatest benefit to the community.
NT ~ 38
" The fact is that general advances have increased from
œ 200,000,000 to œ 320,000,000 in two and a half years. Since June,
1946, about nineteen months ago, the total has increased by
œ 113,000,000. I emphasize that many trading companies want to carry
on their businesses on bank advances instead of going to the public
and getting the capital necessary for expansion. This is because interest
rates are much lower than they were, and because companies
can secure bank advances more cheaply than they can raise funds in
other ways. There has been a tendency on the part of many firms
to use bank advances even for the purpose of financing capital expenditure,
which ought to be financed by calling up capital from the great
amount of surplus money which is available in the community. There
can be no question that there is an inflationary spiral, not a deflationary
spiral, in the community.
" There has been a great and expanding spiral of advances in this
country. There can he only one ultimate result to such a process if the
money is used for purposes other than the legitimate expansion of
production. An increasing amount of new credit is being made available.
Whether it is made available by the Commonwealth Bank or
by private banks does not matter; the effect with the community is
precisely the same. The instructions were issued in the belief that
the most disastrous thing that could happen to Australia to-day would
he an inflation such as is occurring, in other countries. Inflation is
almost as bad as deflation, because finally it brings about an economic
collapse. Unless the national bank of any country exercises some
control in periods of inflationary trends as well as in periods of deflationary
trends, it does not do justice to the community. It must
take steps to ensure that any unduly inflationary or deflationary movement
is corrected.
The Opposition cannot have it both ways by saying on one day
that there should not be political interference with the banks and then,
on another day, saying that directions as to the administrative policy
of the Commonwealth Bank should come from this Parliament.
The national income for 1947-48 is estimated at œ 200,000,000
more than for 1946-47. The gross value of rural production is estimated
this year at œ 537,000,000, an increase of œ 157,000,000 over the
total of 1946-47. I need not go into details of wage earnings, hilt
their rate is 20 per cent. above the rate for 1945-46. By the end of
IDecember, 1948, it is likely to be 35 per cent. above the rate for 1945-46.
Export prices in December, 1947, were 200 per cent. above the average
level for the period 1936-39. There has been an increase of 44 per
cent, since December, 1946. Wool prices in January, 1948, were 220
per cent. above the 1936-39 level and were even 79 per cent. above the
level which prevailed in January, 1947. Wheat prices in January,
1948, were 400 per cent, above the 1936-39 level and were 94 per cent.
above the January, 1947, level.
" These facts prove that a vast accumulation of money is flowing
into the community. Whether this money comes in the form of wages,
ieturns to wheat-rowers, or in other ways, it is clear that a great
number of. people in the community, instead of engaging in further
speculative business, should be paying off some of the advances, made to
them when there was not so much ready money available in the cornmunity
as there is now. What we are faced with in Australia now is
the opposite of deflation. That is proved by the fact that bank advances
haeincreased by atotal of œ 200,000,000 in two and ahalf
years. As I have often said, control of the Commonwealth Bank, or of
any national bank, subject to over-all government policy, must be exercised
to a fair degree by those persons who are responsible for its
functions. They are in possession of the facts and figures necessary
.1 for their guidance. I have cited some of those figures to-day, and I
consider that what has been done by the bank is very wise in the light
of existing economic circumstances."
( For earlier reference, please see No. 133, page 12.)
TARIFF.
CUSTOMS-BILL INTRODUCED.
In Parliament.-On 11th March, 1948, the Minister for Post-war
Reconstruction ( Mr. Dedman) -introduced the Customs Tariff Bill.
The bill was passed.
( For earlier references, please see No. 132, page 3: No. 134, page
MINING.
RADIO-ACTIVE MINERALS-THORIUM.
On 16th March, 1948, the Prime Minister ( Mr. Chifley) said-
The Bureau of Mineral Resources -has carried out investigations
for some time of beach sands along the coasts of northern New South
Wales and -southern Queensland to assess their value as a potential
source of radio-active minerals. Several companies have been engaged
in processing the sands.
" Cabinet decided to-day that the bureau be authorized to carry
out expenditure to conserve thorium-bearing minerals."
MIGRATION.
ALLIED SERVICEMEN, ASSISTED PAS-SAGES.
On 16th March, 1948, the Minister for Immigration ( Mr. Calwell)
said-Ex-service personnel, with their dependants, who served during
World War II. in the armed forces or merchant navies or resistande
movements of Holland, Belgium, France, Norway and Denmark will
subject to the usual immigration -requirements and security checks, be
eligible for assisted passages. Nationals of Holland, Belgium, France,
Nor-way and Denmark, with their dependants, who served during
World War II. in the armed forces or merchant navies of British
Empire countries or the United States will be included.
Under the scheme, the Commonwealth Government will contributeup
to 40 per cent. of the tourist class fare or œ stg. 30 towards the cost
of the fares of adult migrants and amounts ranging from 45 to 100 per
cent. ( with a minimum of œ 17 10s. and a maximum -of E35) towards
the fares of dependent children."
GOVERNMENT POLICY-ITALY, ROUMANIA, BULGARIA,
IHUNGARY.
On 24th March, 1948, Mr. Calwell announced that, following the
ratification of peace treaties with Italy, Roumania, Bulgaria and Rungary,
it had been decided to modify the policy governing the entry of
nationals of those countries into Australia. At present, only persons
who were the wives, unmarried daughters or minor unmarried sons of
residents of Australia were eligible for admission. Under the modified
policy, Italians, Roumanians, Bulgarians and Hungarians might be
admitted if skilled in undernamed trades or professions, or suited for
and would engage in occupations in which there was a definite shortage
of labour, and came within certain age limits. A system of priorities
would operate-
Persons classed as essential workers, nominated and to be found accommodation
by residents in Australia.
Persons nominated find to be found accommodation by Australian residents,
and to engage in employment which was undermanned.
Single persons without noiiators in Australia, who would engage in
essential employment and for whom accommodation could readily be found.
Certain preferences would apply within the priorities. First preference
would go to migrants who were suited for, and engage in,
rural work such as farm labourers, cane cutters, timber cutters.
Second preference would be granted to those who would be employed in
occupations which would help to relieve the housing shortage such
as the production of building materials and housing construction
projects. Third preference would go to those who would engage in
work connected with national undertakings in rural districts such as
water conservation, electricity projects, road and rail construction.
It would be a condition of admission in every case that the migrant
would engage in the class of work for which he was nominated and
would remain in the dietrict to w~ hich -he was assigned for two years.
At the end of that period, those who proved themselves satisfactory
migrants would be allowed to remain permanently. Any who did not
observe the conditions would be liable to summary deportation.
* DEPARTMENT OF SUPPLY AND SHIPPING.
PROPOSED LEGISLATION.
On 16th March, 1913, the Prime Minister ( Mr. Chifley) said-
" The Supply and Development Act of 1939 constituted the Department
of Supply and Development, its functions being the provision or
supply of munitions; the manufacture or assembly of aircraft or
parts thereof; extension of industries for purposes of defence;
acquisition, maintenance and disposal -of stocks of goods in connexion
with defence; and surveys of Australian industrial capacity and the
investigation and development of Australian sources of supply of goods
necessary for the economic security of the Commonwealth in time of
war. " In 1940, munitions and aircraft production activities were transferred
by National Security ( Munitions) Regulations to a new Department
of Munitions. In 1942, the shipping and associated functions of
the Departments of Labour * and National Service, Commerce and
Agriculture, and Trade and Customs were transferred to the Department
of Supply and Development, the title being altered to that of
Supply and Shipping.
" Cabinet decidcd to-day that legislation be prepared -to amend the
Supply and Development Act to repeal the National Security
( Munitions) Regulations, the effect being to restore the Supply w~
Development ' Act to the position it originally held in 1939."
ROYAL AUSTRALIAN AIR FORCE.
AWARDS FOR GALLANTRY.
On 17th March, 1943, the Governor-General announced the award
of the Distinguished Service Order to Air Vice-Marshal W. D. Bostock.
NATIONALITY,
UNIFORMITY-PROPOSED LEGISLATION.
On 18th March, 1948, the Minister for Immigration ( Mr. Calwell)
announced that legislation would be prepared to confer on Australians
the status of Australian citizenship in addition to, and not as distinct
from, the general status of British subject. The British Government
had introduced the British Nationality Bill in February, 1948, givingeffect
to the principle that the people of each of the self-governing
countries within the British Commonwealth should have both a
particular status as citizens of their own country and a common status
as members of the wider association of peoples comprising the Commonwealth.
In 1946, the Canadian Government had enacted legislation
which came into operation on 1st January, 1947, to provide for the
grant of Canadian citizenship, combined with the maintenance of the
status of British subject. NEW ZEALAND.
VISIT OF NEW ZEALAIND GOVERNOR-GENERAL.
On. 19th March, 1948, the Prime Minister ( Mr. Chifley) said-
" I have extended an invitation, through the Governor-General ( Mr-
Mc~ ell), to the Prime Minister of New Zealand ( Mr. Fraser) for the
Governor-General of New Zealand ( General Sir Bernard Frayberg,
to visit Australia later this year
42
PRICES.
GOODS " DECLARED "-SERVICES, REVOCATION.
On 19th March, 1948, the Minister for Customs ( Senator Courtice)
announced that services supplied or carried on by certain nonproprietary
organizations not conducted for private gain had been
removed from price control. These were-
Services supplied or carried on by a society or association, not being a society
or association carried on for the purposes of profit or gain to the individual
members thereof:-
Registered under the law of a State or Territory of the Commonwealth
relating to friendly societies;
Being a trade union or an association of employers or employees
registered under any Act of the Commonwealth or a State or any
O rdinance of a Territory of the Commonwealth relating to the settlement
of industrial disputes;
Established to promote the development of aviation or of the agricultural
or viticultural or industrial resources of Australia;
Established for musical purposes, or for the encouragement of music,
art or literature;
Established for the purposes of any athletic game or sport, or for the
encouragement or control of any athletic game or sport.
One effcect of the decision would be to remove from control admission
charges to many sporting events, musical shows and other entertainment
and functions but would apply only to events conducted purely for the
encouragement or control of the sport or art. Charges for boxing
matches, cinema and theatrical shows and horse, dog and motor racing,
if run for commercial gain, would still be subject to control.
PALESTI NE.
UNITED NATIONS DECISION-MINISTER'S STATEMENT.
On 22nd March, 1948, the Minister for External Affairs ( Dr.
Evatt) said-
" Decision of a competent international conference should be
accepted after there has been full inquiry and fair debate and a just
settlement has been reached. Accordingly, any setting aside of the
United Nations Assembly decision on Palestine must be closely
scrutinized. It is impossible to examine the new plan in detail because nothing
definite is known about it. It is said that trusteeship will be the new
solution. But the word itself is ambiguous. What does it mean?
It certainly seems to imply that the peoples to be placed under trusteeship
are not sufficiently advanced for self-government. Such a
suggestion would seem to be untenable in relation either to the
Palestinian Arabs or to the Palestinian Jews.
If, however, what is now proposed is a temporary United Nations
trusteeship merely to carry out the Assembly's decisions, it would be a
very different matter. But is that intended?
" The final decision was reached in December, 1947, after two
General Assemblies had dealt most carefully and exhaustively with the
Y matter, after all parties were heard, and after a special commission
43
involving very heavy United Nations expenditure had visited Palestine
and reported in favour of the principle of the plan ultimately adopted in
the Assembly. The plan adopted is inappropriately labelled partition'
because it involves four separate points: first, economic union of the
whole of Palestine under the control of an authority with a majority
of ' United Nations membership; second, political division of Palestine
into two new States, Jewish and Arab; third, United Nations trusteeship
over Jerusalem and Bethlehem; fourth, four safeguards for the
holy places and especially for the Christian churches throughout -the
whole of Palestine.
" The only alternative plan suggested to the Assembly was to
establish a unitary State under Arab domination with no a dequat
safeguards for the protection either of the Jewish peoples or of th'.
Jewish churches. This alternative was plainly inadmissible and was
rejected by an overwhelming majority. The United Nations decision
was reached by more than a two-thirds majority, the only dissentients
being the Arab States and certain nations very closely associated with
them. The decision was just and impartial and must not be lightly set
aside. The United Nations did not intermeddle in the Palestine matter.
It intervened only after the British Government had specially requested
the United Nations Assembly to handle the matter as all previous efforts
at reconciliation between the Arabs and Jews had entirely failed. At
the United Nations, the British Government did not itself propose any
solution and announced it would accept the United Nations decision.
In the circumstances, Canada, Australia, South Africa, and New
Zealand all supported the proposal finally adopted. After all that has
occurred, to throxv the solution into the melting pot again may be very
damaging to the authority of the United Nations.
It has been contended that the enforcement of the Assembly's
decision is not possible. Had the great powers who supported the proposal
at Lake Success, New York, adhered firmly to it, there probably
would have been little difficulty. In any event, under the Assembly's
decision, the new Jewish State and the new Arab States were each to be
entitled to establish its own militia forces for the defence of the new
territories, and this decision clearly carried with it the right of Jews
as well as Arabs to import arms and equipment for the purposes of
defence. It is impossible to pass final judgment on the new proposal because
no one has explained it as yet.
I was chairman of the committee which worked assiduously to
obtain a just solution. The committee repeatedly modified its proposals
at the suggestion of the mandatory power in order that Britain should
be able to withdraw its forces after its long, its thankless, but on the
whole successful development of the Palestine area since it was captured
from the Turks by British and Australian forces in 1918.
44
" In my opinion, the United Nations decision has been graduallyundermined
by intrigues directed against the Jewish people. It would
be little short of a tragedy if the fundamental right of self-government
were to be denied to the Jews and Arabs, as it is guaranteed to them.
under the Assembly decision just as religious freedom is also guaranteed
td the Christian Church throughout Palestine.
The only considerations that influenced the United Nations
Assembly were those of justice and fair dealing to all concerned. It
would be most disturbing if mere consideration of power politics orexpediency
were allowed to detroy the decision. However, if a special
-United Nations Assembly is called, it is hardly likely to accept any new
? Ian which involved a repudiation of the previous decision, unless new
facts of overwhelming cogency are proved to exist. I need hardly add'
that, under the United Nations Charter, the Security Council seem's to
have no power whatever to overrule the recommendation of the-
Assembly ( For earlier reference, please see No. 130, page 37.)
By Autho~ rity: L. F. Jomia ' oN, Commonwealth Governciqent Printer, Chnberm. 7.-