It seems to me that the principle of this Bill was touched upon only in two speeches—the speech of Senator Johnson and the speech of Senator Douglas. Senator Johnson asked us by what test is this Bill to be judged. It is to be judged by this simple test: that the interests of the Exchequer require that certain moneys should be provided, either by way of economies or by way of taxation, and the Government has decided that, in order to avoid imposing additional taxation on any section of the community, the balance is to be sought by way of economy. I should like to emphasise that because it seemed to me that Senator Johnson thought that the Bill carried with it the implication of a certain social policy. There is no social policy expressed in this Bill beyond the simple one that it is not considered socially desirable to impose additional taxation upon any section of the community in present circumstances. The Senator has endeavoured to associate, I think, with Part III of the Bill, the policy of levelling down and his reason for that is that any economies which may be secured under this section will not immediately and directly inure to the benefit of the Exchequer. Every one of them, however, will indirectly inure to it. There are certain official undertakings whose administrators enjoy a considerable autonomy, but in respect of which the State has had to assume certain financial obligations, obligations either to provide the interest on their capital, as in the case, say, of the Agricultural Credit Corporation, or obligations to ensure that because they do provide a widespread public service, as in the case of the Electricity Supply Board, the extension of this service and its adequate provision will not be hampered by lack of capital.
In circumstances like the present, it is quite possible that the Agricultural Credit Corporation might have to call on the State to meet interest charges on bonds circulated by us, and the State might be called on to fulfil guarantees given in relation to certain issues of that Corporation. I do not wish it to be understood that that is a probability, but, at any rate, it is a contingent liability which this State might, at some time, have to face, and, against it, the State should take whatever steps it can, in time, to secure itself for this year or any other year in which circumstances might be the same as they are at present. One of the ways by which the State can secure itself is to ensure that there will be a reduction in the internal expenditure of that or any similar undertaking which bears the same relation to the State, and it is because we must take care that the liabilities which we have foreseen and have provided for, and the deficiency, the extent of which we now know, should not increase in any way as a result of this Budget, that steps to secure that reduction in internal expenditure to which I have referred must be taken in this Bill. In the same way, if the existing income of the Electricity Supply Board does not permit it to fulfil its obligations under statute to the State, in respect of repayment of its borrowings from the State, and if, as a result of the experience of the last two years, we are satisfied that it is not practicable to increase the price of electricity to consumers, then we must ask the Electricity Supply Board, or any organisation in a similar position, once again to reduce its internal expenditure in such a way as will enable it to meet its obligations to the source from which it has secured its finances, and it is for these reasons, and for these reasons only, and not because the Government has adopted as a principle the reduction of salaries or remuneration, that corporations and bodies of the kind to which I have referred are brought within the ambit of this Bill.
The next question of principle that arises is that which was raised by Senator Douglas—if economies are to be made, is this the direction in which they should first be sought? Senator Douglas said that, if he were in a position to determine the course of the Government in a matter of this kind, he would seek other economies first and cuts last. I think Senator Wilson answered Senator Douglas in that respect with compelling force and very cogent argument. Where are the other economies that I could make? Am I to seek a reduction in the expenditure made for the promotion of agricultural interests in this country, to restrict the activities of the Department of Industry and Commerce, to reduce the old age pensions and curtail the grant for education? Before I could pursue the policy which Senator Douglas suggests that I ought to have pursued, I should, first of all, have to assure myself that there is in respect of every one of these items a considerable amount of wasteful expenditure at present. During the past year we have made every attempt to reduce the Estimates from these Departments. We have refused, in regard to most of them, to sanction an enlargement of Departmental activities even in a way in which those who are most concerned with the efficiency of the Departments and with fulfilling the object for which they were first established have represented to us as being vital and necessary, because we were anxious to secure that there would not be one penny piece of expenditure incurred in this year that could be wisely dispensed with.
I have to ask the Seanad to take that as an assurance given by me as the one that represents the exact position. Economies could not be made in any other way, and at the same time maintain our present services. Accordingly, we are thrown back on this, the only way in which at the present moment economies could be secured. I know that those who take the point of view of Senator Douglas in this matter take it because it has been represented to them that a Bill of this nature will ultimately represent a decrease in the purchasing power of certain sections of the community. I cannot conceive that there are any other economies that we could make that would not result in a reduction of the purchasing power of a much greater number of people: a greater reduction in the absolute purchasing power of the community as a whole. All those who are in receipt of salaries affected by this Bill are in receipt of salaries that do allow for some margin, in many cases a considerable margin, above the mere subsistence level. Therefore, because of the extent of this margin they are not compelled to expend their remuneration to the last penny piece. Many of them are able to make savings, in some cases considerable savings, for which at the present moment there, possibly, is not an attractive or legitimate opening for investment.
In the case, however, of some other people who might be affected if we were to seek economies in other directions: for instance, in the case, say, of those who are in receipt of old age pensions, the pension which they draw from the State is one which barely enables them to exist at the mere subsistence level. Its size is such that they have to spend every penny piece of it. That does represent real purchasing power inasmuch as there is no purchasing power lying fallow, so far as they are concerned. If, therefore, we were to seek economies in that way it must be clear to every one of us that there would be, as I have said, a much greater reduction in the purchasing power of the community as a whole than there is, if there is any reduction at all, when we seek it in this way.
Now as to whether a proposal to reduce the salaries and wages of public servants must necessarily result in a reduction of the purchasing power of the community as a whole, I should like to say that it seems to me that is a contention that cannot be borne out, because these moneys are provided out of taxation. If we are not going to seek to balance our Budget by a measure of this kind, then we have got to balance it by imposing additional taxation. That taxation in the present circumstances of the time would, I am afraid, have to belong to that category which is generally referred to as indirect taxation: a tax upon expenditure which would necessarily result in an increase in prices and, once again, we would have on the part of that section of the community, the very large section to which Senator Johnson has referred which lives upon a mere subsistence level, a considerable reduction in purchasing power which would necessarily eventuate in a very considerable reduction in production in this country and, eventually and ultimately, result in a general decline in the purchasing power of the community as a whole. But we do not propose to follow that course. We propose instead to allow this £270,000 in the pockets of the general taxpayer to remain there: to constitute for them real purchasing power, to enable them, and the poorer classes particularly, to take advantage of the general fall in prices, and to increase the standard of living of the general mass of the people as a whole, and, by doing that, increasing their purchasing power and increasing production in this country.
