The centre of the controversy was the Premiers' Con- ference
at Canberra. On the opening day,. Friday, February 6th, Mr. Scullin revealed how far he had fallen away from the Niemeyer plan—which, though simple, is, of course, extremely severe—by arguing that the immense decline in the revenue proved that the retrenchment sug- gested by Sir Otto Niemeyer could not be accomplished at once. The essential need was the revival of industry. Then the task of restoring equilibrium to the Budget would be lightened. He did not approve of " relief works " which were wasteful, but he declared that economically sound work for creating employment should be under- taken as soon as possible. He pointed out that the short term indebtedness of the Commonwealth and the States at the end of February was more than £55,000,000. Of this a little more than £38,000,000 was owed to London. The Commonwealth Government submitted no proposals to the Conference, and the scheme of the experts' Com- mittee for reducing public expenditure by £15,000,000 over a period of three years was disavowed both by Sir Robert Gibson, the Chairman of the Committee, and by the representative of the Commonwealth Government.
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