900 THE FEDERATIONS AND THE UNION [PART IV
further conditions in favour of an early taking over of debt
and the creation of a Council of Finance which should
control a sinking fund and decide as to new loan issues,
whether for state or Commonwealth. Parliament was to
appropriate annually the amount required to pay interest
and charges on the debt, £8,753,000. The Commonwealth
would be recouped out of surplus revenue plus any addi-
tional payment necessary, diminishing after five years
according to a sliding scale, and ceasing altogether in thirty
years. A state which made default was to be liable to a tax,
on a certificate of the Council of Finance, and the Council
could suspend its powers of borrowing for ten years. At the
same time the states were to hand over gratis the transferred
properties. The first payments were to be £2,753,000,
and the surplus revenue credited, which at first would be
£6,000,000, would have been raised to £6,568,000 in 1920-1,
and when in thirty years the debts were extinguished
the Commonwealth would in effect be paying the whole
£8,753,000 a year. This scheme had the obvious merit of
settling and separating the revenues of the two bodies, but
the states complained that it deprived them of future in-
sreases of revenue from customs and excise, and said they
must have a fixed annual sum and a proportionate part of
all increases of revenue! In March 19092 the conference
ceassembled at Hobart, when Mr. Fisher attended but made
no proposal. It was then suggested that the Commonwealth
should return three-fifths only of the revenues from customs
and excise, with a minimum of £6,750,000, and the arrange-
ment was to be perpetual, and not to be altered without
an amendment of the Constitution. The distribution was to
be on a per capita basis with a special allowance of £250,000
a year to Western Australia, to diminish by £10,000 a year.
Mr. Fisher referred to his proposal in his political speech at
Gympie in March 1909,2 when he pointed out that the surplus
revenue thus placed at the disposal of the Common-
wealth would be only £1,313,000, which was inadequate to
+ Commonwealth Parliamentary Papers, 1908, No. 44.
Thid.. 1909. No. 48. See also Nos. 23, 44, 50. * Argus, March 31, 1909.
