INTERPRETATION ACTIVITY ON THE ECONOMY - ANSWER KEY

1. What were the main features of the National Economic Plan?

  • pegging wages and profits;
  • closing non-essential industries; and
  • taking control of manpower.

The aim was to have uniform national control to enable the government to raise the necessary money to prosecute the war effectively.

2. How did the Federal Government persuade the States to give up their income tax collecting powers during the war?

The Federal Government promised to compensate the States for the loss of revenue. It did this by providing a series of social welfare measures including widows pensions.

3. What evidence is there that not every State was happy to pass this taxation power over to the Federal Government.

Four of the States challenged the Commonwealth powers in the High Court of Australia.

4. What long term changes occurred in banking as a result of the war?

The Commonwealth Bank became Australia's central bank, thus creating a centralised and controlled banking system for Australia. The Commonwealth Bank's role was confirmed in legislation in 1945.

5. What was the key principle on which Australia's post-war reconstruction was based?

The key principle was full employment.

6. What school of economic thought did the Curtin Government follow in its White Paper of 1945?

The Curtin Government followed Keynesian economic principles in developing its 1945 White Paper.

7. Study this photograph from the exhibition showing the Commonwealth Bank in Forrest Place, Perth, taken about 1950.

a. How is banking today different from what you can see in this picture?

  • There are more people in the bank than you would expect to see today. Most banking had to be done in person at the bank in the 1950s while today a lot of transactions are done by phone, internet, EFTPOS, ready teller machines, etc.
  • Many people are filling in forms at the bank. Today many transactions are processed electronically without the need for paper forms.
  • People appear to be quite well dressed for their visit to the bank, or to the city in any case. (This was the major Commonwealth Bank for Perth.) People today dress more casually to bank or shop.

b. Are there any ways in which banking today is similar to what you can see in the picture?

  • Note the glass 'cages' and grills that protect the tellers in the 1950s photograph. Security is still important in today's banks and the staff are usually separated from the public by a range of security devices as well as having cameras and other security measures in place.

8. In 'the WAY AHEAD' cartoon, what does John Curtin say will be Labor's peace time aim?

Curtin says that 'Social security must be our peace time aim'.

9. When did planning begin for the post-war period?

Planning began from early 1942

10. How did the Commonwealth Government gain dominance in finance and taxation?

The Uniform Tax Act of 1942 gave the Commonwealth power over taxation and finance. The States agreed to hand these powers over for the duration of the war but they never regained these powers when the war ended.

11. What power did 'tied grants' give the Commonwealth Government?

Under Section 96 of the Constitution, the Commonwealth gave the States money in the form of 'tied grants' but the money had to be spent as the Commonwealth required.

12. What changes to government powers were ratified by the referendum of 1946?

The referendum ratified the Commonwealth Government's power over matters relating to welfare provision.

14. List at least four of the welfare provisions that were available to Australians by the end of the 1940s.

  • aged pensions
  • invalid pensions
  • rehabilitation services
  • unemployment benefits
  • funeral benefits for pensioners
  • benefits for university students

15. The Curtin and Chifley Governments paved the way for Commonwealth involvement in a number of key areas. Name at least three of these.

  • tertiary education
  • roadbuilding
  • urban development
  • establishing a national health scheme for medical, hospital and pharmaceutical benefits

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