Federal treasurer William Higgs brought down a war budget taxing those who profited from the conflict

A CENTURY ago people waited anxiously wondering how the Federal Treasurer William Higgs (left) would balance the budget in desperate times.

William Higgs in a portrait photo taken in about 1910-1916.

WHEN Labor’s Federal Treasurer William Guy Higgs stood up in parliament to deliver his budget speech a century ago, people were expecting most of it would focus on the war. It was less than two years since the war began and while the economy had been given some stimulus, it was clear that if the war continued much longer there would be an increasing shortfall between war expenses and existing revenue.

Higgs’ budget would be an attempt to find more money to pay for the conflict. He proposed raising £50 million in government loans as well as taxing war profits at 50 per cent. He argued that “People who make huge profits as the result of the calamity should not begrudge half their excess profits to lighten the burden on those who are not so fortunately circumstanced.” The British had already introduced a 50 per cent tax rate on war profits the year before so there didn’t seem to be any major reason not to do the same.

Although there were complaints from the opposition that the tax was overly complicated and one joked that it would “increase barristers’ profits” as people thrashed over the legal details, the measure was generally seen as fair.

William Higgs in a portrait photo taken in about 1910-1916.

It was Higgs’ first federal budget, and while opinion of his effort seemed to be favourable, it would be his last. Before the end of the year a rift developed between Higgs and Prime Minister Billy Hughes that would see him resign.

Higgs was a former radical firebrand who had made his way into politics through the union movement and become one of the pioneering Labor politicians who made their mark on politics at the beginning of the 20th century.

Born in Wingham in 1862, he was the son of a Cornish-born shopkeeper father and an Irish-born mother. His family moved to Parramatta in 1869 and he went to public schools before leaving school at the age of 13 to take up a printing apprenticeship.

He worked at John Sands & Co. before a stint with the Daily Telegraph and then working as a compositor on the Sydney Morning Herald. In 1882 he joined the NSW Typographical Association later becoming its full-time paid secretary. He became an active unionist, firmly believing in the possibility of “Socialism in our time” a slogan attributed to him.

He resigned as secretary of the union in 1889 to try to gain entry to NSW parliament as a member of the Labor Party. Failing that he made other attempts to enter politics finally winning a seat on Brisbane City Council in 1899 and then becoming a Federal Senator for Labor in Queensland in the 1901 election. He lost his senate seat in 1906 so returned to Sydney where he started his own auction business and later found work as a government consultant until he won election to the House of Representatives in the seat of Capricornia in April 1910.

Prime Minister Billy Hughes gives a rousing conscription talk at Martin Place, Sydney, in 1916 during World War I.

Already well respected in the Labor Party, he carried some clout and had high ambitions. In 1913 after Labor’s defeat at the Federal election he unsuccessfully challenged ousted PM Andrew Fisher for the leadership of the Labor Party. Fisher became PM again in 1914 but later resigned due to poor health leaving the ambitious Billy Hughes to take over. Hughes appointed Higgs treasurer. When his first budget rolled around Higgs had his work cut out for him.

With no end to the war in sight, Higgs had the task of trying to make ends meet by proposing war loans and taxing those profiting from the war. While Higgs was trying to balance the books here, Hughes was over in Britain. Without consulting his parliament the PM was spending government money in England commissioning the building of a fleet of ships to transport Australian cargoes (primarily wheat) to Europe. They would become the core of a state-owned shipping line. Higgs complained about Hughes failing to pass his initiative by cabinet.

Hughes returned to Australia in July, fixed on the idea of introducing conscription, again without consulting his cabinet. In October Higgs resigned as treasurer, joining the anti-conscriptionists within the party opposed to Hughes.

When Hughes then left the Labor Party, taking his pro-conscription supporters with him, Higgs was left behind with the rump of the party. In 1918 he was elected deputy leader and continued to oppose Hughes.

In 1920, however, Higgs supported Hughes in his quest to increase federal powers over industry and commerce and was ejected from Labor. He later joined the Nationalist Party.

He died in 1951.

Originally published as Federal treasurer William Higgs brought down a war budget taxing those who profited from the conflict