Ben Chifley - Prime Minister

Prime Minister

When Curtin died in July 1945, Forde temporarily became Prime Minister for eight days. Chifley defeated him in the leadership ballot and replaced him as Prime Minister and Curtin as Labor leader. Once the war ended a month later, normal political life resumed, and Chifley faced Robert Menzies and his new Liberal Party in the 1946 election, which Chifley won with 54 percent of the two-party-preferred vote. It was the first time that a Labor government had been elected to a second full term. In the post-war years, Chifley maintained wartime economic controls including the highly unpopular petrol rationing. He did this partly to help Britain in its postwar economic difficulties.

Feeling secure in power, Chifley decided it was time to advance towards Labor's objective of democratic socialism. According to a biographer of Chifley, his government embarked upon greater "general intervention and planning in economic and social affairs", with its policies directed towards better conditions in the workplace, full employment, and an improvement in the "equalisation of wealth, income and opportunity". Among other measures, he passed legislation to establish a free formulary of essential medicines. This was successfully opposed in the Australian High Court by the British Medical Association (precursor of the Australian Medical Association) Chifley then organised one of the few successful constitutional referenda to insert a new section 51xxiiiA which permitted federal legislation over pharmaceutical benefits, together with family allowances, benefits to students and hospital benefits, child endowment, widows' pensions, unemployment benefits, and maternity allowances. The subsequent federal legislation was deemed constitutional by the High Court. This paved the way for the Pharmaceutical Benefits Scheme.

Chifley was successful in transforming the wartime economy into a peacetime economy, and undertook a number of social welfare initiatives, as characterised by fairer pensions and unemployment and sickness benefits, the construction of new universities and technical colleges, and the building of 200,000 houses between 1945 and 1949. The achievements of both Chifley's government and those of the previous Curtin Government in expanding Australia's social welfare services (as characterised by a tenfold increase in commonwealth expenditure on social provision between 1941 and 1949) were brought together under the Social Services Consolidation Act of 1947, which consolidated the various social services benefits, liberalised some existing social security provisions, and increased the rates of various benefits.

In addition, tertiary education was also expanded through the funding of Commonwealth scholarships and the establishment of the Australian National University and the Commonwealth Education Office. A Commonwealth Reconstruction Training Scheme was established to provide ex-servicemen with the opportunity to complete or undertake a university education. An interim five-year scholarship scheme was also established to encourage other able students to attend universities and annual grants to the universities to provide the staff and accommodation for the influx of assisted students and ex-servicemen. The Mental Institutions Benefits Act (1948) paid the states a benefit equal to the charges upon the relatives of mental hospital patients, in return for free treatment. This legislation marked the entry of the Commonwealth into mental health funding.

Although it failed in its attempts to establish a national health service, the Chifley Government was successful in making arrangements with the states to upgrade the quality and availability of hospital treatment. The establishment of a Coal Industry Tribunal and a Joint Coal Board (both in 1946) also brought significant gains for miners. Life insurance came to be comprehensively regulated, while a scheme of university scholarships was established. Returned soldiers were provided with a war gratuity and entitlement to special unemployment allowances, loans, vocational training, and preference in employment for seven years. Soldier settlement schemes were better organized than their earlier equivalents, which had brought about a great deal of hardship throughout the Twenties and thirties. The radical reforming nature of Chifley's government was such that between 1946 and 1949, the Australian Parliament enacted 299 bills, a record at that time.

Chifley and his ministers were able to ensure that Australia's wartime economy was managed effectively and that post-war debts were minimised. In addition, ex-service personnel were eased back into civilian life (avoiding the hardship and dislocation that had occurred after the end of the First World War), while a series of liberal measures were carried out which bore fruit during the economic boom of the Fifties and Sixties. As noted by one historian, Chifley's government "balanced economic development and welfare support with restraint and regulation and provided the framework for Australia's post-war economic prosperity." In 1947, Chifley announced the government's intention to nationalise the banks. This provoked massive opposition from the press, and middle-class opinion turned against Labor. The High Court eventually found Chifley's legislation to be unconstitutional. Chifley's government did, however, succeed in passing the Banking and Commonwealth Bank Acts of 1945, which gave the government control over monetary policy and established the Commonwealth Bank as Australia's national bank.

In the winter of 1949 a prolonged and bitter strike in the coal industry caused unemployment and hardship. Chifley saw the strike as a move by the Communist Party to challenge Labor's place as the party of the working class, and he sent in the army to break the strike. Despite this, Menzies exploited the rising Cold War hysteria to portray Labor as soft on Communism. These events, together with a perception that Chifley and Labor had grown increasingly arrogant in office, led to the Liberal election victory at the 1949 election. While Labor won an additional four seats in a House of Representatives that had been expanded from 74 seats to 121 seats, Menzies and the Coalition won an additional 48.