War Savings – Balancing the books of battle

Written by Judith Hickson , Social History Curator, Queensland Museum

The Cultures and Histories Program at the Queensland Museum frequently receives donations that, while seemingly ordinary, provide unexpected opportunities to uncover forgotten pieces of our history and at the same time offer us the chance to re-examine these from a recent and (hopefully) more enlightened perspective.

We were recently given this chance when three war savings certificates were donated to the Museum’s social history collection. Purchased during the final years of World War II by Noel Hill, a Queensland Railways worker, the certificates were donated by Noel’s daughter, Narelle.  The photograph below shows one of the certificates with Narelle’s pencilled name still visible on the top right-hand corner.

War Savings Certificate – JHickson

Few people today would remember war savings certificates, a type of promissory note (a legal document used by financiers primarily for short-term financing) sold to hundreds of thousands of Australians during World War I and World War II.  Through these certificates we can delve into important social and political aspects of people’s lives during World War Two. In this instance, through the lens of finance, we can expose aspects of the way the Australian Federal Government made decisions and administered and applied revenue-raising processes during war time.

The certificates also demonstrate how the lives of Australia’s non-serving civilians were entwined, in ways large and small, with Australia’s overall involvement in the war – to see how ordinary, hard-working people with limited means were induced, both overtly and subtly, to make financial contributions towards the Australian Government’s war effort with the promise, at the same time, to make substantial additions to their post-war savings accounts.

A local lad

Born in 1911, Noel Hill grew up in Brisbane, the fourth of five sons of George and Matilda Hill. A well-known Brisbane boot and shoe seller, George Hill established his first store, ‘Hills’, at Lutwyche and later relocated to Wickham Street, Fortitude Valley. Like many working class women of her generation, Noel’s mother, Matilda, shouldered the duties of home and childcare while also supporting her family’s income by working as a laundress.

Growing up in the Brisbane suburb of Wooloowin amid extended family and community networks, Noel met and later married his childhood friend, Dorothy Emma Myrtle Cummins, in 1926. Both their families attended the nearby Albion Baptist Church.  Noel’s and Dorothy’s long marriage produced six children, Lyle, Leslie, Beverly, Narelle, Bruce and Desmond.

These images of two children in Lever Street, Albion, 1910 and of the Albion Baptist Church, circa 1908, depict the kind of environment and the stage of urban development that were typical of Brisbane at the time Noel Hill and Dorothy Cummins were growing up. Images: John Oxley Library, State Library of Queensland

Dark days

Looming over and overshadowing this happy time for the young couple, the Great Depression of the 1930s caused economic collapse around the world and life for the Hill family, as for so many others, was hard.

In Queensland, the Government created relief work to provide employment. A broad range of public works was carried out in school grounds and parks; swamps and foreshore areas were reclaimed alongside massive drainage projects; around the State, hundreds of miles of roadways were cleared and laid with gravel, metal and bitumen; and, employing relief workers, the Railways Department constructed new branch lines, and re-laid, regraded or reconditioned hundreds of miles of track.

After a prolonged period of unemployment, Noel Hill eventually found relief work at the Moodlu quarry.  Situated on the railway line between Caboolture and Woodford, Moodlu quarry supplied rail ballast for the construction and maintenance of railway lines in the area, particularly the main north/south line north of Brisbane.

A new life

Following his work at the quarry, Noel was fortunate to obtain a position as a fettler for Queensland Railways.  In the late 1930s, he was offered a position as a fettler at Cherry Gully, a small siding on the Warwick-Stanthorpe railway line. One of several major railway lines approved by the Queensland Parliament in 1877 to provide access to mineral fields throughout Queensland, Cherry Gully today is best-remembered today for its 272 metre-long heritage-listed tunnel completed in 1881.

Cherry Gully Tunnel 1882. Image: John Oxley Library. State Library of Queensland

As Queensland was the closest state to the Pacific battlefront and with rail transport the main means of shipping service personnel and military equipment around the country, many troop trains came past Cherry Gully during the war years.

By the end of the war, hundreds of thousands of Australian and Allied soldiers, even enemy prisoners, had travelled millions of kilometres on Australian trains.  Due to wartime secrecy arrangements, railway staff received only about two hours’ notice of the arrival of a troop train.

Farewelling soldiers Brisbane, 1940. Image: John Oxley Library, State Library of Queensland

Noel Hill’s position as a Queensland Railways employee meant that he shouldered an important responsibility towards keeping the rail system well-maintained and in a state of readiness for the increased movement of troops and other military-related personnel.  The Hill family remained at Cherry Gully for the duration of World War Two until 1945 and afterwards moved to the township of Cecil Plains on the Darling Downs.

The Price of War

A pound may seem of little value in today’s world.  However, at a time when the Commonwealth Statistician announced that the average male wage was £4/4s per week, a pound represented a substantial portion of a man’s weekly income. So what exactly were war ‘savings’? And why did so many Aussies like Noel, working hard to support their families, make great sacrifices to invest in a war being waged on the other side of the world?  The answer to this is, as one might expect, rather complicated.

As seventeenth century British economist and politician Charles Davenant laconically observed, ‘the whole art of war is in a manner reduced to money’.

While this astute observation by no means takes into account the extraordinary and heartbreaking human and environmental price of conflict– especially of large-scale world conflicts – it is nonetheless true that, without substantial financial contributions, prolonged warfare would not be possible. It is equally true, that while governments decide why, how, and when to declare war on a perceived enemy, it is, ultimately, their citizens who pay the price on all accounts.  And, despite the evident truth of Davenant’s shrewd remark, few people pause to consider just exactly how the financial accounting for war is tallied and settled.

Beyond our means – raising funds for war

By late 1939, it had become increasingly evident to the Australian Government that the mounting costs of  World War Two would necessitate a range of measures to increase funds. Draft plans for revenue-raising included a comprehensive war taxation programme, the issue of the first war loan and the issue of war savings certificates.

From 18 March 1940, Commonwealth War Savings Certificates (similar to those printed from 1914-1918) were available from over six thousand banks and post offices throughout the country for purchase by the public. The certificates were sold with face values of one, five and ten pounds with the purchase prices (16/-, £4 and £8)  being four-fifths of the face value and set to mature seven years from the date of purchase.  When people purchased these certificates this effectively meant that they loaned the government money to go to war.

War Savings Poster. Image: National Museum of Australia

‘From the pockets of the people’

The Australian government made no secret of their view that the Australian people were to be made responsible for underwriting the cost of the War. ‘It is impossible,’ Assistant Treasurer Fadden declared in May 1940, ‘to make omelettes without  breaking eggs’, thereby defending the Government’s view that any expenditure by the Government on the war  must come ‘from the pockets of the people, as a contribution to the protection of Australia, not only as a nation but also as part and parcel of the British Empire’ and furthermore, that ‘[t]he pockets of the people have to be searched by the Government, and private resources must be utilized’.

The best way to do this, it transpired, was through time-honoured tactics of propaganda, censorship and shaming. Propaganda was aimed at creating fear and hatred against a declared enemy. Propaganda and censorship worked collectively to denigrate foes, to cloud news of losses and to accentuate victories. Censorship, a practice with unequivocal bipartisan support, barred the release of sensitive information to the public but also provoked widespread resentment and criticism among Australians who became increasingly aware and mistrustful of government information.

Intensive publicity campaigns encouraged Australians to donate to the new war loans funds and to participate in whatever work they could do to assist the war effort. Advertisements and articles in newspapers and magazines and government-sponsored radio programs all reinforced and encouraged the new wartime lifestyle and exhorted Australians to practise thriftiness in their everyday lives.

Noel Hill was living nearby when Arthur Fadden reproached his audience at a ‘Win the War’ rally in Warwick in September 1940: ‘If, by your neglect, any one of those lads is denied some little comfort he might have had, it will stand to your eternal shame,’ he concluded, ‘But why should I speak like that to the people of Warwick? As you are proud of what you have done in manpower, so you will be proud of all the other demands that will be made upon you.’

Emphasising the impending threat of invasion was a common tactic used by Government to reinforce the need to give more.  As Treasurer in the Menzies Government in early 1940, Percy Spender, together with his department, was the architect of a strategic ‘investment in victory’ plan urging the public to purchase war savings certificates to combat the ‘peril in which we stand’  from a nation of ‘pitiless… strong … well-armed men’ united in their resolve to overthrow Australia. And this being the situation faced, ‘no cost, no effort, no sacrifice should be too great which could help to ward it off.’

Seventh War Loan: Image: John Oxley Library. State Library of Queensland

With the object of directing large sums into war loans and smaller sums into certificates, the Government initially set a maximum investment of £250 per person (roughly equivalent to about $20,000 today). In appealing to the public, Mr Spender stressed that every certificate purchased was an ‘investment in victory’. In a show of good faith, Prime Minister Robert Menzies purchased No. 1 of each of the denominations of savings certificates for each of his children while Mr Spender followed suit in purchasing No. 2 of each denomination.

From both the government’s perspective and for people on low wages, savings certificates enabled them to make financial contributions to the war effort and were also seen as a useful way to invest small amounts of money.  One of the major incentives to purchase savings certificates was their much higher return than savings held in the Commonwealth Bank on which only 2 per cent yearly interest was paid.

Furthermore, certificates were easily purchased over the counter at issuing centres. There were no complicated forms to complete or documents to sign. If held until maturity, the investments would yield good interest, but if cash was needed urgently, they could be sold beforehand without any difficulty.

Support for raising funds was bipartisan. Even after his forced resignation and from a backbench position, Robert Menzies, in September 1942, did not mince words when he urged the public to give ‘every penny … that you can spare after providing for a modest and decent way of life – and … not for a month or two, but for years.’  Menzies went on to explain that  the twofold purpose was not just  giving money to the government  for war expenditure but that by doing so ‘you will not be spending that money on those competing goods and services  which use up man power and materials urgently and grimly needed for war.’

No Santa Claus!

In 1942, Minister for War Organization of Industry, John Dedman decided to reinforce the need for thrift and to prevent waste of manpower and materials.  Dedman, who subsequently became known as ‘the man who killed Santa Claus’ and ‘Minister for Gloom’, banned the use of words like ‘Christmas’, ‘Yuletide’ or ‘festive season’ in advertising. Furthermore, declaring that Christmas was too ‘commercialised’, Dedman forbade any mention of Santa Claus and asked that adults give war savings stamps and certificates instead of gifts.

War Savings Christmas. Image: Out of copyright

Not all Australian citizens were happy to support Dedman’s ideas. Though acknowledging that austerity was a necessity of the war effort, Dedman’s views were widely met with scorn and derision. In a December 1942 letter to the editor of Truth, a subscriber, A Greyson of Port Kembla, echoed the opinions of many: ‘This wowserism is surely getting the public down. Where will it end? True it is that Mr Dedman and his professional advisers have been baulked over waistcoats, but he is sure to break out again. We are suffering under the Santa Claus ban, the Christmas greetings ban, the travel ban, the pink icing ban, transport of goods ban, and, most idiotic of all, the colour lacquer on tool handles ban. What next?’

War Savings – Really!

From September 1939 to June 1945, Australia spent over two billion pounds on war, more than eight times as much as was spent between 1914 and 1918 equivalent today to almost fourteen billion dollars.  Over half was raised through public loans and war-savings certificates. Amazingly, despite the hardships endured on the home front, not only did people buy war bonds but it was reported in the Canberra Times in October 1945 that Savings Bank deposits had increased by more than £351million during the five years since September, 1940. This sum reflected a tenfold increase in savings from the pre-war figure of just $42million!

Ironically, despite Noel Hill’s hard work and good intentions for his daughter’s future, the three War Savings certificates were never redeemed. Narelle found the certificates in an envelope in a drawer about a year ago.  Now classified by the Australian Office of Financial Management (AOFM) as ‘Overdue Securities’, it is still possible for the certificates to be redeemed  for their allotted face value if they are presented in person to the AOFM office in Sydney. They have not accrued any further interest since their original redemption date and the cost of travelling to Sydney is obviously not a financially viable option for Narelle.

A final reckoning

The twentieth century was both marked and shaped by war and there is no question that the loss of human lives was the greatest cost of all. Of the almost one million Australians who served in the armed forces during World War II, over twenty-seven thousand of those were lost in action or died, while twenty-three and a half thousand were wounded. Over eight thousand prisoners of war died in captivity.  A conservative estimate puts the total number of deaths during World War II at fifty-five million. No economic figuring can compensate for the staggering costs of death, forced human displacement and the health costs of long-lasting and disabling psychological and physical damage to soldiers and citizens alike.

As Australia continues to engage in wars beyond its borders, most of the conflicts entered into today are funded through our taxation system. Documents such as these war savings certificates invite us to pause and to reflect on the larger moral and ethical questions of war and on our roles and obligations to others as both individuals and citizens in the wider landscape of our rapidly globalising world.

Want to know more about our collections? Visit our cultures and histories page. Visit our donation page to learn how you can contribute to our collection, or visit us at the Queensland Museum today!