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McFarlane, Stuart Gordon (1885–1970)

by Selwyn Cornish

This article was published in Australian Dictionary of Biography, Volume 15, (MUP), 2000

Stuart Gordon McFarlane (1885-1970), public servant, was born on 4 May 1885 at Maldon, Victoria, ninth child of John James McFarlane, a draper from Ireland, and his English-born wife Jane, née Matthews. Stuart attended Bairnsdale State School and later acquired accountancy qualifications in Melbourne. In June 1903 he was appointed to the finance branch of the Commonwealth Treasury, on the same day as (Sir) Harry Sheehan. McFarlane transferred to the Postmaster-General's Department in 1911: he served as chief ledgerkeeper in Melbourne, and then as accountant in Perth (1920), Brisbane (1921) and Melbourne (1925). From 1916 to 1919 he had been seconded to the Department of Defence as chief inspector of finances, and had held the ranks of major (1916) and lieutenant colonel (1917). In 1920 he was appointed M.B.E. At St Stephen's Catholic Cathedral, Brisbane, on 1 May 1923 he married Mary Grace McDermott (d.1952), a 36-year-old masseuse; a second wedding took place on 4 May at the Presbyterian Church, Clayfield.

With his reputation for financial prudence secured, McFarlane resumed his career in the Treasury in 1926. That year he was appointed accountant and promoted assistant-secretary (finance). Appearing before the Commonwealth Parliamentary Joint Committee of Public Accounts in 1930, he opposed Tasmania's request for increased financial assistance on the ground that adverse economic conditions were affecting every State. In 1934 he gave evidence to the Commonwealth Grants Commission on submissions by South Australia, Western Australia and Tasmania for additional help; dismissing the argument that their budgets had deteriorated because of the Financial Agreement of 1927, he rejected the States' claims. When Sheehan was promoted secretary to the Treasury in 1932, McFarlane became second-in-charge as assistant-secretary (administrative). He was appointed secretary of the Australian Loan Council and of the National Debt Commission.

McFarlane had made an 'outstanding' contribution to the premiers' conferences in 1931. E. G. Theodore recorded that cabinet regarded him 'as a valuable officer' whose services were 'indispensable' to the Treasury. In 1933 McFarlane was appointed C.M.G. Fixing his sights on the post of Commonwealth auditor-general, he informed R. G. (Baron) Casey in 1935 that his health had deteriorated due to the mental and physical strain of his duties during the Depression. Casey persuaded him to take the post of official secretary and financial adviser to S. M. (Viscount) Bruce at Australia House, London, in April 1936. McFarlane returned to Australia in early 1938 and was gazetted on 24 February to succeed Sheehan as secretary to the Treasury. For six months in 1941 he was also secretary of the Department of War Organization of Industry.

Although McFarlane was respected as a competent administrator and accountant, his austerity—deriving perhaps from a Presbyterian background—and inflexible nature won him few close friends. His failure to understand the new doctrines of J. M. (Baron) Keynes led the government to appoint professional economists as advisers to the Treasury, among them L. F. Giblin and H. C. Coombs. Following the outbreak of World War II, the treasurer (Sir) Percy Spender rejected McFarlane's advice to raise taxes to fund war expenditure, accepting instead the recommendations of the economists to draw upon under-employed resources.

McFarlane's opinions on aspects of planning for the postwar period, including the 1945 white paper on full employment, also conflicted with the ideas of the government's principal advisers. He took the view that the government should concentrate its efforts on winning the war before directing its attention to peacetime utopias. Moreover, he criticized drafts of the white paper for including controversial statistical projections and failing to acknowledge that wage and balance-of-payments pressures would inevitably accompany full employment. Perhaps his most enduring contributions were his formation of the Treasury's general financial and economic policy section in 1943, and his reorganization of the department in 1946.

In January 1948 McFarlane was appointed Australian executive-director of the International Monetary Fund and of the International Bank for Reconstruction and Development, Washington, where he took a particular interest in discussions on currency convertibility, the devaluation of sterling-area currencies in 1949, and the price of gold. His appointment expired in 1950 and he came home to Australia. After his retirement that year, he led a quiet life in Canberra. He played golf (intermittently) and bowls (regularly), and held directorships of several companies, including Anglo-Oriental Tin Consortium and Wormald Bros (Aust) Pty Ltd. In one of his incisive articles in the Australian Financial Review he suggested that inflation in the early 1950s stemmed more from excessive domestic demand than from international factors, such as the boom occasioned by the Korean War.

McFarlane was tall, lean and slightly stooped, with a tendency to move slowly 'as if conserving his breath before the final assault on Mt Everest'. He appeared aloof, melancholy and anxious, his tendency to anticipate the worst earning him the appellation of 'Misery Mac'. Yet he was mentally sharp, loyal, and dedicated. He was also discreet and introspective, and remained an enigma to his associates. Sir Henry Gullett regarded him as 'one of the most modest men in Australian officialdom' and Spender was impressed by McFarlane's 'affable personality'. On the other hand, Sir Frederic Eggleston saw him as 'shrewd, even cunning, a typical departmental officer, arrogant to outsiders, but able to get some sort of power over his Minister in the old bureaucratic manner'. Coombs echoed Eggleston's opinion when he wrote that McFarlane possessed a 'subtle, even devious mind and an intuitive sense of the line of argument likely to prove persuasive with Treasurers of different temperaments and political prejudices'.

On 9 June 1958 at St James's Anglican Church, Sydney, McFarlane married Evelyn Mary, née Bray, the 69-year-old widow of J. A. Perkins. Survived by the son of his first marriage, he died on 2 November 1970 in his home at Forrest and was buried in Canberra cemetery with Presbyterian forms.

Select Bibliography

  • P. Spender, Politics and a Man (Syd, 1972)
  • H. C. Coombs, Trial Balance (Melb, 1981)
  • S. Cornish, Full Employment in Australia (Canb, 1981)
  • G. Whitwell, The Treasury Line (Syd, 1986)
  • Herald (Melbourne), 16 Feb 1939
  • F. W. Eggleston, Confidential Notes: Some Great Public Servants (manuscript, Australian National University Library)
  • A1939/1, McFarlane, S. G. (National Archives of Australia).

Related Entries in NCB Sites

Citation details

Selwyn Cornish, 'McFarlane, Stuart Gordon (1885–1970)', Australian Dictionary of Biography, National Centre of Biography, Australian National University, http://adb.anu.edu.au/biography/mcfarlane-stuart-gordon-10951/text19461, published first in hardcopy 2000, accessed online 13 December 2018.

This article was first published in hardcopy in Australian Dictionary of Biography, Volume 15, (MUP), 2000

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