House of Representatives
24 July 1903

1st Parliament · 2nd Session



Mr. Speaker took the chair at 10.30 a.m., and read prayers.

page 2594

QUESTION

METROPOLITAN TELEPHONE EXCHANGES

Mr F E McLEAN:
LANG, NEW SOUTH WALES · FT

– I wish to know from the Minister representing the PostmasterGeneral if the paragraphs which have recently appeared in the press, stating that no steps will be taken daring this financial year for the reconstruction of the telephone systems of Sydney and Melbourne, have the authority of the Government? If those statements are correct, I would ask the honorable gentlemanwhat steps are being taken to put the telephone exchanges of the two capital cities of Australia into efficient working order? If there is no intention to improve the service, will the Government consider the advisability of reducing the exceedingly high rates now charged for a very inefficient service ?

Sir PHILIP FYSH:
Minister (without portfolio) · TASMANIA, TASMANIA · Free Trade

– The inquiry which the honorable member has made has been anticipated by me, and when the Estimates are under consideration I shall have something to say on the subject. It is, however, impossible to provide metallic circuits - and it is, I presume, of the absence of metallic circuits that the honorable member complains - out of revenue ; that work oould be undertaken only out of loan. funds.

Mr.F. E. McLean. - I was referring to the reports which have been made on the system by experts.

Sir PHILIP FYSH:

– I have not had. them specially brought under my notice.

page 2594

QUESTION

STATISTICAL RETURNS

Mr L E GROOM:
DARLING DOWNS, QUEENSLAND · PROT; LP from 1910; NAT from 1917; IND from 1931; UAP from 1934

– Is it the intention, of the Government to publish the usual, statistical returns for each of the States,, showing their . exports and imports? Ifso,. when are they likely to be published?

Mr KINGSTON:
Minister for Trade and Customs · SOUTH AUSTRALIA, SOUTH AUSTRALIA · Protectionist

– I cannot tell the honorable member when they are likely tobe published, but there is no intention todepart from the usual practice until a betterone can be substituted.

page 2595

PAPER

Sir EDMUND BARTON laid on the table

Further correspondence relating to an agreement .between the Government of the Commonwealth and the Eastern Extension Telegraph Company.

page 2595

QUESTION

EASTERN EXTENSION TELEGRAPH COMPANY’S AGREEMENT

Sir EDMUND BARTON:
Minister for External Affairs · Hunter · Protectionist

– I move -

  1. That this House ratines an agreement entered into between ‘the Government of the Commonwealth and the Eastern Extension Company, a copy of which was laid on the table of the House on Thursday, 2nd July.
  2. That this resolution be communicated to the Senate, with a request for its concurrence therein.

Honorable members will see that in the motion of which I gave notice I used the words “authorizes and ratifies.” Those words were adopted under the following circumstances : The signature of Mr. Warren, the general manager of the company in Australasia, was put to the agreement when the terms had been settled between him and myself and approved of by his board in London, to mark the fact that those terms had been approved of. At the time there was, and there is still, some doubt as to whether his power of attorney covered the authority to sign an agreement of this nature, and therefore we decided to have another agreement executed by the” board in London, signing this agreement in the ‘ meantime in order that the terms might be fixed, so that there should be no departure from them. Since then we have received an agreement signed by the London board, to which the seal of the corporation is affixed. I used the word “ ratifies “ in order to cover the signing of the agreement, and the word “ authorizes “ to meet the event of the motion being proceeded with before we received the second agreement from London. Now that the second and final agreement has been received from London, I have omitted the word “ authorizes,” and I therefore wish the motion to read as I have moved it. In moving this motion this morning I desire to explain that I do so only to put honorable members, so far as I can, in possession of the facts and circumstances relating to the agreement which it ratifies. I have no wish to force the House to vote upon it to-day, though I should be glad if any honorable member who is ready to speak will favour us with his opinions upon it. There are, however, honorable members who are absent whose claims to speak upon a question such as this I cannot ignore, while other honorable gentlemen will require further time for consideration. Therefore, I shall content myself with putting before the House as clear a statement of the position as I can make, and then, if no other honorable member is ready to continue the debate, will consent to its adjournment until another day. It will be within the recollection of the House that, prior to the Postal and Telegraph Departments of the States being transferred to the control of the Commonwealth, there were in existence four agreements between as many of the States and the Eastern Extension Telegraph Company. Those agreements were in respect to the cable which the company had constructed to connect Australia with South Africa, and to thus provide a new and more direct means of communication with England and other parts of the world. The New South Wales agreement was signed only a few months before the Postal and Telegraph Departments were transferred to the Commonwealth, but its terms were the same as those of the other agreements. I refer more particularly to it, however, because there has been considerable controversy as to whether it was a just and proper agreement for a State which was a partner in the Pacific cable to make. The agreement which this Government has made on behalf of the Commonwealth has been attacked upon grounds which seem to me to apply only to the action of the New South Wales Government, and to have no application to our action in basing a new agreement upon the condition of things which we found in existence when we took control.

Mr G B EDWARDS:
SOUTH SYDNEY, NEW SOUTH WALES · FT

– That is the whole controversy.

Sir EDMUND BARTON:

– Yes ; and inasmuch as it is a controversy which is being carried 05 from the other end of the world, and particularly from Canada, I think it is but just to those who have made attacks upon our action to say that- they are probably confounding the rights and wrongs of the matter as they apply to the action of New South Wales with the rights and wrongs of the matter as they apply to our action. The agreements to which I have alluded were in existence when the Commonwealth took over the Postal and Telegraph Departments of the States, and their terms amounted to these : The States concerned received reduced cable rates on a sliding scale in return for granting to the company the right to establish offices of their own in the respective capitals of those States, and to have direct communication with the public, instead of receiving and delivering telegrams only through the Government offices.

Sir William McMillan:

– The company was permitted to bring its wires into its city offices.

Sir EDMUND BARTON:

– Yes. I call the attention of honorable ‘ members to the fact that the agreement was practically perpetual, and could be rescinded only with the consent of both parties, so that, if the company had chosen to stand out, the States were bound to the existing state of things until the crack of doom. How those responsible came to enter into such an agreement is not for me to say, nor shall I criticise their action, but inasmuch as the obligations of the Postal and Telegraph Departments of the States devolved upon the Commonwealth upon the transfer of those Departments to ite control on the 1st March, 1901, the agreements had then to be accepted by this Government, with the onerous burden in perpetuity in respect to the matters to which they related. But if we look at the development of cable communication, and the advance of electrical science in respect to means of communication other than by cable, the unsuitability of a perpetual agreement of this kind is all the more apparent. Within the first 3’ear after the taking over of the Postal and Telegraph Departments by the Commonwealth, it came to be considered whether it would not be desirable to substitute for the four agreements one agreement applying to the whole Commonwealth, and to get rid of the onus of a perpetual obligation.

Sir Malcolm McEacharn:

– Which were the four States which entered into agreements with the company 1

Sir EDMUND BARTON:

– The States of South Australia, Tasmania, and Western Australia first entered into agreements with the company, and afterwards the State of New South Wales, which was a partner in the Pacific cable, followed their example. It will be remembered that the States of

Queensland, New South Wales, and Victoria participated in the obligations of the Pacific cable to the extent of two-eighteenths each, so that when their respective obligations devolved on the Commonwealth, we became a partner in that cable, whether we would or not - although, personally, I am a strong believer in it - to the extent of a third share, and are thus the largest shareholder in it.

Sir William McMillan:

– The New South Wales authorities resisted the proposals of the Eastern Extension .Telegraph Company for a considerable time. They were only agreed to by a Ministerial act in a very peculiar way.”

Sir EDMUND BARTON:

– The New South Wales Government signed the agreement shortly before the transfer of the Postal and Telegraph Departments of the States to the Commonwealth. That Government held out for some time, but at last it seemed to be convinced that it was a wise and proper thing to follow the example of the three States which had already signed the agreement, an action which, as I have said, I do not feel justified in criticising. We are not concerned as to whether New South Wales acted properly or with wise policy in entering into the agreement with the Eastern Extension Company. Our position is that we found an agreement in existence with New South Wales, as’ well as with three other States, and even though that agreement might prove onerous to the Commonwealth there was no means of escaping it. We also had to become responsible for the Australian obligations in respect to the Pacific cable. Therefore” the Commonwealth, whilst having the advantages of both agreements in a certain degree, found itself between two fires with respect to the advocates of both of them.

Mr HUME COOK:
BOURKE, VICTORIA · PROT

– Does the new agreement prejudice the Pacific cable ?

Sir EDMUND BARTON:

– So far from prejudicing the Pacific cable, the limitations imposed by the agreement will prove distinctly advantageous to it. One of the strongest advantages claimed for the Pacific cable is that it establishes an “- all red “ line. One of the advantages claimed for the Cape cable also, which belongs to the Eastern Ex. tension Company, is that it establishes an all British line, vid the Cape of Good Hope. That advantage, whatever it was, or whatever flowed from it, also accrued to the Commonwealth upon the 1st March, 1901, together with a reduction of the prices for messages upon a sliding scale ; so that telegrams which were at one time charged for at the rate of 9s. 4d. can now be sent for 3s. per word. I am now speaking of the ordinary rates, upon which the Government and press rates depend. In addition to this we had the prospect, in the event of a large increase of traffic, of a further reduction of rates to 2s. 6d. per word.’ Now that the two cables are in competition, however, I take it that we may be rather more tardy in reaching that point than would otherwisehave been the case. Within three months after the Commonwealth came into existence it found itself, according to the varying views which may be entertained by honorable members, saddled with, or benefited by, both these^ agreements. In respect of one of the agreements, we were impressed with the onus of it as regards four States, whereas, in respect to the Pacific cable, we were impressed with the onus of it as regards three States only. We were further embarrassed by the fact that one State was a participant in both agreements. This was, of course, a difficult position, and inasmuch as an opportunity was offered to make an agreement applying to the whole Commonwealth in substitution for the old one - without making such alterations in respect to the four already existing participants as to change its character as a transferred service - we took advantage of it. Being impressed with the necessity of making a fresh agreement with the Eastern Extension Company, the reasons for which I have now made clear to honorable members, we set about negotiations. Athough the advantage to be secured by the new agreement to the State most concerned - Victoria - was a considerable reduction of rates, our main object was to secure the abolition of the perpetuity clause, in return for the extension of the agreement to the whole of the Commonwealth. Victoria had declined to become a party to the agreement with the Eastern Extension Company. Although they entered into negotiations, and at one time went within an ace of joining the other States in their arrangement with the company, nevertheless, the Government of Victoria, with, my honorable colleague the Treasurer at their head, finally declined to enter into the agreement. Therefore, Victoria and Queensland stood out as regards the Eastern Extension Company. Queensland ma)-, for the purposes of this agreement be largely left out- of consideration, not out of any ‘disrespect to her, but because the bulk of her business will be done with the Pacific Cable Company, and therefore neither the burden nor the benefit of the contract with the Eastern Extension Company will be material to her. The inequality which the state of things I have mentioned set up pressed very heavily upon the Victorian mercantile community. It is true that bef6re the institution of the Eastern Extension Company’s agreement the ordinary rates had been reduced from 9s. 4d. per word to something over 4s. per word - if I remember aright, the rate was 4s. 7d. per word. But Victoria was excluded from the benefit of the agreement, which brought the rate down to 3s. per word, and in that, respect her mercantile community thought they were hardly treated. Several petitions were . signed, and over 500 Melbourne merchants urged us td place Victoria on the same footing as the other States. I have adverted to one at least of the objectionable features of the agreement concluded between the Eastern Extension Company, and four of the States, namely, New South Wales, Western Australia, South Australia, and Tasmania. I refer to the perpetuity clause. If no other reason had existed for making an agreement with the company applying to the whole of the Commonwealth, there was the cogent reason that we could not be left in the position of establishing, as to four of the States, a perpetual bond.

Sir William McMillan:

– Could we legally enter into a perpetual bond ?

Sir EDMUND BARTON:

– Parliament has the power of annulment of any bond, but assuming that’ Parliament kept faith, the bond would be perpetual.

Mr L E GROOM:
DARLING DOWNS, QUEENSLAND · PROT; LP from 1910; NAT from 1917; IND from 1931; UAP from 1934

– Did the bond confer any exclusive privileges?

Sir EDMUND BARTON:

– No, except so far as I shall mention. The agreement now proposed is very much the same as that now in force, except that it does away with, the perpetuity clause, and provides for a reduction of rates. The old’ agreement gives the Eastern Extension Company certain privileges as to the use of special wires, and, so far. as it may be continuous, but in no other sense, the privilege to use the wires is perpetual.. Now the use of the special wires is limited by the term of the new agreement - which, as I shall show, is for ten years, with two years’ notice after the expiration of the ten years.

Sir Malcolm Mceacharn:

– Suppose that the new agreement were not ratified, would the present arrangement be canveiled 1

Sir EDMUND BARTON:

– If If this agreement is not ratified by the House - and it was entered into subject to Parliamentary approval - I take it that the existing agreement would continue in force.

Mr F E McLEAN:
LANG, NEW SOUTH WALES · FT

– Were the existing agreements ratified by the various Parliaments 1

Sir EDMUND BARTON:

– I am not prepared to say ; they may have been in some cases ; but, in entering into an agreement of this extended nature, applying to the whole of the Commonwealth, I conceived it to be my duty to make it the subject of approval by Parliament, either by introducing a Bill or submitting a motion. - I am now placing the matter before honorable members in the latter form, and the agreement cannot come into force until it is ratified by both Houses. At the outset the company were, of course, rather loth to give up the benefit of the clause by which it could hold its right in perpetuity, and, at first, the utmost that could be obtained after long negotiation, was an expression of willingness on the part of the company to limit the term of the agreement to 50 years - a term which I believe applies to some other of ‘ the company’s agreements. As time went on, and the Government were firm in the matter, we were asked to consent to a term of twenty years, which would be conterminous with the company’s landing rights at Cocos Island, which is in the track of the’ Cape cable, and it was pointed out to us that that was an extraordinarily short term ‘ for a cable agreement. However, we took the view that if we ex- tended the operation of the agreement to the whole of the Commonwealth we should be entitled to ah even shorter term, and I stood firm, and stipulated that, at the outside, the agreement should not be entered into for a longer term than would be roughly conterminous with the operation of the Braddon clause - with two years’ notice of determination. Eventually that was agreed to. I call particular attention to the importance of the fact because of two things. In the first place, the term fixed in the agreement is the shortest to which the company has ever been willing, or has ever been brought to consent in respect to any of their agreements, and the next point is that the fact that the agreement is, as such agreements go, of such short duration is of more importance to us, because it was not made before the cable was constructed, but after the company had incurred all the expense of constructing the cable, and at a time when they might have hoped to obtain an agreement binding the States to the use of the cable on terms which would give them more extended security. I do not take any particular credit to myself, but the Government were firm enough to ultimately secure an agreement for a term of ten years, with two years’ notice at any time after the ten years. The agreement which has been laid on the table provides for the modification of the original agreements, and all these are before honorable members^ It was stipulated that all existing agreements between the company and the several States should be recited and combined in one agreement, and that provision has been so fully complied with that honorable members will find in the recital of the new agreement* everything that is material to the case, and, therefore, everything that is affected by the determination arrived at. A further concession which was obtained was the reduction of the rate for Government telegrams from 2s. to ls. 7£d. per word. The agreement also binds the company to observe the international telegraph regulations as if they had been a party to the International Telegraph Convention. As honorable members who are acquainted with commercial matters will doubtless recognise, that was a very important matter, because doubts have arisen whether the Eastern Extension Company was a party to that Convention. *It has often been asserted that it was a party to it, but we thought it desirable to put the matter beyond doubt as far as this agreement was concerned by binding the company to it as if it were actually a member of the Convention. Further, a provision was made that the company could not - and this is an entirely new provision in cable agreements, and makes some approach to compliance with a resolution regarding State ownership of cables moved by me and passed at the Imperial Conference - that the company cannot dispose of any of their cables as here affected without giving to the Government of the Commonwealth, or to that of the United Kingdom the option of purchasing the cables at a price to be fixed by arbitration.

We found that notwithstanding all efforts we could not obtain the insertion of a clause empowering the Governments concerned to resume the cable, or any cables in connexion with it . which were material to its working. The best substitute which could be secured and I think it is valuable as a first step - was the provision contained in this agreement, under which the company cannot dispose of the cable itself, or any cables which are material to its working, without first giving an option of purchase to the Government of the United Kingdom, or the Government of the Commonwealth, and setting out that the price in such a contingency shall be settled by arbitration.

Sir William McMillan:

– Upon what tenure do they hold their land rates?

Sir EDMUND BARTON:

– . Under the general form of licences which are issued by the Imperial Government. I think that possibly a copy, of those licences may be found amongst the papers dealing with this matter. The provisions of the licences are fairly stringent, and it was by adverting to one of those provisions that we obtained the reduction of the rate upon Government messages from 2s. to Is. 7½d. per word. Of course the period of the licences varies in different cases.

Sir William McMillan:

– Do the Imperial licences govern the land licences in the Commonwealth ?

Sir EDMUND BARTON:

– Not unless the consent of the Government is first obtained. But there are, I think, separate landing licences in connexion with the Commonwealth.

Mr.V. L. Solomon. - They are provided for in the Postal Act, are they not?

Sir EDMUND BARTON:

– Not the licences themselves.

Mr V L SOLOMON:
SOUTH AUSTRALIA, SOUTH AUSTRALIA · FT

– I mean that there is a section as to landing rights.

Sir EDMUND BARTON:

– Finally there is a reduction in the term of the agreement to ten years, with two years’ notice of determination. As I have said, the company had secured landing rights for the cable for Cocos Island for a period of twenty years only. When the negotiations took definite shape another important development occurred. In July of last year, the company, at the request of the Commonwealth Government, tentatively reduced their rates for “Victoria and Queensland, conditionally upon this agreement being finally ratified, to bring them into line with those of the contracting States. From July of last year, therefore, Victoria and Queensland have, at our instance, enjoyed lower rates. Of course, that concession is not of very much consequence to Queensland, because of her closer connexion with the Pacific cable. Upon the agreement being signed, the company adopted another suggestion of mine, which was that they should make a substantial reduction in the charges to India, China, and the Far East generally, making the rate uniform at 2s. 6d. per word to India and China cable ports as from 1st June, 1903. Of course, that concession depends upon ‘ the ratification of this agreement, but it was a business-like and fairly generous actioa on the part of the company at my request. Their position of having a perpetual agreement with the majority of the States was so strong that practically it could have been maintained in Victoria by energetic canvassing. This is made very clear by the traffic returns from Victoria for the four months after competition with the Pacific Cable commenced, and prior to the opening of the company’s public offices in Melbourne. Prior to that period, the company had a communication office in Sydney with the right of distribution and canvassing to any extent they chose, whilst they were without these rights in respect of Melbourne, nevertheless they did more business in Melbourne than in Sydney. That is to say, a larger number of traffic words were communicated in respect of Melbourne than in respect of Sydney.

Sir William McMillan:

– Is there any specific agreement as to equal rates in regard to telegraph rates?

Sir EDMUND BARTON:

– No; that is a matter which must be left open between the two rival cables. But so far there has been no indication of any desire for cutthroat competition. I , think it is generally conceded by the authorities controlling both cables that the rates could not be cut down at present without a loss which even the rich company would not be prepared to incur.

Mr F E McLEAN:
LANG, NEW SOUTH WALES · FT

– They are not delivering their cables in Melbourne ?

Sir EDMUND BARTON:

– Yes. Contingent upon the passing of this resolution, I gave them the right to open: an office in Melbourne, on condition that they made the same reduction in respect of ‘Victorian messages that they had made in regard to messages for the other States. There is another point to which I desire to refer, because it has been the subject of rumours in various quarters. The company e japhatioally deny the accusations freely levelled against them that they have been guilty of any unfair or unscrupulous dealings. In this connexion, they cite their action in regard to the matter of registered address indicators as a case in point. I should like to read part of a memorandum which I made concerning this matter. It is as follows : -

The Government charge an annual fee for registering code address indicators, while the company do not. Consequently, few firms would incur the fee by registering with the Government when it was open to them to avoid it. Traffic would therefore have passed into the hands of the company unless the Government abandoned the charge, and thereby lost a revenue of some thousands of pounds. The company, however, readily agreed to forego this advantage, and not to accept any registrations unless they were first accepted by the Government.

Now the company consider that, although they are very freely condemned in many quarters, they have, by reason of . their services - which, nevertheless, we must recollect, have all been paid for - established a close connexion, with the Commonwealth, and have some claim on account of that long association to reasonable treatment. The)’ have for years transmitted weather telegrams for the Commonwealth free of charge. They also transmitted soldiers’ and sailors’ telegrams to South Af rica and to China at a nominal rate. Generally speaking, I think that there is no reason to complain of the company on the score of illibe rality. But, of course, there is this fact to be considered, that, like every other mono poly, they maintained the higher rates whilst they had an opportunity of doing so in the absence of competition, and it is a fact which must be placed to the credit account of the Pacific cable that, undoubtedly, it was the expected competition of that cable which largely led to a reduction of rates on the part of the Eastern Extension Company. Upon the other hand, when we consider the claims which are put forward by the Pacific Cable Board to prevent the binding force of an agreement such as we now propose to make with the Eastern Extension Company, it must be said that, from the very nature of the case, competition was to be expected as the result of the opening of that cable. The Eastern Extension Company was an existing fact, and was of course in constant touch with the systems of the rest of the world, their lines extending to Australia. Independently of the Cape cable, the company were for many years the holders of a line of cable, without which this country would not have been able to carry on telegraphic communication with the rest of the world ; and even before they started the Cape cable they were in control of that communication. Consequently, when we entered into the arrangement, anterior to federation, which resulted in the Pacific cable being laid, we did so with our eyes open, well knowing that the cable which we were about to institute must enter into competition with that of “the Eastern Extension Company. That consideration of course very largely qualifies the claims made in one direction or another to have such special advantages conferred as would result in one of the cables obtaining a monopoly. At this point I should like to remark that I am not in favour of a monopoly even for the Pacific cable, much less for the Eastern Extension Company. I am of opinion - and I think the majority of honorable members will agree with me - that competition carried to the extent that is healthful in respect of these cables is an advantage even if for many years no profit is realized on the Pacific cable. This competition is one which, provided that it be carried on in a proper spirit, will result in the continuous keeping down of all charges, and therefore is a convenience which applies to the business concerns of every citizen of the Commonwealth, irrespective of whether he uses the cable or not. Therefore I do not think there is much in any argument which would impel us to give such advantages to one of these competing, institutions as would practically drive the other from our shores, because our position as a community would not thereby be rendered any more secure. A very important matter, which does not form part of the agreement, but directly relates to it, is the establishment of a cable ship, and a cable repairing dep6t, in Adelaide, by the. company. The ship which has just arrived is one of the largest and best equipped of its class. It has been specially built for Australian work, and its importance in being at hand to maintain cable communication, not only in time of peace, but in time of war, cannot be over-estimated. The ship is the only cable-repairing vessel- in Australia. Whilst

I am upon that subject, I would point out that, under the old agreement, the company were guaranteed freedom from Customs charges upon their cable and materials in any of the States which were parties to that agreement, and also were freed from such charges as harbor and light dues, wharfage, 4’C. As this is a new agreement, it has necessarily been based, in a large measure, upon the agreement which, previously existed, and has been modified only so far as was deemed to be necessary, either by the circumstances of the case, or-in order to free the Commonwealth from any undue burden. The Pacific Cable Company was charged Customs duty even upon the shore length of its cable by the Dominion of Canada, which has throughout taken up an antagonistic attitude in regard to this agreement. In respect of Customs duties the Pacific Cable Board will reap, at our hands, the same advantages as Are enjoyed by the Eastern Extension Company. We have determined - and to carry out the determination it will be necessary only to place a small sum on the Estimates - to recoup the Pacific Cable Board equally with the Eastern Extension Company, any Customs duty paid by them on their plant and material. That is a concession which is granted in most parts of the world, although, as I have stated, an exception has been made by Canada. I refer to this matter in order to show the House that there is not the slightest desire on the part of the Government - who, being the largest partner, would be the most disregardful of its own interests if it took up a different position - to unduly handicap the Pacific cable, or to place it at any disadvantage. My personal sympathies have always been with that project, and I hope, notwithstanding temporary and initial losses, that it will yet turn out to be a sound investment.

Mr G B EDWARDS:
SOUTH SYDNEY, NEW SOUTH WALES · FT

– Largely on account of this new agreement.

Sir EDMUND BARTON:

– Yes, and for this reason : That if we had allowed the perpetual obligation constituted by the clause in the old agreements to remain in existence, there would have been in front of the Pacific Cable Board a competition conducted under privileges such as the Eastern Extension Company enjoyed by reason of an arrangement which was not terminable by any efforts on the part of the Governments of the States concerned. Thus there would have been a lasting obstacle in the way of the

Pacific cable. But as the arrangement in regard to the Eastern Extension Company is now terminable by t*0 years’ notice after the end of ten years, even the apprehensions of the Pacific Cable Board in that respect are limited by the operation of the agreement which I am asking the House to ratify. At the end of a period of say twelve years, we shall be open to enter into such new agreement as we may think fit with the Eastern Extension Company. I am sure that as now and before, if we do enter into any fresh agreement, we shall take care that it is upon terms such as will maintain every just privilege and right to which the Pacific Cable Board is entitled. And as we have made a concession as to Customs duties in favour of the Pacific Cable Board, independent of any agreement or binding obligation such as was imposed upon us by the distinct agreement with the Eastern Extension . Company, so I propose - and, I think, the House will concur in that proposal - that we shall also extend to the Board an advantage similar to that enjoyed by the Eastern Extension Company in respect of any harbor, lighterage, or wharfage dues which they might be called upon to pay. Thus, in this additional respect, the Pacific Cable Board will also be. placed on an equal footing with the other company. I think that I have now put before the House what I desired to say in explanation of this agreement, in order to supply honorable members’ with materials upon which they may found an opinion when later on a vote is taken. ButT should like to quote a very pregnant and well-worded passage from a letter by Sir John Cockburn, who, as we all know, was formerly Agent-General for South Australia, and is still in London. In the. course of a long letter, commenting upon the controversy which has arisen between the Commonwealth and Canada and New Zealand, two of the other signatories to the Pacific cable agreement he has vindicated the action which this Government has taken. He concluded with these words, which, if fairly and reasonably applied to the Pacific Cable Board, are, I think, of very great weight, and worthy of the consideration of honorable members -

Governments when they go into business must be content to accept, with equal mind, the vicissitudes of profit and loss, and the Pacific combination can hardly complain of that wholesome competition which ostensibly it was established to promote, or legitimately claim a monopoly which it was intended, to abolish.

I think that those words apply exactly to the case which we have before us, and that there is no justification for any undue jealousy being exhibited by one of these bodies of the other. As both of them are capable of rendering us very signal service in our business relations, and, as we as a Government, have no intention- to prejudice the Pacific Cable Board to any greater extent than the existence of a competition of which they knew at the outset must prejudice them - intent as we are on not doing anything which would damage our own proprietary interests in the Pacific cable - I think we may well assent to this agreement as a fair one. It is one which alleviates the position as regards the Commonwealth, instituted by the practical perpetuity of the old agreement, which imports a new term with respect to the acquisition of the cables and their rights, and which in all respects is dictated by a regard for the public interests of the Commonwealth and a spirit of fairness to the Pacific Cable Board.

Mr KNOX:
Kooyong

– I am sure the House has listened with pleasure to the clear statement which has just been made by the Prime Minister, and in which he has reviewed the whole historical aspect of this matter. I recognise, and I am sure that every honorable member will recognise, that the Commonwealth Government found themselves placed in a very difficult position by reason of the action taken by the Government of New South Wales, which, within a fortnight after the ratification of the Pacific cable agreement, entered into another one with the Eastern Extension Company. One would imagine that they did so with their eyes open to the fact that they must ‘ create a considerable difficulty. I agree with the Prime Minister that nothing is to be gained at the present time by reviewing the situation which was created perhaps by the astuteness of the very energetic Eastern Extension Company. That situation may have been brought about by a want of knowledge on the part of the Minister who was in charge of the arrangements at the time as to the difficulties which would follow. My opinion is that we may allow the incident to pass, although it is well known that it has been the subject of very adverse criticism, not only in

England and Canada, but in Queensland and Victoria. It seemed at the time as if the Government were prepared to sell an important position in consideration of a temporary advantage. I am very glad, however, that the Prime Minister found himself at an early date in a position to safeguard Victoria, who, to its credit be it said, held from the first that it must keep faith with the Pacific Cable Board. In the course of his remarks, the Prime Minister has removed much of the concern which I felt in regard to this matter. The fear shared by other parties to the Pacific cable agreement, and entertained not only in England and Canada, but in Australia, was that the Eastern Extension Company would receive advantages over and above those obtainable by the .Pacific Cable Board. The Prime Minister has pointed out, however, that apart from the competition which the existence of the Eastern Extension Company necessarily involves, he intends, as far as he can, to place the Pacific Cable Board on equal terms with that company. If such a statement had not been made, I should have proposed an amendment. The Prime Minister has removed the serious blot which previously existed in that a large corporation like the Eastern Extension Company was to be given an agreement in perpetuity. He has cut down that provision by gradations, so that the agreement may now be terminated at the end of ten years, and after two years’ notice has been given. The amendment which I thought of asking the Prime Minister to accept was -

That the motion be amended by the addition of the following words : - “ Provided always that the Government of the Commonwealth agrees that the Pacific Cable Board may, upon application during the currency of the agreement with the Eastern Extension Company, receive equal facilities and. equal concessions for the conduct and extension of its business throughout the Commonwealth. “

Sir Edmund Barton:

– If the honorable member intends to move anything in that direction, I should like him to specifically state the advantages referred to. He may readily extract the particulars from the agreement -made with the Eastern Extension Company.

Mr KNOX:

– In view of the assurancewhich we have received from the Prime Minister, I do not propose to press the amendment. I desire, however, to have a clear and definite assurance from the Prim© Minister that in the future the spirit of this suggestion will be preserved. I think that when the two cables are allowed to compete on equal, terras nothing further can be asked for. It will remain for the Pacific Cable Board to pursue ordinary business methods to increase and expand its business.

Sir Malcolm McEacharn:

– Which they are not pursuing at the present time.

Mr KNOX:

– Which they are not pursuing at the present time. I wrote to Mr. Reynolds, the general manager of the Pacific Cable Board in London, at the time of the opening of the cable, congratulating him upon the event, and in that letter I pointed out the need for activity. I said -

Meantime the Eastern Company (you understand any references are to the Extension. Coinpiny) are .abundantly displaying their undoubted business capacity and push, so much so that it seems to me that if the Pacific Company is to get its share it will require equally active and vigorous representation throughout the States, whose persistent objective will be the increase of the influence of the Pacific cable, and its free use by the public.

To that letter T received a reply which I assume embodies the views of the board. Mr. Reynolds, amongst other remarks - because I do not propose to trouble the House with the whole letter - says -

The Pacific Cable Board is not in favour of hav ing agents. As a- concern in which the Government is directly interested, it looks to the Postoffice to protect its interests so far as may be practicable, and to the general public and to public bodies for support as a national undertaking.

If the Pacific Cable Board persist in refusing to adopt ordinary commercial methods for increasing their business, and giving facilities to the public, and are determined to rely entirely upon the Government Departments, I think that they will go under, and the community will be faced with the serious difficulty of an increasing deficit on the working of the cable. The deficit last year was, I understand, between £92,000 and £95,000.

Sir Edmund Barton:

– It is now estimated at a few thousands more than that.

Mr KNOX:

– The right honorable gentleman has pointed out that the Commonwealth is the largest partner in the concern, its interest being a one-third share, whilst Canada and Great Britain have each a five-eighteenth share, and New Zealand a ninth share. Now, unless effective business methods are adopted, the deficit on the working of the cable will be a serious matter for the States affected, because they will be called upon to make good a very material loss. Therefore it behoves the Government to raise its voice on behalf . of the community in favour of the adoption of vigorous business methods.

Sir Edmund Barton:

– The Pacific Cable Company can hold its position only by the prosecution of a thoroughly commercial competition.

Mr KNOX:

– That, in my opinion, exactly expresses the position. I deprecate a cut-throat policy, because, as the Prime Minister has pointed out, such a policy is fraught with uncertainty as to permanence. We want to know definitely how we stand, and to have uniform fixed rates, with ‘ the healthy business competition which should be created by the existence of two rival concerns. That well-equipped and most business-like corporation, the Eastern Extension Company, will lose no opportunity to gain business. They have already profited by the lack of business methods displayed by the Pacific Cable Board in London, and have gained a great advantage by being able to make arrangements in connexion with cable communication with a great many of the business firms of the Commonwealth. No one can blame the Eastern Extension Company for the advantages which they secure, but the Pacific Cable Board ought to be alive to what should be done in the interests of the concern which they control. The Prime Minister, in the course of his remarks, said that we must recognise the obligations under which thecommunity rest for the enterprise of the Eastern Extension Company in the past. The results of that enterprise, however, have been very profitable to the company, as I will show by an extract from a speech* delivered in Canada in May last by Sir Sandford Fleming, who has always taken a prominent part in connexion with thePacific cable. Before negotiations for the laying of the Pacific cable were entered into, the’ rate to Australia was 9s. 4d. a word, but the present charge is 3s. a word, and Sir Sandford Fleming says -

Australians will not fail frankly to recognise that the saving to them of 6s. 4d. per word is in a great measure due to the persistent efforts of Canada.

It must bo admitted that Canada has done a great work by its persistent efforts to promote the Pacific cable connexion. Sir Sandford Fleming continues -

What does a Saving of 6s. 4d. a word mean ? According to the last returns of telegraph business which has reached Canada, the total number of words transmitted between Australia and Europe in 1901 was 2,330,515,’ and if this volume of traffic be reckoned at 6s. 4d. per word, we have it demonstrated that there is an actual gain to Australia of not less than £737,850 annually.

That is, the amount by which the reduction of rates has benefited the Australian community, and, therefore, if the Eastern Extension Company are now working at a profit with a rate of 3s. per word, they must have been getting magnificent returns when the rate was 9s. 4d. per word.

Sir Malcolm McEacharn:

– The States have nothing for which to thank the Eastern Extension Company.

Mr KNOX:

– The Eastern Extension Company has all along been managed on the hardest business lines. It did nothing to reduce its rates until it had to meet competition. While it had a monopoly, it charged the highest rates possible, without any consideration for the necessities of the Australian public.

Mr Kirwan:

– It abused its monopoly.

Mr KNOX:

– I dare say that that word would apply, but I would rather speak of the company’s action as the extreme use of a business advantage. They took advantage of their position knowing that, unless the Governments interfered, it would be ‘ extremely improbable that any private combination would come into operation to compete against them, and it reduced its rates only when the laying of the Pacific cable came within the region of practical possibility. “

Sir John Forrest:

– That is only business.

Mr KNOX:

– Efforts have been made by Canada and other parties to the agreement to procure a postponement ‘ of the consideration of this motion, and the Government of the Dominion have been approached with the request to send a Commissioner here to discuss the matter with the Government of the Commonwealth. For my part, I believe that the Government have made the best agreement that they could make under very difficult circumstances, but I ask that we may have the assurance of the Prime Minister that the Pacific Cable Board will be given all the facilities and means of getting business which are available to the

Eastern Extension Telegraph Company, whose activity is acknowledged all over the world. If that is done, and the Pacific Board fail, we must review the situation, because the matter is mainly in our own hands. I have indicated that I am against the adoption of a cut-throat policy, because I want to see a fair trial between the two concerns, and I think, therefore, that they should be placed in an equal, position. The Prime Minister quoted from a lengthy letter written by Sir John Cockburn, and I commend to the House a very straight-‘ forward reply written by Sir Horace. Tozer, in which he refers to the negotiations as a whole in no uncertain voice. He says that he seriously differs from Sir John Cockburn on the facts, and he deals first with the differences between the agreement now being ratified with the Eastern Company, and the agreement with the Pacific Cable Company.

  1. An agreement was made on January 16, 1901, by the State of New South Wales to remain in force until rescinded by mutual consent in writing.

Perpetuity has been got rid of by the astuteness of the Prime Minister.

  1. It conceded to the Eastern Company a special wire on the Government posts between Sydney and South Australia, a distance of several hundred miles, to be provided and maintained for ever at the expense of the State..

That perpetual obligation is now to be removed, but the wire is available, and telegrams can be conveyed directly into the offices of the Eastern Extension Company.

Mr L E GROOM:
DARLING DOWNS, QUEENSLAND · PROT; LP from 1910; NAT from 1917; IND from 1931; UAP from 1934

– To whom does the wire belong 1

Mr KNOX:

– It is provided and maintained for ever at the expense of the State, but I conclude that the actual wire belongs to the Government. I contend that this special wire gives to the Eastern Extension Company a great advantage in the transaction of their business, because they have a clear line right through for their own special purposes at all times.

Sir Edmund Barton:

– They have not had it yet. Although the agreement provides for it, the line has never been placed at the company’s disposal, and they may have some right to complain upon that score.

Mr KNOX:

– We can only look at the agreement as it stands, and it appears from that that they enjoy a very great privilege. The members of the business community desire to have their communications sent through rapidly, and if such a great advantage is given to the Eastern Extension Company, the Pacific Cable Board should be placed upon the same footing. The Pacific Cable Board should have their own offices and carry on their business upon commercial principles entirely apart from the red-tape system which prevails in the Telegraph Department

Sir Edmund Barton:

– The Pacific Cable Board do not desire to open their own offices.

Mr KNOX:

– If the Pacific Cable Board do not adopt business methods with the object of making the cable pay, or at least with a view to avoid loss, the Government should review the whole position in the interests of the community, who will probably have to bear an increasing burden year by year because of the unprofitable nature of the undertaking. The board say that they do not believe in appointing agents, but the Eastern Extension Company have their agents going the round of the business houses every day. Unless active methods are adopted, it is abundantly clear that the community will suffer. Sir Horace Tozer goes on to say -

Though the entire telegraph system of Australia is under Government control, this special, copper wire is connected with the offices of the Eastern Company, and very probably is now being extended to other State capitals. This gives exceptional facilities for uninterrupted communication in Australia, and affords opportunities for secret concessions to customers, one of which, the free registration of addresses, continued in force for at least three months, to the detriment of the Pacific cable.

I am very glad that the Prime Minister has pointed out that that practice has been done away with, and that all addresses are to be registered through the Telegraph Department. Sir Horace Tozer says further - i .TA11 cables, telegraph instruments, machinery, stationery, and goods of any kind of the Extension Company ure relieved from all Customs duties and wharfage rates.

The Prime Minister has mentioned that this matter is to be the subject of adjustment, and that a vote is to be placed upon the Estimates. It is further stated in the letter which I have been quoting that all the vessels of the Eastern Extension Company are exempt from port and light dues, and, further, that the company is -

Exempted from all income taxes and all other rates and taxes, parliamentary or otherwise, except rates and taxes on premises occupied as local offices

These are some of the advantages conferred upon the Eastern Extension Company, and I think it is only reasonable that the Pacific Cable Board should enjoy exactly the same benefits. When I was in London recently, I had occasion to send and receive cable messages almost every day. Some of these were forwarded by the Pacific cable, and others through the Eastern Extension Company, and I am gratified to be able to state that, with one exception, there was no material difference in the time occupied in the transmission of the messages by the two routes. Usually the difference did not exceed ten minutes. At one time there was some delay in the transmission of messages b)’ the Pacific cable route, in consequence of a defect in that portion of the cable extending from the mainland to one of the Pacific Islands. That defect has now been made good, and I am sure that if ordinary business methods are employed there is no reason why the deficit upon the working of the cable should not be wiped out,’ and why we should not be freed from all liability for loss in connexion with it. I would ask the Prime Minister to say explicitly whether, in the event of the new agreement being ratified, the Pacific Cable Board will be granted facilities equal to those enjoyed by the Eastern Extension Company ?

Sir Edmund Barton:

– Perhaps I may be permitted to explain-

Mr SPEAKER:

– Order ! The Prime Minister cannot make another speech, except by way of reply.

Sir Edmund Barton:

– I do not wish to reply at this stage, but simply to facilitate discussion by answering the question which has been put to me by the honorable member.

Mr SPEAKER:

– There is no provision in the standing orders for allowing Ministers, any more than other members, to speak more than once during a debate. I am particularly anxious to facilitate business, because I take it that the standing orders are intended for that purpose, rather than to hamper us. The question time has passed, however, and a speech in reply can be .permitted only at the close of a debate. Therefore, I am precluded from doing anything of an extraordinary nature to enable the Minister to make a speech at this stage. I am quite prepared to overlook a short interjection, by the Prime Minister, as I have overlooked many others at different times, but I could not permit an open violation of the standing orders.

Sir Edmund Barton:

– I could make a statement by special permission of the House, and I now ask that that may be granted-.

Mr SPEAKER:

– Is it the pleasure of the House that the Prime Minister shall have leave to make a statement 1

Honorable Members. - Hear, hear.

Sir Edmund Barton:

– In answer to the honorable member’s question, I desire to say that if he furnishes me with a copy of his suggested amendment, I shall give it careful consideration. I may point out that there may be obstacles, either constitutional or legal, to the carrying out of what he desires. So far as we can constitutionally, legally, and reasonably place the two companies in the same position, I shall, as I said in my opening speech, be very glad to do so. There may be difficulties in some respects, but the honorable member may rely upon our dealing with this question with every remembrance of our partnership in the Pacific cable, and with every desire to avert loss in connexion with its working.

Mr Knox:

– - I desire to explain-

Mr SPEAKER:

– The honorable member cannot continue his speech ; neither can he make an explanation, unless he has been misunderstood.

Mr G B EDWARDS:
SOUTH SYDNEY, NEW SOUTH WALES · FT

– I do not wonder that there has been a great deal of irritation over the proposed agreement, although I think that it will be to some extent removed when the full explanation of the Prime Minister is made known to those who are principally concerned. Some years ago very great interest was taken in the proposal to construct the Pacific cable, which was looked forward to as one of the most advantageous means of communication with the old country. It was pointed out that the Pacific cable would give us more speedy means of communication, and that it would, therefore, possess advantages for us even in times of peace, whilst in times of war it would give us an “all red” route. I was very much surprised at the very small amount of interest taken in the opening of the line. I happened to be in Queensland a few days after the cable was opened, and I could not help remarking how little ceremony was observed, and how little public interest was taken, in the event, not only here, but in the old world. The arrangement now proposed is one that will not only be of advantage to us by relieving us from a position of difficulty, but will, as has been explained by the Prime Minister, eventually turn out to be the very best, for the Pacific Cable Board. Canada and New Zealand havebeen complaining of what they consider a breach of faith on the part of the Commonwealth Government in enteringinto this arrangement. They contend that we have virtually broken the compact entered into ‘ with them in connexion with the Pacific cable, but, as I think I shall be able to show, it would have been very much better for those whonow complain if they had interposed at the time when the arrangement regarding the Pacific cable was first broken by the Government of New South Wales. No one regrets more than I do that that compact was broken. New South Wales was, nodoubt, free, technically, to make some such arrangement with the Eastern Extension Company for better terms in consideration of the perpetual arrangement, but, from the Empire point of view, it seems to methat we broke faith with our brethren in other dependencies and in the mother country. At that time it was quiteopen for the other parties concerned toobject strongly to the proposed alteration. But these alterations having been made by certain States it became incumbent upon the Commonwealth Government to ascertain what was’ the best course to pursue under the circumstances. The arrangement which the Government -ask the House to ratify’ is. is an excellent business one for the Commonwealth. I am indeed surprised that thePrime Minister has been able to secure such advantageous terms with the Eastern Extension Company. I repeat that in the long run it will prove the very best thing possible in the interests of the Pacific cable itself. We are all aware that communication by means of electricity is still beingdeveloped, and that a perpetual arrangement, such as the one which the New SouthWales Government made with the Eastern. Extension Company, might involve us in a very serious liability in years to come. Under the Marconi system of communication, such an agreement might represent so much waste effort, but we should be committed to its terms, and eventually might beforced to pay a large sum to free us from its operation, if we desired to obtain theadvantages of the most up-to-date system of telegraphy.. When the Commonwealth . Government is accused by the Governments- of the Dominion of Canada and of New Zealand of a breach of faith in connexion with this agreement, it is a matter of astonishment that a similar charge has not been levelled against the Imperial authorities. I would point out that the Government of Great Britain approved, in the first instance, of the arrangement which was made by New South Wales. When that agreement was first suggested, a telegram was despatched to the Secretary of State for the Colonies, by the Government of New South Wales, in the following terms : -

Wish 3’On consult Mr. Chamberlain re proposals of Eastern Extension Company as bearing on prospects Pacific cable. Our contract with company expires 3.1st inst. We desire accept their proposals if Imperial Government see no objection, having in view prospects of Pacific cable. Company entirely waive renewal subsidy £32,400, and guarantee against competition, and, in addition to providing cable all way to Glenelg viti Perth, agree at once reduce tariff to 4s. (present rate 4s. 9d.), Government rate 3s., press rate ls. (id. per word., and make further reductions on sliding scale as traffic increases. Sliding scale as follows : - “ The amount now guaranteed by Australian Governments is £227,000, which, with £123,000 for the estimated yearly expenses of the new Cape line, forms a minimum of £350,000, or £15,000 less than present actual receipts of associated companies. If receipts for years 1808, 1899, and 1900 average £350,000, the 4s. tariff would be reduced in 1901 to 3s. 6d. If thev are maintained at £350,000 for the years 1899, 1.900, and 1901, the tariff would be reduced to 3s. in 1902. If average receipts maintained 1900, 1901, and 1902, tariff would be reduced in 1903 to half-a-crown per word. Receipts must average £350,000 for three consecutive years before the next reduction of 6d. per word is made.”

In return company require same privileges in Perth, Adelaide, Melbourne, and Sydney as now enjoy Great Britain, of directly delivering and collecting their international telegrams to and from public. Privilege mentioned us enjoyed in Great Britain is that companies pay British Post Office £5 yearly per mile for each wire, and work both ends by their own operators, collecting and delivering traffic direct with the public. All telegrams to places other than those where the companies have offices are dealt with by Post Office, who are paid their ordinary inland tariff. If the company’s terms are accepted, the whole line might be in working order within two years.

Company further agrees that whilst they enjoy this privilege not to increase tariff as it stands in 1902 or 1903, whichever year is the lower. This agreement obtained order prevent increase rates should it happen that from any cause Pacific cable be delayed.

The point which I specially desire to make is that at the time the arrangement was made by New South Wales the Imperial Government were most specifically informed of its details. What was the reply to that telegram by the Secretary of State for the Colonies 1 It reads as follows : -

London, 4th November, 1899. - In continuation telegram second, Mr. Chamberlain sees no objection to acceptance Extension Company’s proposals contained in your telegram 25th ultimo. He points out, however, it is not expressly stated that company is not in any case to increase its rates, and phrase at end telegram appears implY power reserved increase rate up to 1903 if revenue falls below amount fixed. Mr. Chamberlain would suggest yon stipulate that once reduction made it must stand, though traffic falls off. He also thinks you should insist on South Africa to Australia cable being made all British. No mention is made as to rates between South Africa and Australia, and, although this point does not directly concern Imperial Government or Mr. Chamberlain, of opinion you would do well to stipulate for fair maximum rate least, if not for sliding scale, as in other cases. Finally, Mr. Chamberlain of opinion that arrangements should be made by which points where new cable landed would be settled in consultation with military authorities, with view insuring they shall be landed where shore ends can be protected by fixed defences.

We have there an equally specific and detailed answer by Mr. Chamberlain on behalf of the British Government, which not only approved of the arrangement suggested by the New South Wales Government, but suggested farther modifications that were believed to be to the advantage of all the interested parties. Subsequently Mr. Chamberlain’s reply was considered by the Conference of Premiers, and most of his suggestions were embodied in the arrangement which was ultimately adopted with the Eastern Extension Company. If Canada and New Zealand have a right to blame anybody for what they conceive to bea breach of that arrangement it is certainly not the Commonwealth Government, but the Governments of New South Wales and Great Britain, who ratified it after consultation between them. But, as the Prime Minister declared, we have nothing to do with the back history of this question. It is a legacy which has been handed down to us by the States, and our duty is to do the best we. can under the circumstances. It is absurd to think that we could carry on the transferred service under two different agreements, some States being parties to one agreement, and some to the other, whilst some were parties to both. The Government, therefore, were bound to take the condition of affairs into consideration, and to do their best to enter into an agreement with one company or the other in order to remedy the mixed condition’ of affairs.

I think that the Prime Minister is to be complimented upon the shrewd and businesslike way in which he has protected the interests of the Commonwealth. The arrangement which he has concluded with the Eastern Extension Company excites my unqualified admiration. I do not see what he has given to the company as a quid pro quo for the concessions obtained from that company. It is worthy of remark - because we have recently heard so much about the weary Titan staggering under the too vast orb of his fate - that under the Pacific cable scheme Great Britain contributes only fiveeighteenths of the total cost, whereas the Commonwealth pays one-third, despite the fact that in the event of any grave emergency arising it is estimated that a message transmitted over that line to a fleet or a single cruiser might be worth three times the amount of Britain’s contribution. The Government,’! repeat, are to be complimented upon the admirable business arrangement which they have concluded. The Commonwealth seems to have scored throughout the whole of the negotiations.

Sir Edmund Barton:

– That is the only thing which excites my suspicion.

Mr G B EDWARDS:
SOUTH SYDNEY, NEW SOUTH WALES · FT

– It is almost too much to expect that we can secure what the honorable member for Kooyong desires, but I think that the Prime Minister is in duty bound to make an effort in that direction. We ought, if possible, to grant the same conditions to the Pacific Cable Board in regard to facilities for business as those which operate in the case of the Eastern Extension Company. If the Prime Minister can. accomplish that, he will have done something for which the Commonwealth will be extremely thankful.

Sir Edmund Barton:

– It is done as to the Customs, and will be done as to the harbor, light, and wharfage rates.

Mr KIRWAN:
Kalgoorlie

– I do not know whether the Prime Minister intends to take a division upon this question today.

Sir Edmund Barton:

– I stated that I did not intend to push it to a division, but should like the discussion continued until about 1 o’clock.

Mr KIRWAN:

– Several honorable members who have given this matter a good deal of attention, and who entertain altogether a different view from that which has been expressed by several’ speakers, are absent. Personally, I am not in accord with those who join in a chorus of congratulation to the Prime Minister upon having arrived at this agreement. It seems to mc that there is one point in connexion with it which has been entirely overlooked. The Prime Minister considers that this agreement would undoubtedly benefit the Commonwealth generally. A question which should receive very serious consideration is whether or not there has been any breach of the agreement entered into with the other parties to the Pacific cable. . I find amongst the correspondence and papers relating to this subject, which have be6n laid on the table of the House, statements showing that the other parties to the agreement appear to think that if no actual breach has been committed there has been at least a breach in the spirit of the agreement. In a telegram to the Prime Minister of Australia, the Prime Minister of Canada states that the concession ‘ granted by the New South Wales Government to. the Eastern Extension Company is regarded by Canada as a - violation of spirit of agreement under which. Pacific intentions of cable core was constructed.

The Prime Minister of New Zealand was still more emphatic in his protest against the action of the Prime Minister of Australia. In a letter dated the 11th May, 1903, in which he referred to the concessions proposed to be granted to the Eastern Extension Company, he said -

I beg positively to state, so far as New Zealand is concerned, knowing how far reaching in securing business such concessions are, this Government would never have entered into the agreement respecting the Pacific cable.

Sir Edmund Barton:

Mr. Seddon was asked to point out what better arrangement could be made, and in what respect the Pacific- cable would be prejudiced, but in regard to both these points he could show nothing.

Mr KIRWAN:

– It is’ claimed by theother parties to the agreement for the laying of the Pacific cable, that there has been a breach of that agreement, and the Secretary of State for the Colonies has made a proposal, which I think is an eminently fair one, and which should receive favorable consideration. In a cablegram to the GovernorGeneral, dated. 2nd April, 1903, he said : -

I hope that before the agreement is submitted to Commonwealth Parliament, your Ministers will consent to questions arising out of it being discussed at a Conference between representatives of various partners in Pacific cable.

If the case for the acceptance of the proposal submitted by the Prime Minister is such a good one, I fail to see why this suggestion should not be acted upon.

Mr G B EDWARDS:
SOUTH SYDNEY, NEW SOUTH WALES · FT

– The Secretary of State for the Colonies had previously assented to the action of the New South Wales Government..

Mr KIRWAN:

– That has nothing to do with tha ‘matter. All the other parties to the Pacific cable agreement have objected to the proposal, and I think the question might be submitted to the arbitration of representatives of the parties concerned. Assuming that the proposal now submitted to us by the Prime Minister will be of benefit to the Empire generally, there is still a further point to be considered. We have to remember that although one of the four parties to this Pacific cable agreement may believe that it would be to the benefit of all concerned to alter the terms of that agreement, he is not entitled to set his opinion against that of the three remaining parties. The Prime Minister may think that this proposal is best for all concerned, but unless the remaining parties to the Pacific cable agreement are favorable to it, I . think that the spirit of the Pacific cable agreement will be broken by its adoption. Thus it is a matter of the very gravest importance, affecting as it does, the good faith of the Commonwealth.

Sir Edmund Barton:

– Admitting for the sake of argument that the spirit of the Pacific cable agreement had been broken by the action of New South Wales, how should this Government escape its liability afterwards, and how should we be able to obtain a better agreement1?

Mr- KIRWAN. - That is an argument which might be put before a Conference, such as is proposed by the Secretary of State for the Colonies. I assert that in the interests of the Commonwealth, and in order that the matter might be thoroughly cleared up, the proposal made by .Mr. Chamberlain, which seems to have met with the’ approval of all the other parties to the Pacific cable agreement, might very well have been accepted. That is an aspect of the question which is worthy of the consideration of the House. I should like to see an amendment proposed to give effect to Mr. Chamberlain’s suggestion. I think it is necessary to show that the good faith of the

Commonwealth has not been impaired by what has been done by the Prime Minister. If he has the excellent case that he appears1to consider he has, he need have no fear of such a conference. If it were held he. would, no doubt, be able to induce theother parties to agree with the action which he proposes to take. If no one else will move the amendment I have suggested, I shall move it myself at a later stage.

Mr SPEAKER:

– I would remind thehonorable member that he cannot speak again.

Mr KIRWAN:

– Then I move now -

That all the words after the word “ House,” line 1, be omitted, with a view to insert in lieu thereof the words “is of opinion that the conference proposed by the Secretary of State for the Colonies between representatives of the various parties .in the Pacific Cable should be held before any agreement is arrived at between the Government of the Commonwealth and the Eastern Extension Company.”

Debate (on motion by Sir Malcolm McEacharn) adjourned.

page 2609

PAPUA CUSTOMS TARIFF BILL

In Committee of Ways and Means :

Resolved (on motion by Sir Edmund Barton) -

That it is desirable to provide for a Customs Tariff preference on goods imported from the Territory of Papua.

Resolution reported and adopted.

Ordered -

That Sir Edmund Barton do prepare and bring in a Bill tlo cany out the foregoing resolution.

Bill presented’ and read a first time.

page 2609

SUGAR BONUS BILL

In Committee (Consideration of Senate’s message) :

Clause 2 -

There shall be paid out of the Consolidated Revenue Fund, which is hereby appropriated accordingly, to every grower of sugar-cane or beet within the Commonwealth, in the production of which sugar-cane or beet white labour only has been employed, after the twenty-eighth day of February, One thousand nine hundred and three, a bonus at the rates provided in this Act. . .

Senate’s Request -

That after the word “three,” line 7, the follow- ing words be inserted : - “ or for a period of twelve months immediately preceding the delivery thereof for manufacture. “

Sir EDMUND BARTON:
Hunter Minister for External Affairs · Protectionist

-It would appear from the message - and honorable members will probably have gathered also from other sources - that the Senate has not adhered to the position which it set up in sending us an amendment which, in our judgment, would, if carried, have meant an increased burden on the people, if not, in fact, an origination, pro tanto, of new expenditure. I am happy to say that to that extent the constitutional difficulty which occurred has been settled. But a further question arises. The Senate having abandoned the amendment to which we had expressed our constitutional objection, has sent us a message requesting us to alter the Bill in the direction in which . they formerly desired to amend it. The Senate has acted in this way in the assertion of a power given to them by the Constitution. There may be some conflict of opinions upon this subject, and therefore I desire, before the Treasurer deals with the matter, to make a short statement to the House. AVe propose to make an amendment in the Bill - not that requested by the Senate, but an amendment adopting their words, with an addition which will restrict its application to cases where cane has not been planted by black labour since the 28th February, 1903. In other words, we are prepared to agree to the request of the Senate with a modification, and to turn it into an amendment of our own. Some doubt has been expressed as to the constitutional right of the Senate to make requests where it has the right to make amendments. Honorable members will recollect that we conceded the right of the Senate to make an amendment in an Appropriation Bill not being a Bill for the appropriation for the ordinary annual services of the year, provided that there was no infringement of the provisions of the third paragraph of the 53rd section of the Constitution ; that is to say, provided that the Senate did not affect to increase any proposed charge or burden upon the people. We determined that any amendment which reduced or left the anticipated appropriation as it stood would be within their rights, but we maintained that if they went beyond that, and made an amendment, which, if accepted, would increase the charges or burdens upon the people, they would be exceeding their constitutional powers. They seem to have accepted that position in a spirit of conciliation, and an opportunity has now occurred for us to act in the same way. As I ‘ have said, there was some doubt as to whether the Senate could make a suggestion by way of increase, particularly in regard to the provisions of a Bill which it had the right to amend. We have given close consideration to that question, and we have come to this conclusion : that where the Senate can amend, it ordinarily is not able to suggest ; but where its amendment cannot be by way of increase, it is intended by the Constitution that it should retain the power of suggestion, as in other cases, Where the Senate admittedly could not make an amendment to increase the burdens of the people, it can, as in other cases, make a suggestion which, if adopted by us and carried into effect, would increase the burdens upon the people. In that way we retain our sole right to make amendments of that nature. This suggestion having come down to us from the Senate, we conceive that we may now honorably end the constitutional difficulty by making, with a modification, the alteration which the Senate has requested, and placing it as our own amendment in the Bill. By doing so, we shall be meeting the views which have been expressed by some honorable members during the earlier stages of the consideration of the Bill, and the modification which we shall propose will prevent undue advantage being given to those who have planted their cane with black labour. That is a position which I think we may fairly and honorably assume.

Sir WILLIAM MCMILLAN:
Wentworth

– I was, unfortunately, not present during the earlier discussion upon this measure, but so far as I can grasp the details of the matter, which in its very nature is intricate and difficult, the compromise seems to me a reasonable one, and one which should be accepted. With regard to ‘ the constitutional question involved, I ‘have nothing to say.

Sir GEORGE TURNER:
Treasurer · BalaclavaTreasurer · Protectionist

– Honorable members will recollect that originally the proposal with regard to the rebate on sugar applied only to sugar produced from sugar-cane or beet-root in connexion with the production of which black labour was not used after the 28th February, 1902. Subsequently the Minister for Trade and Customs, exercising what he believed to be a legal power, promised the growers that the concession would be extended for a period of twelve months, and in this Bill it was provided that the bonus which we have substituted for the rebate should be paid only in connexion with sugar in relation to which white labour exclusively had been employed since the 28th February, 1903. A strong desire was expressed, however, by some honorable members for a further concession. They wished that those who had for a period of twelve months employed white labour only upon their plantations, although coloured labour might have been used since the 28th February, 1903, should be given all the privileges obtainable under the Bill ; but the House, after consideration, came to the conclusion that we ought not to go further than to fix the date as the 28th February, 1903, giving an extension of twelve months. The amendment requested by the Senate provides that if white labour only be employed for a period of twelve months, a bonus shall be payable, although the cane from which the sugar is produced had been planted by coloured labour after the date fixed in the Bill. We think that that is going too far but wc hope to meet the views of those engaged in the industry by adopting, as a compromise, the provision that coloured labour must not be employed in planting the cane after the 28th February, 1903. To secure a bonus the sugar must be the product of cane planted after that date by white labour, though the bonus will still be payable if coloured labour is used after that date in the cultivation and other processes connected with the growing of the cane, but ceases to be used for twelve months before the bonus is claimed. We propose to add, however, an amendment providing that once white labour has been employed the grower cannot go back to the employment of black labour, and then, by employing white labour again for twelve months, obtain a bonus. If he uses black labour at all, after he has once registered as an applicant for a bonus, he cannot go back to white labour and still obtain the bonus. We are concerned now only about the method of planting. We say that if after the 28th February, 1903, growers deliberately plant with black labour, they shall not receive a bonus for the sugar produced from the cane so planted, although they may employ white labour exclusively upon its cultivation. At the same time we wish to give the white labour policy a fair trial, and therefore we provide that, although growers may use black labour in the cultivation of the cane because in many cases they may be forced to do so in consequence of engagements previously entered into, that will not prevent them from obtaining a bonus on their sugar, so long as the cane was riot planted after 28th February last with black labour, and white labour exclusively has been employed in connexion with its production for twelve months prior to the application for the bonus. I think under the circumstances we may recede from the original position, that to obtain bonuses, growers should employ no coloured labour at all after the 28th February, 1903 ; but we are not willing to go to the length of saving that they shall be entitled to bonuses for sugar produced from cane planted by black labour after the 2’8th February, 1903. What we say to them now is, that they may employ black labour in connexion with the production of cane which has not been planted by black labour since 28th February, 1903, and upon ceasing to use that labour, and employing white labour only for a period of twelve months, may obtain a bonus on their sugar. It seems to me that that is a compromise which will meet the wishes of honorable members, and will encourage planters to use white labour. They must use white ‘labour exclusively for at least twelve months before applying for a bonus, and they cannot obtain a bonus upon sugar produced from cane planted by black labour since the 28th February, 1903. I move -

That the requested amendment be not made, but that an amendment be made by adding to> clause 2 the following words : - ‘’ Provided that nothing in this section shall authorize the pay-* ment of any bounty for any sugar cane or beet in respect to which any planting has been doneby other than white labour after the twentyeighth day of February, One thousand nine hundred and two.”

That, so far as I recollect, is the form we adopted when dealing with requests from the Senate in regard to the Tariff.

Mr FISHER:
Wide Bay

– The history of this matter is an interesting one. TheGovernment some time ago introduced » Bill to substitute for the sugar rebate provided for in the. Excise Tariff Act a bonus to which the House agreed almost unanimously, but it was further provided that planters who employed even onecoloured person on their plantations afterthe 28th February, 1903, could not obtain, a bonus if the cane were grown from stoolsplanted by black labour. I thought it mv duty to strenuously protest against that provision, and I pointed out the unfairness of requiring the growers who wished to obtain a bonus to ‘ root out the cane stools and replant. I believe that my arguments were sound, and I am sorry that they did not entirely commend themselves to a majority of honorable members. But as the matter was further discussed, it was recognised that my suggestion and the proposal of the honorable member for North Sydney offered a fair means of dealing with the question. Now that the constitutional difficulty has been disposed of, and the amendment has been accepted by the Government with a modification, I may be pardoned for expressing some satisfaction at the action which has been taken. I am bound to say that I desired something more, but I am prepared to make a compromise, because I have gathered from some of the leaders of the House that honorable members would not be in favour of paying the bonus in regard to sugar produced from crops planted by other than white labour after the 28th February last. I admit freely that there are some good grounds for taking up that position. Although I have advocated a still more liberal course, it is only fair, to those who differ from me, that’ 1 should acknowledge that, if the bounty were paid upon cane planted by other than white labour after February last, those who have relied solely upon white labour for the planting and cultivation of their crops would be placed at a disadvantage. I am anxious that it should be made clear to the sugar-growers of Queensland, that the difficulty in which I was previously placed no longer exists. It will not be necessary for the planters to plough out a single stool of cane, if they employ white labour for a period of twelve months prior to the gathering of their crops. I am glad that notwithstanding the reluctance of some Ministers to agree to this course, the Government have adopted it. I desire to see this question settled, and to let the sugar-growers know their exact position. If the Bill is to pass in the form now proposed, every additional day of uncertainty will tell against the sugargrowers, because they will not be able to claim the bonus upon the sugar produced from crops planted by black labour after February last. I am precluded from taking action to secure more than is now offered by the Government. “We must accept the proposal as it stands, or rejects it altogether.

I have no desire to endanger the whole Bill by pressing an amendment.

Sir George Turner:

– The Government proposal deals very fairly with the matter.

Mr FISHER:

– I admit freely that the only persons excluded from the benefits of the bonus are those who have persisted in planting cane by means of black labour since 1st March of this year. I must say that, after all, that is very fair, although it is not all I desire.

Sir MALCOLM MCEACHARN:
Melbourne

– I am very glad, now that the Bill has been returned to this Chamber, to have an opportunity of explaining that when it was passing through Committee,. I had intended to support the amendment proposed by the honorable member for North Sydney. I was called out of the House on business, and when I came back I was under the impression that I was voting in order to put the Minister for Trade and Customs right in regard to certain action which had been taken ultra vires of the Sugar Rebate Act. I had by interjection supported the honorable member for Wide Bay, and I was sorry that he should consider that I had ‘ wittingly voted contrary to my expressed opinions. I am pleased to be able to support the amendment, and have to congratulate the Government upon acting fairly towards the sugar planters of Queensland. I think that their original proposal would have been extremely unfair, because it would have prevented those who desired to work their plantations by white labour from receiving the encouragement of the bonus. Now an opportunity will be afforded of expanding to the fullest extent the system of working the plantations by means of white labour.

Mr R EDWARDS:
OXLEY, QUEENSLAND · PROT; FT from 1913; ANTI-SOC from 1906; LP from 1910

– This has been a very troublesome question for some time, and the sugar planters are still somewhat in doubt as . to the working of the bonus system. Several inquiries have been sent to’ me as to the real effect of the amendment requested by the Senate and of the modification now proposed. I desire to know ‘ if the suggestion made by the Senate will be nullified by the proposed amendment ?

Sir George Turner:

– No.

Mr. R. EDWARDS__ Then planters will be entitled to claim the bonus if they have employed white labour for twelve months immediately preceding the delivery of the cane.

Sir George Turner:

– Yes, but that will not apply to sugar from cane planted with black labour after the 28th February, 1903.

Mr R EDWARDS:
OXLEY, QUEENSLAND · PROT; FT from 1913; ANTI-SOC from 1906; LP from 1910

– I want to know distinctly if those who gave notice of registration before the 28th February last will be able to claim the bonus in regard to their crops at the next crushing in two or three months time.

Sir George Turner:

– There is no question about that.

Mr R EDWARDS:
OXLEY, QUEENSLAND · PROT; FT from 1913; ANTI-SOC from 1906; LP from 1910

– I am very glad to know that, because I have received a large number of telegrams which indicate that there was grave doubt whether planters who registered prior to the 28th February last would ‘ be entitled to claim the bonus.

Mr BAMFORD:
Herbert

– The modesty of the honorable member for Wide Bay is most amusing. He has obtained a great deal more than he has ever asked for or expected, and now he tells lis that he is almost satisfied. No doubt the honorable member deserved everything that he could possibly get for the way in which he has fought this question. Personally, I think that the Government have acted too liberally. I have thought so ever since they proposed the twelve months period. However, I do not intend to raise any opposition at this stage, because I think the sooner the whole matter is settled the better. I know from telegrams I have received that there is a great deal of uncertainty in the minds of planters as to whether they will be entitled to the bonus, because when the Bill was introduced the date fixed was the 28th February, 1902. I am pleased . to hear the assurance of the Treasurer that no bonus will be paid upon cane which has been planted by black labour after the 28th February, 1903.

Sir George Turner:

– The amendment will effectually put a stop to the planting with black labour after that date, if planters desire to receive the bonus.

Mr BAMFORD:

– That is very satisfactory.

Mr. FISHER (Wide Bay). - I wish it to be known to the growers that they must register if they desire to secure the bonus. I am inundated with correspondence from small growers, who, through their ignorance of the regulations, have neglected to register, and I take this public opportunity of asking the representatives of the press to let the planters know once more that they must register in order to secure the advantage of the bonus.

Motion agreed to.

Resolution reported ; report adopted.

page 2613

CONSTITUTION ACT AMENDMENT BILL

Resolved (on motion by Mr. V. L. Solomon) -

That leave be given to bring in a Bill for an Act to amend section 125 of the Constitution of the Commonwealth.

Ordered -

That Mr. V. L. Solomon do prepare and bring in the Bill.

page 2613

MINISTERIAL STATEMENT

Resignation of the Minister for Trade and Customs.

Sir EDMUND BARTON:
HunterMinister for External Affairs · Protectionist

– It becomes my duty, with the concurrence of my right honorable friend, the member for South Australia, Mr. Kingston, to make an announcement with respect to the composition of the Cabinet. I received yesterday afternoon the following letter from my right honorable friend, for I am still happy to call him my friend : - 23rd July, 1903.

My Dear Prime Minister

Re Conciliation Bill

I cannot consent to be any party to this Bill iu a form which will not make it clear that it applies to seamen, so as to permit the making of operati ve awards as to all ships engaged in our coastal trade.

I have, therefore, the honour to enclose my resignation, with an assurance of my sincere regrets that necessity compels the severance of our relations.

Yours faithfully,

  1. C. Kingston.
  2. S. - I purposely refrain from reference to any other point of difference.

The Right Honorable the Prime Minister.

Enclosed with that communication was a letter formally tendering to me his resignation of the office of Minister for Trade and Customs. The same evening I sent my right honorable friend the following letter : - 23rd July, 1903.

My Dear Kingston,

Before making . any more formal answer to the note which accompanies your tender of your resignation (which, pending your reply to this, I do not propose to make public), I wish you to reconsider a step which I consider would be highly injurious to the public interests. You owe it to yourself, to your colleagues, to me, if I may say so, and most of all to the public, to accept this advice.

The measure in which you feel so auxiously concerned gives you nearly all that you have asked. Any measure of the kind is a momentous advance in industrial legislation, and I know of no parallel to it in the laws of any Federation. In the form which the Cabinet is prepared to indorse, it is far-reaching, and will do more for the settlement of industrial strife than any measure of the kind in existence. On this, our first Federal essay in such a field, I ask j’ou earnestly to be satisfied with so much. There are those among your colleagues who have conceded much in accepting the Bill, even withont the extension of awards made under it to the crev s, not parties to a dispute, of shipping not Australian, whether British or foreign. The views and opinions of these colleagues should be considered, as well as your own.

I do not expect a reply this evening. 1 should be better pleased if you would consider this note between now and to-morrow.

Surely it is right that I should ask, and that you should give, further consideration to this matter, remembering not onry your past loyalty to your colleagues, but also the loyalty they in their turn have rendered you, and the cordial relations whicli have so uniformly marked quiofficial ; ind personal intercourse.

Believe me,

Yours sincerely,

Edmund Bahton

TheRight Hon. C. C. Kingston, P.O., K.C., M.P.,

Minister for Trade and Customs

This morning, shortly before noon, I re ceived a further letter from my right honorable colleague,who had been so good as to give the matter further consideration in the meantime. It runs thus - 24th July, 1903.

My Dear Prime Minister, -

Many thanks for your kind note, and I have, as you desired, slept over it, but I cannot retire from the position I have taken. I recognise the loss which it means to me. I prize my office. I love my work. My colleagues are my personal friends. My leader does not require to be told what are my feelings towards him - how strong ray personal attachment, nor how deep my political regard and loyahty. Whatever my many faults, want of loyalty finds no place amongst them. I value very highly loyalty to a great cause. This cause of industrial conciliation has long been dearest to my heart. It has ever been recognised as most needing legislation, especially in the Federal area, for the prevention of disasters such as the maritime strike. Shorn of all application to seamen or cheap crews - not Australian - which invade our coastal trade, any Federal Conciliation Bill would be a mockerj’, for which it would be idle to expect earnest support, and with which I cannot be associated, apart from the circumstances under which the seamen have foregone their claim to special navigation legislation this session.

I have spared no pains to mee my colleagues. I have done all that 1 can do without loss of selfrespect, and I can do no more.

With kindest regards,

Yours faithfully,

  1. C. Kingston.

To that I sent the following reply, not long before the re-assembling of the House this afternoon : - 24th July, 1903.

My Dear Kingston, -

I have your note of this morning, and as my appeal to you has not succeeded, I must reluctantly consent to your action in severing your official connexion with the Ministry.

I warmly acknowledge j’our cordial expressions of regard for your other colleagues as well as. myself, and I cannot conceal the sorrow which your retirement causes me.

The terms of your letter necessitate my addinga few remarks. I do not share any apprehension of a maritime strike. As I have informed you, I am convinced that there is no likelihood during, at any rate, the next twelve months of any reduction in the rates of wages paid to our seamen.

Sir EDMUND BARTON:
Protectionist

– I may mention that I have warrant for that statement -

I have publicly stated our intention to introduce a comprehensive measure, for the passage of which within that period ample time would thus beafforded. I mean a Navigation and Shipping Bill, containing a provision for the payment of our ruling rates to the men engaged on all vessels, even from abroad, taking part in our coastal trade. This could constitutionally, and without doingviolence to any international law or usage, form part of such a measure as one of the terms on which we grant the privileges of our coastal trade. As j’ou are aware, the opinion of the Cabinet is that the provision you desire to make in the Conciliation and Arbitration Bill would be open to objection on both constitutional and international grounds if placed in a measure having such distinctly different purposes, and would be likely to defeat itself. The insertion of the provision in the Navigation Bill is therefore in our judgment the course best calculated tosecure to our seamen the protection which we, like yourself, desire to give them. We have, however, declined to deal piecemeal with the objects of our Navigation and Shipping Bill, and His; Excellency in his speech on opening Parliament intimated that Ministers were not sanguine of being able to deal with . that measure this session.

With kind regards,

Yours sincerely,

Edmund Barton

To the facts disclosed in these letters I have not much to add. The severance of such relations as have existed between my right honorable friend and his colleagues,, independently of the warm regard which has always subsisted between him and me, is a thing not to be contemplated without- considerable sorrow, and the personal aspect of the matter is one that to me is especially painful. No one, however, can with hold from my right honorable friend, or from his colleagues I hope, the tribute of respect which adherence to deliberate political beliefs should evoke. As the measure is not on the table, I may, perhaps, give a very short statement of the point at issue, and if in that statemerit I’ lack any frankness or candour, I trust that my right honorable friend will supply my deficiencies. As honorable members know, it is the intention of the Government to bring in a Bill dealing with the question of conciliation and arbitration. It was also their intention to introduce during this session, if possible, a Navigation and Shipping Bill, but that intention - as has been announced - must give way for the present. The Navigation and Shipping Bill is to contain a provision, as to which I am committing no breach of confidence in making an announcement, because it has been the subject of several public statements on my part. Every Government or rather every Parliament has a right to dictate the conditions upon which the privilege of joining in its coastal trade may be enjoyed, as was clearly laid down the other day in the decision of the Privy Council in the ships’ stores case. As a condition of according that privilege, we propose in the exercise of our undoubted right of defining the terms under which it should be enjoyed to provide that the ruling rates of wages which are payable by our shipowners to seamen employed in our own coastal trade shall be paid by all who engage in that trade, even though their vessels may come from abroad. However, that provision is a regulation of navigation or shipping, which, we think, should properly be included in a Navigation and Shipping Bill. As to the Conciliation and Arbitration Bill, without going into details, our difficulty arose in this way : My right honorable friend desired to insert a provision which would cause awards to extend to seamen and shipping, not purely Australian, but coming from abroad, and, of course, following the scheme of the Bill, those awards would operate as rules to that extent, even though the whole of the persons engaged in that trade were not represented in the arbitration. The difficulty which the Cabinet saw in that provision was that in an Arbitration Bill it did not in itself constitute a condition attaching to engagement in our trade, as did the ships’ stores provision in the Customs Bill, but that it was a provision which my right honorable friend sought to insert in a measure having for its general scheme of application the settlement of industrial disputes in our midst, the extension of which, from State to State, did not seem to us to imply an extension of the area of dispute beyond their territorial limits. We thought, therefore, that such a provision would be open to objection on two grounds. In the first place, we thought that in the case of the crews of vessels owned abroad it could not legally operate beyond our jurisdiction, and, therefore, that it might be defeated by a decision of the courts. Secondly, we thought that, unless it found its proper place, that is, in a Navigation and Shipping Bill, it would be open to objection from those outside our jurisdiction, especially from international sources. I do not desire to disclose more than is necessary for. our purpose, but while the members of the Government generally could see that such a provision would probably find its place presently in legislation apposite to the question, we could not see how it was to produce the intended effect if we placed it in an Industrial Arbitration Bill. That is the whole of this difference between my right honorable colleague and the other members of the Ministry. It is purely a difference of opinion - of conscientious opinion - on both sides. My right honorable friend holds strongly that if this provision would be legitimate in one class of Bill it would be legitimate also in another. We, on the other hand, think that it can only find its legitimate place, so as to be constitutionally valid and to be effectual, in a Bill dealing with the conditions under which we admit others to the privileges of our trade. I am happy to be able to assure the House that, save for our differences in regard to this Bill, there is nothing whatever between ‘us officially, and that there is nothing at all of a personal character. In circumstances of this kind, where there is no tension of feeling, and where we have been engaged, as we have been for a long time, in endeavouring to bring ourselves into line on such a matter, the fact that there has been absolutely no quarrel between us only intensifies the sorrow which the severance occasions. I wish to assure the House that throughout our official connexion I have had from my right honorable friend nothing but loyalty, and throughout our personal association nothing but high regard:

Mr KINGSTON:
South Australia · Protectionist

– I should like to say that I reciprocate most cordially every kind word that the right honorable the Prime Minister has uttered in this connexion - and he has uttered no word which was not kind. I am sorry to have to differ from my colleagues, for all of whom I have the most intense respect and friendship.

Mr Wilkinson:

– Australia will be sorry, too.

Mr KINGSTON:

– But a time sometimes comes in our history when we deem it to be only our duty with deep regret to take a certain course, severing us, in some respects at least, from, for example,’ a Ministerial association which has been long enjoyed. It seems to me that when such a time comes it is the duty of both parties to the difference of opinion to bow with mutual respect to the inevitable. The step which I have taken - and which I can assure honorable members I have not taken without the utmost consideration - is one to which it- seems to me there is no alternative. ‘ What is the position ? It is this : I feel strongly in regard to many matters. I hold strong views in regard to many matters ; but I feel especially strongly on the question of industrial conciliation and arbitration. I have done my best to make it the study of my life, and, it seems to me, that I owe to it a loyalty which exceeds all other considerations. A time has come when I must either resign my association with my old friends in the Ministry, or consent to advocate before the House and the public legislation in which I do not believe. In these circumstances, what am I to do? There is one question above all others in connexion with industrial conciliation, and especially in connexion with Federal industrial conciliation which .is of the gravest importance. I refer to the application of the principle of conciliation to the maritime question - to our coastal trade - for the purpose of the avoidance of a disaster such as the huge maritime strike which occurred some years ago. In 1890, when I had occasion to introduce certain legislation in the South Australian Parliament, I had not spoken for five minutes before I pointed out that, although we were trying in that State to do what we could to prevent a recurrence of the evil to which

I have referred, we could not act effectually until we had obtained Federal legislation on the subject. I referred then to the maritime strike as being the inspiring cause- in connexion with one or two other great industrial struggles which we had then recently experienced - of the introduction of the legislation which I was advocating at the time. What is the position to-day? There may be some difference of opinion, but I claim to have an intimate acquaintance with the true position of affairs. I know that it is only by timely concession and mutual consideration that trouble has been avoided. The position to-day hangs upon the lightest thread. I know full well that time and again I have done what I could in the matter, for the purpose of inducing further consideration. That consideration may be given, but I assert that no Federal Conciliation law will be worthy of the name if it does not provide for the settlement of questions of the character to which I refer -disputes between those who are engaged in our coastal trade. What is the difficulty ? It is this : The Australian ship-owner generally is prepared to concede fair wages to his men, but he does it to-day in these circumstances - that he is exposed to the cruel competition of others who know no similar regard for those whom they employ. To-day the Australianship-master carries on his business in these circumstances - that he gives double the wages paid by those who compete with him in the coastal trade of Australia, if the Bill which I should have had to advocate, if I had remained in my accustomed place, were passed in the shape in which I have been permitted to introduce it, no remedy would be possible of application. In these circumstances, painful as the position is, and re-echoing every word that my leader has uttered, I see no alternative than the course which I propose to pursue. It is not so long ago that, speaking to the representatives of the shipping industry, I told them that we could not introduce a Navigation Bill at this stage, but that a Conciliation Bill would be introduced which I believed would in some measure give the remedy. I thought at the ‘ time that I spoke with a uthority. I may have misunderstood the position, but whatever misunderstanding there may be, , I am content to pay the penalty^ doing that which I believe to be my duty, and at the same time wishing good luck to those with whom I have had the honour to be associated.

Sir WILLIAM MCMILLAN:
Went worth

– - Having regard to the position which I occupy, I do not think that the House will expect me to say much on the present occasion. I am ignorant of precedents, for an occasion such ns this has never before occurred during my parliamentary career. It would be equally bad taste for me to say one word as to the merits of the controversy. All that I can say is that we honour aud respect the principle by - which the right honorable member for- South Australia is actuated in determining, when he finds that, on what to him is a vital question, ho differs materially from his colleagues, to resign his office rather than surrender his conscientious opinion. I think that is a sound principle of Cabinet Government, and I hope that it will never be’ forgotten. The whole principle of Cabinet Government is that upon all important matters the Cabinet shall be a homogeneous whole. On behalf of the Opposition, I thank the Prime Minister for having given this information to the House at the earliest possible moment. Nothing would have been more undesirable than for the Government to allow a period of misunderstanding and rumour to elapse during which the actual state of affairs would not have been known to the public. We know exactly now what has occurred, and before I resume my scat I feel that, as I have hud many differences with the right honorable gentleman who has resigned his office, I should say that, in spite of those differences, I consider he has always acted up to his lights at any rate. I beg to assure him, oh behalf of myself and the Opposition, of our hearty respect for his conduct to-day.

Mr MCDONALD:
Kennedy

– I regret very much that the honorable member for Bland, who is the leader of the party to which I belong, is not present. 1 think, however, that I speak on behalf of the members of that party when I say that we offer to the right honorable member who has just resigned his office our hearty congratulations upon the course which he has pursued. I consider that it is a manly and straightforward action, and I hope that it will be emulated by other public mcn when they find themselves in a similar set of circumstances. Unfortunately it is a line of action that has not always been followed in Australia. I believe that the right honorable gentleman has set a good example, and, although I have not consulted other honorable members of the labour party, 1 feel confident that on their behalf I may congratulate him on his manly and straightforward conduct.

Mr O’MALLEY:
Tasmania

– - Mr. Speaker–

Mr SPEAKER:

– I would remind the honorable member that there is no motion whatever before tha Chair. I believe that I have consulted the general desire of the House id allowing the statements which’ have been made ; but if there is to be a general debate, I must ask the Primo Minister to submit a motion.

House adjourned at 2.30 p.m.

Cite as: Australia, House of Representatives, Debates, 24 July 1903, viewed 6 July 2017, <http://historichansard.net/hofreps/1903/19030724_reps_1_14/>.