House of Representatives
14 April 1904

2nd Parliament · 1st Session



Mr. Speaker took the chair at 2.30 p.m., and read prayers.

page 988

PRINTING COMMITTEE

Report (No. 3) presented by Sir John Quick, read by the Clerk, and agreed to.

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PETITION

Mr. R. EDWARDS presented a petition from the Brisbane Chamber of Manufactures, praying the .House not to pass certain clauses of the Conciliation and Arbitration Bill.

Petition received.

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SESSIONAL COMMITTEES

Motions (by Mr. Deakin) agreed to -

That the number of members appointed to serve on the Standing Orders Committee be increased to nine, and that Mr. Dugald Thomson, member for North Sydney, be a member of such Committee.

That the number of members appointed to serve on the Library Committee be increased to eight, and that Mr. G. B. Edwards, member for South Sydney, bc a member of such Committee.

That Mr- Mauger, member for Melbourne Ports, be a” member of the House Committee.

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SUB -LETTING MAIL CONTRACTS

Mr POYNTON:
GREY, SOUTH AUSTRALIA

– About ten months ago I brought under the notice of the Government a case in which a mail contract, for the performance of which £160 a year was being paid by the Commonwealth to a Mr. Vines, of Ballarat, had been sub-let for £70 to a man named Levison. The facts as I gave’ them were admitted, and it was stated on the floor of the House that the contract would be forfeited, because of the breach of the postal regulations. I have since learned’ that the contract has not been forfeited, and I should therefore like the Prime Minister to inform the House of the causes why the proposed action has not been taken.

Mr DEAKIN:
Minister for External Affairs · BALLAARAT, VICTORIA · Protectionist

– The honorable member was good enough to inform me last evening that he proposed to ask this question, and I have, therefore, communicated with the post-office officials upon the subject. I was surprised, as he must have - been, to learn that the matter had not been finally dealt with- The information supplied to me is that the Department had satisfied itself of certain facts in the case, and had proceeded to take some action, when it was met by a legal difficulty, which was referred to the Commonwealth Solicitor for advice. That advice has been given, and action upon it will probably be taken upon the return of the Postmaster-General.

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QUESTION

PREFERENTIAL RAILWAY RATES

Mr DUGALD THOMSON:
NORTH SYDNEY, NEW SOUTH WALES · FT; ANTI-SOC from 1906

– Is the Minister for Home Affairs aware that a Conference of railway experts, to be followed by a Conference of Railway Commissioners, is at present sitting in Sydney? If so, will he take steps to bring under the notice of the members of those Conferences, and ask their consideration of, the question of the abolition of the preferential railway rates which exist in some of the States, decisions in regard to which will constitute a large portion of the work of the InterState Commission, if it is brought into existence ?

Sir JOHN FORREST:
Minister for Home Affairs · SWAN, WESTERN AUSTRALIA · Protectionist

– I am aware that these Conferences have either met or are about to meet in Sydney. On the 4th August, 1902, the Prime Minister of the day communicated with the Premiers of the States on1 the subject of preferential railway rates, without any’ definite result, and on 23rd March last a further communication was addressed to them by this . Government, asking for information as to the instances in which preferential or differential rates are imposed; but with the exception of an acknowledgment, and in some cases of a promise to have the matter looked into,’ nothing has come of our action. I see no objection to the Premiers of the States being again addressed upon the subject, and’ requested to consider whether it is not advisable for them to bring the matter under the notice of the members of these Conferences. I shall have very much pleasure in moving the Prime Minister in that direction.

Mr DUGALD THOMSON:
NORTH SYDNEY, NEW SOUTH WALES · FT; ANTI-SOC from 1906

– At once?

Sir JOHN FORREST:

– At once.

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QUESTION

TRANSCONTINENTAL RAILWAY

Mr CARPENTER:
FREMANTLE, WESTERN AUSTRALIA

– When will the Minister for Home Affairs introduce the promised Bill to provide for the survey of the proposed transcontinental railway?

Sir JOHN FORREST:
Protectionist

– -Very shortly. I hope.

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QUESTION

PAYMENT OF ELECTORAL OFFICERS

Mr PAGE:
MARANOA, QUEENSLAND

– I desire to ask the Minister for Home Affairs,’ without notice, if he can inform the House when additional returning officers and assistant returning officers employed at the late elections in December last will be paid for their services. Itis four months now since the elections took place, and, whilst none of them have been paid, many are out of pocket for expenses.

Sir John Forrest:

– In what district?

Mr PAGE:

– I refer to the whole of them. In Queensland, if the right honorable gentleman pleases. That is a big enough district.

Sir JOHN FORREST:
Protectionist

– So far as I am aware, with one or two exceptions, in which there are disputed accounts, they ‘ have all been paid already.

Mr POYNTON:

– Following up the same subject, I desire to ask the Minister for Home Affairs whether any arrangements have been made to pay an adequate amount for the services rendered by assistant returning officers. I understand that they received only £3 3s., and there are some cases in which that remuneration was glaringly insufficient for the services rendered.

Sir John Forrest:

– In South Australia?

Mr POYNTON:

– I speak of South Australia. I would ask the right honorable gentleman whether arrangements are to be made to pay them an adequate sum for the services they have rendered?

Sir JOHN FORREST:

– So far as my memory goes, the matter has been settled, and the officers paid a sum which was considered satisfactory by the Chief Electoral Officer, and which I have no reason to doubt was accepted as such by the assistant returning officers.

Mr Page:

– I have grave reason to doubt it.

Mr POYNTON:

– Was the amount ^3 3s. ?

Sir John Forrest:

– No ; more : I think it was -£io 1 os.

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QUESTION

NEWSPAPER POSTAGE

Mr KELLY:
for Mr. Willis

asked the Postmaster-General, upon notice -

  1. Whether it is a fact that Australian and British authorities discourage the interchange of newspapers through the medium of special postal rates?
  2. Whether it is a fact that Australian newspapers re-posted in England or British newspapers posted in Australia are. charged a special rate?
  3. Whether these rates are the outcome of an understanding between the Australian and British Postal Departments?
  4. Whether the Government are aware that the British Postmaster-General has agreed to deliver in the United Kingdom without surcharge, newspapers posted in New Zealand at a postage rate of one penny (as against a surcharge of 2 1/2 d. upon Australian newspapers), irrespective * of weight ?
  5. Will the Postmaster-General make a proposal to the British authorities by which Australian newspapers may be delivered in the United Kingdom at the reduced rate and upon similar conditions to those extended to the Government of New Zealand?
Mr DEAKIN:
Protectionist

– In reply to the honorable member’s questions, £ have to state -

  1. It is not a fact. The interchange of newspapers between Australia and Great Britain is governed by the provisions. of the Postal Union Convention.
  2. Publications which are known and recognised and known in Australia and Great Britain respectively as newspapers within their territory are precluded by the postal laws and regulations of both countries from such recognition when posted outside that territory.
  3. Answered by replies to questions 1 and 2.
  4. The Postmaster-General is aware that newspapers posted in New Zealand .are now delivered in Great Britain without surcharge, if paid at the New Zealand rate of one penny each. He is not in possession of any knowledge of a surcharge on Australian newspapers that have been fully prepaid at the Postal Union rate.
  5. The matter is receiving consideration. The circumstances in this respect in Australia and New Zealand are very different; in the latter a considerable revenue is derived from the inland postage on newspapers of one half-penny each, irrespective of weight, instead of a bulk weight of a penny for twenty ounces on the aggregate weight posted as obtains in Australia, and the distances from the coast are small as compared with those over which newspapers are carried in Australia.

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QUESTION

FEDERAL PATENT OFFICE

Mr POYNTON:

asked the Minister for Trade and Customs, upon notice -

Whether vacancies in the Federal Patent Office will be filled from the different States’ staffs, or do the Government intend to make the selections from other sources than the States’ Patent Offices ?

Sir WILLIAM LYNE:
Minister for Trade and Customs · HUME, NEW SOUTH WALES · Protectionist

– In reply to the honorable member’s question, I desire to state that the principal appointments will be made from the States’ Patent offices, so far as suitable officers are available. If necessary, selections will be made from the Commonwealth Service, or from the Public Services of the States.

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QUESTION

RUSSO-JAPANESE WAR

Mr KELLY:

asked the Minister of Defence, upon notice -

Whether there is any objection to laying on the table of the House a copy of the papers in connexion with the choice, and despatch to the East, of an officer to study, on behalf of the Commonwealth, the. progress of the Russo-Japanese War?

Mr AUSTIN CHAPMAN:
EDEN-MONARO, NEW SOUTH WALES · PROT; LP from 1910; NAT from 1917

– In reply to the honorable member, I desire to say that it is not considered advisable to lay these papers on the table of the House at present.

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PAPER

Sir GEORGE TURNER laid upon the table the following paper : -

Transfers of amounts approved by the GovernorGeneral in Council (dated13th April) under the Audit Act.

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QUESTION

COMMONWEALTH LIFE AND ACCIDENT AS SURANCE DEPARTMENT

Mr HUME COOK:
BOURKE, VICTORIA · PROT

– I move -

That, in the opinion of this House, there should be established a Commonwealth Life and Accident Assurance Department, under the control, management, and guarantee of the Federal Government:.

When, some months ago, I submitted a motion somewhat similar to this, its consideration was rather complicated by the fact that it had to be taken in connexion with the consideration of the Public Service Bill, and there, consequently, was not a clean-cut issue before honorable members. On this occasion, the matter referred to in the motion can be dealt with on its merits, and it is on its merits alone that I ask for its determination. I may take somewhat longer than I desire in addressing myself to the question, for the reason, perhaps, that I have been somewhat overburdened with material supplied to me by the kindness of some honorable members who are interested in the subject, and of some persons outside who have been good enough to assist me. At the outset, I wish to express my obligation to Mr. Thodey, the editor of the Insurance and Banking Record, for his kindness in lending me certain books of reference, and his assistance in directing my attention to others which have proved valuable. On this occasion, the issue raised is clean cut, and the motion covers the whole ground. It is not a proposal to start an establishment to include State servants only, but one which can be extended to include all other classes in the community. What I propose is the creation of a State Department of Mutual Assurance, and the beginning of what, in my judgment, ought to prove an Industrial Life Assurance Department conducted and managed by the Commonwealth. I lay some emphasis upon the word industrial, because

I hope to prove that that class of business requires to be catered for more fully and on some better basis, so far as the assured are concerned, than is at present the case. It will no doubt be urged, and perhaps properly urged, that the other class of business, though important, is satisfactorily provided for by the ordinary assurance offices, and that there is no great need to start a State establishment to come into competition with them for that business. I do not propose to devote myself very much to that aspect of the question, though, of course, I do propose to include ordinary assurance business in the work of such a State Department as I have in my mind’s eye. I am especially desirous and particularly anxious, that the class of business which shall be done by the State Department, if inaugurated, shall be that which will meet the requirements of the great middle and poorer classes of the community, who cannot, under existing conditions, enter into life insurance upon a basis satisfactory to themselves, either from the point of view of the stability of the offices or from their own financial position. The idea of State life assurance is not by any means new. In putting forward proposals of this kind, we are sometimes met with the objection that the legislation sought has not been tried, that it is a vast experiment, a hugeundertaking, or something of that kind, and other sentences are very often uttered containing a number of awful adjectives calculated to frighten the timid and unthinking.

Mr Fowler:

– This is also State socialism, which is a bad term in Victoria at the present time.

Mr HUME COOK:
BOURKE, VICTORIA · PROT

– I shall leave the honorable member to answer the question put to him the other day as to what State socialism is. I am not to be frightened by big words, nor by strange phrases, and I shall strive to do the right thing, so far as I know it.

Mr Wilks:

– And the wise thing.

Mr HUME COOK:
BOURKE, VICTORIA · PROT

– And the wise thing, which is always the right thing. I point out, however, that so far as State life assurance is concerned, this is not altogether a new proposition. We have examples before us of the British Annuity System, about which something was said on a former occasion, and into the merits of which I need not enter at this juncture. In South Australia, I understand that there are two systems in operation; one which has relation to the Superannuation Fund of the Education Department, and another having special relation to the railway servants of that State and their life assurance business. Not very long ago a proposal was put forward in Victoria for the establishment of a Life Assurance Fund in connexion with its Education Department. Whether that proposal has yet reached fruition I am not at present in a position to say, but it is certain that the State authorities have given the matter consideration, and I believe that a sche e has actually been proposed. In Germany, where we have the most striking example of industrial life assurance, the system is perhaps more complete than anywhere else.

Mr O’Malley:

– That is socialism.

Mr HUME COOK:
BOURKE, VICTORIA · PROT

– There, I understand, the system is largely, if not wholly, compulsory. So far as we. can gather from the official reports on the subject, it has given a great deal of satisfaction, and is not likely to be discontinued. In New Zealand there is a State Life Assurance Department, which, according to the best authority, has also proved satisfactory. Regarding this system we know something more than of other cases, and it is largely upon the New Zealand model that I propose that the Commonwealth Life and Accident Assurance Department should be established. That model is a safe one to follow. It has been proved sound, safe, and certain, is exceedingly popular, and is transacting a large amount of business which, so far as the general public are concerned,’ is likely to be extended..

Mr DUGALD THOMSON:
NORTH SYDNEY, NEW SOUTH WALES · FT; ANTI-SOC from 1906

– Has the honorable member any figures to give us in support of his statement?

Mr HUME COOK:
BOURKE, VICTORIA · PROT

– I shall supply those later on. Finally, upon this head, we have an example in the action of our own Federal Government. A few months ago the Treasurer determined that the fidelity guarantee business, in connexion with the public servants of the Commonwealth, should be conducted through his Department, and under his control. That was a beginning in the right direction, which, I am sure, will have the full approval of this House, and I desire now to see an extension of that principle to life assurance generally. The trend of legislation to-day is in the direction of interfering, from the State point of view, more and more with the business of life assurance. There is scarcely any country in the world to-day in which life assurance business is not governed to a large extent by statute law, and the more advanced the character and extent of its business, the greater are the restrictions applied. In America and Germany, in particular, where the volume of business is really enormous, life assurance is carried on under restrictions of a far more rigid character than many honorable members probably, suppose. In the United States, notwithstanding the restrictive character of the legislation in force there, three great companies have assured some 9.000,000 persons for something like £750,000,000. These figures are obtained from the Insurance and Banking Record of last year, and were contained in an article entitled “ The leviathans of the United States.” When we consider the enormous life assurance business transacted in a country like the United States, we begin to see the necessity of doing something to conserve the public interests. Coghlan asserts that the total sum for which the lives of residents of the Commonwealth are assured is something like £125,000,000, and it is satisfactory to note that of this amount £112,000,000 is assured with local offices. However, I propose at this stage to speak more particularly of the trend of legislation rather than of the amount of the assurances. The figures merely point to the necessity for legislation, more especially in view of the great . public interests involved. I have mentioned that in almost every country statute law governs the business of life assurance ; but in Germany and America, where legislation has been passed recently, the restrictions placedon the assuring companies are surprising. In 1891 the German Parliament dealt with this question, and to a very large extent, consolidated the law. The legislation then passed secured for the German offices a very much larger share of the business than they formerly enjoyed. The object aimed at was twofold, and in both respects success appears to have attended the efforts of the legislature. First of all, it was intended to place life assurance under stricter control so far as the State was concerned, and to give better guarantees to the public, and, secondly, an attempt was made to secure for the German offices a monopoly of the business, it being insisted that investments should be made in German securities. I propose to quote from the Economic Journal of December, 1902, which makes specific reference to the Act to which I have alluded. The first feature of the measure, to which I desire to direct attention is that which constitutes what is called an “ Imperial authority “ for the supervising and conduct of life assurance business. This consists of a board of nine persons, five of whom are directly appointed by the Crown, while four others are assistant members. These persons supervise all private assurances in Germany, and they are charged with powers which, in a British community, would be looked upon as savouring of tyranny, .although they do not appear to have been cavilled at in Germany. Their first business is to interest themselves in the articles of association of any company which proposes to carry on life assurance business. Next they have to examine its financial position and to make the strictest inquiry as to what it proposes to do, and the methods upon which it proposes to conduct its business. At page 567 of the Economic Journal it is stated : -

Any company applying for permission to carry on insurance business must submit its scheme of operations to the Supervising Board. The scheme of operations must include the company’s articles of association, the general insurance con,ditions, and the technical rules on which the business is conducted, in so far as the class of business to be transacted renders such rules necessary. In the case of a life insurance company, particulars must be given on the following points : Table of premiums, mode of calculating premiums, and proportion to be retained for the insurance fund (premium reserve), rate of interest forming basis of calculation, and principles as to “ loading.” The tables of probabilities as to duration of life, and the danger of illness and incapacity must be appended to the scheme of operations, as well as the mathematical formulas used ‘for the calculation of premiums, which must be illustrated by examples with figures.

That is a very large order, and includes a very strict and searching inquiry into the plan of operations to be followed. The article goes on to say : -

In order to counteract an obvious method of evasion, it is provided that any subsequent alteration of the scheme of operations must be submitted for the approval of the Board, and cannot be carried out until such sanction has been obtained.

So that they do not provide merely for a preliminary investigation. They take care that there shall be no underhand work on the part of the company, but that the scheme of operations, the tables of premiums, and all other matters shall receive sanction before anything is done, and that any proposed alteration must be subject to sanction. It will thus be seen that life assurance business in Germany is merely permissive, and that it is under very strict supervision. In order that honorable members may understand how close the supervision is it is necessary to quote further : -

An insurance company having satisfied the Board of the correct nature of its constitution, the soundness of its scheme of operations, and the healthy state of its financial condition, is allowed to start business; but it continues to be controlled as to the conduct of its affairs. It is the duty of the Supervising Board to watch the conduct of the business of all insurance companies subject to its jurisdiction, and more particularly to see that the provisions of the law and the rules laid down by the scheme of operations are properly carried out, and it may at any time examine the accounts and balance-sheets, send representatives for the purpose of taking part in board meetings, or general meetings, cause meetings to be convened, or, in case of default, convene and announce them at the cost of the company whom they concern.

I do not know that anything so forward as that has ever been attempted in any other country. As the quotation shows, the Imperial authority in Germany has power under the statute law to send representatives to any meeting of a company, whether it be a meeting of the board or a general meeting ; and if it is not satisfied with the conduct of such meeting, it may convene one upon its own account at the expense of the company. In short, it can do anything it pleases in order to safeguard the interests of those who assure. I may add that so strict is the law that if a company fails to obey . the directions given by the Imperial authorities it may be subjected to penalties which go so far as suspension - the actual prohibition of its operations - unless it will agree to what is suggested by this board. As I indicated in my earlier remarks, the investments made by these companies must be in approved German securities, in order that their solvency and stability mav be guaranteed. With respect to the non-German companies, it is now almost impossible for them to carry on operations. That, however, does not concern us much in this connexion. What does concern us is that in the Act of 1901 it was thought necessary and advisable, in an autocratic country like Germany, to take steps which practically guarantee to the policy-holders everything that the companies undertake to give them for the premiums which they pay. In effect the German system is only just one step short of an Imperial assurance company. When -we look at that system in the light of experience, it will probably be found to be equal, if not superior, to such an assurance company. It is equal in the sense that the guarantee which is provided by the Government, in the form pf a supervising board, is as good as if the business were conducted by the State itself, and it is possibly superior to a State institution in that the Government compels the companies to do all the work, thereby avoiding the expense that would be involved, at the same time guaranteeing to the public a safe and solvent institution. Of course that method of business might not suit the Australian or the English public. If the business is to be guaranteed we would prefer that it should be carried on by the State authorities. That is the method which I desire to see adopted. I think it would be infinitely preferable to establish our own assurance company, carry it on under our own management, and do the business in our own way, rather than intrust it to others. This sort of legislation clearly points the way to the initiation of a State Department of Assurance, and when we consider the general restrictions which are imposed upon life assurance companies the world over, there does not seem to be very much left in the argument that we ought not to embark upon this business, simply because no other Government has done so. I hold that life assurance is in some measure a principle of political economy, and also a ‘matter of very grave State concern. If we study the figures’ relating to the expenditure in Australia upon benevolent asylums, hospitals, and institutions of a kindred character, we shall be astonished to find that the sum aggregates millions sterling. If there .were a larger system of life assurance, and by consequence a greater amount of thrift in connexion with the large industrial public of Australia, in my judgment the present heavy demands for charity would not be made upon the general public, nor upon the States themselves as such. I find, from Coghlan, that the amount voted by the several Governments of Australia for benevolent and destitute purposes, represents £306,000 annually. If we add to that the sums voted for the conduct of hospitals, the expenditure totals £l>347,°°°- Though, perhaps, it -would not be quite fair to add the pension list to that sum, still, it is interesting to know1 that if we did so, the amount’ expended in this direction would aggregate nearly £2,250,000. If we can avoid even an appreciable portion of that expenditure by establishing a system of State life assurance, we shall be doing a very good work. In any case we are face to face with the problem that men an-1 women are not able, owing to existing industrial conditions to make sufficient provision for their old age; and unless we can devise for them a cheap, sound, and safemethod of life assurance, we are naturally bound to institute to a greaterextent than would otherwise be necessary a system of pensions. It is absurd tothink that the old men and women of Australia can be allowed to go down to thegrave in destitution and want. We ought to adopt every reasonable safeguard against that state of things. One of the best steps along the lines of self-help, it seems to me, is to give to the general public, whose rate of pay will not permit of their saving sufficient money to provide for their old age, an opportunity to invest a portion of their earnings in such a way as will safeguard those who are left behind. But this cannot very well be done at present, for, notwithstanding the large number of life assurance offices in Australia, and, in many cases, their economic soundness, if the general public were consulted it would probably be found that they are somewhat suspicious of them, even where thev are not absolutely shy.

Mr DUGALD THOMSON:
NORTH SYDNEY, NEW SOUTH WALES · FT; ANTI-SOC from 1906

– Some of those institutions are conducted upon the mutual principle.

Mr Mahon:

– That does not make them any better.

Mr HUME COOK:
BOURKE, VICTORIA · PROT

– If we examine the figures relating to these institutions, we shall find that some of them are not as sound as they appear to be. Indeed, in some cases the suspicions entertained by the public are quite justified. It has always been my object to discourage proprietary companies, and to encourage mutual companies. But in any case I prefer, speaking as a public man, that a Life Assurance Department should be established by the State, which would be beyond all suspicion, which would attract business from the class of persons who cannot now deal with large life assurance institutions, and which might also obtain some of the business which at present falls to companies that are not worthy of receiving it - companies # whose methods and management warrant the suspicion to which I have already referred. I repeat that in my opinion we should follow the lines adopted by ‘the New Zealand Department. The history of that institution is very interesting, and perhaps I may be permitted very briefly to recite it foi the information of honorable members. It was founded in 1870 as an ordinary life assurance office. Since then it has added accident assurance to its business, just as I propose . that that branch of business should be worked in conjunction with the office which I have in contemplation. I understand that the New Zealand Government intend to still further enlarge the functions of the Department by establishing a State system of fire assurance. It was not until 1893 that the civil servants of New Zealand were brought under the operation of the statute dealing with this particular Department. Previously they had the right to assure with any office they chose. Consequently the State Life Assurance Department of New Zealand had to begin operations without a business nucleus of any kind whatever. It had to forge its way against the competition of strong companies such as the A.M. P. Society and the National Mutual Society, not to mention British and other companies. It has also had fo work during the whole period of its existence under the disability imposed by the restriction of its operations to New Zealand. Further .than that, its investments are limited, in a very wise way, I think, to municipal and national securities. Consequently ithas not the same opportunities to attract business as have other companies whose operations are not so restricted. But, despite these disadvantages, and notwithstanding that it had to commence operations in competition with very strong companies, it began with a scale of premiums somewhat lower than those fixed by ordinary companies. The natural corollary to that was that it offered slightly lower returns than those of other companies. Its aim, however, was to establish a kind of industrial assurance department, and that is what I desire the Commonwealth ‘to do. I have said that it fixed its rate of premiums below that of outside companies, and the reduction made by it in that direction has been more than justified. The profits were naturally lower, because the premiums were lower, and also because in New Zealand direct taxation, which is the only kind of taxation that can, and does, hit life assurance companies very hard, is in greater evidence than in any other part of Australasia. The New Zealand department, laboured under that special disability, but, nevertheless, the figures, relating to its progress form very interesting reading. At the outset it was unable to draw upon the civil servants to form the nucleus of its policy holders. It had to compete, as I have mentioned, with powerful companies, and for twenty-two years it faced a struggle which is perhaps unprecedented in the history of any Life Assurance Department. At the end of that period it was ninth on the list of Australian life assurance offices. That was in 1892, but in 1902 - after the lapse of another ten years - it had advanced to the position of second on the list. The Public Service had been brought in, and the public had begun to realize the advantages which the Department offered, with the result that it was second only to the very strong A.M. P. Society. This, I think, speaks volumes for the wonderful success achieved by the Department, as the result of the adoption of a consistent and reliable policy. The figures relating to the business transacted by life assurance offices in New Zealand up to the year 1901 are of considerable interest. I find, from a reference to Coghlan, supported by the Insurance and Banking Record, and other financial newspapers, that the progress of the New Zealand Department has been along the line of industrial assurance. It has developed in the number of its policy holders rather than in the amount assured. The total number of policies issued in New Zealand up to 1901 was 94,429,- representing a sum of £23>567>427- The A.M.P. Society had issued 28,196 policies, while the New Zealand Life Assurance Department had issued no less than 41,291. In other words, nearly half of the total number of policies taken out in New Zealand up to 1901 were issued by the New Zealand Life Assurance Department. Then I find that, the 28,196 policies issued by the A.M.P. Society represented a sum assured of .£7,769.232, whilst the 41,291 policies issued by the New Zealand Life Assurance Department represented only £2,000,000 in excess of that amount. These sets of figures support my statement that the New Zealand Life Assurance Department is inducing a greater number of persons to assure - because of the more at- tractive scale of premiums wHich it offers and also because of its solvency - and’ that the volume of its business, from the standpoint of pounds, shillings and pence, does not show the same ratio of increase as that of the A.M. P. Society. It is satisfactory to note, however, that judged from the number of persons assured, the volume of its business is greater than that of any other life assurance office in Australasia. The same statement applies to the business transacted in New Zealand during 1903. When Sir Edmund Barton was Prime Minister he was good enough to forward me an extract from the Mutual Provident Messenger, which was rather a laudation of the society’s own business. The quotation, which is dated 1st June, 1903, reads as follows : -

New Zealand Branch. - As disclosed by the society’s annual report, its business in New Zealand continues to show very satisfactory progress. This. is the more gratifying when it is remembered that in that colony the competition of the Government Life Insurance Department has to be faced. The returns of that department just published for the past year enable us to furnish the following comparative results as regards the net increase of business in New Zealand : - Net Increase : A.M. P. Society, year 1902 (N.Z. branch), policies, 1,248; sums assured, ^306,008; annual premiums, ^10,504 is. 4d. ; N.Z. Government Life Insurance Department, policies, 1,115; sums assured, ^154,470; annual premiums, ^6,856 os. rod.

The average policy taken out in the A.M. P. office was equal to a sum of £227, while the average policy issued by the New Zealand Life Assurance Department was for £137 - a difference of £90. It will thus be seen that the statements which I have made with respect to the business of the Department for 1901 are also true of the business transacted bv it in 1902. The poorer sections of the middle classes are availing themselves of the system of Government life assurance, and the number, of the policyholders in the Government office is continually increasing. That is the best test of the business. To put the matter briefly, the ordinary societies are the rich men’s companies, while the Government Department is the poor man’s office, and it is for the poorer classes that I am urging legislation in this direction. I may add that I believe New Zealand is per unit the most heavily assured country in the world. The volume df industrial business is growing in ali parts of the world, and it is for that class of business that we have more particularly to cater. In America this branch of life assurance represents thousands of millions of pounds.; in Germany it is also very extensive; whilst in Australia the industrial life assurance business represents a sum assured of something like £7,000,000 with pre miums amounting to about £300,000 per annum The average policy taken out in this branch of life assurance, however, is only, £21 while the average premium is but £1 per annum. There is a great gap between the class of persons doing business with’ industrial life assurance offices in Australia, and those doing business with the mutual and proprietary companies* Those who take out policies in the industrial offices belong, as will be seen from the average amount of the policies, to the very poorest sections of the community, while those doing business in the ordinary life assurance offices belong to what may be termed, for the purposes of this argument, the middle classes. The middle classes and those of the working classes generally offer a great field of enterprise to a department such as would be established if my proposal were carried out. There must be hundreds of thousands of persons in Australia who, although not assured, desire to make that provision, but cannot because of the high premiums charged take advantage of the mutual and proprietary companies as they are at present conducted. They do not desire to avail themselves of the industrial offices as they at present exist, because they do not care for their business methods,. - because they are suspicious of them or have some other objection to doing business with them.

Mr DUGALD THOMSON:
NORTH SYDNEY, NEW SOUTH WALES · FT; ANTI-SOC from 1906

– The honorable member says that the rates charged by the New Zealand Life Assurance Department are the same as those charged by ordinary companies ?

Mr HUME COOK:
BOURKE, VICTORIA · PROT

– No; they are lower,

Mr DUGALD THOMSON:
NORTH SYDNEY, NEW SOUTH WALES · FT; ANTI-SOC from 1906

– They are lower, but the Government Department offers less advantages.

Mr HUME COOK:
BOURKE, VICTORIA · PROT

– The premiums are certainly lower in the Government office, and the advantages’ in the shape of profits must necessarily be lower. But what persons of the class to which I refer require is not so much a large profit in the way of bonuses as the certainty that by availing themselves of the system they will make safe provision for their old age, or for those they leave behind.

Mr O’malley:

– The profits depend on the cost of the business.

Mr HUME COOK:
BOURKE, VICTORIA · PROT

– Quite so. But if the premiums charged by one office are lower than those of other offices, its interest earnings must likewise be lower. This is a proposition which does not need 2 k 2 to be demonstrated. What the public want is an assurance which is cheap, because they cannot afford to pay high premiums ; and which is sound, because they are not so deeply interested in obtaining large profits as in making certain that, if anything happens to them, their widows or children, or other persons for whose benefit they are assured, will receive the money due to them. They ask that the business of the companies or offices with which they assure shall be conducted upon sound lines, so that failure would be impossible. Cheapness, soundness, and certainty in connexion with the life asurance business are, it seems to me, the three essentials which are desirable in the interests of our great industrial population. I believe that at the present time none of the insurance offices or companies offer those advantages, and hence there is an urgent need for a Commonwealth Life Assurance Office.

Mr DUGALD THOMSON:
NORTH SYDNEY, NEW SOUTH WALES · FT; ANTI-SOC from 1906

– Can the honorable member give us a comparison of the rates of the New Zealand Government office with those of the mutual offices?

Mr HUME COOK:
BOURKE, VICTORIA · PROT

– I have not such a comparison to hand, but the information can be obtained.

Mr McColl:

– There is very little difference between them.

Mr O’Malley:

– From 5 to 15 per cent.

Mr McColl:

– Not so much.

Mr HUME COOK:
BOURKE, VICTORIA · PROT

– There is a difference, the New Zealand Government rates being lower than those of the other mutual offices.

Mr O’Malley:

– The rates depend upon the age of the assured.

Sir George Turner:

– And upon his health.

Mr HUME COOK:
BOURKE, VICTORIA · PROT

– They must depend in every country upon the age and health of the assured. The highest rate of interest earned by any mutual office doing business in Australia during 1901 was 4J per cent., and the lowest 3.9 per cent., but hotwithstanding the limitations placed upon its investments - the Department being confined practically to municipal and Government securities - the New Zealand Government Life Assurance Department yet earned something more than the minimum I have quoted. A rate of from 3 per cent, to 3J per cent, might well satisfy any reasonable person, because profits are neither the be-all nor the end-all of life assurance business. What the assured desires above ali is the certainty that his policy will be paid when it falls due or when death occurs. Those who assure have not that certainty to-day in connexion with proprietary assurance offices, and a great many are prevented from assuring in the mutual offices because of their methods of business and their high premiums. How is the soundness of assurance companies measured? We know, in spite of their protestations to the contrary, that in a great many cases the mutual companies are not as sound as they should be. Their soundness is measured by the soundness of their mortgages, and a drought or financial collapse upsets them to an extent which can hardly be calculated by the ordinary layman.

Mr DUGALD THOMSON:
NORTH SYDNEY, NEW SOUTH WALES · FT; ANTI-SOC from 1906

– It would upset a Government Department too.

Mr HUME COOK:
BOURKE, VICTORIA · PROT

– Yes ; but a Government can always put its business right by methods which are not open to ordinary life assurance offices. I hold that in the interests of the State itself the Government should, if the necessity arose, resort to those methods to secure the stability of its Assurance Department. The valuation of the assets of assurance companies is upon a basis which no layman can discover, and is of quite their own making. Moreover, there is no certificate as to their reserves, so that we do not know how- their money is invested, and there is no law governing the investment of it. In short, there is in Australia a very large field for legislative interference with life assurance companies, even if we do not deem it wise or necessary to start a Government Assurance Department. The public should be given guarantees in regard to the investment of reserves, and certificates of proper investment should be required from competent and f feariess examiners. At present we have no knowledge as to what the securities of the companies are, or of the checks upon their investments. Their expenses, too, are at the mercy of the boards of directors or of the management. We know nothing satisfactory with regard to the inner working of these offices. Their business is practically at the mercy of boards of management whose members may be competent or incompetent, honest or dishonest, earnest or indifferent.

Mr DUGALD THOMSON:
NORTH SYDNEY, NEW SOUTH WALES · FT; ANTI-SOC from 1906

– Might not the same thing be said of Government management? Would not a Government Department be at the mercy of its managers’?

Mr HUME COOK:
BOURKE, VICTORIA · PROT

– Yes; but Government managers would have no interest in obtaining large dividends, as the directors of proprietary companies have, nor would they be always trying to increase their fees, or to provide bonuses, or to help along various persons with whom they had business connexions, which is what sometimes happens in the case of mutual companies.

Mr DUGALD THOMSON:
NORTH SYDNEY, NEW SOUTH WALES · FT; ANTI-SOC from 1906

– Does the honorable member suggest that the officers of a Government Department would be treated worse than the officers of private companies are treated?

Mr HUME COOK:
BOURKE, VICTORIA · PROT

– No. What I say is that Government managers would not resort to favoritism in order to give business firms little pickings, nor would they indulge in other practices to which private companies are prone. As an instance of what may be done by an industrial company - and I am indebted to the honorable member for Brisbane for the following facts and figures - I might inform honorable members that one of them some time ago bought a property for £13,000. It expended £500 upon it, and those “ in the know “ were then surprised to find it appraised among the assets in the balance-sheet at £25,000. Next year the value was written up to £31,000. But, attention having been directed to the matter in the public press, the management, shame-facedly, I suppose, reduced the valuation to £25,000. All this was done in order to enable the proprietors to obtain and pay a 10 per cent, dividend. The particular company to which I ‘ allude is included in the list of offices in which the Government permit its servants to insure. But those who do insure with it will probably wake up some morning to find their investments lost for ever, owing to the insolvency of the company.

Mr Wilkinson:

– - The company to which the honorable member refers has £10,000 deposited with the Queensland Government.

Mr HUME COOK:
BOURKE, VICTORIA · PROT

– Its liabilities are, I believe, something like £40,000, and, speaking from memory, I think it will be found that, even including the asset I have spoken of at the valuation to which it was written up, the company could not pay more than ninepence in the £ if called upon to pay up what they owe.

Mr McColl:

– It must be a mushroom company.

Mr HUME COOK:
BOURKE, VICTORIA · PROT

– Of course it is only a mushroom company, brought into existence to put fat dividends into the pockets of a number of proprietors at the expense of the public. It is doing that work in most successful fashion, and I say that the Federal Government has been badly advised in consenting to name that company in the scheduled list of companies in which public servants may assure. Another company carrying on an industrial business in Australia, and a company which is also named in the Government list, works another pretty little fake. It sets against the industrial branch nearly the whole of its management expenses, and as a result the ordinary business branch does not suffer. In other words, it makes the people who pay one penny and two pence, for the assurance of the lives of children, mostly, bear all the brunt of the larger business of the ordinary branch.

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

– In what State is that company doing business ?

Mr HUME COOK:
BOURKE, VICTORIA · PROT

– In all the States. The company is well known, and I need not name it, though if it were necessary I could name it. I have here a quotation on this subject from the Insurance and Banking Record for March, 1901, which was followed up in other places. There is here some analysis given which shows what this well-informed paper thinks of the matter -

It is preposterous to suppose that the ordinary branch business costs (apart from commission) only a little over 4 per cent, to conduct, the percentage including, moreover, medical examination. A careful examination of the items as stated in the accounts must raise doubt. For instance, of the £2,400 paid in directors’ fees (itself a very high sum), only £200 is debited to the ordinary branch, while the industrial policy holders have to pay £2,200. Then the ordinary branch gets off with a charge of only £352 for rents, rates, and taxes, but the industrial branch pays £4,101. Government taxes amount to £114 in the ordinary branch, and £1,210 in the industrial branch. And so on. It is much to be feared that the allocation is inequitable to the industrial branch, and we would strongly urge the directors to review this question with the assistance of competent outside advice.

Sir George Turner:

– Does the honorable member know the’ proportion of assurances in the different branches? They mav take that as the basis.

Mr HUME COOK:
BOURKE, VICTORIA · PROT

– They* do not; that is the trouble. The total income of the ordinary branch is £145.301, and of the industrial branch £176,406. The expenses of management debited to the ordinary branch, though there is a difference between the income derived from the two branches of only some £21,000, is £6,030, whilst no less than £42,400 is debited to the other branch, the ratio of expense of management to the total income being for the ordinary branch 4’ 15, and for the industrial branch 24*03 per cent. Of course it is not my desire to do any injury to any particular company, and I have not named either of the companies to which I have referred.

Mr Mauger:

– Is that fair to the other companies ?

Mr HUME COOK:
BOURKE, VICTORIA · PROT

– I prefer to let the companies interested prove their own’ case. What I am endeavouring to prove is that, under existing conditions, these companies are offering to do industrial business - and it is with industrial business that I am chiefly concerned in submitting this motion - and are doing it in a way which is unfair and Improper in some instances to the general public who assure with them. In order to safeguard the general public, to do the right thing by them, and, further, to encourage that self-help and thrift which every man in his heart approves, we ought to give an opportunity to the public in this respect, which can be given only by such an establishment as I have indicated.

An Honorable Member. - Does the honorable member propose industrial business for a State Department ?

Mr HUME COOK:
BOURKE, VICTORIA · PROT

– What I say is that whilst we cannot begin exactly’ an industrial business on the lines upon which it is conducted by private companies, we can, in the circumstances which I propose to narrate, begin a life assurance business which will largely tend in that direction: We know that the premium rates which would require to be charged by a State Assurance Department would be so much lower than those at prese.it being charged by private companies, that it would attract the class of business which is now being done by private companies, and a class of business which is not provided for in any way at the present time. As we should avoid a very great proportion of the expense of management, and should not require to keep up expensive buildings, such as must be provided by private companies, it is beyond doubt that we could afford to quote lower premium rates whilst we gave as good an investment, and offered as reliable a security as can be offered by any private company. I may be asked why I wish to start a State Life Assurance Department. If it is admitted that industrial business is not in all cases’ carried on upon a sound basis, I shall be told that I cannot deny the fact that most of the mutual life companies doing business are sound. I. have already attempted to answer that by endeavouring to show that a large proportion of business can be done which is not being obtained by any company at the present time, because of the excessive premium rates, and the other difficulties to which I have alluded. It will be admitted that our present industrial system is not sound, in some instances, at any rate. The investment is too expensive by far, whilst the benefits are very small indeed; and lastly, and most important, there is no certainty that the assured will get the sums for which they assure. With respect to mutual companies, the expense of management is much too great to enable them ‘to reduce their premiums sufficiently to attract all the business which could be attracted by a life assurance office conducted by the Government. In short, they cannot offer the inducements to the public which could be offered by a State Department of Assurance, and in any case the suspicions of the poorer classes of the people are so strong and their fears so great, that there is little likelihood of any considerable increase in the assurance in private offices. In these circumstances it seems to me to be the imperative duty of the State to step into the breach and create a State Department of Assurance.. I have therefore moved the motion standing in my name, and I trust it will be carried. . We do not desire to indulge in any more charity or benevolence in Australia than is absolutely necessary, and we do wish to encourage, so far as possible, self-help and an independent spirit amongst our people. If we offer to them inducements along such lines as I have indicated, I think it will be found that the response will be very much greater than many persons imagine, and as a result, the necessity which exists, and which, to a certain extent, will always exist, for the payment of old-age pensions will not be so pressing. In any case, I do not think we are justified, nor is Parliament right, in guaranteeing particular companies for the assurance of civil servants, unless we get some fee from them. I have already mentioned a couple of instances in which I am satisfied that if assurances do take place, they will be regretted by those who take out policies with the companies to which I have referred. It seems to me that the Government, in going so far as to schedule a list of companies with which the public servants may do business, practically give a guarantee to the assured which they should be prepared to meet. We have 1,500 or 1,600 civil servants, whom we compel to assure their lives in certain offices. The compulsion to assure in these offices seems to me to carry with it a guarantee that if the companies fail the Commonwealth will itself pay the assured amount. Is it not better, therefore, for us, having the public servants as a nucleus, to start on our own account; with an advantage which even the New Zealand Department did not enjoy at the beginning ? Every other life assurance business has had to start from scratch without any nucleus. I am informed that the A.M.P. Society had been in existence ten years before the number of policy-holders reached 1,500 or 1,600. We should begin with that number, and we should not then be under the necessity of giving a guarantee in regard to outside companies. In brief, my proposal is to begin with the public servants and to offer attractions to those outside who do not now assure to any great extent with the mutual offices. Whilst we might not perhaps be able to offer the same inducements in the way of bonuses or awards as do the mutual companies, we could give a guarantee that should in itself be sufficient to attract a large amount of business and enable us to conduct a successful institution. We should not be under the necessity of paying any high commissions, and the collection of premiums could be carried out very easily, because every pay-office throughout the Commonwealth might be made a receiving office. We should not have to maintain any large offices, because the public buildings could be utilized for that purpose. We should not have any drag upon us in the shape of a building fund and all the contingencies which that would involve, and our staff, if it required to be increased, would be augmented only to a very slight extent. There would be no losses arising from depreciation of mortgaged properties, and we should not have to maintain a foreclosed properties department.

Mr DUGALD THOMSON:
NORTH SYDNEY, NEW SOUTH WALES · FT; ANTI-SOC from 1906

– Would there not be any bad municipal loans?

Mr HUME COOK:
BOURKE, VICTORIA · PROT

– I do not think so. That has not been the experience of New Zealand. If need be, we could restrict the investments to Government, or at least to States, securities. I contend that we require something that will be cheap, sound, and certain, something which will attract people to save their money in- order to provide against a rainy day, and which will guarantee to them the payment of the sums for which their lives are assured. Of course, I recognise that this is a far-reaching proposal, and that it marks an advance upon anything yet attempted in- Australia, although not ahead of what has been successfully achieved in New Zealand. Believing that the principle is sound, and that the end to be served is a desirable one, it seemed to me to be a part of my duty to place my ideas before honorable members, and to endeavour to secure for them the favorable consideration which I trust they warrant.

Mr MAHON:
Coolgardie

– I have great pleasure in seconding the motion. I think it would be futile to attempt to add to the information afforded by the excellent and exhaustive speech of the honorable member for Bourke. I desire to’ compliment him upon the thoroughness with which he has examined the subject, and elaborated it to the House. He ought to have satisfied the majority of honorable members - at any rate, the majority of those who are not interested in assurance companies - as to the soundness of his scheme. The proposal is one that the Government should take in hand as soon as possible, and I agree that no more important matter has been brought before the House for seme time. The honorable member has demonstrated the necessity of the State establishing a department of this kind. He has instanced the success of the State Assurance Office in New Zealand, and the critics of his proposal are invited to go to New Zealand, and, if they can, find any flaws in the Department that has been administered there for some years. I have never heard of any complaint, and I think that the figures adduced by the honorable member tend to show that the Department is increasing in popularity among the poorer classes and others for whom it is our business to see that some provision is made. The parallel which the honorable member draws from Germany is one which - if we are not prepared to follow him to the full length of his proposal - we might take as an example. We might with great advantage adopt the German scheme to a still further extent, because in that country an admirable system of old-age pensions is provided. I should like to see the honorable member’s proposal so expanded that the proposed department should also take over the management of any funds that may be subscribed by employers and employes to provide for those who have passed the working age. I understand that in Germany the employ^ pays one-third, the employer another third, and the State contributes “the balance to a fund for the maintenance of workers who have passed their prime. A system such as the honorable member proposes would pave the way for an old-age pension scheme of that kind, which, after all, would be the soundest that could be established. It is all very well to say that we should establish old age pensions by taxing the general public, but we have seen the outcry raised in Victoria because the money required for the payment of these pensions is taken from the pockets of the taxpayers. The unfortunate people who have been depending on the pensions have been squeezed down to the very lowest amount upon which it would De possible for a man to subsist, whilst in some instances pensioners have, upon some ridiculous pretext, been absolutely deprived of their miserable pittance. I- think that if we desire to establish a stable old-age pensions fund we should adopt something in the nature of the German system. Such a fund would be invulnerable. It could never be attacked by any class in the community, because it could not be said that the people deriving the benefit were not direct contributors to the fund. The honorable member for Bourke has also demonstrated that his scheme would offer greater security than is afforded by any private company to persons assuring. Naturally that must be so, because the credit of a State is sounder than is the credit of any number of private individuals, of which these mutual and proprietary companies are really composed. I do not wish to say one word which would raise a suspicion concerning the assurance companies, whether mutual or proprietary, which are doing business in Australia. In their own way they are performing good work. But when they are held up to be so absolutely perfect as to deprive those who advocate State interference of all warrant for such advocacy, we have a right to ask what would be the position of these institutions if a crisis similar to that experienced by the banks in 1893 confronted them ? They have never faced such a position as the Australian banks did in that year, and until they do, those who talk so loudly about their soundness had better be very careful in their choice of language.

Mr DUGALD THOMSON:
NORTH SYDNEY, NEW SOUTH WALES · FT; ANTI-SOC from 1906

– They never can face such a crisis, because their liabilities do not become due at the same time.

Mr MAHON:

– It is very fortunate for some of them that their liabilities do not fall due upon a single day. Seeing that these institutions lend money on mortgage, and that the value of their securities fluctuates from time to time, does any one suppose that they are so absolutely sound that they can offer a security resembling that afforded by the State? The honorable member for Bourke has dilated upon the fact that insufficient supervision is exercised over these companies. We do ‘not know what they are doing; we do not know whether their securities represent anything like the value which they place upon them. We are unaware how often their directors advance large sums of money upon flimsy security to their own particular friends. I suppose something of that kind has been done, even in the model State of Victoria. I know that it has been done in some of the other States, where the directors of assurance companies, like those of banks and other financial institutions, have their- particular favorites, whose securities are not scrutinized with the same degree of keenness to which those of an outsider are subjected. I repeat that these institutions have never been tested by conditions similar to those which prevailed during the great banking crisis of 1893, and it is a very fortunate fact for some of them. I have no desire to include all the assurance companies doing business in Australia in any sweeping condemnation ; but I believe that Government, supervision is required in some cases. The honorable member for Bourke has also pointed out that the heavy expenditure incurred by these institutions renders it necessary for them to charge high premiums to the persons whom they assure. A State Life Assurance Department would be able to save a large portion of that expenditure. For example, it would not need to send canvassers all over the country, with medical officers following in their train. Its advantages would soon become known to the public, who would embrace them eagerly without being canvassed. Thus a State Department would save an enormous sum, which is now spent by private assurance companies upon representatives and medical officers. The industrial companies are the greatest shiners in extravagance. In some cases I have heard that it costs them 18s. to collect £1. There is another aspect in connexion with them, of which this Government and Governments elsewhere ought to have long ago taken cognizance. I refer to their practice of paying assurances upon the death of mere infants. That is a wrong principle to adopt, and no Government ought to allow an assurance company to pay over moneys upon the death of children. On the contrary, it would be far better - especially for the Government - to pay a premium to every person who rears a healthy child up to fifteen years of age. Without casting any reflection upon the public in this connexion, I hold that it is a very dangerous principle to allow assurance companies to assure the lives of child- ren so that their parents may benefit by their death. The practice, however, is sufficiently prevalent to call for notice. When the Government are legislating upon the matter I trust that this aspect of it will receive attention.” I believe that the funds of a Government Life Assurance Department could be invested very nearly as well as can the funds of private companies. No doubt it would be very injudicious for a State Department to lend money on mortgage in the ordinary way ; but it is not altogether a new practice, because even in Victoria the State advances money upon freehold property at 4^ per cent.

Sir George Turner:

– That is an independent tribunal.

Mr MAHON:

– I presume that the. Department which we propose to establish would also be an independent tribunal.

Sir George Turner:

– No; it would he. a Government Department.

Mr MAHON:

– Does not the Government of Victoria guarantee the other institution ?

Sir George Turner:

– It does not interfere with its management in any shape or form.

Mr MAHON:

– Does not the Government of Victoria guarantee every depositor in the institution to which I refer ?

Sir George Turner:

– Of course it guarantees the Savings Bank; but that is not a Government Department in any shape or form.

Mr MAHON:

– Does not the Savings Bank advance the funds of its depositors upon mortgage, and is it not guaranteed by the Government of Victoria?

Sir George Turner:

– As a matter of fact, the Savings Bank does not advance the funds.

Mr MAHON:

– Well, the Commissioners of the Savings Bank do so. The Government are responsible to the depositors of that institution, whose money is advanced to freeholders at 4J per cent. There is nothing to prevent a State Department from doing precisely the same thing. At any rate, if it objected to do that, it could go upon the open market, and purchase Government bonds which would absolutely return it 4 per cent. It could buy some bonds which would return a still greater interest, and it could even purchase the bonds of the Metropolitan Board of Works, which would yield £4 9s. per cent. That would be a very good return. The money thus received from premiums might, with advantage, be devoted, as it accumulates, to’ the redemption of the Government debt of Australia. At any rate, it would earn sufficient to enable a reasonable allowance to be paid to every one who had decided to depend upon an honest assurance office. The Department would have the civil servants to form the nucleus of its list of policy holders; members of the outside public would also take out policies from time to time, and with the .present opportunity to invest funds at a high rate of interest there is not likely to be a more favorable time for its establishment. I commenced my observations with the remark that I did not intend to traverse in detail the’ speech made by the honorable member for Bourke, because I had not had the opportunity to fully study the matter as he has done. I shall, therefore, conclude by expressing the hope that the motion will be carried, and that the Government will establish the Department as soon as possible.

Mr O’MALLEY:
Darwin

– My only object in rising to address myself to this question is that I desire to explain that when some two years ago the honorable member brought forward a motion dealing with the question of Government life assurance I voted against it, and for the reason that it was different altogether from the proposition which he now invites the House topass. I wish, first of all, to congratulate the honorable member on the excellent speech delivered by him in submitting his motion to the House - a speech that was a clear declaration of what he seeks to accomplish. The proposition originally submitted by him was that all public servants should be assured by the Commonwealth. I was opposed to that proposal, because it was not suggested that the Government should enter upon the business in a legitimate way: It was not proposed that a sinking fund should be created, or that the business should be conducted on lines which would give reasonable averages, and enable the Department to pay fair bonuses. The position now taken up by the honorable member, however, is entirely different from that assumed by him on the occasion to which I refer. It seems to me that as the Commonwealth will find it necessary from time to time to raise money in the markets of the world, and, as in the case of the Victorian conversion loan, we shall have to pay enormous rates of interest, we should make an effort to secure the profits to be derived from a Life Assurance Department, and thus reduce the necessity. for floating loans. Large sums which go into the sinking funds of life assurance companies might well be kept in the hands of the Government, arid used either for Commonwealth purposes or distributed pro raid among the States. Life assurance is not a charity, but a legitimate business, and must be run upon the great basis of equation. It must be conducted in the interests of policy-holders. New policy-holders must be secured from time to time. They are the life blood of a company, and without new business an office must die. In my opinion, we should establish a Commonwealth Life -Assurance Department, even if it be only for the purpose of enabling an examination to be made of the business of life assurance companies on the lines adopted in Massachusetts. The honorable member for Bourke referred to the position in Germany ; but I should like him to consider the life assurance laws of Massachusetts.

Mr HUME COOK:
BOURKE, VICTORIA · PROT

– I am aware that they are very strict.

Mr O’MALLEY:

– In Massachusetts a Yankee is employed to throw life assurance people out of the State faster than the Japs have thrown the Russians out of Port Arthur. If the directors of a company are unable to swear to every item in their balance-sheet, the office is refused permission to do business in the State. It is a serious matter that a number of promiscuous life assurance companies should be permitted to transact business all over the Commonwealth without any reasonable restrictions being imposed upon them, and more especially is this the case when we remember that according to Carlyle many men are either born fools or become so later on. It is a serious matter that many so-called representatives of life assurance companies should be allowed to promise people everything in the heavens above and the earth below, when they really represent no institution worthy of the name. I can remember one company - the Charter Oak - which carried on business in the State of Connecticut, and ruined thousands of people before the Government exercised strict supervision over life assurance societies. The Queen was another company which closed its doors after it had issued policies representing several millions of money. Some companies may be able on paper to show funds amounting to millions of dollars, when they have not a penny in the treasury. I remember one bank in Tasmania, which crossed the stream of destruction, and the directors of which had borrowed from it some £40,000 in excess of the actual amount of its capital. When we recall these facts, we must recognise that the people of Australia are not saints any more than are the people of the United States. I for one, at all events, have not heard of -directors of large institutions working until late at night, and exerting themselves solely in the interests of the people. In Australia a man has to hustle for every dollar that he makes, and the people of the Commonwealth are just as grasping as are those of the United States of America, or any other country. There is a large amount of life assurance business to be transacted here, and the establishment of a Government Life Assurance Department would be an excellent investment. If I did not hold that opinion, I should not be found supporting this motion. I would point out, however, that, as the honorable member for Coolgardie has said, it is absurd to imagine that people will rush the Government life assurance office because of the inducements it offers, unless those inducements are brought prominently before them. A good business manager must be appointed, and perhaps we should compel every man to assure for at least £100. Why should we not do so? Why should we not set up a system similar to that which Germany has established ? There workmen are required to insure their lives, and the premiums are paid by the Government, the workers, and the employers combined. That has proved a very successful system; but when we establish this department we must take cane to bring its merits prominently before the people. Unless that were done, it would be possible for a man to start out as the representative, for example, of the “Missouri Progressive Life Assurance Company,” and to do business where the Government office could not secure a new policy-holder. I should not be afraid to set out to-morrow to secure life assurance business, without being the representative of any company. Everything depends upon the man engaged to do the business.

Mr Knox:

– What salary would the honorable member require?

Mr O’MALLEY:

– I would not accept a position in the Department, because I am now too old to add to my responsibilities in this direction. The adoption of this proposal would bring money into the coffers of the Commonwealth Treasury, and would enable us to secure funds for a system of old-age pensions. That system might be established on the ordinary lines for- a period of twenty years, and at the end of that time we should require pensioners to secure their allowance through the medium of the Life Assurance Department. By the creation of this Department we should be able to secure profits which would render it unnecessary for the Commonwealth in many cases to borrow money in outside markets. I shall have pleasure in supporting the motion.

Mr DUGALD THOMSON:
NORTH SYDNEY, NEW SOUTH WALES · FT; ANTI-SOC from 1906

– I have no desire to enter into any lengthy discussion of this question, but I wish to place certain considerations before the House. Whilst I give the mover of the motion credit for the manner in which he has dealt with certain aspects of the question, I feel constrained to say that he failed to bring before the House a great deal of information that should have been placed in its possession before it was asked to deal with an important matter of this kind. For instance, we had Government companies quoted. But we had no comparison between the rates charged by those companies and public companies, and the privileges granted in return, nothing by which we could estimate the advantages offered to the assured by each. We had not that full information as to the character of these different Government schemes which is desirable before we are asked to commit ourselves to a resolution of this description. I admit that abstract resolutions, whether carried or not, mean very little, but we ought to be careful not to commit ourselves to a resolution unless we are satisfied that action should be taken in the direction decided upon. Section s.i of the Constitution empowers us to make laws with respect to -

Insurance, other than State insurance ; also State insurance extending beyond the limits of the State concerned.

There are different ways of exercising that power. I believe that our first duty is, not to establish a Commonwealth assurance office, even if that may eventually be shown to be desirable, but . to meet the circumstances which honorable members who have spoken have detailed in connexion with the management of existing private institutions, by providing for an inquiry into their condition, so that the public may know that they are solvent, and that by the supervision of their operationspayment of the policies when they become due may be guaranteed.

Mr Wilks:

– We require a Commonwealth Audit Department.

Mr DUGALD THOMSON:
NORTH SYDNEY, NEW SOUTH WALES · FT; ANTI-SOC from 1906

– We need a Commonwealth Insurance Department similar to that of the United States. There should be a very strict and searching examination of the operations of assurance offices. In some of the States there is practically no law aimed at securing the solvency of these offices, although the public have invested in them such large sums of money, and have indeed, in some cases, intrusted to them their future.

Mr Wilks:

– This lack of legislation is very marked in New South Wales.

Mr DUGALD THOMSON:
NORTH SYDNEY, NEW SOUTH WALES · FT; ANTI-SOC from 1906

– It is a credit to those who have had the conduct of assurance business in Australia, that, notwithstanding these extraordinarily loose conditions, there has been practically no default. But it is not safe to allow this state of affairs to continue, and it should be our first business, not to establish a Commonwealth Department of Insurance - leaving the existing private offices to continue their operations under the loose conditions which now prevail, and perhaps diminishing their solvency by our competition - but to pass a law providing for searching inquiry and thorough investigation into the position of the existing companies, so that the public may have a guarantee as to the security of their investments. The honorable member for Coolgardie referred to a very’ important point in connexion with Commonwealth life insurance. It dovetails into the old-age pension question. .He was perfectly right in saying that if we establish, not the charitable old-age pension scheme which exists in one or two of the States, but one based upon contributions from those who are eventually to benefit, thus encouraging thrift, and removing the charitable aspect which is repellant to many, greater security for the regular payment of any given pension will be obtained than when the money has to be dragged from the pockets of the taxpayers.

Mr Wilks:

– In Germany it has been found difficult to keep up the contributions.

Mr DUGALD THOMSON:
NORTH SYDNEY, NEW SOUTH WALES · FT; ANTI-SOC from 1906

– There are difficulties, which in Germany are to some extent surmounted by allowing the employer to deduct the contributions from the wages of his employes.

Mr Wilks:

– That is all very well where people have permanent employment.

Mr DUGALD THOMSON:
NORTH SYDNEY, NEW SOUTH WALES · FT; ANTI-SOC from 1906

– Yes, but liberal conditions might be allowed, providing for the reinstatement of policies upon the making of payments at subsequent periods. The whole question, however, requires consideration, and the subject of both life assurance and old-age pensions should be referred to a Committee of the House for inquiry, before we attempt to deal with either. We shall probably not have an opportunity to establish an old-age pension scheme for a long time to come, but the whole subject might receive trenchant investigation at a period considerably anterior to that at which we are likely to be called upon to deal with it. Conditions are not alike in every country, and therefore an inquiry should be made as to whether compulsory or voluntary insurance is the better, as to whether a scheme of insurance can be combined with an old-age pension scheme, and in regard to other points. I do not say what my conclusions upon this subject will be. No honorable member can do so until such an inquiry has been made, and the evidence ta.ken, presented, and reported upon. The question, however, deserves investigation. It has been raised by Mr. Chamberlain and others in Great Britain, and should be thoroughly looked into. We are now trying to determine something by a resolution which either means nothing, or, if it has a meaning, must be followed by action before any proper inquiry is made. Then, again, circumstances are not quite as the mover of the motion supposes. In the first place, while there is extreme danger in the operations of private companies without supervision, there is also danger in the operations of a Government Department. We have seen the reckless attachment of Savings Bank funds by a Government, and the wanton use of loan money, and it cannot be expected that any Government continuing that policy would always remain solvent. There might be an occasion when such a Government, like a bank, would be unable to meet its liabilities.

Mr Webster:

– If there had been reckless expenditure ‘.

Mr DUGALD THOMSON:
NORTH SYDNEY, NEW SOUTH WALES · FT; ANTI-SOC from 1906

– Does the. honorable member express ignorance of reckless expenditure already having been undertaken ?

Mr Webster:

– I am doubtful of the truth of the assertion that it has.

Mr DUGALD THOMSON:
NORTH SYDNEY, NEW SOUTH WALES · FT; ANTI-SOC from 1906

– Then the honorable member would require extreme evidence to convince him.

Mr Webster:

– I am afraid that the statement is readily accepted without evidence.

Mr DUGALD THOMSON:
NORTH SYDNEY, NEW SOUTH WALES · FT; ANTI-SOC from 1906

– I think there is evidence for it. Where are the Savings Bank funds of some of the States?

Mr Webster:

– Wisely invested.

Mr DUGALD THOMSON:
NORTH SYDNEY, NEW SOUTH WALES · FT; ANTI-SOC from 1906

– Portions of them are unprofitably invested in Government work on which no interest whatever is being returned. I am not speaking now of any particular Government, but suppose a run was made upon a Savings Bank whose funds at a time of monetary distress had been thus misappropriated - used as ordinary revenue, or for purposes which should be met out of revenue. Where would the Government be then?

Mr Webster:

– The Government would come to the rescue of the bank.

Mr DUGALD THOMSON:
NORTH SYDNEY, NEW SOUTH WALES · FT; ANTI-SOC from 1906

– It would have no money in hand.

Mr Webster:

– They hold the power.’

Mr DUGALD THOMSON:
NORTH SYDNEY, NEW SOUTH WALES · FT; ANTI-SOC from 1906

– -To re- . fuse to pay. No doubt any of our Governments would pay eventually, though I know Governments which I should not like to trust.

Mr HUME COOK:
BOURKE, VICTORIA · PROT

– Would not the fact that the Government was behind the bank prevent a run?

Mr DUGALD THOMSON:
NORTH SYDNEY, NEW SOUTH WALES · FT; ANTI-SOC from 1906

– No. I have seen a run upon a Savings Bank guaranteed by a Government. It was the most extraordinary sight I ever saw. No ordinary run upon a bank was like it. Honorable members who come from New South Wales know the run that took place there. On that occasion it was not the

Government but the other banks which, by providing gold, prevented the Savings Bank from shutting its doors. Institutions are not necessarily sound and solvent and superior to runs or to strain merely because they are Government institutions. Good management must be exercised in connexion with both Government and private institutions if they are to remain solvent, and it is only good management that can make a Government institution equal to a successful private institution. It has. been said that if there were any shortage in a Government insurance fund the people could be taxed to make good the deficit. That is a most unfortunate argument. The insurance money due by Government institutions should be provided by the premiums paid by those who insure, not by the taxpayers. Those who have insured in private offices should not be called upon to assist in making good the shortage in a Government fund so that payments might be made to others who had insured with the Government Department. The Government Department should stand on its own footing, and pay its own liabilities. The honorable member for Bourke stated that the premium rates of the New Zealand Government Department are lower than the rates of the private companies doing business there, but they are obviously lower only if the Government office gives the same privileges as are given by private companies, and he stated that they do not. Consequently it cannot be shown that they are lower unless a very exact comparison is made, and wc have not been given a’i opportunity to make such a comparison. The honorable member said that the lowest rate of interest earned by public life assurance companies in Australia was 3.9 per cent., and that the highest average rate earned by any company was 4 J per cent. That is the interest returned upon the investments. I know that it is possible that some of the investments of these companies ‘may not be accurately valued. That is why I say that we should appoint some authority to make a searching inquiry. In many cases, however, there is ample security afforded to those who are assured. I am not speaking as one who has any connexion with life assurance companies. I neither hold shares, nor am I a director, nor do I hold a policy in any life assurance company; but I am aware that some of the companies make the most ample provision for any drop in the value of their assets. Funds are set aside for that purpose, and the rate of interest upon which they calculate their rates is reduced from time to time, so thai it is gradually becoming lower and lower. That is one of the methods which the companies have of offering additional security to investors. A State Assurance Department, such as proposed, would invest its funds in Commonwealth bonds, and possibly in State bonds. I do not see how a Commonwealth institution could invest in municipal bonds. Therefore the Government could not expect, at the usual rates for money, to earn more than 3 per cent. The New South Wales Government credits its Savings Bank depositors at present with 31 per cent., but for years the rate was only 3 per cent. That is a considerable reduction on the rates earned by private companies, and must mean some reduction of the advantages offered to persons assuring. I do not say that this is an absolutely fatal argument against the establishment of a Government Life Assurance Department ; but I contend that it shows the necessity for a searching inquiry before we commit ourselves to any resolution. I cordially agree with all ‘ that has been said regarding the objectionable practice of assuring the lives of infants, ‘but that has nothing to do with the proposal to establish a Government Life Assurance Department. Independently of any question of that kind we should require to pass a law dealing with the life assurance companies now in our midst, in order to put a stop to the objectionable practices mentioned. I certainly cannot vote in favour of a bald motion of this kind until we have first taken all the steps that are within our power, under the Constitution, to regulate private assurance companies, and until we have inquired into the question of Government assurance, particularly in Germany and New Zealand, and have obtained a report instituting a comparison between the conditions in those countries and in our own. This would be necessary before Ave could arrive at a proper decision, and, therefore, I must vote against the resolution.

Sir GEORGE TURNER:
BalaclavaTreasurer · Protectionist

– I think that the honorable member for Bourke is to be congratulated, not only upon having brought forward the motion, but also upon having thoroughly investigated the subject, and endeavoured to place it clearly before us.

I agree with hint that this is a farreaching proposal. It is also one which I do not feel justified in asking the House to deal with until we have had opportunities for fuller discussion and consideration. So far as I am personally concerned, I am, to a considerable extent, in sympathy with the honorable member’s views, but I feel that a Minister occupies a position different from that of a private member in dealing with such a subject, because he would -be responsible for afterwards giving effect to his views, and would have to bear the full burden of any mistake that might be made. I am making inquiries into the subject. I have the latest report from. New Zealand, and there are certain facts upon which I desire to obtain information, -with a view to placing it before the House. I also wish to consult with my colleagues upon this important subject. Under these circumstances, I do not think it is unreasonable to ask that the debate should be adjourned. There is not a very large amount of private members’ business on the notice-paper, so that the honorable member for Bourke need not fear that he will be deprived of an opportunity to further deal with the motion later on. I move -

Th.it the debate be now adjourned. Motion agreed to; debate adjourned.

page 1006

HIGH COMMISSIONER BILL

Motion (by Mr. Deakin) agreed to -

That leave be given to bring in a Bill for an Act to provide for the office of High Commissioner of the Commonwealth in the United Kingdom.

Bill presented, and read a first time.

page 1006

CONCILIATION AND ARBITRATION BILL

Second READING

Debate resumed from 13th April (vide page 937), on motion by Mr. Deakin -

That the Bill be now read a second time.

Mr MAUGER:
Melbourne Ports

– I shall endeavour to avoid, as far as possible, reference to matters with which I dealt in my speech upon a similar measure last session. I desire to briefly reply to one or two statements made bv honorable members who have adversely criticised the Bill. In the first place the acting leader of the Opposition/ in a carefully prepared and an exhaustive speech, dealt with the question cf conciliation, and pointed out that in Great Britain this very admirable system was making such rapid strides that there was no occasion for the Bill. I do not wish to deprecate conciliation. ‘

Mr DUGALD THOMSON:
NORTH SYDNEY, NEW SOUTH WALES · FT; ANTI-SOC from 1906

– What was referred to was voluntary arbitration.

Mr MAUGER:

– That is much the same. Conciliation and voluntary arbitration are practically interchangeable terms.

Mr DUGALD THOMSON:
NORTH SYDNEY, NEW SOUTH WALES · FT; ANTI-SOC from 1906

– No.

Mr MAUGER:

– An agreement without the force of law, whether it be the result of voluntary arbitration or or conciliation, is very much the same. The honorable member referred to the successful efforts of the Honorable Mr. Mundella, at one time President of the Board of Trade, in connexion with the cotton and other industries.

Mr DUGALD THOMSON:
NORTH SYDNEY, NEW SOUTH WALES · FT; ANTI-SOC from 1906

– I did not refer to Mr. Mundella. It was the honorable and learned member for Angas who did so.

Mr MAUGER:

– I think the honorable member also referred to him. However, in connexion with that matter, I should like to remind my honorable friend that in all cases in which the so-called voluntary arbitration has been successively applied, the trades unions have been sufficiently strong to compel a settlement, and to see that the decisions given by the Arbitration .Boards were respected. Behind the unions also was a very strong public opinion. Notwithstanding all that the honorable member said with regard to the success of conciliation, I would point out to him that, according to the latest Board of Trade returns, those for 1903, the dullest year that has been experienced in ‘ the United Kingdom for a very long time, the number of working days lost through trade disputes was simply appalling. The figures for last year show a decrease on those for the preceding year, because trade was duller, and business generally was not nearly so brisk. The number of working days lost in 1903 was no less than 2,317,000, “ involving 114,000 persons, whereas the average annual loss in 1902 and 1903 was no less than 8,840,000, involving 271,000 persons. And yet the honorable member for North Sydney would like honorable members . to believe that the principle of conciliation is being applied with such success to the settlement of trade disputes in the United Kingdom that the only strikes occurring are of a trivial character.

Mr DUGALD THOMSON:
NORTH SYDNEY, NEW SOUTH WALES · FT; ANTI-SOC from 1906

– I did not say that.

Mr MAUGER:

– The honorable member argued that nearly all the important trade disputes had been settled by voluntary arbitration.

Mr DUGALD THOMSON:
NORTH SYDNEY, NEW SOUTH WALES · FT; ANTI-SOC from 1906

– I did not say that.

Mr MAUGER:

– Then the honorable member did not convey what he intended. I agree that where trades unions and the employers have consented to conciliation, the application of that principle has . been attended with success. But I also contend that hundreds of claims for disputes to be referred to Boards of Conciliation have been refused, that strikes and trouble have resulted, and that the loss thus occasioned has been so enormous “that last year, which was a dull year, no less than 2,317,000 working days were lost to the workers of Great Britain. That alone is sufficient to warrant such a proposal as the Government are submitting to this House. Let honorable members reflect what that loss really involves. As John Burns said in speaking upon this very matter at Battersea recently, it is not only the loss which is involved from an economic stand-point, but the suffering which is involved in the homes of the workers. He rightly urges that the women, upon whom the burden chiefly falls, are really worthy of the Victoria Cross for bearing so nobly the trials which they are called upon to endure, in consequence of these great industrial calamities. I repeat that no less than 114,000 persons were involved in trade disputes in England last year, and 2,317,000 working days were lost to them as the result. The honorable member for North Sydney also alluded to the working of the New” Zealand Act, and urged amongst other things that whilst in many instances wages have been raised as the result of this class of legislation, and that consequently the position of the workers has been improved, the cost of the articles produced has been enhanced to the consumer.

Mr DUGALD THOMSON:
NORTH SYDNEY, NEW SOUTH WALES · FT; ANTI-SOC from 1906

– Naturally.

Mr MAUGER:

– I interjected that such had not been the case in Victoria.

Mr DUGALD THOMSON:
NORTH SYDNEY, NEW SOUTH WALES · FT; ANTI-SOC from 1906

– But there is no Arbitration Act operative in Victoria.

Mr MAUGER:

– I meant as far as the Act and the principle applied. I intend to show that in the opinion of a New Zealand legislator, that result has not been produced there.

Mr DUGALD THOMSON:
NORTH SYDNEY, NEW SOUTH WALES · FT; ANTI-SOC from 1906

– There is no Arbitration Act in force in Victoria.

Mr MAUGER:

– But we have an Act which brings about practically the same results. We have wages boards in Victoria, which are constantly raising wages, shortening hours, and generally improving the status of the working classes.

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

– They are onesided, then.

Mr MAUGER:

– They are intended to be one-sided. If the argument of the honorable member for North Sydney be correct, the cost of the articles produced by all the industries in which wages have been raised in Victoria, should have been enhanced to the consumer. That has not been the case. Indeed, in ninety out of every 100 cases, there is no connexion whatever between the cost of the article to the consumer and the price which is paid to the person who produces it by the manufacturer.

Mr DUGALD THOMSON:
NORTH SYDNEY, NEW SOUTH WALES · FT; ANTI-SOC from 1906

– The honorable member will find that my statement is confirmed by sworn evidence.

Mr MAUGER:

– Let me give a concrete case. For some years we have been agitating for the establishment of a wages board in connexion with the dressmaking industry in this State. The Minister for Labour, MrMurray, was for a long time opposed to that proposal, but he collected data which conclusively demonstrated to him that there was no connexion whatever between the cost of an article to the consumer, and the wages which were paid to the persons engaged in producing it. For some time he had on exhibit at the State Parliament House ladies’ dresses valued at 14s., for the making of which. is. 3d. was paid to poor struggling seamstresses. But, reverting to the case of New Zealand, I wish to quote from the New Zealand Hansard the report of a speech delivered by the honorable member for Christchurch city, in which he alludes to the very matter which was referred to by the acting lender of the Opposition. This is what he says: in reference to the prices which are charged in that Colony, and the effect’ of the Arbitration Act upon those prices : -

If one will take the trouble to go through the warehouses of the cities, it is astonishing to see the enormous stocks to be found there of highlymanufactured articles produced in this country. With regard to the prices of boots and clothing, and so forth, I have to furnish my family with these articles, and I know they have not gone up in price, although the wages of those who make them have gone up.

These statements prove conclusively that the contention of the honorable member for North Sydney, that prices have been raised as the result of the operation of the New Zealand Act, is altogether erroneous. The honorable member also urged that unionists in England and America object to the principle of compulsory arbitration. I quite agree that that is so. But the honorable member forgot to mention why they are opposed to a system of compulsory arbitration. In this connexion I would point out’ that one of the principal leaders of unionism in America, the organizer of the great Anthracite Trades Union, which numbers 250.000 members, and is perhaps the largest industrial union in the world, in a recent article, published in McClure’s Magazine, declares that he is entirely opposed to the principle of compulsory arbitration, because he thinks it would be sheer madness on the part of the working men of America to give up their right to engage in a strike whenever circumstances may demand it. He goes on to use arguments in support of his position. He says that after five months’ struggle in connexion with the great anthracite coal strike, the force of public, of judicial, and of legislative opinion impelled the owners to agree to a settlement of that trouble, and, as a result, arbitration was eventually resorted to. Surely that is not voluntary conciliation. It is, rather, compulsory arbitration of the very worst type. In America trades unionists take up their present position because they wish to retain the power to strike, and also because they have absolutely no faith in their Judiciary. Whether any grounds exist for that lack of faith. I am not in a position to say, but I rejoice to think that we have not yet reached that pass in Australia. I rejoice that the majority of the working men of the Commonwealth are content to trust our Judiciary, and to submit these important matters to its decision. A condition of affairs prevails in England similar to that which obtains in America. At a recent congress, which was held in Manchester, the leading unionists urged that the one powerful weapon, which had secured to them all the progress and advancement of the past fifty years, was that of industrial warfare - the right to strike - and that it was their duty to see that no Parliament deprived them of that right. Thev further declared that they had no faith in decisions which might be given by. their

Judiciary. That is a deplorable condition of affairs. These are the reasons why the workers of Great Britain and America refuse to subscribe to the principle of compulsory arbitration. I am, however, of . opinion, that before many years have elapsed they will have changed their views just as Mr. Ben Tillett, who was formerly opposed to that principle, was impelled to change his opinions. He visited New Zealand for that purpose of inquiring into the working of the Arbitration Act there, and. as a result, was converted into an advocate of the compulsory system. Similarly, I believe that as the trades unionists of England gain experience in regard to this matter, they will do as they did in connexion with the system of voting by ballot - follow in the footsteps of Australia, and support the principles which are embodied in this Bill. We believe that our Judiciary will do the right thing. We have every confidence in the Court which it is proposed to establish. More than that, we hold that strikes are barbarous, and that industrial war is even more calamitous than is war between nations. It leaves an ineffaceable trail in the sufferings of women and children, and ought, therefore, bv all means, to ‘ be avoided, even at the risk of great loss on the part of those engaged in our great industrial affairs. The honorable member for North Sydney also contended that the prosperity of New Zealand was due to its great natural resources, and to the fact that Providence had been kind to it. But surely those great natural resources existed prior to the enactment of this particular form of legislation. New Zealand was just as prolific before 1891 as it has been since. The country did not derive greater benefits from the South, African trade than did Australia. The Victorian trade with South Africa was exceedingly great and valuable, and I am sure that, if we compare our exports with those of New Zealand, it will be found that we enjoyed a very considerable measure of that trade.

Mr Deakin:

– In addition to that, we had the trade of Western Australia, which New Zealand had not.

Mr MAUGER:

– Exactly. I should like to direct the attention of the House to some remarkable figures in connexion with the progress of New Zealand during; the ten years ended 1901. In 1891 there were 59,477 persons employed in agricultural pursuits in that country. In 1901 the number had increased to 67,812 - an increase in agricultural labourers and employed of 8.335, an<3 that notwithstanding the fact that the Arbitration Act of that State can be applied to those engaged in agricultural pursuits.

Mr Poynton:

– The Re-purchase Act had something to do with that increase.

Mr MAUGER:

– I am not urging that it had not. At the same time, the honorable member will agree that that Act and its beneficial effects only serve to emphasize the point that the small farmers of New Zealand have not been crushed by the operation of this legislation. On the contrary, they have been able to progress, and to employ a larger number of hands. I could quote from the New Zealand Hansard to show that the fear which exists in the minds of the farming community of Victoria in respect of legislation of this character does not obtain in New Zealand.

Mr Poynton:

– Does the Arbitration Act of New Zealand apply to the farmers?

Mr MAUGER:

– It may be applied to them. One large farmer, writing to the Treasurer of New Zealand, rejoices to notice that the agriculturists of that State are forming an association, because, he declares, its inevitable effect will be to cause their employes to organize, and as soon as they do so their hours of labour will be shortened, their sleeping apartments improved, and their general environment bettered. Surely even the honorable member for Wannon will not dispute, although he may perhaps resent the application of this Bill to those engaged in agricultural pursuits, that there is room for vast improvement in the condition of the farm labourers throughout Victoria. I do not profess to be as familiar with the farming industry as I am with the industrial life of Melbourne; but I am in a position to state that many of the places in which farm labourers have to sleep, and, indeed, many of the conditions under which they are required to work, are more characteristic of barbarians than of a civilized community. Whether the time has come for the application of this measure to farming communities or not. I think that all right thinking people will feel it their duty to do their best to improve the condition of farm labourers. As the environment of these men is improved, the attractions which the cities hold out to them will decrease, and the exodus from country districts to large centres of population will be reduced. In New Zealand the number of agricultural employes increased by 8,335 between the years 1891 and 1901.

Mr Robinson:

– Does the honorable member say that the farmers of New Zealand are under the Conciliation and Arbitration Act?

Mr MAUGER:

– I say that the farming community of New Zealand may take advantage of that measure. In 1891 there were 10,056 persons employed as pastoral labourers, while in 1901 there were 16,872, an increase of 6,816. During the same period the increase in the number of persons employed in the mining industry amounted to 939, while in all the primary industries the number of persons employed increased by 21,375. In the number of persons engaged in manufactures there was no less an increase than 23,085. The latest return which I have been able to obtain shows that there are no less than 48,718 persons employed in manufactures in the great colony of New Zealand.

Mr Deakin:

– Can the honorable member explain why the number of unionists in New Zealand is not increasing ?

Mr MAUGER:

– I think I can. The fact is that trades unionists very rarely increase in numbers when good wages are being paid and when the country in which they live is in a comparatively prosperous condition.

Mr Spence:

– We have also to remember that the Judge in the New Zealand Court decided that he would not give a preference to unionists.

Mr MAUGER:

– Quite so, but prior to that decision there was a slight decline in the number of unionists. For the last four or five years there has been a tendency towards a decrease rather than an increase. A leading trades unionist, writing from Auckland, as late as last week, states that the only reason he can assign for this falling away in the ranks of unionism is that tailoresses, furniture workers, woollen mill employe’s, and others are now receiving higher wages than were ever paid before, and that the condition of the working classes generally has so much improved that they have become careless of unionism. Believing that their present position is assured, they do not feel that there is any need to trouble about unions.

Mr Spence:

– And we know that the Judge of the Arbitration Court there declined to give a preference to unionists.

Mr MAUGER:

– That may be one of the causes, but it is not sufficient to wholly account for the decline of trades unionism. I think that the honorable member for Darling will bear me out when I say that it is in the time of stress and trouble - when the poverty and hunger of men can be appealed to - rather than in the days of prosperity that they are inclined towards trades unionism. In times of prosperity they are disposed to become careless of trades unionism, forgetting that, in various ways, they are even then reaping the benefits of the system.

Mr Carpenter:

– In Western Australia some of the workers deliberately said to the union representatives : - “ Now that we have the Arbitration Court we do not want the unions.”

Mr MAUGER:

– That only shows that among the workers, as in other classes, there are selfish people.

Mr Spence:

– Tyrannical employers always make trades unionists.

Mr MAUGER:

– I agree with the honorable member. If all employers paid good wages, required their employes to work only a reasonable number of hours, and endeavoured to bring about a better understanding between themselves and their workmen, they would do much to “ scotch “ the bogey of socialism, of which they are so ready to speak. It is because many of them try to crush the workers, and indulge in speeches such as those made at a certain gathering in this city last night, that they cause men to join unions. Such tactics do not always bring about beneficial results to the employers. I also agree with the honorable member for Darling, that the advent of the Employers’ Federation, and the almost insane utterances of its executive officers, have done more to re-vitalize trades unionism in Victoria than has all the preaching in which supporters of unionism have indulged for the last twenty years.

Mr Poynton:

– That Federation, coupled with the. passing of the Coercion Act in Victoria, have brought about that result.

Mr Robinson:

– A Coercion Act was not passed by the Victorian Parliament. It was simply an Act to suppress a revolt against constituted authority.

Mr MAUGER:

– If there has been no Coercion Act passed by the Victorian Parliament, there has been an Act passed that has sown the seeds of discord and distrust, the harvest of which is now being reaped, and is likely to be reaped for some years to come in this State. I am sure that if greater moderation were shown by employers, . and if the spirit of oppression were less in evidence than it is, we should have far less friction between master and men than exists to-day in Victoria. The figures which I have quoted conclusively prove that wonderful progress has been made in New Zealand under legislation similar to that which we propose to pass. It is true that there have been trade troubles there, and those troubles are likely to continue to make their appearance. There has been friction there, and there must be friction as long as human nature is constituted as it is. But, nevertheless, the trouble and friction which have occurred have not been nearly so great or so painful in their results as were the strikes of former times.

Mr Poynton:

– There have been no lost days.

Mr MAUGER:

– No. Lost days, whether due to idleness or follies of any kind, are not easily made good. There have been no lost days in connexion with the great enterprises of New Zealand. The pastoral, agricultural, mining, and manufacturing industries have all advanced steadily, and a feeling prevails in the best minds in New Zealand to-day that the Colony is in a better condition than is any other- country.

Mr Spence:

– The facts in relation to New South Wales also prove that good has attended the passing of the State Arbitration Act.

Mr MAUGER:

– Quite so. As time goes on - as the accumulation of business now before the New South Wales Arbitration Court is cleared away - the Act will be found to work better than it does at the present time.

Mr Spence:

– There has been prosperity in New South Wales since the passing of that Act.

Mr MAUGER:

– And I am satisfied that that prosperity will continue. The troubles and difficulties now to be found among the workers in New South Wales are as nothing compared with those incidental to the disastrous shearing strike and other trade disputes of a few years ago. I wish now for a moment or two to deal with one or two questions touched on by the honorable member for Wentworth. The honorable member referred to the effect of the minimum wage and the common rule as applied under an Arbitration Act, and made the statement which is continually being advanced by opponents of this class of legislation in Victoria, that the minimum wage invariably becomes the maximum. We are constantly being told in this State that the minimum wage always becomes the maximum wage; that under that principle conscientious work must go unrewarded, and that the careless man is just as highly thought of as is the man who puts intelligence and skill into his labour. We know that that is contrary to fact. Under a minimum wage provision we say, in effect, to the employers of the country - “You are to begin at a certain standard ; but it is open to you to reward intelligence and thrift and faithful service as much as you please.” I am happy to say that such service is being rewarded by the majority of the employers of Victoria. I have before me a statement that completely controverts the assertion of the honorable member for Wentworth as to the effect of a minimum wage. I refer to a quotation from a report of the Chief Inspector of Factories in Victoria, which is an irrefutable reply to the assertion that the principle of the minimum wage is reducing the standard of living, that there is no effort to go beyond the minimum fixed, and that all workers under it are brought down to the one common level. Mr. Ord says -

I am anxious to refer to a statement repeatedly made by some manufacturers, and which frequently appears in the press. The statement is that the minimum wage is nearly always the maximum wage, and that the fixing of same tends to take away from the good workman the incentive to do his best.

That is what my honorable friend said yesterday -

The. Special Board system has now been in force in a few trades since 1897, and I have no hesitation in saying that the minimum wage is never the maximum wage. If we take the clothing trade for instance, the minimum wage for adult males is 45s. per week, whereas the average wage paid last year was 53s. 6d. per week; for adult females in this trade the minimum wage is 20s. per week, whereas the average wage paid last year was 22s. 3d. per week.

Honorable members will see that the minimum wage is considerably below the average wage.

Mr Robinson:

– Then why does the honorable member seek to have it fixed?

Mr MAUGER:

– Now that I have proved that the position of honorable members is absolutely untenable, I am asked why we require a minimum wage. My reply is that we need it to prevent the men whose interests some honorable members champion from forcing their employes to work for a less than a reasonable wage. In the days of Victoria’s prosperity - at the very height of the land boom - seamstresses in Melbourne were being shamefully sweated.

Mr Maloney:

– The Premier of the day was accused of wearing clothes made in a sweater’s den.

Mr MAUGER:

– Quite so. He ‘discovered that, unknown to him, the clothes he was wearing had been made in such a place. There is no connexion whatever between the price paid by a man for his clothing and that which the manufacturer gives to have it made up. The late J. B. Patterson, when Premier of Victoria, received the first deputation which set in motion the factory legislation of the State, and in the course of the interview he discovered that his own clothes, for which he was paying a fair price, were being made by sweated men and women at a shamefully low rate. We sought to prevent the repetition of such occurrences, and - 1 am proud to say that the Victorian Factories Act has had that effect. It has made the minimum wage not even the average wage, to say nothing of it being the maximum. Then the Chief Inspector of Factories goes on to say in his report that -

In the boot trade the minimum wage is 42s. for adult males, whereas the average wage paid last year was 44s. 7d. For adult females the maximum is fixed at 20s., whereas the average wage paid last year was 2rs. 8d.

My own experience bears out the statement of the Chief Inspector of Factories, that the minimum wage does not become the maximum wage, and that there is nothing in legislation of this kind to prevent employers rewarding conscientious workmen in a suitable way. I am confident that many employers make the Victorian Factories Act a mere stalking horse. Many are anxious to carry out the spirit of the Act, but there are others who continually make use of it in their desire to deal unjustly with their work-people. The honorable member for Corangamite does not appear to have realized that the day for individual bargaining has gone for ever, and that provision must now be made for collective bargaining. He speaks flippantly of agitators on the side of the workers, unmindful of the fact that there are agitators and organizations working in the interests of the employers.

Mr Poynton:

– The employers have their unions.

Mr MAUGER:

– They have some verystrong unions. We all know that the lawyers and doctors and ‘bankers have some of the closest corporations for the preservation of their interests of which it is possible to conceive.

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

– Look at the black list issued by the capitalists of America the other day. *

Mr Tudor:

– There have been black lists here.

Mr MAUGER:

– No doubt. The employers are continually organizing. I do not object to that. I think that under our present system every employer should join an organization. But as the employers recognise the value of organizing, and of appointing lecturers and secretaries, they should be prepared to concede to the employes the right to take similar action, and should rejoice in the fact that the employes are preparing to meet them upon a fair and reasonable basis. The honorable member for North Sydney appeared to think that the New South Wales Arbitration Act is likely to break down ; but in the Review of Reviews there is an admirable article which I commend to honorable members. It is by the leader of the Opposition in New South Wales, Mr. J. H. Carruthers. He does not appear to be favorably inclined to this kind of legislation.

Mr Spence:

– He was opposed to it.

Mr MAUGER:

– That makes his article all the more significant and valuable, and bears out my contention that the New South Wales Act has been fairly successful. Time and experience will make it more successful, and if reasonableness is shown by both sides the results are likely to be all that we desire. Mr. Carruthers writes -

There seems to be no middle course. With the political situation of Australia, adult suffrage, vote by ballot, and the great power of the people over Parliaments and Governments, industrial disputes, if .permitted” to engender strikes, will become political disputes, and the institution of selfgovernment will be degraded.

That has been and will continue to be the case. These matters are not subjects for political discussion or political settlement. They should be settled by a judicial body having proper information and data before it. Mr. Carruthers continues -

Far better to have a wisely-designed law, administered by an impartial Judge and assessors, and maintained free from political interference, than to have every industry in the land at the mercy of politicians created for the purpose of taking sides in industrial warfare.

The present law is but an experiment, but it is a valuable one, and, with a fair trial, it bids fair to show us errors to be avoided, and some solid achievement to maintain.

Those words- apply to the measure which we have now under consideration. I hope that all the wisdom and thought which can be brought to bear upon it will be given to it, and that the result will be an Act of which we shall have reason to be proud.

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

– The number of points of view from which honorable members have dealt with this question on its second discussion in this Chamber is astonishing. In the many speeches to which I have listened, both yesterday and to-day, I have not heard the subject dealt with by any two speakers from the same stand-point, and I find myself in the position of being able to express my opinions from a point of view which, I think, has not yet been referred to. I am not opposed to this legislation. On the contrary, I am firmly convinced that something in the direction of compulsory arbitration must ultimately take place. My experience as a manufacturer and a considerable employer of labour has taught me that no other means for securing industrial peace exists. But in dealing with this measure we are brought face to . face with a great political crisis. We cannot blind our eyes to the fact that we have to consider, not only the concrete proposals put before us by the Government, but also the question which party shall ultimately hold the reins of power in this Commonwealth. As I have already fully expressed my views upon’ the subject of arbitration, and the need for doing something to secure to labour its fair share of the rewards of industry, I should not have spoken on the subject again but. for the very extraordinary and peculiar circumstance to which I allude. The position -of affairs is a very confused one, and no two of ‘us are quite* in accord as to what should be done. I am decidedly in favour of making an attempt to deal with such industrial disputes as we are empowered to deal with by the Constitution. The experience which has been gained elsewhere and in the States in the adjustment of industrial differences, although not entirely favorable, is sufficient to warrant us in continuing what I regard as experimental legislation, and to that extent I must support it. But, as I have already stated, I do not think it is the wisest measure that we could adopt for dealing with the very grave and far-reaching difficulties which must present themselves. The adoption of compulsory arbitration in varying degree has occurred in several of the States, and the result in some of them has been practically successful. Although the success of the New Zealand legislation is to be discounted to some extent by the prosperity which has so happily befallen that country, the operation of the New Zealand Acts has been in the main satisfactory. The Victorian wages boards, which had a somewhat similar end in view, have also been successful in remedying to some extent the grave consequences which have been due to free competition in the employment of labour in this State. The New ‘South Wales Act, though not the wisest that could have been devised, has also, I am forced to admit, not been unsuccessful. The friction which its administration has caused has been due largely to the fact that it descends to deal with a great variety of detail. Instead of laying down- broad principles and main lines of settlement it has descended to such trumpery and trivial details that a vast amount of irritation has been caused. Yet, on the whole, while we must view all this legislation as tentative, I consider that this Parliament is justified in carrying the experiment still further, by providing for a method of settling disputes which extend beyond the control of the Legislatures of the States. Such disputes must be of vast magnitude, and very far reaching in their consequences, not only to those immediately concerned, but to the whole public of the Commonwealth. It is not here or there, but from one end of the world to the other, that disputes between capital and labour, between employer and employe, arise, and any effort to bring about industrial peace must be regarded as laudable. I think it is forced upon those who oppose compulsory arbitration to tell us what is the alternative. No man who goes about the world with his eyes and ears open can ignore the present economic difficulties, the friction, want of agreement, and industrial discord which exist from China to Peru. We hear daily of strikes and disputes between the two great factors in the economic production of the world. Therefore those who oppose legislation for the settlement of these disputes should set before us some alternative. To my mind, we must either meet these difficulties, or be prepared to submit to a condition of anarchy.. My reading and my personal experience make me believe that no better solution has yet been offered than the adoption of arbitration, and arbitration is useless unless it is made compulsory. All systems of arbitration which have hitherto been adopted have done a certain amount of good, but in most instances, unless those in disagreement are compelled to come to terms, no great amount of good is to be looked for from arbitration. The better class of employers, who desire to treat their men well, are frequently prevented from improving the condition of their employes by the .competition of others, who, by treating their men less generously, are able to produce more cheaply. Compulsory arbitration for such employers would be an advantage, because it would compel all to conform to a certain standard. In my opinion, we must either follow in the lines of the economic evolution of civilized society, or we must be prepared for a devolution, under which the nation, by reason of its falling off in physique and intellectual vigour, must be crushed out of existence by other nations ; or there must he an absolute revolution. We shall do well to move on the lines of well-known natural forces, resistance to which would bring about a greater national disaster than any slight loss accruing to employers under legislation which would give employes greater profits than they now enjoy. A great deal has been said about the teachings of history with regard to this matter. I think I have read history to as great an extent as most ordinary men, and, like most ordinary men, I find that my reading has been to a large extent undigested. Certain very general broad impressions have, however, been left on mv mind, and one of these is that the world has for centuries past been moving in the one direction. It is as if one saw the curve of a circle, and were asked to state in what direction the line was proceeding. One would have no difficulty in predicting the course which the line would describe, because one could see that it had been following a certain direction. If we learn anything at all from our historical reading, we gather that, from the dawn of history up to yesterday, the general tendency of economics has been in the direction of a more equitable distribution of the products of labour. All that we have been able to read of history, of that of. the last too years in particular, shows that the State has interfered more and more in the direction of bringing I about an equitable distribution of the results of labour. All the talk indulged in regarding the suggestions which were made in the middle ages, and which were adopted, and afterwards discarded, go for nothing, in view of the general trend of history, which has been in the one direction and with a strengthening purpose. The teaching of history alone shows us that we ‘must adopt some such legislation as this in order to keep pace with the evolution that has been in progress. The main objection to this class of legislation has been summed up in one word, which has been repeated so persistently and with so much force that it has almost silenced many supporters of this measure. I refer to the word “socialism.” There would be some trouble in denning that word in such a way that the definition would be accepted by every one engaged in this discussion. We have been recently invited by one of the newspapers of Melbourne to give our definitions of that word. I should be very pleased indeed if we ‘could induce every honorable member to give an absolutely unbiased opinion, apart from any reference to the encyclopaedia, regarding the meaning of that word. If this could be done and an average were struck, the result would probably be to give us the general acceptation of the term, although, of course, many of the opinions would be diametrically opposed. The word “ socialism “ has been used as a weapon by the strongest opponents of legislation of this kind. I was very much struck by an incident related by the honorable and learned member for Northern Melbourne, whose experience coincides with my own. The honorable and learned member told us that he had had a conversation with a gentleman of his acquaintance in a train. This gentleman was apparently well-to-do. If he had not been he would scarcely have given his opinion that the country was going to the dogs, and that socialism was ruining the community. This same gentleman, before he left the honorable and learned member, said that Parliament ought to do something by way of legislation in a certain direction in which he was interested, and his suggestion was as purely socialistic as anything that has ever been proposed in this Chamber. Those who are so strongly opposed to socialism when it does not bring anything into their own pockets are among its staunchest advocates when it bears upon some large scheme of irrigation, a proposal for the payment of iron bonuses, or for something else in which they are interested.

Then they are absolutely socialistic; because they wish to bring about a combination of all the forces of the State in order to secure a certain result. That is one of the definitions of socialism. When, however, something is proposed which will confer benefit upon others, but will not be attended by any particular advantage to them, these self same gentlemen declare that they will have nothing to do with it, and that socialism is ruining the country. According to one encyclopaedia, to which I referred, socialism is “ a new form of social organization, based upon a fundamental change in the economic order of society in which the collective or co-operative principle shall become normal or usual, and under which all shall share in the fruits of associated labour, in accordance with some good or equitable principle/’ That is socialism, and adhering strictly to that definition, we have amongst us very many socialistic institutions, which have succeeded past all the expectations of those who proposed them. Take the post-office, for instance. Those who oppose such a measure as this on the ground that it is socialistic, say that everything should be left to private enterprise, that we have no right to ‘interfere with the liberty of the individual. If we applied that class of reasoning to the post-office, it would be claimed that every person should have liberty to despatch his letters in his own way, at his own time, and according to his own methods. But, after the experience ofthe post-office for two centuries, we have come to the conclusion that this measure of socialism has resulted in the greatest benefit to the whole body politic, poor and rich, old and young. If ‘ it be good that a man should be able to exchange his ideas upon business or social matters through some medium of Government creation, why should he not be able to send his linen to a national laundry, get it washed, and returned to him? This is done in some countries. Socialism resolves itself into a question of how rapidly it is wise for us to proceed. Some countries have gone beyond our present standard, and others have lagged behind, . and the question as to how rapidly it is wise to proceed in the direction of the whole body of the people doing something through its Government, in the interests of the community generally, is purely one of expediency. France regulates it’s funerals and its public laundries, and has many other institutions which we should consider! socialistic ; but the State has not yet taken over the control of the railways in that country. Socialism, I take it, is civilization carried to its ultimate ideal, and we are all socialists. The only difference between one socialist and another is with regard to the rapidity of the rate at which we should proceed in achieving our ultimate ideal. If any one asked an enlightened man for a definition of Christianity, he would be told that he had better ask for its history ; and so it is with socialism. Anyone who seeks a definition of the term had better ask for a history of the development of the idea. In regard to the regulation of the relations between labour and capital, we have passed through several evolutions. Paternalism has gone, individualism has gone; they have absolutely passed away. Profit-sharing and co-operation have not yet come into being. They have been tried in isolated cases, with more or less satisfac-tory results, but to adopt them as a general means of removing present-day difficulties seems to be quite out of the question at present. I believe that profit-sharing will ultimately remove the difficulties attendant upon the struggle between capital and labour; but up to the present nothing practical has been done to justify us in adopting it as a national expedient. I am firmly, convinced, however, that the time will come when it will be possible for a number of men in a certain trade to band themselves together as workmen, and - as in the case of the members of a limited company at present - to go to capitalists and obtain credit on the strength of their union. They will be able to ask the capitalists to give them the money necessary to make their labour productive, and the possession of the power to labour will then be quite as good a credential as is the possession of so much credit to-day. We have not yet reached that stage, and therefore we have to consider what other expedients are open to us for the settlement of the grave difficulties which show no signs of diminishing in this or other countries. A French writer, M. Yves Guyot, has recommended that workmen should enter into such combinations as I have indicated, and that, instead of holding capital in common, they should hold labour in common. The capitalists should go to them and say, - “ We desire to produce so many thousand yards of cloth, or so many thousand pounds of goods. We have here a full supply of the raw material, and we wish to know at what price you will sup ply’ the labour necessary to transform the raw material into a marketable article.” This writer declares that a solution of the difficulty is to be found in that direction. But when practical men come to examine it, it seems utterly impossible to deal with the problem upon those lines, for the reason that the class of labour, and the means of employing it, are so diversified. Consequently, I scarcely think that even this advanced writer has discovered the solution of this unquestionably difficult problem. There is only one factor of which we are bound to take cognizance. Unions of capitalists and workmen exist in every civilized country throughout the world. They confront one another in menacing attitudes, and that is the difficulty which we have to face. But that very difficulty to my mind- suggests its own solution. We can make use of these unions - as is proposed under this Bill - to bring about an improved state of affairs. These very, organizations, whilst making industrial conflicts graver and more disastrous to the general community, offer a solution of the evil by means of collective bargaining, under the supervision of a competent Court. In that way a prospect is presented to us of securing a settlement of that industrial strife which menaces to-day almost every civilized country. The system proposed gives more promise of success than any which has hitherto been adopted. Nevertheless, I think it will suffer largely in its ultimate effect from the action both of its friends and its foes. Its foes may defeat it, and thus render it necessary to substitute something very much more stringent in order to insure that industrial peace which we all desire. Its friends may defeat it by asking too much - by proceeding to extremes - and in this connexion I think that there are several members of the Labour Party who are really inclined to go too far. I feel convinced that the legislation of New South Wales in this respect has proceeded too far, and that its effect must be “ to kill the goose that lays the golden egg.” If any legitimate attempt be made to effect a solution of this very grave problem, it must: be approached by both sides in a spirit of compromise. I think we have to consider the legislation proposed in conjunction with’ political contingencies, and I am of opinion that it is possible for us to go very much too far, especially if such legislation is to be administered by representatives of a mere section of the community. I think that compromise is essential if any successful effort is to be made to reconcile the differences which exist between capital and labour. Let me take the case of the honorable and learned member for Parkes, who is absent from the House to-day. He is one of the ablest opponents of this Bill. I cite his case because he is one of the best of a class which is opposed to it. He goes to an extreme and conjures up the bogy of capital being affrighted by such legislation and in some mysterious manner leaving Australia. He paints a picture of capitalists packing up their belongings and seeking refuge upon another planet. I hold that that is a mere bogy. The honorable and learned member ought to give some consideration to the absolute condition of things existing to-day in some parts of the world - the condition of a hungry proletariat, incensed because they are not getting their fair share of this world’s goods, who as a result are endeavouring to secure remedial legislation of a just character, but who, to attain their ends, will, in the last resort, not hesitate to adopt revolutionary measures or something akin to them. Surely it is better to consider how far we can meet existing difficulties in a spirit of compromise than to defy the terrible situation which may arise if every proposed remedy is resisted.

Mr DUGALD THOMSON:
NORTH SYDNEY, NEW SOUTH WALES · FT; ANTI-SOC from 1906

– We have enacted the principle of one man one vote.

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

– It is because we have enacted that principle that we shall ultimately succeed in securing this legislation.

Mr DUGALD THOMSON:
NORTH SYDNEY, NEW SOUTH WALES · FT; ANTI-SOC from 1906

– Therefore, there is no need to resort to revolution.

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

– I hold that it is bad policy to resist the inevitable. The leader of the Opposition once remarked that when he came to a stone wall he got over it if” he could, but that if he could not he got under it. If he could not do either, he would lie down beside it. I ask the opponents of this Bill to accommodate themselves to the inevitable, and instead of opposing it tooth and nail, to join with others in effecting a reasonable measure of reform. Many of its opponents constitute the ablest men amongst us. I refer more particularly to the honorable member for North Sydney, and the honorable and learned member for Parkes. I am convinced that if they will endeavour to make this measure a workable one, they will ultimately accomplish more good than they will achieve by blindly opposing it. It has been stated that if the Government are defeated upon the Bill, we shall have a dissolution of this House and another general election. That sort of threat is frequently used when we are face to face with a difficulty of this character.

Mr Deakin:

– Who made that threat?

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

– I do not know.

Mr Poynton:

– The press.

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

– The Prime Minister himself has no excuse for urging a dissolution, because he boldly announced his views to his constituents, not only upon the measure but upon its details. The same remark is applicable to myself. I am not a supporter of all its details, but I certainly favour extending its operation to the railway servants of the States. So far as I am concerned, I see no need whatever for a dissolution, although I do not fear one. I am perfectly willing to return to my constituents, and to stand or fall on the views which I have expressed upon this Bill, but 1 should be equally prepared to forego my opinions if, by doing so, I could bring about what I consider to be a very much healthier condition of affairs in this Parliament. Prior to the opening of the present session, the statement was made that we required a re-adjustment of parties in this House. From the first moment that I saw the relative strength of those parties I realized that the fiscal issue would have to be buried - at least for a time, and consequently it -became more easy to effect a political combination for the good of Australia. I was prepared to hear of some proposals in that direction. To the credit of this Parliament be it said, the Prime Minister has honorably kept the promise which he made to his constituents at Ballarat, that if any coalition were attempted, he would be no party to any secret understanding. He declared that whatever arrangements were made would have to be of an open and public character. The same attitude was taken up by the leader of the Opposition. Upon no occasion has the right honorable member sought to influence the personal views of his supporters upon this particular question. It has been left entirely to the individual judgment of honorable members on both sides of the House. I regret, however, that some solution of the difficulty does not appear to be likely before we reach a stage at which it will be almost impossible to retrace our steps. It seems to me that we are bound now to speak out. There are three members of the present Administration behind whom I would willingly sit, and, in the interests of good Government, I should like to see those honorable gentlemen associated with three other honorable members - who would have the confidence of the vast majority on both sides of the House - in completing the remaining machinery measures necessary for the complete establishment of the Federation. I should like to see a strong capable Government of that kind dealing with those and the still greater questions of finance, immigration, the control of our rivers, and other matters which demand the best talent that we can secure. It is my desire that this measure should be passed in some shape or other, and I think that it should be possible to give effect to it, at ali events in some modified form. It is highly desirable that we should adopt a spirit of compromise if only in order to determine whether a measure of this kind, if applied to the Commonwealth, would be as efficacious as many honorable members believe it would be, or whether it would be the failure that others predict. A question of this kind cannot be decided by reference to what has been .done elsewhere. The only way in which to test -the effect of a measure of this description is to declare that it shall remain in operation for a period of a few years, and to amend it from time to time, as experience dictates. I believe that this could be more happily and effectually achieved by a strong capable Government, created by some coalition of parties, than by any Government consisting of honorable members of the Labour Party, or of any one party in the House. I have no personal or political antipathy to the Labour Party. As a matter of fact, I coincide with their views to as great an extent as does any honorable member outside the party ; but I do not think it would be to the best interests of Australia to leave the control of its affairs in the hands of the representatives of a mere section of the people. Perhaps the only way to secure an adequate solution of the problem with which we are confronted would be to allow our honorable friends of the Labour Party an opportunity to form an Administration. If that were done it might lead to that coalition of parties, which we all appear to desire, but are apparently unable to accomplish. It may be asked, what have I done towards bringing about such a coalition. It is not given, however, to the mere satellites of political life to bring about a readjustment of party relations. The readjustment must come from the fixed stars and the suns of the system. Since they have failed us in this instance we have to submit to the existing conditions, and to endeavour, while awaiting the result, whatever it may be, of the present position, to carry out our own individual principles. I’ am in favour of this measure, and I also favour such an amendment of it as will bring the railway employes under its operation. A Bill of this kind that did not extend to the employe’s of the great railway services throughout the States would not be a measure of Federal arbitration, and would fail to meet the greatest demand likely to be made upon such legislation. I am convinced, as an ordinary layman, that we should not exceed our constitutional power if we extended the operation of the Bill to those employes. Lawyers differ on this point. The Prime Minister himself does not seem to be %’ery emphatic in the view that the railway servants of the States cannot be brought under the operation of this measure.

Mr Deakin:

– I am positive on the point.

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

– All I can say is that the honorable and learned gentleman, in the two speeches which he has made on this question, has failed to convince me that he entertains a positive opinion on the point. He appeared to take up the ground that such an extension of the scope of the Bill would be unconstitutional, and that, if it were not, .even as a matter of expediency, it would be unwise to avail ourselves of the full extent of our powers in this direction. One approaches with bated breath a question of legal interpretation, such as that with which I propose to deal later on ; but I feel satisfied that we have this power. If we do not possess it, why should we seek in this Bill to expressly exclude the railway servants of the States from its operation ? It is a matter for regret that it has been impossible to approach the consideration of this question with a stronger and more capable Government in power - a Government better able to carry out legislation in the direction which they think desirable - than is the present Administration. After the general elections we had an opportunity to secure such a Government - one that might have passed this measure in some form, as well as many other Bills which would promote the ultimate good of the Commonwealth. Instead of availing ourselves of that opportunity, however, we find that we have a Government which, instead of taking the initiative, and endeavouring to remove the entanglement due to the conflicting interests of parties, is simply waiting the ultimate outcome of the resulting difficulty. If an arrangement such as I have suggested had been brought about, I should have been prepared, if necessary, to give up my own convictions as to bringing the railway employes of the States within the provisions of this Bill. As a matter of fact, I informed some of my own friends of my willingness to do so. Some honorable members have much to say of consistency, but in many cases an absurd view is taken of that virtue. Consistency after all is only consistency to principle. One may have two principles which are dear to him, and in certain circumstances it may be necessary for him to decide which of those is dearest to his heart, and, perhaps, nearest to his honour. Although convinced that the railway employes of the States should be brought within the scope of this measure, I do not say that it should apply to all public servants. Such an amendment would include a class of professional men that we do not intend to bring under the Bill if they are outside the service. A difficulty among the railway men of the States, however, would . be the most disastrous of any that we could face, and they ought not, therefore, to be omitted from this measure. A Federal Arbitration Bill which took no cognizance of the railway employes of the Stateswould be like the play of Hamlet with the Prince of Denmark and all his family, so to speak, left out. Why should we ignore the railway employes? They play a most important part in the operations of the States, and if they went to extremes might play a disastrous part. Nevertheless, if a coalition such as I have mentioned could have been brought about I should have been prepared if necessary to give up my desire to see them brought within this Bill. In that event I should have felt myself impelled to resign my seat, and to appeal to my constituents to indorse my action, inasmuch as at the last elections I told them that I should vote for the inclusion of the State railway servants in the Conciliation and Arbitration Bill. If it had been considered necessary to secure a strong Government to carry on the affairs of this nation, which is as yet in its childhood, I . should have been prepared to sacrifice my own views in this respect. But we ha%-e had no proposal in that direction.

We are face to face with the fact that we must proceed with the consideration of the Bill under existing circumstances, and that we are called upon to give expression to our individual opinions, and I, for one, intend to adhere to my original view that the railway employes of the States should be brought under the operation of the measure. This measure departs but slightly from the Bill introduced last session, and the difficulty which I have experienced in dealing with both of them is that no concise declaration has been given either by the Prime Minister or by any other member of the Government, of what will be the precise effect of such a measure. We know that under the Constitution we cannot deal with any dispute that does not extend beyond the limits of any one State. Yet this Bill contains all the machinery provisions that would be necessary if the Constitution declared in plain unmistakable terms that we had the sole right to legislate for the settlement of all industrial disputes. The Prime Minister has not addressed himself, either in this House or outside of it, to the question of how far these machinery provisions are to be employed, and to what extent it is proposed to put them in operation. The honorable and learned gentleman is somewhat chary of interfering with States rights, so far as the railway employes or other public servants are concerned. But he has not had much to say of the infringement of State rights, so far as private enterprise is ‘ concerned. Although, by interjection and otherwise, we have asked for an explanation of the object of all these machinery provisions, the honorable and learned gentleman has made no response. It is plain that the Bill has been framed, as was stated by a member of the Government, or some prominent member of the House, in the hope that at some future period we shall be given power by the States to exercise all possible jurisdiction for the settlement of disputes between employer and employed. We- do not know how far the present Administration intend to set these machinery provisions in motion, but the fact remains that they will . be available for interference in every possible way with States rights. Before I consent to the Bill coming out of committee, I shall endeavour to obtain a rigid expression of the intention of the Prime Minister as to the extent to which this machinery will operate, and as to at what stages of a dispute it is to be used. 1 It seems to me an attempt to grasp the whole power of settling disputes, and a more violent invasion of State rights than the inclusion of State servants. Not one petition or remonstrance of the many which have been addressed to us, from all parts of Australia, objects to the inclusion of railway men; but members of Chambers of Commerce, of Chambers of Manufactures, and employers generally, object to the attempt which is being made to enable the Commonwealth to interfere for the settlement of every industrial dispute throughout the length and breadth of the land. It is only in regard to this matter that the people are alive to the threatened invasion of State rights. Here and there a prominent politician, in a State Parliament, may have expressed indignation at the proposal to include State servants in the Bill, but the great mass of the people have taken no notice of that proposal, and have confined their remonstrances to the effort of the Government to bring the most trumpery disputes within the jurisdiction of the Commonwealth Court. It may be an open question whether to apply the provisions of the Bill to State servants would be an invasion of State rights ; but this other violation of the constitutional rights of the States is disgraceful, and cannot be disguised. I have heard the Prime Minister make many magnificent speeches, but two of the very best were those which he made on the second reading of the previous Bill, and in moving the second reading of this Bill. His first speech was better than one could have expected even from him, and what I chiefly admired in both was his whole-souled sympathy with the labouring classes, and his desire that they should obtain their fair share of the results of their labours. His illustration of the private duello, and the need for restricting similar action on the part of organized bands of industry, was, I think, one of the best efforts of the kind we have had in this Chamber. Like him, I am a most loyal adherent of the .Constitution. I feel that we must imbue our children with loyalty to it, and I am pleased to see statesmen like the honorable and learned gentleman ready to resist any attempt to violate it. It seems to me, however, that in connexion with this measure the Prime Minister has strained at a gnat while swallowing a camel. He is ready to resist the violation of State rights implied by the inclusion of State servant’s in the Bill - though I do not think that that would be a violation - but he had nothing to say against the still more serious violation to which I refer.

Mr Robinson:

– The Bill is a bad one all through.

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

– I do not think so. The title of it, at all events, is good.. So are some of the definitions, and many of its provisions ; and I hope that in committee we shall make it a good measure. If it be unconstitutional to apply the provisions of the Bill to -State servants, why has the Prime Minister specifically excluded them from its operation? If the Constitution excludes them, why make any reference to them at all? Why not leave it to the High Court to say whether they are or are not included ? If we were content to pass a law providing for the settlement of disputes between employers and employes, and a dispute arose between the Government of a. State and some of its employes, the High Court would have to decide whether the suit could be entertained.

Mr Kelly:

– Is it federally expedient to apply the provisions of the Bill to State servants ?

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

– I am not now dealing with the question of expediency. I am dealing with absolute facts.

Mr DUGALD THOMSON:
NORTH SYDNEY, NEW SOUTH WALES · FT; ANTI-SOC from 1906

– We have to decide whether it is expedient.

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

– The Prime Minister, at all events, is not in that position. He belives that it is unconstitutional to attempt to apply .these provisions to State servants, and he should therefore have made no reference to them in the Bill.

Mr Deakin:

– Does not the honorable member recollect the circumstances under which the Bill was drafted?

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

– Whatever the circumstances under which the original Bill was drafted, it was the duty of the Prime Minister to see that this measure embodied his own fixed opinions.

Mr Deakin:

– So it does.

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

– In that case, the honorable and learned gentleman has no fixed opinions, because he proposes to exclude from the operation of the Bill a set of persons to whom he says its provisions cannot apply.

Mr Deakin:

– The honorable member is ignoring the circumstances under which the Bill was framed.

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

– The original draft contained no provision excluding State servants. A copy was obtained by the Agc, by means of a petty larceny, or in some manner which was not quite straightforward, and the summary of its provisions, printed next morning, contained no reference to State servants.

Mr Robinson:

– That fact does not prove that there was no reference in the draft to State servants.

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

– I was connected with the press for fourteen years, and I know that a salient feature such as I refer to would not be lost sight of.

Mr Deakin:

– The Minister then in charge of the Bill gave a copy of it to a reporter of the Age. What occurred was due to a misunderstanding.

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

– There was a breach of honour somewhere. When Mr. Irvine was interviewed on the subject he was in a state of some hesitation ; but if it had been proposed to include State servants we -know that he would have had nothing to do with ‘such a proposal. The Prime Minister says that it would be absolutely unconstitutional to include State servants in the Bill, and yet he has inserted a provision which specifically excludes them.

Mr Deakin:

– The honorable member forgets that the right honorable gentleman who shortly afterwards left the Cabinet held the opinion that if there were no reference to State servants they would be included. I differed from him.. I said that if there were no reference they would be excluded. The provision inserted in the Bill was adopted to meet the views of my colleague, and to place the matter beyond all doubt.

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

– I am in accord with the right honorable member for Adelaide. I think that if no reference were made to State servants the provisions of the Bill would extend to them. There is the suspicion afloat, however, that the subsequent revision of the Bill was an instance, if not of panic legislation, of panic draftsmanship. If a certain event had not occurred in Victoria we might not have heard of this exemption clause. The honorable member for Richmond last night referred a good deal to English history, and particularly to the history of the Revolution. When he was speaking the recollection crossed my memory that after the Revolution they adopted in England the Bill of Rights, and in Scotland the Claim of Rights. According to the best English lawyers, the institution of torture was always illegal in England, and consequently there was no need ro deal with it in the Bill of Rights; but, as the best Scotch lawyers considered it to be legal in Scotland, it was thought that it should be dealt with in the Claim of Rights. However, while the matter was under consideration, Lord Advocate Lockhart was murdered under circumstances of considerable atrocity, and that occurrence determined those, who were dealing with the matter that the right to torture should be maintained. They decided an abstract proposition wholly because of particular circumstances brought under their purview at the time. Thev refused to abolish torture because at that particular juncture they wished to use the right to torture. That was an instance of panic legislation ; and, similarly, I think that the Victorian strike had 10 do with the drafting of this Bill in regard to the control of State employes. It seems to me that it had a great deal to do with the proposal made here to positively exclude them. I do not for a moment doubt our power under the Constitution to do so ; but I wish to leave the whole question open, and await the considered decision of the very able gentlemen who adorn the High Court Bench. In dealing with the question whether States employes, particularly railway servants, Could be brought within the scope of our powers under the Constitution, I would point out that section 51 gives us the power to make laws for the peace, order, and good government of the Commonwealth. Nothing has a more important bearing upon the maintenance of peace, order, and good government in Australia than the vast network of railways in each of the States. The peace, order, and good government of the Commonwealth is very largely dependent upon the relations which exist between the railway employes and the Commissioners. On dissecting this important section, we find that by subsection 1, trade and commerce between the States is brought under our supreme control. Under sub-section IT. we have power to deal with taxation. A question has been raised as to whether we could tax States imports. I believe that that point is now being submitted for the decision of the High Court, but I have always entertained the view that it is absolutely essential that we should have the power to tax States imports, and I see nothing in the Constitution to the contrary. This power is clearly necessary for the protection of other States. There is no distinct provision to this effect in the Constitution, and the power is conferred only by inference. In connexon with the power of taxation, we have the right to levy excise duties on spirits and other commodities manufactured within the Commonwealth. Should we have power to tax the products of a State distillery or of a State tobacco manufactory ? I say clearly we should have such power. It is not given to us in express terms, but it is conferred by inference. We find that under section 91 of the Constitution we have power to grant bounties. Could we give bounties to a State Government? Do we make any distinction between a State Government and an individual? It has actually been proposed in this House to give a bounty to a State Government in connexion with the production of iron. Then, again, subsection XIII. of section 51 confers powers upon us to deal with banking other thai State banking, and also with State banking which extends beyond the limits of the State concerned. We are not to interfere with State banking when it does not extend beyond the limits of the State concerned. That is also the only limitation to our powers in connexion with conciliation and arbitration. As long as a dispute is kept within a State we cannot interfere. It is only when it extends beyond the limits of a State that this Parliament has power to step in and deal with it. In regard to banking and insurance, we can interfere the moment that the business of any State in these matters extends beyond its own border, and in the same way we can step in under sub-section XXXV.. which confers upon us the power to create tribunals for the prevention and settlement of industrial disputes extending beyond the limits of any one State. It has been stated, notably by the honorable and learned member for Bendigo, who, together with Mr. Theodore Fink, has contributed a long opinion to one of the Melbourne newspapers, that we cannot interfere between the State and its employes, because if the Arbitration Court raised the wages of the State employes the State Parliament might refuse to make the necessary provision. Passing by, for the moment, the assumption that wages would be raised in every case, and noting that the Court will deal with many Questions besides that of wages, I would ask if there are not many difficulties precisely similar to those indicated by the honorable and learned member for Bendigo and Mr. Fink with reference to other Federal institutions, in connexion with which the power of the Federal authorities is unquestioned. Take the High Court itself. That Court might decide in its appellate jurisdiction against the verdict of a State Court, that the State should pay £100,000 as compensation to persons injured through some accident upon the railways arising from defective mechanism or gross carelessness. Can it be contended for a moment that the State would refuse to make the necessary provision to comply with the decision of the High Court? Take the case of banking or insurance. Suppose a State entered into banking or insurance business, and extended its operations beyond its own borders, and thereby opened the way for the exercise of the undoubted power of -this Parliament to impose regulations, would the State authorities resist a provision by us that certain securities should be deposited with the Federal Government ? We can see that the decisions of institutions created by the Federal Parliament might be at variance with those of somewhat similar institutions created by the States Parliaments, and that if the latter were disposed to go to extremes they might resist the Federal authority. We do not, however, for a moment apprehend that such’ a position of affairs would ever come about. The same people who created the machinery in one case would be called upon in the other case to find the funds necessary to comply with the authority exercised through that machinery. I do not see how any difficulty could arise, unless we- take a view that is not warranted by anything we know of English communities under free institutions. If a rigid interpretation is to be placed upon the Constitution, I would invite the attention of honorable and learned members to section 98, which gives power to the Parliament to make laws relating to trade and commerce, extending to navigation and shipping, and to the railways the property of any State. That is very definite’, but would it not also apply to private railways? Most decidedly. They are not mentioned, but that fact does not exempt them from the operation of the section. Would not the power of the Federal authorities also apply to States shipping? Suppose a State entered into the shipping business for the purpose of competing with private firms. Does any one suppose that, under our Interestate Commission we could not submit State-owned ships to exactly the same conditions that we imposed upon private ships? In the same way is it to be for one moment imagined that we could not impose the same obligations on private railways that were intended to apply to State railways? Yet, if we were to rigidly interpret that section, as some honorable members appear inclined to treat the sub-section relating to conciliation and arbitration, we should be forced by a parity of reasoning to exclude private railways and States ships from the operation of the Federal authority. Then, again, take the case of the Swiss cantons, and the provision made for education under the Swiss Constitution where the Federal Parliament has provided for an excellent system of compulsory education, and the cantons are called upon to find the funds to carry it out. The system may be extended and rendered more expensive from time to time, and yet because of the good sense of the community there is no friction. The Prime Minister said that the case of Switzerland was not on all fours with our own. Nor is it. But we have to remember’ that ever since its establishment the Swiss Federation has been moving more and more in the direction of our Constitution. Yet. in regard to the question not only of education, but of the .maintenance of roads and several minor matters, the Swiss people have experienced no difficulty whatever as the result of allowing the National Legislature to enact laws for the administration of which the Governments of the Cantons are obliged to find the money. In my judgment, what we need is a measure dealing upon broad general lines with disputes which are likely to pass beyond the limits of any one State. At the same time, our legislation should not embrace minute details such as are dealt with by State laws. If a dispute be of a Commonwealth character, it necessarily follows that it can have little to do with those minute details which occupy so much time in our State Arbitration Courts, leading to a congestion of business, and preventing the unions from obtaining those speedy decisions upon the main issues involved upon which the success of this class of legislation largely depends. If we could obtain an Act which is . capable of dealing chiefly with the broad questions involved in wages - because the matter of holidays may be settled by, local custom or by State legislation - I hold that we should secure advantageous legislation, because it could be applied to large disputes, such as maritime, railway, or shearers’ disputes, all of which we know, from experience, are likely to recur sooner or later. It is for these disputes that we should prepare, and not for the minor troubles to which certain portions of the Bill refer. There are one or two other matters to which I desire to direct attention. In the first place, I observe that the’ title of the Bill has been altered. That seems to me an admission of the existence of some of the difficulties which I have already endeavoured to point out. When the Bill was under consideration in Committee last year, the present Prime Minister proposed to amend clause 3, so as to make its wording harmonize exactly with the paragraph in the Constitution which has reference to this question. At the time I could not help remarking that his action was probably taken with a view to obtaining the decision of the High Court as to the powers which we possess in regard to this legislation. I pointed out that it would be far better- to adopt the phraseology of the Constitution itself in the title of the Bill. That suggestion, I am pleased to note, has now been acted upon. I think that it is wise to test our constitutional powers upon the very title of the measure. We shall then know exactly where we stand. Concerning the details of the measure, I have previously . stated that in my opinion we are committing a mistake- in refusing to appoint permanent Justices to the Arbitration Court. It is urged that we require to have Justices who are skilled in the special matters which will be submitted for their consideration. But experience has taught us that it is utterly impossible to obtain the services of Justices who will be skilled in all matters which come before an Arbitration Court. To my mind it is wrong to appoint two gentlemen, who are simply the nominees of the rival parties to any dispute. If a similar system were adopted in other Courts, chaos would be created immediately. In those Courts matters of even weightier import than those which will occupy the attention of the Arbitration Court are decided. Some of our mining courts have to determine questions which involve larger sums of money than those which will be affected by the decisions of the Arbitration Court. Personally, I am of the opinion that it would be wise to appoint three Justices to settle disputes under this Bill. The idea that it is necessary to have Judges who are possessed of, special knowledge is an erroneous one. The proper place for an expert is the witness-box. It has been stated that Mr. Justice Cohen and some members of the Arbitration Court in New South Wales have complained that they could not follow the intricacies of certain cases which came before them. But I would point out that it is no new experience to find Justices in other Courts admitting, in exceptional cases, that they have been confronted by a difficulty from an absence of technical knowledge. In such circumstances, they have to obtain the best assistance available from experts in the witness-box. We have to recognise, too, that beyond the contending parties to disputes, the public are largely interested in their settlement. The three Judges should represent the State just as much as do Judges in cases of civil or criminal jurisprudence. I hold in my hand the report of a statement made by Mr. W. D. Cruickshank in regard to his position as a member of the Arbitration Court in New South Wales. The extract is taken from the Sydney Morning Herald, of 19th January last. It reads -

Mr.W. D. Cruickshank, employers’ representative in the Arbitration Court, attended the last meeting of the Council of the Employers’ Federation, and made a statement in reference to the general principles by which he is guided in adjudicating upon arbitration matters. The President, Mr. H. Hudson, in introducing Mr. Cruickshank, said that Mr. Smith, the representative of the employes, made it appear by his actions that he and Mr. Cruickshank sat only as advocates for the parties they represented. Therefore, it was suggested that the employers’ case was prejudiced, as Mr. Cruickshank was unacquainted with the circumstances before they came before him as a Judge. Other members of the Council said that some of the employers felt it would be in their interests if Mr. Cruickshank would follow more the lines of Mr. Smith, as they thought he sat there not as a Judge, but as an advocate. It was also thought that it would be desirable for Mr. Cruickshank to be approachable for advice by employers, as Mr. Smith was for the employes. It was also stated that if certain matters had been brought before Mr. Cruickshank prior to the hearing by the Court, the award might have been different. In reply to these remarks, Mr. Cruickshank made an unequivocal declaration of policy. He said that the importance of being “ in continuous touch “ and being “ posted up “ was very much over-rated. In fact, he was quite satisfied, in his own mind, that any and all such posting up would be of very fractional and doubtful advantage, because employers’ counsel, from his experience and training - if properly instructed - could, and no doubt would, put all the points before the Court much better than he could, and the sworn evidence must of necessity be the principal factor in determining any award.

I think that Mr. Cruickshank’s opinion did him honour. It will be seen, from the above extract, that the opinion exists amongst the organizations of labour and capital, that their nominees upon the Bench are really advocates. That being the case, it should be pointed out that wherever there is room for a difference of opinion, the case is decided by the Judge. In such circumstances, I hold that we are wasting money in appointing these two additional men to the Bench. If any case is so intricate as to require the possession of special knowledge, that knowledge should be supplied through the medium of the witness-box. I do not think that any legislation of the character proposed has gone far enough in the direction of ascertaining how much can be achieved by means of conciliation. Some of our State Acts provide for the reference of industrial disputes to arbitration alone, and others for their reference to a Conciliation Board in the first instance. In the latter case, conciliation fails utterly. In the New South Wales Act - and it is likely to be the case under this Bill - the arrangements made for bringing conciliatory methods to bear upon industrial disputes have practically no effect whatever. Up to the present time comparatively little has been done by means of conciliation. It seems to me that the chief hope engendered by legislation of this character has been admirably summed up by a writer in the Argus, who says -

No Court, whether voluntary or compulsory, is to be considered successful unless it promotes the preliminary settlement of disputes by friendly meeting around a common table. The smaller the number of cases which come up for arbitration, because they cannot be settled by conciliation, the greater is the success of the Court. The business of the whole machinery of industrial conciliation must be preventive rather than curative.

In this Bill no provision is made to induce conciliation in case of industrial disputes. I hold that we can induce conciliation if we can compel it by making use of the selfinterests of the parties to disputes. In Committee I intend to submit a proposal having for its object the bringing about of a settlement of a larger number of industrial troubles by means of conciliation, and thus avoiding what I regard as the chief blot upon the New South Wales Act, namely, “the splitting” of differences. It is a principle, which in my opinion is fraught with great injustice. It allows questions to be settled in a haphazard fashion, and is one which would not be recognised in any ordinary Court of law. I feel that I may safely appeal to the lawyers of this House to support my statement, that the system of “ splitting differences, “ which has been adopted to a large extent by Arbitration Courts, would not be countenanced in any other tribunal. A case is brought before the Court, in which the men demand for example, ns. per day, while the masters offer only ios. After wasting a great deal of time in hearing evidence, the Court settles the dispute by fixing the wage at i os. 6d. per day. The effect of this system must be that the workers on the one hand will recognise that, if they fail to ask for a sufficiently high wage, they will be awarded a rate of pay less than they expect to receive, while the employers on the other hand will feel that if they do not make a sufficiently low offer, they will be called upon to pay more than they would otherwise be required to do. The result of the system is that parties are forced wider and wider apart. If we Could introduce the principle of equity we ought to do so. On one occasion, a comrade and I were in the bush, and our supplies were reduced to a very small piece of bread. We had had nothing to eat for ten hours, and my comrade, turning to me, said - “ I will halve the bread, and you may choose.” I have held the opinion ever since then that that was the most absolutely equitable method of division that could have been devised. The nicety with which my friend divided the bread really left no advantage to be gained by making a choice. It seems to me that if we could bring a principle of that kind to bear under our Arbitration law we should effect much good. I consulted the right honorable member for Adelaide, whose absence I am sure we all regret, in reference to my desire that we should embody a principle of this kind in the Bill. He agreed that it was worthy of consideration, and assisted me in drafting an amendment which at a later stage I shall place before the House. The amendment embraces to a considerable extent the principle I have named, and I desire that it shall be ventilated at this stage. If it were brought into operation it would materially reduce the work which must otherwise flow to the Arbitration Court; it would also avoid such a congestion of business as now exists in the New Zealand and New South Wales courts. My proposal is, in effect, that the workmen on the one side and the masters on the other should come together in the conciliation stage of the proceedings provided for in this Bill, and that after they had fully discussed the points at issue they should be called upon, if unable to arrive at a satisfactory settlement of their differences, to place on the records of the Court the last offer made by the masters and the latest demand made by the men. That record should be under the control of the registrar or the president of the Court, and they should be able, if necessary, to return ‘it to the parties, in order, to clear up any ambiguity in the language employed. The question at issue might relate not only to the rate of wages, but to holidays, overtime, the supply of tools, and other matters, and each party should be required to make a final offer in regard to every point at issue. When the dispute had passed On to the Arbitration Court, the Judge, after hearing all the evidence,, would say, unless he saw some strong reason for departing from this principle - “On points A, B, C, and D, the offer of the masters, or the demand of the men, should be conceded, and nothing else.:’ In this way we should bring the parties so closely together in the conciliation stage of the proceedings that they would hasten to settle their differences. After giving the matter much consideration, it appears to me that it is only by some such means as these that we shall be able to induce conciliation, and so avoid the immense amount of work which must otherwise be thrown on the Court.. The principle which I have outlined is. not altogether new to jurisprudence. It is that underlying the old law of the Athenian democracy. We know that they had a system by which a person who instituted proceedings before the jury or dycastery was called upon to name the penalty to be imposed. The defendant had an opportunity to name some other penalty ; and, in the event of his conviction, the jury had to determine which of these two penalties should be imposed. It will readily be recognised that, in a state of- society such as that of the old Grecian democracies, it was necessary to have some such power to prevent political animosity being pressed to extremes, and the persecution of men even to the death. We see the operation of this, law in the historic trial’ of Socrates. Socrates was charged by Miletus, the poet, Anytus, the tanner, and Lycon, the orator,, with denying the gods of Athens, and corrupting the youth. The charge was brought before the dycastery, and these three citizens were constituted the public’ prosecutors. In those days they did’ not have regular public prosecutors. Nostatutory penalties for crimes of this kind - and they were regarded as crimes - existed. Socrates had three courses open to him. He could plead guilty and throw himself on the mercy of the court by naming a lower penalty, he could plead - “I am not guilty, but even if I am, the penalty named is excessive for such an offence” ; or he could plead “ not guilty,” and rely upon obtaining acquittal. As we all know, he was found guilty, and in a contemptuous spirit proposed an alternative- fine of one mina. His friends, fearing that he would be put to death for making so contempuous an offer, expressed a readiness to pav thirty minas. Even that penalty, however, was considered insufficient, and Socrates went to the cup of hemlock. This principle, although now out of date, possesses features of which use might be made in our Arbitration “Courts, and which would certainly reduce the number of cases now being brought forward. The business of both the New Zealand and the New South Wales Courts is in a most congested state, and this has an irritating effect on all parties. If we laid down some principle on the lines which I have suggested, we should be able to induce conciliation, and do away with the excessive demands and unreasonable offers that we see, from time to time, in connexion with cases that now come before the States Courts. The less friction we have in the working of our Arbitration Court, and the speedier and the more just the decisions of the Court the better.’ Let us, then, endeavour to secure these desirable ends, and pass a piece of legislation which will set a good example to the States.

Mr KNOX:
Kooyong

– It is not my intention to make a lengthy speech, or to traverse the ground which I covered when dealing with the Conciliation and Arbitration Bill introduced last session. I, with other honorable members, have listened with pleasure to the remarks by the honorable member who has just resumed his seat, and who always supplies the House with much food for thought. His speeches invariably give evidence of careful inquiry, and exhibit a degree of research that deserves our warmest commendation. .1 heartily concur with the opinion which the . honorable member has expressed on many details, of this Bill, and agree with him . that the machinery provisions are too involved to deal with the issues that are likely to foe submitted to the decision of a Commonwealth Court qf Arbitration. The honorable member has 2 l referred to the possibility of bringing about a system of barter or compromise between the parties to a dispute; but I do not consider that it would be successful in practice. Nothing has occurred since the Conciliation and Arbitration Bill was before us last session to make legislation of this kind more acceptable to those who on that occasion opposed it; on the contrary^ those who then expressed themselves in favour of the principle must recognise that the establishment of the New South Wales Court has led to considerable irritation and much conflict of opinion between employers and employed. Some of the decisions of that Court have not been received with complete satisfaction by either side, and certainly, in one or two cases, they have not been satisfactory to the workers. The experience of New Zealand is that legislation of this description must be amended from time to time. Year after year amending acts’ have been passed by the Legislature of the Colony.

Mr Watkins:

– The sooner we begin our experiments the sooner shall Ave reach perfection.

Mr KNOX:

– We are building up something which is altogether unnecessary. The Government manifestly expect that a very large amount of business for the Arbitration Court will be created by the Bill. This measure is being foisted upon the Com- monwealth heedless of the fact that it will cause great irritation, and bring about industrial trouble in all the States. The Prime Minister has qualified his previous views as to the class of disputes which could be brought within the jurisdiction of the Commonwealth Court. He has admitted, and I think it is now generally held, that a merely sympathetic dispute would not justify Commonwealth interference. Before the Commonwealth Court can take action, a dispute must occur in one State, and a dispute similar in all particulars occur in another State. It is manifest that under those circumstances there might be a serious, conflict between the decisions of States Courts and the decisions of the Common-. wealth Court, and a serious interference Avith States rights and policy. But the modification of the Prime Minister makes an elaborate measure unnecessary. Every honorable member who heard it - whether’ he does or does not’ agree Avith the views expressed- must admit that the Prime Minister gave us a most eloquent address when moving the second reading. He stated, however, that there is an urgent and burning need for this legislation.. I hope to show that there is no such need.. I have found upon inquiry from honorable members who are deeply interested in the passing of this legislation, that there are only threelarge industrial organizations which in the near future may be affected by its operation - the seamen, the shearers, and the water-side workers.

Mr Deakin:

– Not the miners?

Mr KNOX:

– No; I think there is no prospect of the miners coming under its operation. It is only in connexion with disputes occurring in both Victoria and Tasmania, where the Amalgamated Miners’ Assotion operates, that the mining industry might be involved.

Mr Watkins:

– There may be another miners’ confederation.

Mr KNOX:

– I hope that the Bill is a measure, not for the creation of difficulties, but for the ending of those which exist. The honorable member for Darling has disabused my mind in regard to the recent conferences of shearing organizations which took place in Melbourne. I understand that only Victoria was affected.

Mr Poynton:

– In New South Wales the pastoralists would not meet the men.

Mr KNOX:

– I understand that that was due to the operation of the New South Wales Conciliation and Arbitration Act. In Victoria and Queensland the shearers and pastoralists have voluntarily come to an amicable arrangement.

Mr Spence:

– Only in Victoria.

Mr KNOX:

– In Victoria an amicable arrangement has been brought about without this elaborate legislation, and, therefore, there is no urgent and burning need for it, so far as the shearers are concerned. I think there is also no need for it so far as the seamen are concerned. I have made it my business to ascertain, from those who know, what is going on in regard to shipping matters, and I understand that there is at present in existence an agreement between the seamen and ship-owners, which is working satisfactorily, and is terminable on the giving of six months’ notice. It seems to me that, when that agreement is terminated, there will be another voluntary agreement arrived at. I am not in a position to say what the position of the water-side workers is, but they have not made any demand for the creation of a Commonwealth tribunal to settle their disputes. So, in regards to neither the shearers, the seamen, nor the water-side workers is there any burning necessity for , the Bill. Thus we are driven to the position, that what is proposed is a complicated piece of machinery which is uncalled for, and at the present time unnecessary. I hold, and the honorable member for South Sydney occupied the same ground, that the machinery,’ provided for in the Bill is, wholly disproportionate to the necessities of the present and the probable necessities of the future. I. had to take a part in some of the larger strikes which have occurred in the past, and have a full knowledge ‘of the distress and suffering which they caused, and I am, therefore, of opinion that it is desirable to have some means for compulsorily settling strikes and locks-out where voluntary methods have failed. A Court might be appointed consisting of a Judge and a representative of each of the parties to the dispute, and the Commonwealth Cabinet might justly intervene when it felt that the public interest and welfare demanded interference, and compel disputants who would not voluntarily come to terms to submit their case to adjudication.

Mr Poynton:

– Then the honorable member differs from us only in degree, not in principle. What he proposes is compulsory arbitration.

Mr KNOX:

– I am aware that ultimately, when other methods fail, compulsory arbitration must be resorted to. But any dispute in which any of the three organizations to which I have referred is concerned must be a very large one, and each I submit would be sufficient to engage attention on its own merits. It is not necessary to create machinery to deal with an immense number of trivial and small disputes. For instance, in my judgment, the principle of the common rule should not apply in regard to Commonwealth disputes. Each dispute should be dealt with on its merits, putting other matters aside. Why should the Commonwealth legislate for matters which can be dealt with by the States? There is a considerable difference between disputes which could be naturally dealt with under a State Act, and those which could be fittingly brought within the jurisdiction of a Federal tribunal. An effort is being made by the Government to introduce the most complex machinery, and an invitation is issued to disputants to bring the most trivial questions before the Commonwealth Court. Surely this is not desirable. The Commonwealth jurisdiction should not apply to any disputes except those of a farreaching character, which involve large interests. All small matters might be very well left to the State tribunals. The country is waiting for us to enter the fighting ground upon which we shall have to decide who is to rule this country. I am sure that honorable members must have been gratified to hear the Prime Minister say that so far as the Government were concerned- everything would be done straightforwardly. If a coalition is to be brought about I hope that it will assume the character of a straight-out combination of the forces on both sides of the House, and that everything will be done in the full light of day. Such a coalition would be very desirable, and might very easily be effected. The electors are entitled to call upon us to determine the question as to who is to control the Legislature of the Commonwealth. If the Labour Party are to carry through legislation of the character now before us, just as they may desire, by all means let them occupy the Treasury benches, and the sooner the better. The country wishes to know what our intentions are, and, therefore, I feel that I shall best conserve the interests of the community oy refraining from protracting this debate.

Mr. HIGGINS (Northern Melbourne).I think that honorable members in all parts of the House must regret extremely the absence of that great and strenuous politician who has so prominently identified himself with measures of this nature for some years, past.

Honorable Members. - Hear, hear.

Mr HIGGINS:
NORTHERN MELBOURNE, VICTORIA

– I feel sure that we should all welcome his aid and his guidance in this matter. This measure constituted the chief plank in the platform of the Government at the last election, and was also included in their programme at the previous election. The country has pronounced with no uncertain sound its verdict in favour of the Bill ; and that party which has been most strongly identified with the advocacy of conciliation and arbitration has been re turned with increased strength. In spite of this, however, some honorable members persist in treating the proposal for conciliation and arbitration as if it were a foulminded ogre, which was seeking to devour our industries and injure our people: Yet our experience in Australia shows that wherever the Arbitration Court is, there is peace - more peace at all events than there was before. The principle of ‘ compulsory arbitration has been accepted

Oil the understanding that almost any peace is better than war. Those who oppose the Bill seem to lack memory or imagination, 2 l 2 and to be unable to realize the facts disclosed by the telegrams which reach us almost daily, relating to industrial struggles in the great countries of the world, which are causing pain to the workers, and terrible loss to the employers, which are devastating homes and inflicting injury upon the communities in which they occur. At the same time, I quite recognise that a measure of this kind should be closely criticised, because we are sailing in an unknown, or at least an uncharted sea. We do not know where the sunken rocks are, and we have nothing to guide us in avoiding the dangers which beset our course. The Arbitration Court, which it is proposed to erect, will be of an exceptional character. It will not have to interpret and apply definite and express laws, but will practically have to direct and conduct living industries. Difficult as is the work of the Courts under ordinary circumstances in interpreting and applying the law, I say without hesitation that the difficulty of conducting industries is far and away greater. I do not intend to inflict a long second-reading speech upon the House ; but I feel that this Bill forms part of a system of legislation based upon the feeling that if human life is to be used for the purpose of profit it must not be used to its degradation ; that after all it is our duty, as far as we can, in view of the fact that human life is the most valuable asset of any country, to see that that life, if used for the purposes of gain, is not so employed that the health and vitality of the community are lowered. This is one of the measures designed to take the weight off the delicate fibre of . human life and impose the stress upon inventions and appliances - to put weight upon dead and lifeless matter, and to as far as possible protect the vitality of the people. It is satisfactory to the supporters of the measure to be able to challenge its bitterest opponents to point to any authentic instance of injury having been done to any industry in these States by any legislation of this character. Stress has been laid upon the fact that in America and the United Kingdom the working classes have deprecated the adoption of compulsory arbitration. The votes of the unionists have undoubtedly been given against compulsory arbitration in the past ; but so far as I have been able to gather a great revulsion of feeling is taking place in America and England in regard to this matter. The reason is clear to my mind. This change in the attitude of the workers is not’ the result merely of what is known as the Taff Vale case, but is the outcome of a still more extraordinary series of decisions by the foremost Judges of England - and presumably also of America - which has, in effect, deprived the unions of the right to strike or to organize for the purpose of striking. It has been decided that it is an actionable offence, and perhaps a crime, for a number of men to unite in abstaining from accepting employment themselves, or in persuading others to do so, with a view to enforce their demands for higher wages or for better conditions of employment. The result has been that the weapon of strike, upon which the unions so long relied for protection, has been taken from them. They cannot be regarded as acting legally in these matters if the decisions of the Courts hold good. In the Taff Vale case it was decided that the funds of the unions may be applied to the payment of any penalties imposed for offences committed by the unionists as such.

Mr Mauger:

– The American Courts have gone still further, and have decided that the furniture of the individual members of the unions can be levied upon.

Mr HIGGINS:

– As to the Bill itself, the general framework is good, but in many respects the details have not been sufficiently examined. Perhaps, therefore, I may be pardoned if I refer to some of the clauses, with a view to stimulate a little inquiry before we reach the Committee stage. There are two clauses which, I understand, have been introduced to deal with a difficulty to which I referred in the last Parliament - a difficulty which ‘ was- not met by the previous Bill. The position then was that a station owner might have a number of shearers camped around him who refused to accept employment, save upon their own terms. If an arrangement be arrived at between the union to which they belong and the station holder, I think that, in all fairness, they should be compelled to accept employment, if ordered to do so, under the terms of the agreement. I am glad that an effort has been made to meet such a contingency. In clause 7, I think that the word “industrial “ should be inserted before the word “agreement.” I make this suggestion in consequence of a conversation which I have had with the honorable member for Darling. Without the insertion of that word, clause 7 may render a union liable for a breach by an individual member of his own private agreement. To my mind it should be liable to punishment only if the member commits a breach of the industrial agreement which has been made between organization and organization. Clause 8 I regard as a very dangerous one. Of course the Bill is intended to exclude railway servants and other public servants from the Arbitration Court. The effect of this clause, however, is to afford them no protection whatever. In the event of a dispute arising they have not the protection of the Arbitration Court. If we do not afford them the protection of that Court, we have no right .to do what is done by clause 8 - take away from them the only weapon which they have, namely, the power to strike. The effect of the provision is that if a dispute occurred, such as that which unhappily took place last year between the Railway Engine Drivers’ Association, and the Government of Victoria, the association would be denied access to the Arbitration Court, and at the same time any committee which encouraged its members not to work would be guilty of an offence. Surely we must be consistent in this matter. If’ we do not intend to make the Bill apply to railway servants, by all means let us leave them in the position which they at present occupy, whether ‘ it be better or worse. I am very glad that the Government have, in clause 11, adopted the principle of making the same Court a tribunal of conciliation and arbitration. I feel convinced that in New Zealand the severance of these Courts has been a great mistake, and I am sure that, upon the principle that- a horse will always run better if it is aware that its rider holds a whip in his hand, we shall get far more conciliation than arbitration if the tribunal which conciliates can also arbitrate. I understand it is intended that no decision by the Court shall be valid unless three members adjudicate. I do not think that is a wise provision. I suggest, with very great deference, that it might be well in cases where conciliation is at all possible, if the two members of the Court who represent the employers upon the one side, and the employes upon the other, were invested with power to hold a preliminary meeting, to ascertain whether, from their knowledge of the wants of both sides, they can conciliate, and also adjudicate, calling in the President only as occasion might require. I do not think that the appointment of a Justice of the High Court as President of the Arbitration Court is necessarily a wise proceeding. Indeed, I entertain very grave doubts about it. I say nothing whatever in respect of lawyers as a class, but I hold that the very qualifications which would make a Justice of the High Court a good Judge are those which are least in demand in a Court of Arbitration. . In the High Court he is bound by rules of evidence. He has to follow definite principles, and to act upon rigid laws. His course of life and practice are such as to disqualify him for entering sympathetically into a dispute between employers and employes. I sympathize very strongly with the observations which were recently made by Mr. Justice McMillan in Perth when he stated that he had been learning rules of evidence all his life, and had now been appointed President of a Court in which he was called upon to disregard those rules. A very difficult question which we have to face is whether the other two members of the Court should be appointed for a term of seven years, or only in connexion with each dispute. At first I was inclined to think that a special expert was necessary for particular disputes. Upon reflection, however, I doubt very much whether that proposal would work out well. My reason is that if a trade dispute arises, and we appoint to the Bench men representing both the employers and the employes in the particular industry affected, they will attend the adjudication as heated partisans. Their minds will be imbued with the feelings of the employers on the one side, and of the employes on the other.

Mr Deakin:

– They will be more advocates and less arbitrators.

Mr HIGGINS:

– Exactly.

Mr DUGALD THOMSON:
NORTH SYDNEY, NEW SOUTH WALES · FT; ANTI-SOC from 1906

– They are that now.

Mr HIGGINS:

– It is all a question of degree. In the very analogous case of patent examiners, a man who is skilled only in mechanical engineering is sometimes called upon to deal with soft-goods cases ; but, with a very little experience, by bestowing attention upon the particular question under his ken for the time being, he becomes sufficiently expert to arrive at a decision. I have found that the best patent examiners are very often those who know the least about a particular industry and the men engaged in it. However, I am not bigoted upon this matter, and I mention it merely to show the present state of my own mind. I do not quite see how clause ig will work out. If we pay a permanent man £700 a year I cannot see how we are to remunerate a temporary expert at the same rate. I presume that we should have to pay him for piece-work, seeing that he is called in only for a special term. Then I fail to .realize why, under clause 24, the President of the Court only should he charged with the duty of endeavouring to reconcile industrial differences. To my mind the representatives of employers and employes, if they are good men, are very often able to reconcile these differences much better than any President would be.

Mr Deakin:

– That would be impossible if the members were chosen only for each dispute.

Mr HIGGINS:

– I am assuming that the scheme of the Government is carried out. I would ask. the Prime Minister if clause 27 is valid under the Constitution? Of course our powers are limited to industrial disputes which extend beyond any one State. If a dispute occurs in New South Wales, I cannot see how the State industrial authority can delegate its powers to the Federal Court.

Mr Deakin:

– That provision is intended to meet disputes which may arise in one State, and then overflow. Suppose that an industrial trouble occurred in New South Wales, that the State industrial authority commenced to, investigate, it, and that it then overflowed to another State. The State authority could thereupon cease its own procedure, and request the Federal Court to deal with it.

Mr HIGGINS:

– I am afraid that the clause will, mislead if it applies only to the case where a dispute has overflowed from one State.

Mr Robinson:

– Elsewhere in the Bill provision is made for the overflow.

Mr Deakin:

– But that provision will not prevent the State industrial authority, if it thinks fit, from concluding an inquiry which it has commenced, and. from making an award which may or may not be overridden.

Mr HIGGINS:

– Perhaps by a little reconsideration of this clause we may be able to meet limited cases-

Mr Isaacs:

– The term “ Industrial disputes “ in the interpretation clause means disputes which extend beyond the limits of” any one State.

Mr HIGGINS:

–I am aware of that. At the same time the Bill makes it appearthat the .State industrial authority has-, power to refer any dispute to the Federal authority. Clauses 28 and 31, I think, will allay some of the apprehensions of our critic’s. .The opinion is entertained by some honorable members, including the acting leader of the Opposition, that this Bill is intended to involve the reference of every petty industrial quarrel to the Arbitration Court. “ The provisions of clause 31, I think, are ample to prevent the time of the Court from being” abused in that way. Before a case can be brought before the Court it will be necessary to obtain a certificate from the Registrar, or the approval of the President. ‘ Mr. Dugald Thomson. - It is necessary under the New South Wales Act to obtain the certificate of the Registrar.

Mr HIGGINS:

– I am glad to hear that that is so. Then it is provided that no industrial dispute shall be submitted- to the Court by an organization unless the Registrar gives a certificate setting forth the consent of the organization, according to its rules, to the institution of proceedings. It will be necessary to show that the organization has given its consent at a general meeting, convened in a certain way.

Mr Deakin:

– That is an alternative.

Mr HIGGINS:

– Quite so; or that the consent has been given in writing, under the hands of the majority of the committee pf management. It appears to me that clause 36 is rather ambiguous; I do not know whether it is meant to provide that an award which is found to operate unjustly shall nevertheless be binding for all time. The clause provides that- the award shall continue in force “ until a new award has been made,” and if we turn to section 47 we find that an organization may apply to have an award varied.

Mr Deakin:

– Clause 46, paragraph o, gives. the Court power at any time to vary an award.

Mr HIGGINS:

– But, except in certain circumstances, application cannot be made to the Court to vary an award. If the power to strike is to be absolutely taken away - not merely conditionally upon an organization being brought under the measure - it is difficult to see how a dispute can arise, and if no dispute can arise, how will it be possible to obtain at variation pf. an award?

Mr Deakin:

– Application. may be made to have an award varied without the occurence of a dispute. An award can be reopened on the application of the person or organization aggrieved.

Mr HIGGINS:

– I trust that lis so= I come, now to clause -37. I regard .that clause, .and especially the provisions contained in paragraph c, with great apprehension. The paragraph provides that the award of the Court shall be binding on -

All organizations and persons on whom the award is declared by the Court to be binding.

That is to say, an award may be binding on all organizations and persons who may not have been heard by th’e Court.

Mr Deakin:

– It is the common rule power as conferred on the Court.

Mr HIGGINS:

– Provision is made in paragraph / of clause 46 for the common rule, and it is to apply to all persons “in the same industry.” But I think we should go to extremes if we gave to the Court power to declare, in the case of a dispute between industries A and B, what rule should bind industry C. I admit that at the basis of legislation of this kind lies the assumption that the Court will exercise common-sense, and that we must assume that the men who will be called upon to administer tlie measure will act reasonably, and with judgment But I object to a proposal to give the Court control over the liberties of persons who have never been heard - who have had no opportunity to “put their case before it. Some kind of limitation should be imposed. It is, to my mind, remarkable that it is the workers who, as a class, are most anxious to secure the passage of this Bill. I can foresee that powers are to be given to this Court, which, unless fit men occupy seats on the Bench, the employes may some day find injurious to their position. I cannot help recognising that, cf the three members of the- Bench, there will be two at least with bourgeois tendencies, with sympathy for the wage-paying, classes, as distinguished from the wage-earning classes, and it is a sign of the intense desire of the wage-earners of Australia, for peace, order, and good government at all hazards, that they are so anxious, in spite of these risks, to submit to a Court of this kind. We should be careful; however, to refrain from giving unnecessary powers to the Court. I am strongly in favour of endowing it with large powers in respect of parties who will have an opportunity to be heard, but I do not consider that we should give power to a Court, however pure and incorruptible it may be, to deal with parties who have no voice in the disputes dealt with by it. The Government propose to give power to the Court to deal with industries which have no voice in disputes. that come before it.

Mr Deakin:

– It does not affect the honorable and learned member’s argument, but I think that if he looks closely at the provision, he will see that it is the authority on which the common rule is afterwards made - that the common rule may apply to any industry affected, whether that industry has been heard or not.

Mr HIGGINS:

– If the honorable and learned gentleman turns to clause 37, he will find that there is no limitation of the award to the one industry.

Mr Deakin:

– Neither is there under the common rule. Clause 46 refers to “ any industry affected by the award.”

Mr HIGGINS:

– The provision in paragraph / of clause 46 would be taken to mean the common rule of any industry which is concerned in the arbitration.

Mr Deakin:

– Exactly.

Mr HIGGINS:

– Do I understand the honorable and learned gentleman to say that under clause 37 it is simply proposed to extend to the Court the power to apply the common rule?

Mr Deakin:

– That is what I understand it to mean. I did not draft this measure in the first instance, and have interpreted these as being two complementary provisions relating to the same action.

Mr HIGGINS:

– I wish now to refer to clause 48, which provides that the Court may by its award at any time - prescribe a minimum rate of wages or remuneration, with provision for enabling some tribunal specified in the award or order to fix, in such manner and subject to such conditions as are specified in the award or order, a lower rate in the case of employes who are unable to earn the minimum wage.

It seems to me from the wording of that clause that the Court cannot prescribe a minimum wage without prescribing an exception in the case of old and infirm workers. I do not deny that there are cases in which the Courtshould be able to make that exception, but it is a very dangerous power. The clause should be amended so as to make it clear that there shall be power to make an exception in respect to aged and infirm workers, and that the Court shall not be prevented from prescribing the minimum wage which may be applied, unless the exception be made. I also wish to know what is the tribunal referred to in this clause. It provides that the Court shall have power to prescribe a minimum rate of wages - with provision for enabling some tribunal specified in the award or order to fix . . . a lower rate…..

Will that provision involve more expense and more appointments?

Mr Deakin:

– As a rule it will not. The employers will name one man and the employes will name another to act when necessary. This procedure will not need to have anything to do with the Court.

Mr HIGGINS:

– There should be some explanation of the kind of tribunal which we have in view, even if the Government take the power to prescribe by OrderinCouncil what the tribunal shall be.

Mr Deakin:

– We take that power.

Mr HIGGINS:

– With regard to enforcing an award it is provided in clause 52 that -

Any organization or person entitled to - the penalty may proceed for the recovery thereof in any court of summary jurisdiction.

Who will be entitled to the penalty ? There is nothing in the Bill that gives us any information “on this point.

Mr Deakin:

– There is nothing in the Bill declaring who would be entitled to the penalty. How would it be possible to make such a provision ?

Mr HIGGINS:

– In Acts imposing penalties it is usually provided that the man who sues for the recovery of a penalty shall be entitled to the whole or to the half of it as the case may be. There is nothing here to show who will be entitled to the penalty.

Mr Deakin:

– The award will show that.

Mr HIGGINS:

– Not necessarily.

Mr Deakin:

– An award in that respect will be like the order of an ordinary court of justice for the payment of costs.

Mr HIGGINS:

– There are some penalties which can be recovered only by the Crown. Is it intended that the Crown alone shall enforce these penalties?

Mr Deakin:

– There are other penalties which may be recovered by individuals.

Mr HIGGINS:

– If the party who makes the complaint is to be entitled to the penalty that fact should be clearly set forth in the clause.

Mr Deakin:

– We do not intend that the same course shall be pursued in every case.

Mr HIGGINS:

– I observe that judgments may be enforced against the property of an organization, and I understand that they may be enforced only by filing in a Federal or State Court, and obtaining execution in that way.

Mr Deakin:

– That is the only form which I can at present call to mind.

Mr HIGGINS:

– Then in clause 54 it is provided that a member of an organization isto be liable in respect of a penalty only in the event of the execution against the organization itself being returned unsatisfied.

Mr Deakin:

– Where the. property of an organization is insufficient to fully satisfy the - process.

Mr HIGGINS:

– I think it should be clearly shown at what precise stage action is to be taken against a member. It is a very vital matter. If the funds of the organization are insufficient to satisfy a process proceedings may be taken against an individual member ; but is it necessary that the funds of the organization must first be attached, or must it be proved that, even if the funds were attached, they would be insufficient? It may be considered that I am somewhat hypercritical in dealing with the Bill in this way on the motion for the second reading; but I have found that a discussion of the details at this stage invariably assists the progress of business in Committee. There is another question which has attracted a good deal of attention. I refer to the proposal to include the railway servants of the States, and, indeed, public servants generally within the provisions of the Bill. I may be doing the Prime Minister an injustice, but I understand that he has changed his opinion upon this question - that the first Bill introduced by the- Government was such as would have included the public servants of the States.

Mr Deakin:

– Never ; a draft Bill as submitted to Cabinet might have tacitly included them.

Mr HIGGINS:

– I am not going into Cabinet secrets.

Mr Deakin:

– A Government Bill never did so.

Mr HIGGINS:

– If the Prime Minister has changed his opinion in relation to this matter, he is, of course, entitled to do so.

Mr Deakin:

– I am not aware’ that I have in any respect whatever.

Mr HIGGINS:

– At all events I see on the face of the Bill evidence that it was meant to apply to the public servants of the States, but for the insertion on page 3 of certain words. Clause 4 says that “ employer “ means any employer in “any industry,” and “employ^” any employe’ in any “ industry.” The only modification is the definition of an industrial dispute, which is not to be taken to include a dispute in which the servants of the Commonwealth or of a State are concerned. I have read the speech of the Prime Minister with great care. Whatever we may think of the conclusions which he has reached, I am sure- that we all wish him well, and have to thank him for the frank and friendly way in which he has expounded this and other Bills which he has brought before the House. He has the goodwill of all in this Parliament, and I think of all who know him. But, in my opinion, he has. come to his conclusion regarding the railway servants of the States upon insufficient reasons. Our power of legislation is confined to “disputes extending beyond the limits of any one State,” and, furthermore, we are confined to “industrial disputes.” Therefore we cannot, by a mere stroke of the pen, include all public servants in the operation of the Bill. I take it that the railway officials are engaged in an industry - that of carrying passengers and goods by rail ; and that, similarly, the postal officials are engaged in an industry. But however industrious the officers in the Treasury or some other departments maybe, it can hardly be held that they are engaged in an industry. It is one thing to be industrious, and another to be engaged in an industry. Mr. Dugald Thomson. - Would not they come under the definition of industry contained in the Bill ?

Mr HIGGINS:

– The Bill cannot expand the meaning of the term used in the Constitution. . I take it that while the word “industry,” as used in the Constitution, applies to the railway service and to the postal service, it does not apply to many of the public departments.

Sir John Forrest:

– Why does it apply to the postal service?

Mr HIGGINS:

– The carriage of mails used to be a private industry ; now it is a public monopoly.

Mr Robinson:

– Was it ever a private industry in Australia?

Mr HIGGINS:

– No ; but, no doubt, if it ceased to be a public monopoly private individuals would immediately undertake the carrying and delivery of letters. Our railway service is certainly an industry. The railway property is vested in the Commissioner. He, and not the Crown, is the employer of the railway servants. He appoints and dismisses them. He pays their wages, and he or his subordinates make the regulations which govern the service.

Mr Robinson:

– The Victorian Full Court has said that it is the Crown who pays here.

Mr HIGGINS:

– Outsiders have only to do with the Railway Commissioner. They sue him; they do not sue the Crown, when a cause of action arises in connexion with the administration of the railways. He is as much an independent employer as is the Metropolitan Board of Works. Now, if arbitration is a “good thing for private employers and employes, why is it not a good thing for public employers and employes? A quarrel between the railway servants and the Commissioner would be a more serious thing than a quarrel between a private employer and his employes, not only because of its indirect operation, but because of the fact that the railway employes have no choice of an employer. After the Victorian railway strike, expert engine-drivers were driven out of the service, and they have since been unable to find employment at the work which they were accustomed to perform. I admit that honorable members have been largely stimulated to support the ..proposal to apply the provisions of this Bill to public servants by the Victorian railway strike. I happen to know something of the inner working of that unwise and deplorable occurrence. I speak from knowledge which cannot be gainsaid, although I am not breaking any confidence, when I affirm that, if the Government of the day had been willing to submit the points in dispute to any tribunal, even a Court of law, there would have been no strike. The men were told that they must break away from the Trades Hall. Rightly or wrongly, they thought that rules to govern their conduct outside working hours were illegal, that the authorities had no power to prescribe where they should attend church, or what political, or other association, they should or should not join. If the Government had said - “We will state a. case for the Supreme Court.” the men would not have struck. But, when, in place of submitting a question to a competent and independent tribunal, the Government called Parliament together for the enactment of a drastic Bill, which, under very unusual circumstances, they were able to carry, the men struck.

Mr Poynton:

– That Bill represented the public opinion of a past century.

Mr HIGGINS:

– I do not wish to go too far into the matter ; I am merely emphasizing the point that that unwise and disastrous strike came about because the Government of Victoria would not submit to an impartial tribunal the question whether they were doing right or wrong. Law or . no law, they determined to act as they pleased.

Mr Robinson:

– So they should have done.

Mr HIGGINS:

– They happened to have behind them the whole forces of the metropolitan press.

Mr Robinson:

– And of the country press, too.

Mr HIGGINS:

– We saw the unusual sight of the. two Melbourne morning newspapers being on. the same side.

Mr Robinson:

– And the whole country was behind them.

Mr HIGGINS:

– We have not yet seen the ultimate consequences of that strike. It was easy to crow over the seeming victory, but in the course of a few years men will regard it as an occurrence which showed the expediency of the creation of some tribunal for the redress of industrial grievances.

Mr McColl:

– It showed the folly of striking.

Mr HIGGINS:

– The strike was an unwise one; the maddest thing that the men could have done; but we must place the blame upon the right shoulders. If the dispute had been referred to some impartial body, such as the proposed Arbitration Court, the loss and suffering . which happened would not have occurred. I agree with the Prime Minister that it is difficult to see how a railway dispute could extend beyond the limits of a State. It is doubtful if the Bill will operate as often as some people think. The organizations of the railway servants in the different States may amalgamate, but the governing authorities are not likely to act in unison. Therefore it is hard to conceive of a case in which a dispute between the Railway Commissioners, say of New South Wales, and their employes will extend beyond that State and become a dispute_ between the Commissioners of Western Australia andtheir employes. At all events, the railway in which the Minister for Home Affairs is so interested must first be constructed. It was stated during the late strike that the threat was made that the Victorian mails would not be carried by the New South Wales railway employes, but I do not think the New South Wales railway employes would have been so mad as to use their power to that extent, so long as they were well treated by their own Commissioners. I do not think that the threat emanated from any authentic source.

Mr Hutchison:

– Would a dispute be taken to extend to another State if the employes of that State were levied upon to assist the strikers elsewhere?

Mr HIGGINS:

– That is a difficult question, upon which I cannot now venture an opinion. The effect of the words, “ extending beyond any one State,” is difficult to define. We used those words in the Convention because we could not get better.

Mr DUGALD THOMSON:
NORTH SYDNEY, NEW SOUTH WALES · FT; ANTI-SOC from 1906

– The members of the Convention might have used a clearer expression.

Mr HIGGINS:

– Yes, if the honorable member’s friends would have allowed us to go as far as we wished. We could only obtain power to deal with disputes extending beyond the limits of any one State. I think that in that matter I had the assistance of the Minister for Home Affairs, who, I understand, now considers that I led him astray.

Sir John Forrest:

– I think the honorable and learned member did so.

Mr HIGGINS:

– I hope that the right honorable gentleman will change his mind upon that point. No one who is in favour of conciliation and arbitration can deny that it would be well if we could apply that principle to the railway and other servants of the States. The Prime Minister has based his objections upon two grounds. In the first place, he doubts if the Constitution confers upon us the necessary power, and, secondly, he questions the expediency, under present conditions, of extending the provisions of the Bill to States servants. I observe, however, that the Minister does not go so far as to say that if he had his own way absolutely he would not think it well to apply this beneficent provision to the States servants-

Mr Deakin:

– I think that every State ought to pass an Arbitration Act.

Mr HIGGINS:

– That may be. I hope they will. I am now, however, speaking of disputes extending beyond one State with which the individual States cannot deal.

Mr Deakin:

– Each State could deal with its own railway servants.

Mr HIGGINS:

– But if a dispute extended beyond any one State, that State would not be able to cope with it, any more, for instance, than the Victorian Government, were able to deal with the seamen’s strike, or the New South Wales authorities were able to exercise jurisdiction in regard to the shearers’ strike. . If it be once granted that there is a dispute extending beyond one State, the. Federal power will be required to. deal with it.

Mr Deakin:

– In the case of a railway strike, each State could deal with its own particular section of the employes who have struck.

Mr HIGGINS:

– The Prime Minister has asked us to decline to extend this provision to the States servants on the very grave ground that we have not the power. If we accept that position, it will be impossible for us to legislate in the future to bring States servants within the scope of our Arbitration law. If we once concede that it is not in the power of this Parliament to provide for disputes in which States servants are concerned, and which extend beyond any one State, we shall lay down a precedent which will be a guide hereafter, and it will be taken for granted that we have not the power. We are the repositories of a most important trust for the people of Australia, both present and future, and we ought not, unless there is good ground, “to surrender any of the powers conferred upon us by the Constitution. If I thought there was no power under the Constitution to legislate in such a way as to meet the case of the States public servants, I should submit to the inevitable, and vote with the Government. These rigid Constitutions are like prisons, and when we talk about whether we have this power or that, the question is one merely of the range of the walk within our prison. Unfortunately, we are hampered, and we shall continue to be hampered, in the development of legislation, and in the improvement of this country, by beingpulled up in this way, by the limits of the Constitution.

Mr DUGALD THOMSON:
NORTH SYDNEY, NEW SOUTH WALES · FT; ANTI-SOC from 1906

– Our powers are bound to be limited, unless unification is brought about.

Mr HIGGINS:

– I am speaking of the present condition of affairs. Here we have a rigid Constitution, which it will bevery difficult to alter. No such attempt has yet been made, and the Government that would propose to alter it would be very brave. When Ministers come down and say - “ You must not apply thisprovision to States public ‘ servants, because the Constitution does not give us the power,” we must not agree with that view, unless we are perfectly clear that the power in question is not conferred upon us.

Mr DUGALD THOMSON:
NORTH SYDNEY, NEW SOUTH WALES · FT; ANTI-SOC from 1906

– Not- if we thought it inexpedient?

Mr HIGGINS:

– I am putting expediency on one side for the moment, and I am assuming that we are asked to concede that we have not the power. The mere fact of that ground, that we have not the power, being put before us, makes it expedient to test the question, whether we have it or not. It will be found practically impossible in future Parliaments to exercise the power if we fail to assert it now. If it were decided by the Court that <we had not the power, the matter would be settled once and for all. With regard to the construction of the Constitution, I respectfully differ from the Prime Minister. In his speech, as reported in Hansard, at page 786, the Prime Minister said -

Of course the conclusion he draws from that is that, inasmuch as the State is not expressly named in the Constitution where conciliation and arbitration are referred to, the State cannot be bound by any legislation upon the subject of conciliation and arbitration. The State is not expressly named in the sub-section relating to conciliation and arbitration for the prevention and settlement of industrial disputes extending beyond the limits of any one State. That sub-section does not specify whether the disputes for which we are to legislate are to be between private or public employers and their servants. The whole matter is left open. So far as I can find, however, in all cases in which it is intended to exclude the States, or to exclude States industries from the operation of the Constitution, express provision -is made to that effect. If honorable members will glance at sub-sections XIII. and XIV. of section 51, they will find that we have power to legislate for the peace, order, and good government of the Commonwealth with respect to banking and insurance. In subsection XIII. the Commonwealth is empowered to legislate in regard to “banking.” If the sub-section stopped there, State banking would, according to the Prime Minister, :be excluded ; yet the sub-section continues, Mother than State banking.” If the argument of the Prime Minister is sound, those words’ should not -have been necessary. Further, provision is made, for power <to legislate”. with regard to “State banking extending beyond the limits of the State concerned, the incorporation of banks, and the issue of paper money.” Sub-section XIV., relating, to insurance, is . similarly worded, and, if the Prime Minister is right, all that would have been necessary would have been to stop at- the word “banking “ or the word “ insurance.”

Mr Deakin:

– My argument is that those words, “ other than State banking,” were inserted to introduce the further provision that the powers of the Commonwealth should extend to legislation with regard to State banking . extending beyond the limits of the State concerned.

Mr HIGGINS:

– I do not see how that applies, because the two sets of words are in no way inter-related. According to the Prime Minister, there would be no power to tax States’ properties if the States were not expressly named; but if honorable members will look at section 114, they will find that it is provided that -

Nor shall the Commonwealth impose any tax on property of any kind belonging to a State.

Full power is conferred to impose general taxation, and, according to the Prime Minister’s view, that power would not apply to States; property. We find, however, in this section, that States ‘ properties are expressly exempted from taxation. It would be idle for me to. enter into an elaborate argument. I am no ‘bigot in these matters, and I admit that the whole question will depend upon the decision of the Privy Council or the High Court, for either may be appealed to for an interpretation of the Constitution.

Mr Deakin:

– Surely not. Is not this a matter determining the rights inter se between the States and the Commonwealth under section 74?

Mr HIGGINS:

– No. My impression is that it is a question that might be referred to either the Privy Council or the High Court. After all, it is a matter of opinion, and a decision of the Court only would be final. Here, as in America, it is our business to see that we abandon nothing of the trust which we suppose to be imposed upon us by the people. The Prime Minister has attempted to apply to our circumstances the United States decisions as to taxing Federal and State incomes, and has given us the benefit of an elaborate argument, which, I understand, has led him to the conclusion that we should violate some mystic Federal principle if we were to include States public servants within the operation of the Bill. I confess that I do not see what the principle adopted in America with regard to taxing Federal incomes by the State, or State incomes by the Federal power, has to do with the interpretation of our Constitution so far as it relates to our power of legislation in regard to conciliation and arbitration. Concerning American decisions, I have long held the opinion that they represent what the Judges thought the Constitution ought to contain, rather than what it does contain. However, I do not think those cases have anything to do with this matter. The only judgments which have been given by Australian courts are to the effect that these American decisions do not apply here. Similarly, the only judgment given by the Privy Council is one which tends to show that they do not apply even in Canada. The Prime Minister, as will be seen by reference to page 781 of Hansard of the present session, further stated -

I may point out, to give a clue to the argument which I intend to follow, that if the Conciliation and Arbitration Bill embraced public servants, a decision of, the Court might have the effect of raising their wages. That would increase the taxation of the State in which they were employed. It would impose a new obligation upon the States which does not now exist. Or the Court might lower their wages ; in that case the men would not receive the amount of money which the Parliament of the State had voted for them.

Increase the taxation which the State would require to impose ! Increase the Estimates and the Appropriation made by Parliament ! Interfere with the Estimates and with the Appropriation ! Why, every additional post-office that is erected, every increase that is made in the Defence Forces of the Commonwealth, every extra supply of ammunition that is purchased, every adverse judgment which is given against the Crown, involves an alteration of the Estimates, and necessitates the submission of supplementary estimates. The thing is done every year in the different States. If an action is brought against the Crown for breach of contract, and a decision is given against it, no execution is levied on the King ; there is no enforcement of the judgment upon his drawing-room furniture, and no seizing of the assets in the Treasury buildings. We are a people who pay our debts. When a judgment is entered against a Government they make provision for its payment, and there has never yet been a case in which they refused to do so.

Sir John Forrest:

– There was one in Queensland.

Mr HIGGINS:

– I am quite sure that there was never one in Western Australia.

Suppose that a penalty were imposed upon the Railway Commissioners, under which an extra ^1,000 required to be paid. The Government would submit supplementary estimates and ask Parliament to vote that amount. It is a disagreeable course to adopt, but it is one which is followed every day. I would also point out that in framing the Constitution there’ was no intention on the part of the Federal Convention to exempt the railway estimates of the States from interference. Why, the Constitution itself gives us power to interfere even with railway rates. There is nothing that will so materially affect the railway estimates as the provision in the Constitution having reference to preferential rates. That will make a tremendous difference to the lines adjoining New South Wales and Victoria. It will mean a great loss of revenue in some cases, and a great increase of revenue in others. The States must submit to having their finances interfered with.

Mr Deakin:

– Express power is given in that instance.

Mr HIGGINS:

– But throughout the entire Constitution there is no evidence of any intention to keep the railways sacred from the desecrating touch of the Commonwealth Parliament.

Mr Isaacs:

– Could we so legislate as to deprive the States of the whole of their three-fourths share of the Customs receipts ?

Mr HIGGINS:

– I have not reached that point yet. If, however, an impasse actually occurred between a State Government and the Federal Courts, I have no doubt that we could introduce a Bill to allow the Commonwealth Government to deduct from the balance of the Customs revenue payable to that State the amount of any judgment given against it.

Mr Glynn:

– Do not the States satisfy any judgment given against them simply because they have submitted to the action being entertained?

Mr HIGGINS:

– It is true that no action can be brought against the Crown unless it is permitted by Act or otherwise. I am merely endeavouring to show that at present there is no means of compelling the Crown to pay.

Mr Glynn:

– But the Crown says, “We have agreed to the action, and must abideby the judgment.”

Mr HIGGINS:

– It is not a question of agreement. If the honorable and learned member obtained judgment for ^1,000 against the Government of South Australia he could not compel its payment unless Parliament made an appropriation for the purpose. But no doubt Parliament, with the sense of honour that has always characterized our public men, would see that any creditor under a judgment against the Crown was paid.

Mr Deakin:

– Surely no Bill which this Parliament can pass could alter the constitutional provision for the return of the fixed proportion of the surplus revenue to the States ?

Mr HIGGINS:

– I have no doubt that it could, by .way of a set-off. The best argument that has been advanced by the Prime Minister is that at the inception of this Act it is inexpedient to overload it. I should be strongly impressed by that argument if this question were not involved in a greater one. We are asked to refuse to extend the operation of this Bill to the public servants of the States upon the ground that we do not possess the constitutional power to take such action. With me that consideration overweigths any question of expediency. If we believe that we have the necessary constitutional power, by all means let us exert it. Now is the only time for us to exercise it. We must speak now, or be for ever silent. When we are told by the Government that we do not possess this power, we must insist upon testing the question. I would not be a party to including in the measure any provision which I thought would be nugatory and useless. At the same time, if we honestly believe that we possess this power, let us exert it and not abandon the trust which the people have reposed in us. I must apologize to the House for having trespassed upon its patience so leng. The gravity of the position is such as to justify honorable members in conveying to the Government and the House generally the direction in which their votes will be cast,, and amendments proposed.

Question resolved in the affirmative.

Bill read a second, time.

In Committee. :

Clause i - (Short title.)

Mr DUGALD THOMSON:
NORTH SYDNEY, NEW SOUTH WALES · FT; ANTI-SOC from 1906

– I would ask the Prime Minister to report progress, seeing that it would be useless to enter upon the discussion of the details of the Bill to-night.

Mr DEAKIN:
Minister for External Affairs · Ballarat · Protectionist

– As no notice has been given of any proposed amendment of the Bill prior to the important one relating to its extension to the public servants of the States, I am inclined to agree with the acting leader of the Opposition that it would be profitless to enter upon a discussion of its details to-night. I have here a small measure of a purely formal character - the Acts Interpretation Act Amendment Bill - ;and if we pass that to-night, as we are to be the guests of His Excellency the GovernorGeneral to-morrow, I’ am perfectly willing that the House should adjourn till Tuesday next, when honorable members will be able to deal at once with the crux of the measure.

Progress reported.

page 1037

ACTS INTERPRETATION BILL

Second Reading

Mr DEAKIN:
Minister for External Affairs · Ballarat · Protectionist

– I move -

That the Bill be now read a second time.

This little measure which has already re- ‘ceived the sanction of the Senate, is of an extremely useful, but simple character. If honorable members will look at the eleven clauses which it contains, they will find that each of them is an old friend, because they have been frequently included in the measures submitted for their consideration. The object of again introducing them in the form of this Bill is to place them upon the statute-book permanently, so that we may have the benefit of them in the various Acts to which they are applicable, without the necessity for repeatedly enacting them. For instance, we have become familiar with the form of drafting which was introduced by the right honorable member for Adelaide, in which the statement “ Penalty, fifty pounds,” at the foot of a section, indicates that that is the maximum penalty by which any breach of that particular section can be punished. In the same .way we have made provision time and again for distinguishing between indictable offences and offences which can be dealt with under summary jurisdiction. We have provided in a number of Acts that those aiding or abetting an offence, shall be liable to suffer for so doing, and that those who attempt to commit an offence shall be capable of being treated as if they .had committed, it. The last clause relates to the procedure by which regulations under- the various Acts may be adopted. If not challenged in either House within fifteen days after they have been laid on the table, they are sanctioned. These are all the provisions of the measure, and I think that the legal members of the House can assure honorable members generally that it contains nothing novel. We propose to enact’ these provisions once and for all to save their continued repetition in other measures.

Mr GLYNN:
Angas

– Doubtless many of the provisions in this Bill which are found in State legislation should be passed, but one or two of them are of considerable importance. I do not know why we are asked to include in this measure provisions which ought to be found in a criminal code, unless it be that there are so few penalties that we can impose that it is considered desirable to provide for them in. this way. The provisions of clauses 7 and 8 properly belong to a criminal code rather than to an Interpretation Bill, because they provide for penalties following convictions. They are not mere interpretations of terms.

Mr Deakin:

– Strictly speaking, the honorable and learned member is correct. They are simply provided for in this way as a matter of convenience.

Mr GLYNN:

– Quite so. In my opinion, however, clause 11 should be amanded. It proposes to perpetuate the old and erroneous method of prescribing that regulations shall be adopted, unless within fifteen days after they have been laid upon the table of either House a motion is passed disallowing them.

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

– The time allowed is insufficient.

Mr GLYNN:

– As a rule there is no time to take action. It rests with the Government of the day to say whether the proposed regulations shall be adopted, and as they are responsible for them, they naturally propose to allow them to pass. It is left to a private member to challenge them. He has to give notice of motion, and perhaps two months elapse before the motion can be considered, so that it is impossible for him to take effective action. I mention these matters in the belief that although we may push this measure through all its stages at a rapid rate, the Prime Minister will take an opportunity to consider them.

Question resolved in the affirmative.

Bill read a second time.

In Committee :

Clauses 1 to 4 agreed to.

Clause 5 (Offences punishable by summary conviction).

Mr GLYNN:
Angas

– From a hurried* examination of this .clause I find that it. practically limits the powers of a Court of summary jurisdiction to deal with an offencewhich is punishable by imprisonment for a period not exceeding six months. All. other cases must go by. indictment before a jury. I believe that the Constitution provides that’ all indictable offences must be tried by jury.

Mr Deakin:

– There is some such pro-., vision.

Mr GLYNN:

– It is thus proposed tosend many cases to a jury, and thus to harass litigants. This clause . practically means that all offences punishable under . any Act by two years’ imprisonment must be tried before a jury. I venture to express the opinion that in 90 per cent, of the cases the period of imprisonment will not be limited to six months.

Mr Deakin:

– I think it will be so limited under our laws. Our position is different from that of a State, with its large range of offences.

Mr GLYNN:

– In order to overcome difficulties of this kind, the States’ laws provide that in certain circumstances an accused person may submit himself to the jurisdiction of a Court of summary jurisdiction. In some States power is given to such Courts to impose penalties up to two years’ imprisonment, and thus avoid the expense and delay of sending a person to trial before a jury. I would suggest that in certain circumstances we should allow a person to consent to- be finally tried by a Court of summary jurisdiction.

Mr DEAKIN:
Minister for External Affairs · Ballarat · Protectionist

– I confess that the suggestion is practical, but am not’ aware that a penalty exceeding six months’ imprisonment has yet been imposed for an offence against Commonwealth law. I do not anticipate the imposition of greater penalty, save in some rare instance

Mr Crouch:

– Under the Electoral Act. we provide for lengthy terms of imprisonment.

Clause agreed to.

Clauses 6 and 7 agreed to.

Clause 8 (Aiding or abetting an offence to be deemed an offence).

Mr ISAACS:
Indi

– This is a clause which ought to be carefully scrutinized, for, although it appears in an Acts In,terpretation Bill, it is a very serious addition to the criminal law.

Mr Crouch:

– The same remark will apply to clause 7. ‘Mr. ISAACS. - That is a case of a different class. This provides amongst other things, that any person who is - indirectly concerned in the commission of any offence against any Act, shall, unless the contrary intention appears in the Act, be deemed to have committed the offence, and be punishable accordingly.

We know that there are persons who might be indirectly concerned in the commission of an offence, according to the interpretation placed by the Court on the word “ concerned,” although they are perfectly innocent in mind. Under this clause such persons would be treated as if they had actually committed the crime. This is too serious a clause to pass without careful consideration. We have not had time to fully consider it, and I think it will be well for the Prime Minister to give us ‘a further opportunity to say whether such a provision shall become law.

Mr DEAKIN:

– I believe that the clause was debated in another place, and that it was alleged to be too drastic.

Mr Glynn:

– It is copied from the Customs Act.

Mr DEAKIN:

– It was pointed out that it was identical with clauses in the Excise and other measures providing for the punishment of criminal offences, and also identical with clause 236 of the Customs Act. With that explanation it was agreed to.

Sir JOHN QUICK:
Bendigo

– I would suggest to the Prime Minister that the clause should be negatived. It is one that ought really to be inserted in a Crimes Consolidation Bill. We cannot be too careful to see that our Criminal Law is clearly denned and expressed oh the face of the Act itself. It might be that such a clause would be appropriate in the Customs Act, but wholly inappropriate in a Postal Act.

Mr Deakin:

– I shall not press the clause in its present form.

Clause negatived.

Clause 9 (Attempt to commit an offence to be deemed an offence).

Mr GLYNN:

– There is not the moral objection to this clause that can be levelled against the one with which we have just dealt, but there is nevertheless the objection that it is proposed to be inserted in the wrong Bill. Wherever the provision with yhich we have just dealt appears in other Acts it is followed by this clause.

Mr Deakin:

– The two are not necessarily connected. .

Mr GLYNN:

– In the Customs Act the one precedes the other.

Mr Deakin:

– But this clause has an independent value. ,

Mr GLYNN:

– It might make a man liable to a double penalty.

Mr Deakin:

– No; it relates only to future Acts.

Clause agreed to.

Clause 10 (Definitions).

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

– I believe that in either the Customs Act or the Electoral Act reference is made to a Justice of the Peace for the Commonwealth. Heaven forbid that I should suggest an increase in the roll of Justices, but if we are going to create Justices of the Peace for the Commonwealth we ought to. provide for them in this definition clause.

Mr Deakin:

– That will not be necessary until we actually take the step.

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

– But this clause would exclude them.

Mr Deakin:

– No; it would necessarily include Justices of the Peace for the Commonwealth’.

Clause agreed to..

Clause 11 -

If either House of the Parliament passes a resolution at any time within fifteen days after such regulations have been laid before such House disallowing any regulation such regulation shall thereupon cease to have effect.

Mr GLYNN:
Angas

– There are several amendments which might be made in this clause, but I do not intend to attempt’ to draft them at this stage.

Mr Deakin:

– It is a familiar clause.

Mr GLYNN:

– It is a clause to which objections have frequently been taken, although Governments have declined to take any notice of them. It really gives no power to the House to amend regulations. Regulations must be rejected or accepted in toto, although the Government have doubtless effected an improvement by allowing us to accept or reject one regulation.

Mr Deakin:

– A regulation must come before both Houses. It is just as simple to pass a new one and lay it before the two Houses as to amend the old one.

Mr GLYNN:

– Apparently the Government think so, because they invariably follow what to my mind is an erroneous course. I think I showed a very strong objection, when speaking on the second reading, to the wording of the clause as it stands, and I ask the Prime Minister to consent to an amend- ment which will alter the clause so as to : make it provide, not that the resolution1 i must be passed within fifteen days, but that notice of a motion challenging a regulation must be given within fifteen days. That object will be met by inserting after the word “resolution” the words “of which notice has been given.”

Mr Deakin:

– I wrote those very words upon my copy of this Bill while the honorable and learned member was speaking.

Mr GLYNN:

– Then I move-

That after the word “ resolution,” line a, the words “ of which notice has been given “ be inserted.

Amendment agreed to. Clause, as amended, agreed to. Preamble and title agreed to.

Bill -reported with amendments; report adopted.

page 1040

SPECIAL ADJOURNMENT

Motion (by Mr. Deakin) agreed to - That the House, at its rising, adjourn until Tuesday next.

page 1040

ADJOURNMENT

Ammunition Reserve : Transmission of Telegrams : Trial of Election Petitions : Carriage of Postal Stores

Motion (by Mr. Deakin) proposed -

That the House do now adjourn.

Mr PAGE:
Maranoa

– I think that after the press criticisms we have had . of late the House and the country should be informed as to how many up-to-date rifles the Commonwealth possesses, and what quantity of ammunition is in reserve. I shall be much obliged to the Minister for Defence if he will give us that information.

Mr CHAPMAN:
Monaro- Minister for Defence · Eden · Protectionist

– If the honorable member will give notice of the question for Wednesday next I shall be pleased to make a statement on the subject.

Mr CARPENTER:
Fremantle

– I wish to bring under the notice of the Prime Minister, who I understand is representing the Postmaster-General in the absence of that honorable gentleman, a complaint upon a very old subject - the delay in the transmission of press telegrams between the eastern States and Western Australia. I have been informed by the proprietor of a newspaper in Western Australia that last week a press telegram occupied something over four hours in transmission. No doubt when there is a rush of business, as there has been in times past, allowance must be made for delays, no matter how aggravating they may be ; but under normal conditions every effort should be used to expedite messages, . and particularly press telegrams, a delay in the transmission of which means annoyance and loss. I am sure that the Prime Minister will have the necessary inquiries made, and try to avoid repetition of the cause of complaint.

Mr O’MALLEY:
Darwin

– In. view of the tremendous expense to which a member is now put in defending his seat when another man wants it, and to prevent honorable members from being driven into the Bankruptcy Court, will the Prime Minister bring in a Bill to amend the Electoral Act, so as to provide for the trying of election petitions by a Committee of the House?-

Mr GLYNN:
Angas

– I wish to direct attention to a question, of postal administration. In calling for tenders for supplies for the Post and Telegraph Department it has been made a condition, I believe, that white labour only shall be employed, with the result that in South Australia the cost has been more than doubled. There camels are largely used for the carriage of supplies, and it is difficult to obtain the services of reliable white men for anything like what it costs to employ Afghans. Under what provision of the Postal Act is the Postmaster-General required to make this stipulation, or is it simply a happy thought of his own? r

Mr DEAKIN:
Minister for External Affairs · Ballarat · Protectionist

– I shall cause inquiry to be made as to the reason of the delay complained of by the honorable member for Fremantle. I cannot promise the honorable member for Darwin the pleasure of appearing before a committee of his fellow members for the trial of an election petition, because the experience of this State has shown that no more expensive tribunal was ever devised for that purpose. A leading barrister of this city, who was a spectator at a recent trial in the High Court, assured me that an ordinary court would have been occupied for three weeks in dealing with a matter which engaged the High Court only three days.

Mr Crouch:

– Hear, hear. I was there myself.

Mr KING O’MALLEY:
DARWIN, TASMANIA · ALP

– A committee of this House could have dealt with it in a couple of hours.

Mr DEAKIN:

– How could justice have been obtained if the complex questions at issue, one of which affected 1,400 ballotpapers, had been dealt with in two hours ?

Mr O’Malley:

– The High Court is for millionaires.

Mr DEAKIN:

– I ask the honorable member to exercise a little patience, until an amending Bill can be introduced which will remove the misconceptions upon which the cases to which he has referred have been based. It is reasonable to expect that no such confusion will occur in future elections.

Mr O’Malley:

– No lawyer will appear in the High Court for less than ,£100.

Mr DEAKIN:

– If the honorable member prefers a lawyer at that price, it is no doubt because experience has taught him the value of such an advocate. With regard to the matter referred to by the honorable and learned member for Angas, it is one of departmental administration, and I shall be happy to inquire into it if he will tell me where the practice of which he complains obtains. I suppose it is confined to the Northern Territory.

Mr Glynn:

– It obtains over a large part of the State of South Australia.

Question resolved in the affirmative.

House adjourned at lo.ai p.m.

Cite as: Australia, House of Representatives, Debates, 14 April 1904, viewed 6 July 2017, <http://historichansard.net/hofreps/1904/19040414_reps_2_18/>.