3rd Parliament · 2nd Session
Mr. Speaker took the chair at 3 p.m., and read prayers.
– I received from His Excellency the Governor-General a letter, dated 16th inst., intimatingthat he had forwarded to the Marchioness of Linlithgow the resolution of sympathy passed by this House on the death of the Marquis of Linlithgow. To-day I received from His Excellency another letter covering the reply, by cable, from the Marchioness. With the consent of honorable members, I shall direct that it be recorded in the Votes and Proceedings.
Honorable Members. - Hear, hear.
Mr. HEDGES presented a petition from the Perth Chamber of Commerce, praying that the House would lay aside the Australian. Industries Preservation Bill.
Petition received and read.
– Canthe PostmasterGeneral inform the House how long telegraphic communication between Queensland and the southern Stateshasbeen cut off, and what efforts are being made by his Department to restore it?
– The damage done by the floods in the north appears to be farreaching and serious, and the restoration of telegraphic communication will involve some time, and considerable expense. I shall lay upon the table of the House the telegrams that I have received on the subject.
– How long has telegraphic communication with Queensland been interrupted ?
– For some hours. I have issued instructions that neither effort nor money shall be spared in restoring communication.
– In regard to the interruption of the telegraphic service with the north, I desire to ask the PostmasterGeneral whether he will arrange for a cheap service through New Zealand during the period that the interruption continues? It is a serious thing for the whole of Queensland to be cut off from communication with the southern States for two days, and the Government ought certainly to take some steps to ascertain the state of affairs which exists in that portion of Australia. Will the Postmaster- General do his test to arrange for a reasonably cheap service to and from Queensland through New Zealand ?
– I shall consult the Prime Minister in regard to the matter, and if any facilities can be afforded to the public of Queensland they will be.
– And oblige the press.
-Will the Prime Minister lay upon the table, with a view to their circulation amongst honorable members, the objections to certain clauses of the Navi gation Bill which have been transmitted to him at the instance of the British Board of Trade, together with the correspondence connected therewith ?
– With pleasure.
Visit to Australia
– Has the Prime Minister received official verification of the report published in the press that the Government of the United States of America have accepted the invitation extended by him, on behalf of the Commonwealth, to the American fleet to visit Australia. If so, will he invite the British Government to have special naval representation on the occasion of the visit, so that the ceremonies may partake of something in the nature of a British-American naval demonstration in Australian waters?
– The Government are not yet in receipt of the official reply. The invitation was tendered through the British Government, and the reply will follow the same channel. No doubt a proper recognition of the visit of the fleet by the British squadron will be arranged bythe Imperial Government.
– I desire to ask the Prime Minister whether a port of Tasmania is included amongst those to be visited by the American Fleet?
– The invitation to the American Fleet is to visit the Commonwealth of Australia. I presume that when the acceptance reaches us, or soon after, we shall know the ports they propose to visit, though, as I say, the invitation covers the whole of the Commonwealth.
– Can the AttorneyGeneral inform the House of the reasons that prevented the case of The King versus Harris, Scarfe and Company being proceeded with recently at Adelaide, seeing that the High Court had arranged to sit there ?
– Negotiations for a settlement of the case had been started, and were, at the time, nearly concluded.
– I should like the Attorney-General to say whether full details of the terms of any proposed settlement will be published ?
– Yes. The terms of the settlement will necessitate an appearance in Court, and the whole case will be made public.
– But the settlement will be arranged in private.
– I have been informed of the general principles of the proposed settlement, but am not in possession of the whole of the details. I ask the honorable member not to press the question, because I cannot make any further disclosure at this stage. I may say that the Crown issued certain informations, and the defences to them were demurred to on grounds of law. Negotiations have been going on in regard to the pleadings, and certain settlements have been arrived at, details of which I have not yet received from the Crown Solicitor. The judgment in the case will have to go to a single Judge, and be entered up in Court.
– I desire to know whether the Minister of Defence noticed in the press of yesterday some serious statements made by Captain Rushall, commanding officer of the Melbourne Cavalry, in reference to his retirement from the Forces. The statement is in reference to the Mounted Cadets, and is as follows : -
The boys have no rifles, no belts, no bayonets, no haversacks, no capes. Theyhave nothing except their horses, saddles, bridles, and uniforms, all of which they have themselves provided.
If the Minister did notice that statement does he propose to have steps taken to remedy this state of affairs, and secure the services of this valuable officer?
– I did see the statement referred to, and the case originated in this way. It is laid down by the regulations that an officer shall hold only one position in connexion with the Defence Forces. For instance, a man may not be an officer in the Artillery and in the Light Horse at the same time; and so he cannot be an officer of cadets, and also an officer of Light Horse.
– Have the boys none of the accoutrements mentioned ?
– I am not aware of the fact, but I shall look into the matter, and, if such should prove to be the case, I shall endeavour to get over the difficulty. I do not desire to say any more about the case at present.
– In view of the answer just given I desire to know whether the Minister of Defence will take into consideration the advisability of amending the regulation which provides that an officer, holding a commission is compelled to resign that commission so soon as he takes up an appointment in connexion with the cadets. For instance, a school teacher may be a valuable officer, but the moment he takes charge of the cadets, as he must do in connexion with the schools, he is compelled to resign his position in the volunteers or the militia. I trust the Minister will see the advisability of giving greater range, so that officers, under such circumstances as I have indicated, may be allowed to continue to give their services in both capacities?
– Under such circumstances as those described an officer is seconded for the time being - it is not a question of absolute severance. My personal opinion is, with regard to the cadets, that it would be wiseto permit militia officers, who are prepared to give their time, to accept appointments. That is my personal opinion, but beyond that I do not think the honorable member will ask me to go at present.
Stimulus of Industries : Immigration
– Can the Minister of Trade and Customs inform us whether any stimulus to Australian manufactures has followed, or is expected to follow, the imposition of the new Customs duties?
– Yes ; and I should be very glad if the honorable member will allow me to give a great many instances of where Australian industries have been very much stimulated. The honorable member must have seenthis stimulus in his own city of Sydney, or he goes about with his eyes closed.
– I desire, following on that question, to ask the Prime Minister whether, in view of the stimulus given to Australianmanufacturing industries by the recent imposition of higher duties, the honorable gentleman will further assist these industries by advertising in the United Kingdom the opportunities which Australia offers to industrial immigrants particularly, and by arranging to assist such immigrants with reduced fares, and by such other means as may be found necessary, in order to show that the Commonwealth is ready to encourage immigration without waiting any longer for the States.
– I received no intimation that this question was to be asked, and until the last few words thought.it would be possible to give a short and favorable answer. But, as a matter of fact, we are still in communication with the States, and I am exchanging letters with the Premier of New South Wales in connexion with these very questions.
– My question relates to industrial immigrants, and not to immigrants for the land.
– - The whole question has been discussed in the correspondence which will shortly be laid on the table of the House.
– I desire to ask the Minister of Home Affairs whether he has received a report as to the advisability of reverting to local meteorological forecasts ?
– The Minister has furnished me with a report from the Commonwealth Meteorologist, Mr. H. A. Hunt, and as it is a somewhat lengthy paper, I propose to lay it on the table. For the immediate information of the honorable member, however, I may say that the report, amongst other particulars, states that out of a total of sixty-two forecasts, thirtytwo were correct, eighteen were partially correct, and twelve were failures. The report adds that had the forecasts been issued from Adelaide, the probabilities are that they would have been still more unsatisfactory than has been the case, for in framing the forecasts in the Central Bureau, the Commonwealth Meteorologist has. the advice not only of the best South Australian expert, but also the combined opinions of the central staff of experienced meteorologists.
– Upon Sunday last the official forecast issued by the Meteorological Department for South’ Australia generally was “fine and warm.” As a matter of fact, the day was cold, and wet. Would that forecast be included amongst those to which the Minister representing the Minister of Home Affairs has referred as “ partially correct.”
– I would recommend the honorable member to read the whole of the memorandum which has been submitted in regard . to this question, and which has already been laid upon the table of the House. When he does so, perhaps he will find an answer to the question which he has just put.
– I desire to ask the Minister in charge of the Federal Capital site matter a question, without notice. I understand that it is proposed to make visits to certain proposed sites before the question is finally decided in this House, and I should like to know “whether the time of these visits has been fixed, and when we may expect the matter to be ripe for decision by Parliament?
– The Government are projecting no visit, but honorable members have expressed a desire to see one or two sites. I understand the visits will take place within the next fortnight.
– Next Saturday week, and, perhaps, on the following Saturday.
– But those visits do not necessarily imply any delay in the necessary preliminary steps for the introduction of the Bill.
– I desire to ask the Prime Minister whether the Government propose to take early action in regard to the appointment of an Administrator in Papua, and whether there is any truth in the report that it is proposed to appoint Judge Murray ?
– The vacancy has not yet arisen technically, nor, when it does arise, is there any immediate urgency for the appointment. On the contrary, this: appointment, together ‘with certain other changes, will require to be considered by the Government, and brought before this House, before any definite action is taken.
– I desire to ask the Prime Minister whether it is the intention, of the Government to introduce the Bill relating to the appointment of a High Commissioner during the current session?
– All questions relatingto the current session are necessarily ambiguous, on account of the uncertainty which, exists concerning its duration. If thesession be a short one, I doubt whether itwill be possible, during its continuance,. to introduce the Bill to which the honorable member has referred. If, however, it should be prolonged, the measure in question will most certainly be brought forward.
– I wish to ask the Prime Minister a question relating to the report of the Royal Commissioner upon secret drugs, cures and foods. In the Age of Saturday last the statement appeared that the Parliamentary Medical Committee appointed to deal with the report had de- clared that the Government were holding back the circulation pf the document in question, and that it would be necessary to introduce a Bill to protect the Royal Commissioner, as the contents of the report are not covered by parliamentary privilege. I desire to know what is the attitude of the Government in regard to the report in question, and whether it is necessary that a protecting Bill should be introduced to cover the matter of privilege?
– It is necessary that such a Bill should be introduced, and the Attorney-General is now engaged in drafting it. ‘ I hope that it will be laid on the table of the House in a day or two.
– I wish to know whether the attention of the PostmasterGeneral” has been directed to the following remarks, which are reported to have been made by the Secretary of his Department, and which recently appeared in the press - “ Any sensible man would know,” said the secretary, referring to the article in the Herald, of -Friday last, “that no relief can be given until officials are appointed. What has to be done before a permanent hand can be appointed ? The postmaster has to ask for it. ft has to be reported on by the inspector. It has to be approved by the Postmaster-General. It has to be passed by the Public Service Commissioner, and then the question of money comes in. Men cannot be put on until there is money to pay them. . . . The PostmasterGeneral himself cannot appoint a messenger boy. He has to apply for what he wants.
As to the delays and losses referred to, we cannot be expected to be responsible at head-quarters for the inefficiency of men. They are not appointed by the PostmasterGeneral, and he cannot remove them from their offices. No other large ‘business establishment would ever expect lo carry on under the conditions the Postmaster-General is bound down to.”
If the attention of the Minister has been directed to the foregoing remarks, does he think that the permanent head df his Department should reflect upon the policy adopted by this Parliament, and by the Ministry, under whom he holds office? If he does not, will he take steps to see that in future any expressions of opinion upon matters of policy emanate from the Minister himself, in that discreet way in which he generally deals with such matters? I think it is unfortunate that reflections should be cast upon another Department of the Commonwealth, and upon the policy of the country, by the permanent head of the Postal Department.
– The statement to which my honorable friend has drawn attention is largely correct. The question of the advisableness or otherwise of the permanent head of the Department giving expression to opinions upon matters of policy is one which will’ receive attention.
– Before the Christmas adjournment I asked the Prime Minister whether he would ascertain how many veterans engaged in the Indian Mutiny and the Crimean War were inmates of charitable institutions of the State, and he promised to make inquiries into the matter. I now wish to know whether he has any information upon the subject to give to the House?
– I have obtained an. incomplete list, which, of course, it did not seem desirable to present to the -House, because odd veterans are to be found in various parts of the Commonwealth. I think, however, that the complete list will shortly be available, and it will then be laid upon, the table.
– I wish to ask the PostmasterGeneral whether he recently issued the following memorandum -
Officers of your office desiring to lake part in St. Patrick’s Day procession on 17th inst. should make application for half-holiday on day in question. If their services can be spared without public inconvenience, applications will receive favourable consideration.
It is alleged that this memorandum was issued on the 12th inst., and I desire, to ask the Minister whether he will issue a similar memorandum prior to St. George’s Day, St. Andrew’s Day, and St. David’s Day ?
– I may tell the honorable member thatI knownothing whatever of the circular in question. I desire to add that similar facilities are afforded to postal employés in every State upon public holidays. The action in question was taken by the Deputy PostmasterGeneral in accordance with the custom that has obtained for some years.
– I wish to ask the Minister representing the Minister of Home Affairs, what is the cause of the delay in proceeding with the survey of the proposed line of railway from Kalgoorlie to Port Augusta?
– I do not know that any real delayhas taken place. A Conference of experts recently met in Melbourne, and arrived at a certain determination, which was submitted to the Cabinet, and approved. Steps have since been taken to allow of the work being proceeded with as soon as possible.
– Is it true, as reported, that the experts have decided to survey a route passing through Tarcoola, although it would cost£800,000 more to take the railway that way?
-I shall ascertain, and reply to the honorable member’s question to-morrow.
– Is it intended to give effect to a promise made in this Chamber when the Bill was being considered, that a prospecting party would be equipped to go with the survey party so that the country should be not only surveyed, but also prospected ?
– If that promise was made, no doubt the Minister’s instructions to the party will give effect to it.
– Has the attention of the Prime Minister been called to the following report, which appeared in the Argus of 20th February last, of a speech made by the honorable member for West Sydney, at the annual picnic of the Wharf Labourers’ Union -
Nothing was easier for them thanto bring about a condition of things that would be distasteful to the country by a cessation of work. They had never broken an award of the Arbitration Court, although they were under no obligation to observe it, seeing they had been denied preference.
I wish to know from the honorable and learned gentleman if a statement or assertion made by a member of the House to induce persons to break the law is in accordance with the oath of allegiance which he takes on being sworn in ?
– No doubt,I read the report, though I do not remember the expressions quoted. I take these as a criticism of theState law, in regard to which an amending Bill is now before the New South Wales Parliament, and am not aware that they can imply any breach of the oath of allegiance.
Alleged Customs Frauds.
– I desire to move the adjournment of the House to call attention to a definite matter of urgent public importance, viz., “ The alleged Customs frauds by the firm of Harris, Scarf e and Company.”
Five honorable members having risen in their places,
– Following upon the reply of the Attorney-General to a question I put to him on the subject, I have taken this action because I wish to know whether, in any settlement arrived at the Government is to be a party to the compounding of a felony. It should not be possible for the public to think for a moment that this or any Government would be allowed by Parliament to do such a thing as that. Ever since the right honorable member for Adelaide ceased to administer the Customs Department, the comment has been common that justice is not being done to the revenue, as it was in his time, by the punishing of persons defrauding the Customs.
– That is a very serious charge to make against his successors.
– It is a very serious charge; but I, and many others, have been led to think that there is ground for the common statement that the Customs Department does not appear to be entirely free from taint. Since the resignation by the right honorable member for Adelaide of the portfolio of Minister of Trade and Customs, case after case has been reported in the newspapers, but the names of those committing offences have been kept back. This leads to the suspicion that there is something of the backstairs method in the present settlement of disputes, which should not be tolerated.
– That is a charge against the present Minister.
– Iam merely stating my suspicions. I have good grounds for believing that in this case an enormous sum is involved. The firm concerned is one of the wealthiest in the Commonwealth, and it must not be thought that this House will allow the treatment meted out to a strong firm to be different from that meted out to the smallest offender against the Customs Act.
– What is the firm supposed to have done? Is there a difference of opinion as to rates of duty, or is fraud alleged ?
– I believe that the commission of a criminal act is in question.
– Does the honorable member know that to be so?
– No; it can be known only by allowing the case to go into Court. I have very strong grounds for suspicion, and they will not be allayed unless the Court deals with the case. We took Robert Reid and Company to Court to prove what that firm had done, and this firm should be similarly treated.
– The right honorable member for Adelaide was Minister then.
– I am certain that he would have taken this case to Court. In certain circles it is commonly reported that the firm in question has been guilty of representing imported goods to be of less than their true value, as if, for instance, it had imported silverware, and entered it as electroplate. If that, or anything like it, has been done, a criminal offence has been committed. The sum involved is. I am sure, a very large one, and in a big case like this, there ought to be no private settlement.
– What is the charge against the firm?
– That it has been guilty of defrauding the Customs.
– Just a general charge?
– The case is a civil one; but if it is settled privately how can we ascertain the facts?
– Tucker’s case was not settled privately.
– Unfortunately there has been the greatest laxity in the administration of the South Australian branch of the Customs Department. On page 169 of his report, the Auditor-General says, that for years past no less than £3,000,000 of revenue has not been subjected to a detailed audit.
– Was that before Federation?
– Both before and after, but mostly before.
– That makes matters worse.
– Is this sort of thing still going on?
– Yes. It is complained that in Adelaide, at present, there is no audit staff, such as there is in all the other States. Only one audit officer is employed there. I believe that complications have prevented the staff being placed on the footing that prevails in other States, but I do not want honorable members to imagine that, although there is only one Commonwealth audit officer in Adelaide, the accounts of the Customs Department are not being audited. I cannot say how long these alleged fraud’s have been going on.
– Some of us do not know anything about the case. What are thefacts ?
– I have not all the facts.
– The case itself is immaterial to the question before us. The point is whether a case of this kind should be dealt with in open court.
– Or settled privately in the office of the Minister. I hope that no big case will be privately settled ; all should be treated alike. Under the old system,a reputable firm could be brought before the police court for a mere error of judgment, but nowadays the practice is for the Minister to deal privately with such matters. All cases should be dealtwith in open court, so that the public may know the real facts. I should prefer to deal with a man who had never defrauded the Customs Department rather than to patronize a man who had beenconvicted of doing so. There is; however, a far more important principle involved. When it was alleged that Charles Tucker had defrauded the Department of Trade and Customs of about £30,000, the people were astounded. Yet we find from the report of the AuditorGeneral that the administration is still as lax as ever. Many of the officers who were administering the Department when the Tucker frauds took place still retain their positions, and no change has been made in respect of the office of Collector. The Auditor-General shows that, instead of the Department having been defrauded of £30,000, it has in that way lost at least £60,000, to say nothing of what has happened during ten years in respect of which no record can be obtained. This firm ought to be brought before the Court in order that we may discover whether or not it has been doing what Tucker did. I sincerely hope that it has not, but I believe that either frauds or offences covering very large sums have been entered into by the firm.
– Is the honorable member sure of his facts? His statement is a very serious one.
– It is alleged that serious frauds have been committed, and I wish to ascertain whether that allegation is correct. The honorable member must not put into my mouth statements that I do not make.
– I thought that the honorable member said he believed that such things had happened.
– So I do, but I cannot prove that they have. I should not have taken the extreme step of moving the adjournment of the House had I not strong grounds for the belief that all is not right - that not only a civil, but a criminal offence has been committed.
– Would the honorable member make that statement outside, where he would not be sheltered by privilege?
– Why should I? I once declared that I would not say in Parliament what I was not prepared to say outside, and my adherence to that resolution cost me £350. The man of whom I spoke was Charles Tucker, who is now in gaol .
– How did he get a verdict ?
– There was a property jury, and one of Tucker’s relations was a member of it.
– This is a coward’s castle.
– I do not begrudge the £350 that the case cost me, since it has led to a scoundrel being convicted of the offence charged against him. He has been sent to gaol, and thus prevented from committing other swindles. My desire is that no other swindlershall have an opportunity to rob the Department.
– I suppose that the honorable member is speaking of what is current rumour in Adelaide?
– The Minister, if he chose to speak, could show that there is something more than mere rumour involved. This is one of the most serious matters that the Court could deal with, because it involves the reputation of one of the largest companies in Australia. I certainly have no desire to injure any firm, but, on the other hand, I do not wish the revenue, and, consequently, the taxpayers to be injured. There are some men who think that they have a perfect right to get at the Government if they can do so, and they are merely looked upon by many as smart business people who are doing that which is immoral but not illegal. Such practices, to my mind, should be both illegal and immoral. I am not prepared to remain silent whilst a case like this is being hushed up in a private office. To show the laxity of the administration at Port Adelaide, I would point out that when Messrs. Meucke and Company were acting as agents for Messrs. John Martin and Company the payments to the Department on behalf of the principal item were much larger than they were whilst Tucker acted as their agent. In an extract from the report of the Chief Clerk of the Audit Office, which appears in Appendix C to the report of the AuditorGeneral, it is shown that -
Following Tucker’s appointment, the payments to the Customs on John Martin and Company’s account in July and August 1884, totalled £2430s. 6d., as compared with£9819s. 4d. for the corresponding months of the previous year, when Messrs. Meucke and Company were acting as agents.
The Chief Clerk shows that for July and August, 1893, the duty payable by John Martin and Company, after allowing 7 per cent. for charges, was £1,018 16s., and that the amount actually paid to the Department was only £190 2s., or a shortage of £828 14s. In the months of January, February, July, and August, 1894, the amount payable by the company was £2,0881s. 2d., but the amount actually paid was £205 8s. 9d., theshortage being no less than £1,882 12s.5d. He points out that -
From the 6th March, 1897, until the 31st December, 1897, the amount paid to the Charles Tucker account - by Messrs. John Martin and Company - in respect of duty was £4,068 7s. 2d., out of which there was paid to the Customs the sum of£1,940 19s.1d., thus leaving a shortage for the period of£2,127 8s.1d.
It is remarkable that year after year this state of affairs prevailed at Port Adelaide, and that notwithstanding that the volume of merchandise handled on behalf of Messrs. John Martin and Company was the same as before, the Customs authorities did not notice the falling off in revenue from that source. The firm of John Martin and Company is one of the most ‘ reputable in Australia; but it was victimized t a,s the result of its effort to do a good turn to a relative of a member of the company. I trust that when the Government are called upon to determine what payment it shall make in respect of the amount short paid on its behalf bv Charles Tucker, .thev will extend to it some consideration. There can be no doubt that the firm honestly handed over to Tucker, as its agent, every penny for which it was liable in respect of Customs duties, and that Tucker, to whom, as I have said, they tried to do a good turn, robbed the Department. When such things are possible, something must be wrong with the administration of the. Department in South Australia. We have a right to know whether in this case a mere error of judgment has been committed, or whether a criminal offence has been perpetrated. I believe I shall have the House with me when I say that our desire is that every individual, whether influential or not, shall have justice. I hope that no suspicion that corruption exists in the Department will be allowed to remain in the public mind ; but if important cases are settled in private, the public certainly will suspect that there- is something wrong. Having regard to the lax state of affairs which has prevailed and the comparatively trifling attempts that have been made to remedy the defects in the administration, we certainly have cause for dissatisfacion . I trust that the Attorney-General will inform the House that this case will not be settled except in the most public manner. ‘
– The honorable member for Hindmarsh was a little precipitate in moving the- adjournment of the House, and would have done well to refrain from taking action until to-morrow, so that he might have an opportunity to make inquiry as to the exact position of affairs.
– It might then have been too late to take action.
– The facts relating to the question immediately before us may be briefly stated. An action against this firm was instituted in the High Court, and on the pleadings certain defences, involving questions of law, were raised by way of demurrer.. . The matter that was set down for. hearing by the High Court was the determination of the points of law so raised. Late last week certain negotiations transpired, which obviated the necessity for the questions of law being dealt with by the Court. The firm in question were charged on seventeen sets of charges with having passed false entries with intent to defraud. The fullest investigation was made by the Crown Solicitor’, by counsel in Adelaide acting on behalf of the Department, by the Department itself, and by a solicitor in London, who, acting on behalf of the Commonwealth, had access to all papers there relating to the case. The books of the firm were placed at the disposal of the Department, and the fullest investigation was made.
– Who acted in London for the Department ?
- Mr. Galbraith, who always acts as solicitor for the Common - _ wealth in London. Mr. Culross, solicitor, and Mr. Piper, counsel, of Adelaide, acted for us in that city, whilst Mr. Whitton, an officer of high standing in the Audit Department, examined the whole of the books.
– Is the AttorneyGeneral sure that the officer saw ail the books?
– Yes, I believe so. The officers made the fullest investigation, and they are satisfied that all the books relating to these “matters were seen, and, further, that the firm did not receive one single penny -benefit by reason of the fraudulent acts. But certain individuals are to be charged with fraud. . In regard to the firm, the charge of intent to defraud will be withdrawn ; but, at the same time, the proceedings are to be continued against them. The firm will admit seventeen distinct charges of, through their servants, making false entries; and all those charges will come before the Court, which will have to assess the penalty in each.-
– Have the firm participated in the frauds?
– No; I thought I had made that clear. The fullest investigation has been made, and it has been shown that the firm did not benefit at all.
– Some intermediaries benefited ?
– Yes; and those intermediaries will be prosecuted.
– In what respect do these charges differ from those made against Messrs. Robert Reid and Company?
– In the latter case there was evidence that the firm benefited.
– Why should these Adelaide cases not go into Court?
– They aregoing into Court; the whole of the charges, in which the firm have admitted their liability, will go before the Court.
– And they are going to plead guilty on seventeen charges?
– Except that they do not admit they received any benefit from the frauds.
– That is so. I may mention that the amount of duty at stake in the particular charges is not very great, but the firm have agreed to pay £950 duty which we claim. A Judge of the High Courtwill determine on the facts submitted in the case, and assess the penalty on each charge. It will be seen, therefore, that there has been no private settlement in the Minister’s office.
– A great number of cases have been settled in the Minister’s office.
– I am now referring to this particular case ; and after what I have said, I think the honorable member will withdraw anycharge orsuggestionthat there is a taint of personal, impropriety on the part of any one connected with the matter.
– I have not made a definite charge.
– I can assure the honorable member that no single step in the action has been taken without the advice of counsel who have been in touch with the case from start to finish - without the advice of eminent counsel, as well as that of the Crown Solicitor. The latter gentleman has, perhaps, had more experience of Customs matters than most, and I think we can say that he has been eminently successful in bringing parties to justice. Every step in this matter has been the subject of most anxious investigation, and, as I say, we must admit on the reports, that the firm has not benefited from the frauds. On the whole, I ‘think -that justice is being done in the settlement which is now being made. It is not a private settlement, nor is there any endeavour to keep facts from the public; indeed, the very nature of the settlement will necessitate the case going into Court for the assessment of penalties.
– The Fish case went into Court, where the penalties were assessed after evidence had been laid. Would not that have been the better course in this case ?
– In theFish case, the facts were disputed; whereas in the present case they are admitted, and they will all come before the Court, just as if evidence had been given.
– Why not give every person charged with Customs fraud the same opportunity as has been given to this firm?
– In the present case, as I have said more than once, the firm have not benefited to the extent of a penny.
– But they are responsible for the acts of their servants.
– Yes; and for those acts the firm are beingprosecuted.
– This is a new way of encouraging fraud !
– Those who committed the frauds will be prosecuted. With the facts as we have them laid before us by our own officers, it would have been idle to go into Court and attempt to prove a charge when we knew we could not succeed.The law officers must be guided by the evidence in their possession.
– And on that evidence there is not a criminal, but only a civil, remedy against thefirm.
– In regard to the Fish case mentioned by Mr. Fisher, I am informed that only one charge was tried, the others being settled in the same way as in the present instance.
– That was after the cases had gone to Court.
– But only one case was tried. In the face of our officers’ advice that the firm did not benefit by the frauds, what other course could we adopt than that I have laid before honorable members?
– The Crown proceeds against the firm civilly, and against the servants or intermediaries criminally.
– Strictly according to law. This is a Customs prosecution against the firm, who admit seventeen charges. In any criminal case, if the accused pleads guilty, the proceedings are at an end.
– It is peculiar that frauds should be committedand no benefit received by the firm.
– The honorable member misunderstands the position. The firm’s agents passed those false entries, for which the firm are responsible.
– Who got the monetary benefit - the firm or the agents?
– Apparently, the agents or the intermediaries.
– Somebody got the money.
– But the firm who are charged did not get the money. If we proceeded without any evidence of fraud, it would only be inviting failure, with the attendant heavy costs.
– Will the Attorney-General give us a supposititious case?
– I prefer dealing with the case before the House.
– Do I understand the Attorney-General to mean that the firm paid the full amount of duty, and that some agents swindled the Customs?
– The firm paid the duties and they received no benefit whatever from the passing of these entries. The Crown Solicitor has only just returned from Adelaide, and in the last ten minutes has supplied mewith the information I am laying before theHouse.
– Have any arrests been attempted of these intermediaries?
– I can make inquiries and let the honorable member know later. The action taken by the Government is strictly in the interests of justice, and we have only followed the usual practice. The Customs authorities have strenuously insisted upon complete proof.
– The Attorney-General is entirely responsible for the motion for the adjournment, because he led me to believe, from his reply to my question, that the case had been completely settled.
– I told the honorable member that I had. not seen the Crown Solicitor since his return.
– At any rate, that is what I understood. I am glad to know, however that these charges are to come into Court. But while it is quite true that; in the face of the evidence in their possession, theGovernment are taking the only possible action, the inquiry of the honorable member for Grey, as to who has obtained the advantages of the frauds, is most pertinent. This is a matter the Customs Department ought to look into; and I am very glad the question has been raised. I have never known a fraud to be committed without somebody receiving benefit, and if the firm did not receive the benefit of these seventeen distinct frauds, the intermediaries must have done so. It is necessary that Parliament should know how these intermediaries benefited.
– I have told honorable members that proceedings are to be taken against those intermediaries.
– What I said was that there were strong grounds for suspicion that the firm were implicated, and that a fairly large sum was involved. We cannot say whether the charges which will come before the Court represent the whole of the amount of which the Customs have been defrauded, because, I take it, that only those charges which can be sustained will be put forward. In another case, which has been mentioned, a number of sums were involved, but the Government could not proceed with every charge, and the offender was sentenced to eighteen months, while he ought to have been sentenced to eighteen years, and then he would have got off cheaply, scoundrel that he was. I am glad the Attorney-General has made a statement to the House, and if he had done so in reply to my question, it would not , have been necessary to move the adjournment.
Question resolved in the negative.
– The honorable member for Wimmera, on Thursday last, asked a question in reference to the want of uniformity in the exposure of thermometers throughout Victoria, and the following reply has been furnished by the Meteorological Department -
In reply to the complaint of the Hon. Mr. Sampson, M.P., with regard to the want of uniformity in the exposure of thermometers in various parts of Victoria, it should be understood that the Commonwealth only assumed control of the States’ Weather Services from the first of January last, and consequently was only in a position to initiate a system of uniformity from that date. A number of regulation screens have already been sent to the country to remedy the most urgent defective exposures. The less urgent cases are being dealt with as quickly as supplies, equipment, and circumstances will permit.
Relations between Commonwealth and States - Revenue and Expenditure - Other New Commonwealth Expenditure.
asked the Prime Minister, upon notice -
– The answer to the honorable member’s questions is as follows -
The proposals of the Government in regard to the finances ofthe Commonwealth and their relation to those of the States will be submitted to Parliament prior to the Conference of State Premiers next month. As these proposals will provide for a permanent instead of a temporary settlement of the financial relations between the Commonwealth and the States, some of the propositions laid before the Conferences of1905-6 are being reconsidered.
asked the Treasurer, upon notice -
Whether he will have the two Treasury returns dated 5th November, 1906, and 9th October, 1906,
Drought up to date of last financial year, and submitted; viz. : -
asked the Minister of Defence, upon notice -
In reference to the following paragraph from the Queenscliff Sentinel of the 7th March - “A guard of honour of 50 rank and file, in charge of Captain J. E. Robertson, left here for Melbourne on Thursday morning and returned on Friday. The occasion was the reception of Commodore Bouchard, of the French manofwar R.S.S. Catinat, on his official visit to the Military Board and State Commandant.”
– The answers to the honorable member’s questions are as follow -
The replies to questions 1 and 2 are in keeping with the second paragraph of regulation quoted.
Theguards are usually furnished in connexion with the opening and prorogation of the Commonwealth and State Parliaments by the GovernorGeneral and State Governor respectively.
asked the Minister of Trade and Customs, upon notice -
– The answers to the honorable member’s questions are as follow -
– Does the Minister know whether it is being manufactured in the States?
– I have reason to believe that it is. .
asked the PostmasterGeneral, upon notice -
– The answers to the honorable member’s questions are as follow -
The total provision for inland mail services, apart from those carried by the railways, asked for on the Estimates-in-Chief for the current year, exceeds that of last year by £6,300, and it has been found necessary to askfor a further sum of £4,500 to meet the actual necessities of this financial year in this respect.
The States are also to be paid £25,000 additional for the half-year ended 30th June next for the carriage of mails by the railways, and as all the passenger and mixed trains are now available for mails, greater facilities will be afforded generally, and particularly in country districts.
I shall be pleased to inform members in every case of any curtailment of postal facilities in their electorates, but cannot undertake to issue public notices of such curtailments and’ the reasons therefor.
asked the Treasurer, upon notice -
– In reply to the honorable member’s questions I desire to state -
asked the Prime Minister, upon notice -
– The answers to the honorable member’s questions are as follow - 1 and 2. The South Australian measure to give effect to the agreement has been reserved for the Royal Assent. No information has been received as to the cause of the delay in giving such assent.
Debate resumed from 13th March(vide page 9039), on motion by Mr. Groom -
That thisBill be now read a second time.
.- I do not intend to occupy much time in completing the remarks which I was addressing to the House when the debate was adjourned on Friday last. The principal matter to which I desire to direct attention is that, whilstI and a great many other honorable members are quite prepared to clothe the Government with the powers necessary to secure the conviction of trusts or combines operating in restraint of trade, and to the detriment of the consumer, we desire that that power shall, as far as possible, be removed from the sphere of political influence. In Committee, I hope that some such proposal will be adopted. I feel sure that the result I have indicated can be achieved without depriving the Government of the power with which we wish to invest them.
– How does the honorable member suggest that that result can be achieved ?
– The matter can be best dealt with in Committee.
– Cannot the honorable member foreshadow it now, so that we may be afforded an opportunity of thinking it over ?
– As a matter of fact, it was foreshadowed in a leading article which appeared in the Argus this morning. The article, to a great extent, has taken the wind out of our sails.
– I have not read the leading article which appeared in the Argus of to-day.
– I am exceedingly sorry that the honorable member does not attempt to improve his mind by reading that publication.
.- I read the leading article in reference to this Bill, which was published in the Argus this morning; but I cannot say that I gained a great deal of light from it. To me it appeared to be merely a re-hash of the criticism which emanated from the front Opposition bench on Friday last.
– That does not detract from its value.
– No ; but the article does not throw any additional light upon the subject, and spoken words are occasionally much more effective than are printed words. I must confess that the remarks made by the leader of the Opposition on Friday last impressed me a great deal more than did the leading article which appeared in the Argus of to-day.
– What was the position previously taken up by that journal?
– I do not know. I am not a very consistent reader of that publication. All I know is that upon this Bill the Argus takes up precisely the attitude adopted by the leader of the Opposition.. I do not intend to discuss the details of this measure. I merely wish to say that we can hail it as the first of a series of amending Bills dealing with antitrust legislation. Last session we passed the principal Act, and, though it has not yet been brought into operation, an amending Bill is already required. I do not blame the Government for this. The problem with which we seek to deal is a most complex and difficult one, and I shall not be at all surprised if, before the close of this Parliament, we are called upon to consider yet another amending Bill.
– Human nature is constantly changing.
– Conditions are constantly changing. There is no doubt that it is very difficult to secure a conviction in the case of trusts and combines. American experience has demonstrated that. Even after a conviction has been obtained, the public will be fleeced in some other way. As soon as the Court has’ decided that a certain method of fleecing the consumer is illegal, the trusts will adopt some other method. . They will attain their object by a different means, and, as a result, we shall be constantly called upon to pass amending legislation. It goes without saying that the object of the Government is not to break up trusts and combinations.
– There are lawful and unlawful combinations.
– The Government merely seek to regulate these combinations so as to prevent the grosser evils which usually flow from them. One of the difficulties connected with all anti-trust legislation is that it necessarily assumes that what is perfectly lawful in the case of the individual is illegal in the case of combinations. In the Mogul Company dispute, Lord Chancel lor Halsbury said -
I have been unable to discover anything done by the members of the associated body of traders other than an offer of reduced freights. to persons who would deal exclusively with them ; and if this is unlawful it seems to me that the greater part of commercial dealings, where there is rivalry in trade, must be equally unlawful.
TheLord Chancellor was therefore of opinion that, if the granting of rebates was unlawful, the greater portion of our commercial dealings, where rivalry exists in trade, was equally unlawful. As a matter of fact, nearly all the unlawful acts committed by trusts - acts which have led to wholesale reprisals and to general condemnation - are committed by individuals without exciting any public alarm. Whilst those acts may not be considered perfectly right, they are certainly perfectly legal. For instance, the act of securing a monopoly closely resembles the action of a shopkeeper who - having seen a customer entering his rival’s establishment to purchase some goods - tells him upon the next occasion that he enters his store that he had tetter get all his goods where he purchased his sausages. There are two ways in which any anti-trust legislation which we may devise can be dodged by these combinations. One is by forming an amalgamation. The provisions of the measure would not apply where only one firm was concerned.
– The Act punishes all combinations with intent to injure or destroy.
– Intent is exceedingly difficult to prove. Could one firm be called a combination?
– The law applies to every person who enters into or engages in a combination. A firm might be liable for monopolizing or attempting to monopolize.
– Only if it did something in restraint of trade. To endeavour to prevent competition is a perfectly lawful act for any individual or any firm, and it seems to me that amalgamation would enable combinations to dodge the law. The British trusts are largely held together by what are termed “ gentlemen’s agreements,” of which there is no documentary evidence, nothing being put on paper ; and those who have gone carefully into the operations of trusts say that some of the most pernicious effects of combination are due to these arrangements, which the law cannot get at. Therefore, do what you will, you cannot surmount the difficulties which are entailed by these attempts to prevent combination. The members of the Labour Party take no responsibility in connexion with the matter. This is the al- tur native of private enterprise. The advo cates of unrestricted private enterprise are now brought to this pass : that they have to introduce a Bill which is, in the highest degree, repressive of public liberty, in order that there may be some semblance of free competition. The Labour Party has its alternative. We say that this kind of legislation must, in the nature of things, fail, because the evolution of businesses is to get into fewer hands, combinations succeeding combinations until monopolies are created. Once a monopoly exists, no tinkering legislation can prevent the evils to which President Roosevelt refers in his somewhat frenzied appeal . to Congress, published in this morning’s newspapers. The power to work evil will cause evil to be done, and where there is a monopoly, the State should step in and run the enterprise itself.
– Nationalize it ?
– Certainly. The choice is between two alternatives ; monopolies managed by and for the benefit of a few private individuals in opposition to the interests of the community, and monopolies worked by the State in the public interest. I admit that legislation may prevent the grosser abuses which have accrued in the United States of America. The day is yet distant when trusts, however powerful, will be able to buy up Australian Legislatures and courts of justice, though that is among the possibilities of the future. The entire control of an industry, the power to fix the prices at which raw material shall be paid for and finished products sold, should not be exercised by private individuals ; it should be exercised only by the State for the benefit of the community. Honorable members may say that this is Socialism. It is common sense. I do not care anything for Socialism as such. I would not vote to make an industry socialistic merely for the sake of doing so. Unless a business is a good one, the State ought not to embark in it. I do not know whether I am or am not a Socialist.
– The honorable member is not. He wants only the plums.
– No true representative of the community would propose that the State should do other than take over only the plums. We are not here to land the community in bad business enterprises. Does the honorable member think that Socialists should take over the failures of private enterprise?
Colonel Foxton. - We should all flourish under Socialism.
– I believe that we should ; but, unless we should all flourish legitimately under Socialism, Socialism ought not to be.
– Some of the promoters of enterprises which have failed are very strong Socialists.
– Yes ; when, like the Coal Creek Company of Victoria, they wish the Government to take over their businesses.
– The honorable member suggests that when a man has worked up a good business, the State should take it over.
– That depends. I believe in the minimum amount of Socialism consistent with the public interest.
– What does the honorable member call “ Socialism”?
– Let me say, in place of “ Socialism,” the minimum amount of collective control consistent with the public interest.
– The maximum in the public interest, surely ?
– I do not wish to take over more than it may be necessary in the public interest to take over. Everything depends on the view held as to where the public interest begins and ends. If a man works up a business until it becomes a monopoly, for the control of which Parliament must continually legislate, the State should take over the enterprise, since it has become too large for one man to run in his own interest. But it would not be fair to the Government to enter upon a general discussion of Socialism, except so far as the subjectis inseparable from the Bill.
– One man could not legitimately make a monopoly.
– That is true. A monopoly can be made only by the suppression of rivals.
– Marriage is a monopoly.
– That is dragging in the marriage tie.
– Yes. The Labour Party is quite prepared to leave this matter to the Government, though, no doubt, if the Opposition were in power, it would introduce practically identical legislation, to enable free competition to live a little longer.
– Does the honorable member think that it should live a little longer?
– I should like it to live as long as “possible”; but no longer than is consistent with the public good
– If it is a bad thing, why should the honorable member wish any further life for it?
– Nothing under the sun is entirely good or entirely bad. There is a great deal of good in combinations. They enable business to be better organized and conducted than under the old system, whereby every trader had a small shop of his own. There is no doubt that they are bringing about more rapidly than could any socialistic propaganda the evolution of society towards organized industry.
– Then the honorable member prefers them to the old time business methods.
– No; I hold that such a state of affairs is inevitable. But after all, is it not idle to say that one prefers conditions that obtained some fifty or sixty years ago to those now ruling? We cannot get face to face with the exact circumstances of trade of half a century ago, but perhaps the conditions then prevailing were the most suitable for the time being. We have nowadays huge business organizations, and huge firms are being amalgamated at a very rapid rate. I have just read a most interesting book, The Trust Movement in British Industry, by H. W. Macrosty, which cannot be said to be antagonistic to or insupport of trusts. It is really a short history of the formation of the principal trusts in Great Britain. In his survey and conclusions the writer says -
Great as is the extent to which industry has passed into the hands of large combinations, greater still is the domain still subject to the individual trader.
In other words, the most that the writer can say of the movement is that the proportion of British trade not controlled by combinations is greater than is that under their direction. He goes on to say -
But the encroachment on the realm of free competition steadily progresses, though not at the feverish speed of six or seven years ago. We have to reckon with the probability, to use no stronger term, thoughone might, without exaggeration, saythe certainty, that we are in the early stages of the evolution of the form which industry will take in the future.
– Does he traverse the operations of the trusts already in existence with a view of showing what terrible octopi they are?
– No. He shows the extent to which they have grown, and what is the best and most permanent form to secure certain results. He takes an unbiased view of the trust movement, but I should say that he is if anything rather favorable to it. The control of trade by combines is rapidly approaching completion. I do not object to that. On the contrary, I hold that it is a natural evolution. The alternative to a Bill such as that now before us is to nationalize any industry in danger of becoming a monopoly. The Government have chosen to attempt to regulate trusts, and I understand that the Opposition support them in that effort, but object to some of the details of their scheme.
-Isnotthe honorable member supporting the Government in this effort?
– I am not going to oppose them. We can say to the Government, to the Opposition, and in short to all who proclaim themselves antiSocialists, “This is your Bill. Settle the matter amongst yourselves. We are not going to prevent you from passing it.”
– Is the honorable member going to vote against the motion for the second reading of the Bill?
– I could with the utmost consistency vote against it,but the honorable member could not. The only alternative open to him is to agree to the rationalization of monopolies. The regulation of trusts proposed in this Bill takes a form which is horrifying to the honorable member for Maranoa.
– I am satisfied that the Bill is no good.
– We all are. As the leader of the Opposition has pointed out, legislation of this kind appears to involve the subversion of all the best-known maxims of British jurisprudence. The principle that no man shall be considered guilty until his offence has been proved goes by the board, and others are to be violated in order that private enterprise may be allowed to continue for a little longer to attempt to crush out all competition.
– We admit that something is necessary, but we say-
– The honorable member is prepared later on to take this action when it is shown to be absolutely necessary. If the trusts be allowed to carry on their operations without restriction they will soon show that something must be done to cope with them. If we leave them alone, the trusts in Australia will develop on. the same lines as they have done in the United States of America.
– They are now merely hibernating.
– That is so. They are now setting out on their career in Australia, but they know that they are being closelywatched, and that there is a strong public feeling against them. That knowledge, to some extent, keeps them in check. They have not yet reached a stage at which they could exercise wide control. Combinations in England, in the first place, have taken the form of trade associations to regulate prices, and have passed on to various stages until they reach the point at which vast amalgamations have been thought necessary. We have an illustration of this in the Goates sewingthread combination, which practically governs the sewing-thread industry of the world. It began as a small combination of a few individual firms, but gradually absorbedor crushed all its rivals. If trusts are let alone,or encouraged by the law, they will rapidly develop as they have done in America. America is the great home-
– Of trusts.
– And of boodlers.
– It is not only the home of the boodler, but the paradise of those who believe in absolute freedom of trade.
– It is, in other words, the anti-Socialists’ paradise.
– No other nation believes so much in the restriction of trade as does the United States of America.
– It is also the home of the boodler and the corrupt politician.
– It is the home of prohibitive protection. The honorable member forgets that.
– Andof the trusts and combines that arise from prohibitive protection.
-I have just quoted from a book devoted entirely to trusts in Great Britain, where free-trade prevails.
– A book that does not contain one word as to their harmful character.
– The honorable member will find in the book much that is a very serious reflection on some of the business methods adopted by British combines. The writer does not pretend to deal with the ethics of trusts; but only with the extent to which they obtain control ofindustries and their effects up to the present.
– And the honorable member says that the trustification of industries is a good thing.
– I said that it is inevitable ; I did not say whether it is good or bad. The terms “good” or “bad” in connexion with an inevitable evolution of industry such as trusts, is idle. To say that trusts are “ good “ because it is necessary under the present conditions that businesses should become larger and larger and get into fewer hands, seems a misuse of the word - trusts are good and necessary in some respects; but they are bad in other respects. In so far as trustification leads to the cheapening of products, it is certainly good.
– A bad trust is a bad thing and a good trust is a good thing ?
– The honorable member is malting me repeat myself. I told him that nothing in the world is either all good or all bad - that no good trust is all good, or no bad trust all bad. The Standard Oil Trust has really done some useful work, as well as work which is certainly not for the benefit of the community. However, I regard this as a matter for the Government ; if they think that this kind of legislation is necessary in the endeavour to repress trusts, very well, we on this side will assist them, as I am sure the Opposition will - the Opposition dare not do anything else.
– Does the honorable member desire to repress trusts ?
– Does the honorable member desire to repress them ?
– The honorable member does not desire to do so, but desiresthat the State shall take them over.
– Certainly ; when trusts become monopolies I desire them to be taken over by the State. When trusts reach the stage at which they control industries, they should not be in the hands of. individuals; when they reach the stage at which they can exercise their powers against the interests of the community, it is time the community owned them. It is quite right and proper, and I hail with some pleasure the attempt of the Government to restrain trusts by this legislation. By all means let the attempt be made.
– So that it can fail !
– Does the honorable member not know that it will fail? The honorable member knows in his inner consciousness, as we all know, that the best we can hope for is that this legislation will stave off for a time the inevitable result that certain businesses, when they become monopolies, must be controlled by the community. I do not like to accuse an honorable member of want of sincerity, but I think any one might be suspected of want of candour, if he said he expected by this legislation, for all time to control trusts.
– Free competition is the best cure for that sort of thing.
– The result of free competition hasbeen–
– That there has not been free competition.
– Exactly ; the result has been that trusts have been formed with the sole object of annihilating competition. Even in the United States of America, where there is the greatest play in the world for competition the trusts have absolutely annihilated it. The natural evolution of unrestricted free competition is the formation of trusts which dominate entire industries, and ; put an end to competition.
– Does the honorable member seriously say that there is free competition in the United States of America with their high protective Tariff?
– In the United States of America we find the nearest approach to absolutely free competition. The honorable member seems to think that the Tariff has something to do with this question, and he drags the Tariff in under all kinds of circumstances.
– At any rate, the Tariff is associated with the question.
– Not in Great Britain. My intention is tovote, so far as the details of the Bill are concerned, with the Government ; and if the Opposition were in the place of the Government, I should do the same. In a measure such as this, I leave the Government to decide for themselves what they think is necessary, confident that all such measures will be found totally inadequate to prevent the formation of trusts, which will constantly call for more legislation, and ultimately lead to their absorption by the public for the benefit of the public.
– I have listened very carefully to the various expressions of opinion of honorable members in the Labour corner on the question of the repression or otherwise of trusts. The Labour leader began the other day by chiding us over here for the different attitude we take on this occasion from that we assumed in regard to the principal measure when it was before the Chamber. He said he. was glad to see we were taking a more favorable view of this legislation now than we did on the previous occasion. Immediately afterwards he was followed by his predecessor in office who told us plainly that, while he proposed to support the Government, he did not believe the measure would do any good - that it was only a stage in the failures that must take place before the final necessity was seen by the community of taking over these huge monopolies. That is a consistent attitude on his part - it isthe attitude he has always assumed. I well remember that in his speech on the principal measure he frankly admitted that he had no faith whatever in this kind of regulative legislation as applied to trusts. Why, therefore, should we be chided by the present leader of the Labour Party with regard to any want of sympathy with the proposal ? I said then, and I say to-day, that honorable members who welcome this legislation, and assist the Government to pass it, are simply making hypocritical pretence. They are passing legislation which they say beforehand they are confident can be of no practical value.
– I say that it is the nearest step I can get to my desire.
– Then the nearest step to the honorable member’s desire is to solemnly and deliberately enact a failure?
– Hear, hear.
– That is frank. Why does not the leader of the party say the same? However, we must go to the rank and file in order to ascertain the party’s true attitude. We are told that the community must pass through a series of failures in order that the evolution of the trustification of industries may in time lead to the absolute necessity of the taking over of industries by the State.
– If the honorable member says he can successfully regulate trusts, we shall give him every assistance.
– So the honorable member says; but, at the same time, he has the reservation in his mind-nay, he has expressed a belief - that all this legislation must end in failure; no one has made that clearer than has the honorable member for South Sydney. It is useless, in a debate of this kind, to make use of the general terms which are being constantly indulged in by members of the Labour Party. For instance, the leader of that party, in an attitude of complacency, and with all the force of axiomatic truth, said that what he wants is economic justice to every man. I do not know one who would controvert that proposition. We, on this side are just as eager to give economic justice to every individual as is the honorable member. Then the honorable member for Boothby told us to-day that what he desires is the minimum of collective control consistent with the public interest. That is a very definite statement indeed. But what on earth does it mean ? We could all say the same ; and I ask whether honorable members do not see that those idle generalities do not help in the discussion of this serious question ? If I require light, I must leave those honorable members and their generalities, and discuss the concrete proposals of the Government. The honorable member for Boothby., to embellish his speech, must needs quote from a writer who declares that there is a great number of trusts in Great Britain. When challenged by me to say what the opinion of the writer is regarding the character of the trusts - whether harmful or helpful to the community - the honorable member could not quote a single line.
– I told the honorable member that the book was written with the object of not inquiring into that question.
– Quite so; but where then, is the relevancy of the quotations to a Bill of this kind. Everyone knows that there is a great deal of trustification going On all over the world ; and we admit, as the honorable member admits, that this is an evolution of our modern industrial life, and that the process seems to be proceeding apace. But what I venture to say is, that it is too early to be confident as to what the ultimate effect of this trustification is to be. Honorable members say, “ Here are trusts, therefore they are art evil, and will kill the community if we do not kill them.” That was the expression of the Prime Minister the other night ; and, I say it is a little too early to begin to talk so definitely as to the ultimate effects.
Mr.McDonald. - The expression is that of the President of the United States of America.
– I do not know that he is the final economic authority in the world. May I remind the honorable member that the President of the United States of America said that under no circumstances must we do anything that will hurt a trust, so long as it is engaged legitimately in co-operative enterprise.
– I think that is something like what the honorable member for Boothby said a few minutes ago, and what the honorable member is now attacking him for.
– Where is the use of selecting statements from this or that person and making them appear to bear some relation to the concrete proposals of the Government?
– The honorable member for Boothby was showing how trusts are growing, and he quoted a book, the object of which is to show that they are a natural evolution.
– Quite so; and I say it is idle and irrelevant to quote general statements and make general remarks in relation to concrete proposals by the Government. The honorable member assumed, or tried to lead the House to assume, that enormous trustification is proceeding, and that, therefore, it must necessarily be harmful.
– In a great number of cases it is.
– Anybody who compares the trusts of Great Britain with those of America is merely trifling with the intelligence of honorable members.
– Nonsense. The difference is merely one of degree.
– In regard to these trusts, is not that difference everything? The honorable member admits, as did the honorable member for Boothby. that the co-operative control of industrial enterprise is not necessarily an evil. It is an evolution of our modern industrial life. What makes the operation of these trusts so harmful?
– The exorbitant profits which they exact from the public.
– What is the mainspring ?
– Human greed, human avarice - in a word, human nature. Shall we alter human nature if we place these monopolies under Government control? All the evils associated with many trusts are entirely due to the weaknesses of human nature.
– That is why some men are sent to gaol.
– Human nature would continue to operate in exactly the same way if the Government controlled these industrial enterprises.
– It does not operate the railways in that way.
– All I have to say is that if members of the Labour Party merely hope to bring about the same industrial conditions under Socialism as we now have operating in the case of the railways and other Government enterprises in Australia, they will not get the majority of the employes in those services to agree with them. The latter believe that something more, and very much more, is to come to them in the way of advantage. Honorable members opposite will not get the employes upon our railways to say that they are contented with their lot.
– They all say that they are better off than they would be if the lines were conducted by private enterprise.
– I doubt if they are so satisfied as the honorable member would make it appear. I wish to make my position in regard to this matter very clear. With my honorable friends opposite, I recognise that trusts are growing apace throughout the whole industrial world. But in my judgment - and I endeavour to keep my mind open to all the facts of the case - we are now beginning to see what are their natural limitations. We are beginning to perceive that the difference between those trusts which are most harmful and those which are least harmful springs from the nature of the case itself. We are beginning to recognise that we cannot make the operation of trusts harmful in their character to the general community in connexion with products in which there is world-wide production and competition. We may set that down as an economic law. Trusts become an evil only where competition is stifled.
– To stifle competition is the object of trusts.
– I am pointing out that it is impossible for trusts to stifle competition in those products which are in general use throughout the world, and as to which there is a degree of competition.
– There could not be a beef trust for instance?
– What is happening in America? What is making the operations of trusts so harmful there ? The very thing that protectionists will never admit. It is the prohibitive Tariff of the United States which is making the operation of these trusts so great an evil. The Attorney-General talks about the Beef Trust. Let him reflect upon the duty that is imposed upon preserved beef in the United States, and he will then see why that trust has exercised so baneful an influence. In the first place, the Legislature has decreed that there shall be no external competition in the matter of beef. Having shut out the competition of the world, the Beef Trust set about working harmful results to the people inside the ring.
– I have heard the honorable member say dozens of times that a duty does not operate so soon as a country begins to export.
-What has that to do with my argument?
– America exports beef.
– And the Beef Trust is operating in London.
– It operates anywhere that it can get a chance. If a little healthy competition were turned upon these trusts we should soon see the result. I am not now arguing the question of free-trade versus protection. I am merely debating whether it is right to impose prohibitive duties upon those products, the control of which may lead to the establishment of monopolies. Wherever we can preserve the element of competition by regulating our Tariff we shall have trusts whose operations are less harmful in their character than would otherwise be the case. In proof of this statement we have only to compare the trusts of Great Britain with those which exist ; in America. It is idle to. single out individual cases. The fact remains that it is impossible to institute a parallel between the trusts of Great Britain as a whole and the trusts of America, either from the stand-point of their harmful character or of the magnitude of their operations.
– The English newspapers say that there is a comparison.
– Does that settle the matter?Let us take the figures relating to the capitalization of these trusts, and compare them.We shall then beable to draw our own inferences, apart altogether from what newspapers may say. I am not here to defend the trusts of Great Britain any more than I am those of America, where they are exceeding their proper function, which is to supply the people with goods at a fair price, whilst paying those engaged in their manufacture fair wages. So long as trusts work no harm to the community, what cause of complaint have we against them? Economic production ought to be encouraged all over the world. So long as trusts do not attempt to unfairly manipulate prices or to drag down the wages of their employés, nothing can be urged against them.
– Would the honorable member allow a company to come here and ruin business men by selling goods at less than their cost price?
– What has that question to do with what I have been saying? I have just declared that I am opposed to harmful trusts and now the honorable member asks me - I do not use the term in an offensive sense - the foolish question of whether I would allow a harmful trust to operate. He assumes - and this is at the bottom of all he says - that all these trusts are necessarily harmful in their operation, and must continue to be harmful until the community in self protection says, “ Takeover this industry and relieve us from the incubus from which we are at present suffering.”
– Will the honorable member name one trust whose operations are not harmful ?
– In discussing this question last year, I quoted figures to show that out of 300 odd trusts in America, only about twenty-three were paying dividends in any shape or form.
– Thatproves nothing.
– It proves that there is a natural limitation to the successful control of industry by trusts. It demonstrates that the moment a trust begins to operate, it begins to fight natural laws.
So long as healthy competition is preserved in respect of those products in which a trust deals, its operations can. never become harmful. What have trusts endeavoured to do in regard to copper from time immemorial? They cannot succeed in securing a monopoly in that metal, try as they may. Neither can they secure a monopoly in respect of products for which there is a world-wide demand and in which there is world-wide competition.
– That is a mere gamble.
– The honorable member is one of those who would build up trusts by freeing them from the natural competition which would otherwisebring prices down to a normal level, and compel these organizations to adopt a reasonable attitude towards the community.
– How does the honorable member’s statement affect the Tobacco Trust ?
– Only the other day I was talking to a gentleman upon this matter, a member of this House, and he assured me that to-day he is purchasing a better tobacco than he was able to obtain previously, and that he was not paying more for it. Is that result a harmful one ? I know nothing whatever about the Tobacco Trust, but that is the statement which was made to me.
– How would the honorable member deal with such a monopoly if its operations were of a harmful character ?
– I would seek to prevent its operations from being harmful.
– Yet the honorable member complains of indefiniteness.
– Because I am not able to give offhand the details of an elaborate legislative scheme, am I to be charged with indefiniteness? Surely that is not fair ?
– The honorable member has threatened that if the operations of trusts in the Commonwealth become harmful to the community, he will be after them.
– Unquestionably. That has been our attitude all through. This brings me to an interrogationwhich I should like to put to the Minister in charge of the Bill. What is the case for the Bill? We have not had it stated. We have been told that the Solici tor-General says that the Bill is necessary. Why? The Act has been on the statutebook for nearly two years. The Government declared that there were in existence in Australia and elsewhere trusts, malign in character and operation, to destroy which legislation was needed. But, after two years, nothing has been done, and we are told that further poweris wanted. The Government, so far as we know, has not taken a trust before the Court.
– I explained that five or six cases had been investigated, but that the parties concerned refused to allow us to see their agreements, without which it would be impossible to prosecute.
– Will not these agreements still be refused? In his secondreading speech the honorable gentleman stated that precedents are to be found in the later AmericanActs for some of the powers asked for in the Bill. Is it proposed to follow American legislation? Is legislation similar to this operating in the United States?
– Yes. The present AttorneyGeneral of the United States has prosecuted successfully some of their biggest combines.
– The honorable gentleman also said that the United States Government is rigorously and successfully enforcing these laws.
– It has recovered some very heavy penalties within the last twelve months.
– Is that statement conclusive? We want, not to recover penalties, but to remove trusts of a harmful character.
– In the United States of America the Government is exercising other remedies. It is obtaining injunctions to restrain.
– I gather that the trust legislation of America is succeeding.
– It has been made more effective than it was.
– What trusts has it broken up?
– That is a pertinent question. We should take care not to repeat the constant failures of America. I admit that our conditions are not similar to those of the United States. It is useless for honorable members to try to make it appear that our trusts are as harmful as those of America. They are not, and never will be, unless we put in their hands that great weapon for the destruction of healthy competition, a prohibitive Tariff.
– And land monopoly.
– I wasvery much amused by the statement of the honorable member for Boothby, that America is the home of the boodler and the trust fiend, but the one country in the world which has unrestricted trade.
– Unrestricted competition.
– Is it not absurd, in view of the American Tariff, to say that there exists there unrestricted and uncontrolled competition. It is the country where there is least competition.
– There is unrestricted competition amongst its citizens.
– In dealing with world-wide problems, one must proceed on world-wide data. To cite the case of America is therefore to bring forward an irrelevant illustration, which does not help the elucidation of this matter. The countries to which we should pay regard are those where there is healthy and legitimate competition, and where, consequently, trusts are not nearly so harmful as they are in America. If there were a little more competition in America, the trusts there would be infinitely less harmful.
– The honorable mem ber is dodging the issue by dragging in free- trade.
– No ; and I do not wish to do so. There is a difference between dragging in free-trade and so regulating the Tariff as to preserve the element of competition between one country and another. The honorable member himself does not wish to surround Australia with a Tariff wall as high as that of America. During the Tariff debates, he told us that he did not desire prohibition for Australia.
– But he voted for it pretty often.
– Yes; though sometimes he voted with us for lower duties, showing that he possesses a glimmer of reason in connexion with these industrial and fiscal matters. I do not quite understand one of the definitions which the Attorney-General has seen fit to put into the Bill. The Bill says that to “ answer questions” means that the person on whom the obligation of answering is cast shall. to the best of his knowledge, answer all questions on the subject mentioned that the
Comptroller-General or the person named by him shall ask. I suppose it is sought to compel the person on whom the obligation of answering is cast to answer all questions.
– Upon the subject mentioned.
– On any subject mentioned by the Comptroller-General. Surely he should be compelled to answer only questions relating to the inquiry?
– The words must be read in connexion with proposed new section 15b.
– The definition says that the person interrogated must answer all questions.
– It follows the precedent of the Customs Act.
– Are the cases the same?
– The principle underlying the procedure is the same.
– In an examination under the Customs Act, what is desired is to find out whether persons are committing fraud, and whether duty is obtainable upon certain goods, a very small matter compared with the hauling of men to Court, to be imprisoned or heavily fined, perhaps, for the commission of some act detrimental to the community. So far as I know, there is no harm in making a man answer all questions relating to goods unlawfully in his possession by reason of the fact that duty has not been paid on them. The indictable offence created by the principal Act is a different matter. Therefore, the greatest care should be exercised in making provisions taken from the Customs Act apply to the control of trusts. I should also like to know what person is likely to be appointed to act for the ComptrollerGeneral ? Is an ordinary Customs official to be sent to a firm engaged in a large way of business to say, “ Show me your books, and let me take extracts from them, with a view to using them against you later on”? Sucha power should be jealously guarded and surrounded with every possible safeguard. The person charged is to tell the Customs official everything about his business and its ramifications, and to answer every question which the Comptroller-General or the person named by him may ask, and the averment in the information against him is to be deemed to be proved in the absence of proof to the contrary. Throughout the principal Act, “ intent “ is dealt with, the
Act being made to apply to those who intentionally deceive the Minister, and intentionally try to work their malign influence upon the community. But intent is specially exempted under the Bill. It is provided that the Bill shall not apply to what is the substance and essence of the principal Act. To what then does it apply? What is meant by the statement in the proposed new section 15A that the averments of the prosecutor contained in the information in any prosecution for an offence against sections 4, 5, 7, 8, or 9 of the Act shall be deemed to be proved in the absence of proof to the contrary?
– Intent must be proved in every case.
– Then it seems to me that the substance of the principal Act is exempted. What is left?
– The fact that an agreement has been entered into.
– Does the AttorneyGeneral say that while the averment in the information is not at this stage to be deemed evidence against a trust in the matter of intent, it will at a later stage be so deemed?
– No. Evidence of intent must be given in every case. The Crown must prove intent.
– I do not know how it will do so. The Court must determine whether there was intent. But intent being the sum and substance of the principal Act, and being excluded under the Bill, what is meant by the statement that the averments of the prosecutor shall be deemed to be proved in the absence of proof to the contrary ? The utmost that we should agree to is that, if a person who is charged does not furnish -proof to the contrary, the statement of the prosecutor shall be deemed to be evidence in the case. Why does the Government fear to let the Court decide upon the evidence?
– The Court would have to decide upon the facts.
– Then does this provision mean anything at all. In a prosecution for an indictable offence the guilt of the defendant must be established by evidence, I presume on the part of the prosecutor. If so, what is there left as to which this precious clause can apply ? There is the further provision, relating to the production of the books of trusts, the taking of copies, and the investigation of their affairs generally in a compulsory way.. And for what purpose? For the purpose, as the leader of the Opposition so clearly pointed out, of building up a case against them. In British communities that is an unusual, procedure in connexion with such trials. I do not say at present it is un- ‘ necessary. I do not take that attitude; but we have a right to ask the Minister why this new departure is proposed? He ought to give us the facts on which is based the demand of the Government for this extraordinary power. Before any such power is exercised by a mere officer there ought to be the direction of a Judge that it shall be exercised. If it is necessary to make the proposed preliminary investigation let it be done on the order of a Judge. Let us surround the whole processes of interrogation and inquiry by a judicial atmosphere rather than let loose a Customs officer to conduct what, after all, is a judicial inquiry to secure evidence upon which to build up a case.
– And the judicial atmosphere on the part of the Department is what importers object to in connexion with the administration of the Customs Act.
– When the Department begins to inquire into the business of trading concerns, with the expressed in- .tention of building up a case against them, it should have the authority of a Judge for its action, and the interrogation should be surrounded with such limitations and directions as the Judge thinks fit. That step ought at least to be taken in proceedings that are of vital concern to the people interested, and are so closely connected with the industrial life of the community.
– The security of which the honorable member speaks is required even in civil actions. A Judge must be satisfied that there is a case for interrogation.
– It seems to be the very essence of fairness that there should be such a security. If this procedure is to be adopted let us divest it of every suggestion of political significance and surround it with a judicial atmosphere.
– The honorable member should have supported the action taken this afternoon by the honorable member for Hindmarsh, who urged that all Customs cases should be tried in the proper way.
– I did not hear the honorable member for Hindmarsh. My point is that if it i? necessary to take these extra powers - and I use the word “ extra “ in relation to these matters as distinct from the ordinary processes of investigation in connexion with criminal offences - the officer who exercises them should have the authorization of an order of the Court. I shall be glad to hear the Attorney-General upon these matters. He should tell us plainly what are the defects of the principal Act and why it has been found impossible to proceed under it against huge trusts, which the Government allege are harmful, the operations of five or six of which they say have already been investigated, and as to which they wish to take action, but are’ unable to do so by reason of the inadequacy of the principal .measure. The Minister says that he wants further power; let him make out his case for it.
– - 1 had intended to address myself more fully to this question than I now propose to do. I wish only to indorse the view expressed by the deputy leader of the Opposition, that fuller information should be placed before us as to the necessity or desirableness of giving to a Customs officer the power which this Bill proposes in respect of preliminary investigations. I feel that, as in cases under the Customs Act-
– But this Bill does not relate to mere Customs cases.
– The Bill is administered by the Department, and if there is one thing more than another which is. likely to embarrass the State, it is the continuance of the present system of dealing with matters in dispute between the Department of Trade and Customs and the public. I do not desire that procedure to be continued under this anti-trust legislation. In making preliminary investigations of the character outlined in the Bill, the officers of the Department should have behind them the authority of the law. We ought not to allow an individual officer in the Department to ask for information which in ordinary circumstances - -and I quite agree with the honorable member for Parramatta that we are endeavouring now to deal with extraordinary conditions - no one would ever think of giving; but, as the honorable member for Boothby has said, we are dealing with an evolution in trade, and must be prepared to go further than we have in the past. The honorable member for Parramatta has not shown that he is one of those who are bound to the systems of the historic past. He is prepared to take a step forward, and to sanction acts which in days gone, by might have been considered unreasonable - he is pre pared to agree to such action being taken in order to deal with what Ave regard as an extraordinary state of affairs. I agree with him, however, that the power of preliminary investigation, for which provision is made in the Bill, is altogether too great to be placed in the hands of . an official. The Comptroller-General for the time being might be a very able man, fully competent to deal with matters in dispute in a way that all would heartily commend ; but we must not forget that he has’ power to delegate his authority. We might in certain circumstances have an officer without tact or judgment taking proceedings calculated to plunge the State into a very serious action.
– We are legislating in respect of future ComptrollersGeneral, as well as for the present occupant of that office.
– Certainly Ave are. I trust that the Attorney-General will give us a fuller statement than he has done of his reasons for asking that this extraordinary power shall be placed in the hands of an officer. At the same time, I recognise that there is great difficulty in obtaining sufficient evidence to enable proceedings to be. taken against a trust. Some agreements are not committed to paper ; they depend merely upon the honesty of the parties to them.
– What is called an “ understanding “ is sometimes arrived at.
– Quite so. I know of one or two that are at present in operation, and are loyally observed by the parties to them, although no agreement has actually been committed to paper. In these circumstances, it is impossible to secure a conviction, and if Ave are to deal with trusts further power is necessary. I frankly admit that’ at present trusts in Australia have not assumed such proportions as to cause the community to feel that they are burdensome ; but history teaches us that it will be only a matter of time before they extend their powers and show us what they are capable of doing. We are now endeavouring to control, not to obliterate, them. Our sole desire is to secure that the community will not be injured by their operations. We can do that only by dealing with them in their infancy. If a’e refrained from taking action until thev had assumed the proportions of some of the trusts in the United States of America, we should find ourselves almost as powerless as are the authorities there. For these rea- sons I feel sure that honorable members on all sides of the House, no matter what their views may be as to what should be the ultimate aim of legislation of this character, will unite in placing on the statute-book an effective measure. We must . admit that the principal Act is not effective. The Minister has told us that it is not. As one who has had a little experience in Victoria, -I ‘ can assure honorable members that a Minister of the down could occupy no more humiliating position than that in which he finds himself called upon to administer a law which really confers no power upon- him. What could be more humiliating”” to a Minister than that he should be compelled to compound felonies, as was done in Victoria - and is still done, in my opinion, by the Department of Trade and Customs of the Commonwealth - simply because of the ineffectiveness of the law at his command ? There is no more humiliating position for a Minister or for a people who find themselves unable to check an abuse, or to control the growth of -trusts and combines, and direct into proper channels the development of industry. I hope that the House will speedily agree to the motion for the second reading of the Bill, and that, when we go into Committee, the Attorney-General will either give, us a sufficient reason for his request that enormous powers should be placed in the hands of an individual, or that he will- amend the Bill in the direction indicated by the deputy-leader of the Opposition.
.- If it is expedient to pass a measure of this kind, it is certainly desirable that it should be made effective in its application. The AttorneyGeneral has told us that under the principal Act it has been found impossible to obtain the information necessary to enable action to be taken against trusts. Whilst concurring in the . necessity of giving the Government the requisite powers, I feel that the Attorney-General has not taken the House into his confidence, and with sufficient frankness informed it of the special difficulties that have been met with, and which have rendered it necessary to introduce this amending Bill. I hope that at a later stage he will explain why these larger powers are sought, and that the House will agree with the general principle that the original measure shall be made effective. Whilst I am sura that the Government will, experience no difficul tv in securing the second reading of the Bill, I feel that a more un-British proposition! than is contained in one or two of itsclauses has never been embodied in any measure. As has been so well and ably presented by previous speakers, this Bill proposes to ask persons, who may be absolutely guiltless, to proffer information, which may incriminate them ; and even if those who are suspected be guilty, I hold that such a procedure is contrary to British law. In Committee, however, it may bepossible, by amendment, to give the Minister the powers which he deems to be necessary to enable him to obtain the necessary information ; and to that end I shall assist, provided the proposals are on fair and legitimate lines. I entirely concur with the view, that we are placing too great a power in the hands of the Comptroller-General. At the present time the Commonwealth is fortunate in the Comptroller-General, whose honour and integrity are above suspicion ; but it is possible that, in the future, we may not always be successful in securing the services of so discreet and discriminating an officer. I agree in the view that evidence should, from the commencement of the proceedings, be secured under the authority of a Judge, whose position guarantees his absolute impartiality. The two points I have mentioned constitute, in my opinion, the chief objections to the measure A Comptroller-General, however capable he may be in the discharge of his important duties, must necessarily have a bias in favour of the Department in any action which he has to initiate on what he believes to be justifiable .information. I am not prepared to vote against the second reading, but I hope that in Committee, while securing the fullest powers to obtain information, the Government will see the desir-ability of modifying their views, so as fo, make the measure more equitable and just;: and to that end I hope amendments will besubmitted, which will commend themselves,, not only to this House, but to the public generally. There is not a single honorable member, I am sure, who approves of combinations and trusts which operate against the public interest, or to the detriment of trade and commerce, or who believes that they should be allowed to carry on illegitimate operations without intervention.
– There are two or three combinations which are operating in that way now.
– Then if that can be shown to a Judge, I unhesitatingly say that such combinations ought to be brought within the law ; and it is because I am of that opinion that I shall assist in giving the Government the necessary power. I shall not, however, cast my vote in favour of the extraordinary proposals to which I have referred.
– According to the law officers these proposals represent the only, effective means of dealing with the matter.
– Then the law officers have supplied the House with only incompleteinformation, though when we come to deal with details in Committee, they may be able to justify their position j and if they show by specific cases that” those clauses are necessary, my feeling will be to support the Government. At present, however, I hold that those extraordinary powers are not necessary, and that all the information should be obtained judicially in the proper way. I regard this as not a party question, but a national question ; and honorable members on all sides of the House should join in an effort to produce an equitable measure so as to prevent in Australia the conditions which have arisen in the United States, and which have recently been brought so prominently under the world’s notice. If trusts have to be dealt with, it is better that it should be .in their early stages, before they grow so powerful as to make the task impossible or difficult. I have ventured to say these few words as an indication of my position in regard to the Bill.
.- I do not intend to detain the House more than a. few minutes, in view of the fact that I spoke very fully when the original proposal was before us, and gave my views on trusts and the means necessary to restrain them. On that occasion I took exception to some of the measures proposed, on the score of their ineffectiveness and unfairness. I agree with the honorable member for Parramatta that the Government, having adopted a policy which gives the opportunity to create trusts, are now engaged in trying to scotch or kill that which they have created.
– The shipping ring is not created by the Tariff.
– I admit that there are trusts not created bv the Tariff, but the honorable member will admit that when there is a strong protective fence, trusts can be created much more readily. There are trusts which can be formed under the freest conditions of trade, especially in industries- where large capital, and extensive means of transit, such as steamers and railways, are required. Indeed, such trusts as these can be created under free-trade or protection ; but there are other trusts which can exist only with protection from outside competition.
– That is so.; but if we can break the one we can break the other.
– There is greater difficulty in breaking one kind of trust than there is in breaking the other kind, as I think I shall show when I come to deal with some of the proposals in the Bill. When the original measure was before us, I expressed, as I do now, a strong desire that malignant, hurtful trusts should be dealt with effectively. This afternoon, the honorable member for Werriwa asked whether there are any harmless trusts. To that, I answer that there are ; and. while I need not detain honorable members by giving many instances, I venture to say that the Coal Vend at Newcastle, properly conducted, is a harmless trust.
– But is the Vend properly conducted?
– I am not dealing with that question, but with the argument supplied by the particular case. So long as a combination does not develop into a tax-imposing power over the community - so long as it does not take the place of the Government, and draw from the people, not -merely ordinary profits, but really taxes - and’ so long as it operates to the advantage of those in the industry, and of the public, then I say such a combination may be, and is, beneficent. I quite admit, of course, that such a trust may cease to be ‘beneficent and become ma.lignant, if, not satisfied with the original object of raising the wages of those employed in the industry, and of saving it from cut-throat competition, while, at the same time, supplying the public at a fair price, they proceed to constitute themselves tax-gatherers and reap a return out of all proportion to the services rendered. To the extent that the original measure and this amending Bill can prevent such a state of affairs arising, I am heartily with such legislation. When the original measure was before us, I not only tried to modify what I considered to be some of its unfair provisions, but I pointed out that it would be ineffective for its purpose. The then AttorneyGeneral did not agree with me on the latter point, considering as he did that the measure would prove sufficiently opera- tive, but, now, the present Government, by asking for an extension of powers, prove that my criticism was justified.
– The Act has been practically a dead letter.
– That is so; and I desire to point out how little can be accomplished even under the amending Bill. This is not wholly due to the legislation, though inpart it is. The ineffectiveness of the measure is in some degree due to the Constitution, which makes it possible for trusts to evade both the original Act and the Bill. The Commonwealth cannot proceed against a trust operating in one State only, unless it is a corporation, and, even in the latter case, I am doubtful whether the Commonwealth could succeed.
– There is fair argument in favour of the presumption that the Commonwealth could succeed.
– I am very doubtful, having in view the powers under the Constitution to deal with corporations.
– There is at least a very great doubt.
– I may be wrong, but I think so. A trust has only to split itself into firms or individuals operating in the States separately, and apparently quite distinct from one another, in order to avoid the provisions of both the original measure and this Bill. I admit that that is not. the fault of the Government, but is due to the circumstances of the Constitution ; and unless the States choose to co-operate with the Commonwealth I venture to say we shall secure very little effective result. It must not be thought that those powerful organizations, who have proved themselves elsewhere to be able to evade what appeared to be the most drastic legislation, from which even lawyers considered there was no escape, will allow themselves to be overcome when there is such a simple means of effecting their purpose. Therefore, however drastic we may make this Bill, so long as our powers under the Constitution are limited, I doubt if we shall achieve much in the way of the effective suppression of trusts. In some of the provisions of this Bill - if they do not go further than they ought - the wrong means of reaching the end in view has been adopted. If the Attorney -General had stated more fully the reasons why the Government require to be vested with these powers, possibly we might have formed a somewhat different opinion. But I do not think that he has put into operation even the powers that he can exercise under the principalAct. Perhaps he will be good enough to say whether he has not received complaints that rebates have been granted by a certain trust.
– I understand that the system has since been abandoned.
– Is that the reason why action was not taken against the trust in question?
– Then what additional power to deal with such cases will the Attorney-General obtain under this Bill ? The evidence that rebates were being granted was easily obtainable.
– It was easily obtainable before the principal Act was passed.
– One big trust was advised by counsel that the provision relating to the payment of rebates in the principal Act is of no effect.
– If that be so, I am afraid that a good deal of the rest of the Act can have no effect, for in no place is its language more precise. Paragraph d of section 6 reads -
Unfair competition means competition which is unfair in the circumstances, and in the following cases the competition shall be deemed to be unfair unless the contrary is proved : -
If the defendant, with respect to any goods or services which are the subject of the competition, gives, offers, or promises to any person any rebate, refund, discount, or reward, upon condition that that person deals, or in consideration of that person having dealt, with the defendant, to the ex- clusion of other persons dealing in similar goods or services.
That section seems to be much clearer than are some other portions of the Act. Yet the Attorney-General says that he had not the power necessary to obtain a conviction. If he could not succeed under that provi- sion, how can he expect to succeed under the much more vague provisions of the Statute? The principal Act seeks to accomplish too much and yet does not sufficiently deal with the worst evils associated with trusts. For instance, it deals with the offence of prices being unduly raised to the detriment of the public, and then reverses the process and creates an offence of goods being sold too low or at a loss, presumably because the effect of such action might be to interfere with some Australian industry. How are we going to steer between these two opposites? A penalty is imposed for the offence of unduly raising prices and also for that of selling goods at less than their cost price.
– Persons are sometimes compelled to sell their goods at less than cost price.
– Of course. If a squatter had to meet bills which were falling due he might have to sell his sheep at perhaps half the price at which he had purchased them.
– Does the honorable member say that the two cases are analogous?
– Under section 8 of the principal Act, two things have to be proved - first, intent, and then association.
– I know that that is one of the great difficulties experienced in this connexion.
– Does the honorable member contend that the Bill does not go far enough in some directions, and that it goes too far in others?
– I contend that it has been complicated by the introduction of the fiscal element. The principal Act should have dealt with the operation of trusts in the Commonwealth, whether they were operated by external or internal organizations. The fiscal element to which I have alluded, which seeks to restrain what might be legitimate competition should have been eliminated. Its introduction hasrendered the measure more difficult to operate. Clause 4 of this Bill declares that in any prosecution for an offence against the Act, the declaration of the prosecutor shall be deemed to beproved in the absence of proof to the contrary. To my mind, the less we use such a provision, the better. If sufficient evidence is not forthcoming to show that a trust is operating injuriously to the interests of the public, I do not know that it is wise for the. Government to interfere, and I do not believe that they will be able to successfully interfere, under the provisions of the principal Act, with the amendments now proposed. A somewhat similar provision was inserted in the principal Act. This Bill extends that power, and unless its exercise can be safeguarded by some means which will entirely remove it from political influence, I shall be very loth to support it. If such a power is to be exercised, it should be strictly guarded. We should not allow political influence a chance to operate.
The powers of the Comptroller-General, both under the principal Act and under this Bill, are extreme. Under this Bill, he will be permitted to establish a star chamber, to hale persons before him to ask them any questions that he. chooses. These they are compelled to answer under a penalty of £50.
– The remedy is proportioned to the disease.
– If such a power be necessary, the ComptrollerGeneral ought not to exercise it. The answers given to questions put by him are subsequently to be used against the party charged with an offence. I should like to know whether the Minister has provided any means for the taking down of that evidence with a view to proving that the testimony subsequently given by the ComptrollerGeneral is strictly accurate.
– The procedure followed is exactly the same as that adopted under the Customs Act.
– But the provision in this Bill goes much further than does that in the Customs Act. It covers the whole area of commerce in other relations than that of the payment of Customs duties. Under the Customs Act, the one thing which the Comptroller-General is required to do, is to ascertain that he receives the proper amount of duty. But under this Bill, he may be moved to action by a rival of the party charged with an offence, or by one of thelatter’s discharged employés. Thereupon the alleged offender would be haled before him, subjected ‘to a searching cross-examination, and when he had extracted from him all the information that he desired, he would use that information against him in evidence.
– The proposed sub-section 1 5 a, relates to the use of evidence against a trust.
– But the intention is that a person may be brought before the Comptroller-General. It would be the. same thing in the case of the representative of a trust, except that the proceedings might then, be brought either against him or against the trust. The provision is open to most improper use. I agree that we might obtain the services of an autocrat who could exercise the multifarious powers of the Comptroller-General. - which are getting more arbitrary every day - better than a Parliament or a Court ; but the objection to autocracy is that, while, at one time, . you may have a suitable man at the head of affairs, at another time you may have there an entirely different and unsuitable man. There is too much tendency in our legislation to recognise that we have at the head of the Customs Department a very honest and able man - which I admit - anto act as if he, or some one exactly like him, would always fill that office. As a matter of fact, we know that there will be a succession of Ministers and of Comptrollers-General, some of whom will be scrupulous and some less so ; some biased by political opinions, and others not biased. We must provide for this, and not frame our legislation on certain lines simply because we now have at the head of the Customs Department an excellent official in whom we have the utmost personal confidence. The authority whom we should set up should be one more important and more judicial than most Customs officials are likely to be. That authority, should have the power to say whether certain persons should; be questioned, and, if questioned, what questions should be put to them. There were one or two . other matters to which I intended to allude; but I shall defer my remarks in regard to them until the Committee stage is reached. I take objection now, as I have done before, to the readiness with which it is proposed to delegate to others powers which should be exercised only on the responsibility of the Minister, and especially the tendency to make an autocrat of the ComptrollerGeneral. Administrative work is being unnecessarily piled on the Customs Department by the passing of Act after Act, so that its head, even if he possessed the ability to deal judicially with the cases coming before him, must have so short a time to devote to the consideration of fine points of distinction, and to questions of right and wrong, that, in my opinion, powers such as are given in this Bill to the Comptroller-General should be given to some other authority’, and other powers should be exercised only by the Minister responsible to Parliament.
Sitting suspended from 6.29 to 7.45 p.m.
.- Those who were members of the House when the principal Act was introduced will remember the attitude of the members of the Labour Party in regard to it, and their criticism upon it. They said that it, or any measure like it, could not, from its nature, succeed in eradicating the evils associated with trusts. Now, after a lapse of two years, we. find that not one case has been brought under the Act, and the Ministry is asking for additional powers. The attitude of the Labour Party towards the principal Act is its attitude towards the . Bill. It supported the principal Act, not because it thought that it would be effective, but to show those who insisted upon trying to maintain competition when competition was growing impossible, and upon upholding private enterprise when public ownership should take its place, that their efforts to meet the situation were futile. Its members said in effect, as they say now, “ We are prepared to vote for the measure, and to go as far as the Ministry asks us, in granting powers for the regulation of combines and trusts, not because we think that they can be effectively used, but to show that they are bound to fail.”
– The party wants to educate us.
– We want, perhaps, to have the satisfaction, a few years hence, of saying in regard to the Bill as we can say now in regard to the Act, “ We told you so.”
– Honorable members will not try freedom as a change from restriction.
– When the honorable member brings forward his proposals for overthrowing the trusts, by giving them more freedom than they have had in America-
– I speak of freedom of competition.
– We may all believe in competition ; but no student’ of the trend of industry can believe that it will be competent for legislators to maintain competition in the near future.
– We say that it will maintain itself in spite of all efforts to prevent it.
– On that point we differ. Honorable members shut their eyes to the state of affairs now existing in England and in America. While the Oil Trust robs the world, they’ say that competition will maintain itself. They see the rise here of the Brick Combine, the Coal Combine, the Coastal Shipping Combine, and yet they tell us that competition will maintain itself.
– My recollection is that the coal combines of Australia have been brought about by the miners compelling the coal-owners to combine to control prices.
– I do not condemn combinations per se, though it is strange, since the honorable member told us two minutes ago that competition would continue in spite of all efforts to prevent it, that he now says that the miners are forcing the mine-owners to combine. We have been told by the Opposition that the measure introduces methods unknown to . British law. The honorable member for North’ Sydney said - I think correctly - that it will establish a tribunal like the Star Chamber, making the Comptroller-General of Customs an autocrat. The leader of the. Opposition and the honorable member for Parramatta contend that the measure introduces a new principle, by shifting the burden of proof from the accuser tothe accused, making a man appear guilty until he has proved that he is innocent. Its provisions are undoubtedly stringent, and such as the extraordinary nature of the conditions which continually arise through the operations of trusts can alone justify. Believing that the evils associated with trusts cannot be overestimated, I am prepared to go as far as the Ministry asks us to go in providing for their control.
– If fines were not effective, would the honorable member proceed to the torture to extract information? That is the logical conclusion.
– I think not. A Ministry, finding that trusts are, like disobedient children, continually causing trouble, is justified in bringing forward measures which it thinks will control them.
– There is no universally accepted rule for the management of recalcitrant children.
– I am aware of that. Let those who own such children support them. Private enterprise and competition are the children of other parties in this House ; the child of the Labour Party is national ownership. I am prepared to go as far as any other man in helping the. Government to experiment in connexion with’ the controlling of trusts; but I believe that there is only one solution of the problem, and I wish to guard myself from the charge on some future occasion, when this legislation has proved useless, that I have been willing that Parliament should spend its time in passing measures of this kind.
– I suppose the honorable member will admit that he who does not believe in a remedy is hardlythe best person to apply it?
– The Ministry believes’ irk. this remedy, and asks us for permissionto apply it. If the Labour Party were in. power, it would propose for the control of combines, not measures like this, but the measures which its members have openly advocated at all times - methods that areembodied in the objective of our movement -the, nationalization of monopolies as they arise.
– The Labour Party were in office for four months, and did not take a successful step in that direction.
– I am aware that the honorable member at one time expected a good deal from our movement, but I did not know that he believed our party, duringfour months in office with a very slender majority, could change the whole face of industry. I have some difficulty in following the contentions of honorable members who have spoken against the proposal of the Labour Party to nationalize monopolies. The honorable member for Parramatta, as I understood his argument - and I do not wish to misrepresent him - contended that we could not have a trust stifling competition in the necessaries of life.
– I did not say that.
– For instance, how could1 the production of wheat be controlled by a trust ?
– The fact that it is not socontrolled is no evidence that it will not be. In that respect the honorable member for Parramatta and the Labour Party are at one ; we have no desire to nationalize the wheat production of Australia. Our proposal is to nationalize only monopolies, that arise. If the honorable member did’ not contend - and I accept his assurancethat he did not - that we could not get a: trust to stifle competition in necessaries–
– I said there could be no harmful combination where there was healthy world-wide competition.
– Then I venture to join issue with the honorable member, and to say that where there is a possibility of world-wide competition harmful combinations have arisen. Take, for example, the combination in respect of sewing cotton. The Coates’ Trust is a world-wide one, controlling the whole of the sewing cotton trade of the world, with the result that cotton is dearer to-day than it was fifteen years ago, when competition prevailed. Then we have the Beef Trust of America, already established in England.
– Cotton is not grown all over the world.
– It is grown in different continents.
– In very few countries.
– That may be, but the number ought to be sufficient, if the honorable member’s contention is correct, to prevent a harmful trust arising in connexion with cotton production. If the honorable member says that only those things which grow in’ every continent are free from the operations of trusts, he cuts down the possibility of our maintaining competition in connexion with the great bulk of articles that are in common use. I dare say that the great majority of the articles in every-day use are not produced in all parts of the world. If that be so, the honorable member does not go very far ; it is no satisfaction to us to know that only those articles which are produced all over the world can be controlled by trusts.
– Is it not better that we should inquire into the surroundings of trusts that are admittedly harmful?
– I do not see much purpose in merely inquiring into their surroundings. The question which this House and the country have to decide is what is to be done after the inquiries have been made. We have ample evidence of the evil that trusts can do, and we now await from honorable members who are opposed to the nationalization of monopolies a solution of the difficulty before us.I venture to say that it will not be found in this Bill. The honorable member for Tarramatta seems to think that many trusts are harmless - that the number of harmful trusts are few. When I asked him to name a few of the harmless trusts, he assured us that only about twenty-three out of some hundreds of trusts in America were returning dividends. Is that an answer to the question? Does the honorable member contend that trusts which do not return dividends are necessarily harmless in their operations?
– When they are not paying dividends, they cannot be very successful. They cannot continue very long on their losses.
– No; but they will change their losses into profits.
– Nearly £500,000,000 are invested in trusts which are not returning one copper.
– Most men when floating their business enterprises into trusts endeavour to get as much as possible for them; and if people are foolish enough to purchase scrip at a very high price, it is quite possible that they will not get any return on that outlay. But let the trusts retain their monopoly long enough, and we shall not have £500,000,000 invested in them at a loss.
– Let them keep on making losses, and they will grow rich.
– I do not suggest that, but I know many firms - and the honorable member knows of many - that have found that it paid them to make losses for a year or two - until they had crushed out competition - and that they were soon able then to make good their losses. One of the features of the successful establishment of trusts is that they have to submit to losses for a few years, with the full knowledge that in time they will reap if they faint not. We have received from the Opposition the assurance that trusts cannot exist here as they prevail in America - that there is no danger of their having in Australia the harmful effects that they have had in America. I do not know on what ground that contention is based. When I consider the age of this country, the extent to which rings and combines already operate here, and the evil effects manifested in connexion with their operations, I cannot understand why they should stop short of what trusts in other countries are doing.
– Trade unions will be brought under this law.
– I am prepared to apply the same principles to trade unions.
– Hear, hear; let them submit their books for examination.
– The unions do not object to that being done. In most of the industrial disputes that arise, it is the other side that objects to give full information.
– Trade unions are quite prepared to be taken over by the State.
– I am sure that they are. Having regard to the cry that we hear almost incessantly as to the evils already existing in connexion with trusts, I do not know what ground there is for the hope that no bad effects will arise from them. The honorable member for Moreton towards the end of last year entertained the House at considerable length with a recital of the evils of the Shipping Combine. How can it be said that there is no danger of great evils arising from trusts in Australia when the very men who come here to uphold private enterprise and to oppose the extension of the functions of the State give evidence as to the evil tendencies of the Shipping Combine in Australia? In such circumstances, how can we hope that there will be no ill effects from the establishment of trusts ?
– No one denies the existence of the evil. The difference of opinion is as to the method of dealing with it.
– I do not think that the honorable member speaks for the Opposition generally.
– He does.
– The honorable member for Parramatta spoke of beneficent trusts, and although, like myself, he is not a judge of tobacco, he assured us that the tobacco obtainable here now was better than could be secured when there was no Tobacco Trust.
– He said that he had been so informed.
– And obviously believed that it was so.
– The tobacco here is infinitely better than the tobacco of Italy or of France, where there is a régie.
– Iknow that when some honorable members take a tour through France on a motor car, and see the Frenchmen contentedly smoking that which suits them, or they would not use it, they come away satisfied that the tobacco obtainable there is the worst that could be smoked.
– Does not the honorable member think that he would be in a better position to judge if he had been there and had smoked the tobacco?
– Order. The debate is passing altogether beyond the scope of the Bill. The question is that the Bill be now read a second time, and I ask the honorable member not to be drawn aside by interjections, but to pursue the discussion of the Bill itself.
– I wish to put before the House as clearly as I can the view that the method of dealing with trusts embodied in this Bill is not calculated to be successful. I do not understand how honorable members can console themselves withthe idea that we shall have in Australia only harmless trusts. The honorable member for North Sydney said that he would reply to the question that I put to the honorable member for Parramatta as to the names of some ofthe harmless trusts of which he spoke, and proceeded to say that the Coal
Combine properly managed might be a harmless one. I do not hope to see in this country any harmless trusts. I do not believe that men combine for a public good, but rather for their own good. We have been told that, so long as competition continues, no great harm can be done by trusts : but I think that the object of trusts is rather to wipe out competition. We may safely say that if men be given power, they will use that power whenever it suits them to do so. If we allow trusts to arise in which a few men can combine, they will rob the public if the opportunity presents itself. It might be possible to have harmless trusts if all merchants and manufacturers were philanthropists, and went into the business for the good of the country.
– It might be possible, if they were all wise.
– That, of course, depends on what standard of wisdom is set up. I have always understood that those commercial men who are regarded as the wisest, are those who make as much money out of their business as they can;and that is the object of trusts. I do not complain on that score, because, as we have been told to-day, it is only human nature. We are warned that before we can materially alter present conditions, we must alter poor human nature. I do not know that human nature is either all good or all bad, as some honorable members seek to make out; but I do know that in the name of human nature many good and many bad, and many brave and many cowardly, things are done. What I say is that, if people are put into a position of power without responsibility, in the way that directors of trusts are, they will use the position for. the benefit of their own pockets; and so long as that continues, so long will legislation of this class be ineffective. We suggest that when this legislation has been found to fail, and is discarded - when honorable members, who are prepared to introduce the Star Chamber, and upset the principles of law which have prevailed for centuries, recognise the failure - we shall turn to the only true remedy, and nationalize monopolies as they arise.
– Make a bigger trust !
– Yes, and at the head of the trust have those who are responsible to the users of the goods produced.
– Make a bigger trust, to be controlled and operated by the same human nature.
– Operated by the same human nature, but for the benefit of the community. Honorable members can easily see the difference by contrasting the Sydney tramway organization with the Melbourne tramway organization.
– The Melbourne tramways are a delegation of Government monopoly.
– I am afraid that is a distinction without a difference, so far as my argument is concerned.
– Is the honorable member prepared to say that the conditions of the tramway employes in Sydney is the ultimate ideal of Socialism?
– Will the honorable member for Werriwa kindly take his seat? The interjection by. the honorable member for Parramatta is just one of those to which I referred a few minutes ago. The honorable member for Werriwa would be able to proceed with his speech without the slightest difficulty but for interjections of this kind, which draw him off the track of his argument.
– There is no doubt that the same human nature controls both systems, but the difference is obvious. The users of the trams, and the employes on the trams, all reap the benefit under public ownership and Government control, whereas if the trams be in private hands, the users are robbed every time they make a journey, those in Melbourne paying more than their trip is worth when comparison is made with the fares charged in Sydney. The reason is, of course, that those who control the private enterprise are responsible to none but the shareholders, and the more they can rob the public, and the less wages they can pay the better,because it tends to benefit their own pockets. In the case of public enterprise, however, the very opposite effects are seen, because the advantages are shared by the public, and the employes are better treated. I shall vote for the proposal of the Ministry, willing to let them have another try to control private enterprise, and continue competition. But, as every one knows who has marked the trend of industry during the last two or three decades, we shall find after all our efforts that it is impossible to maintain competition in an age like ours.
– After the full discussion of this Bill, I do not propose to occupy the attention of honorable members for more than a few minutes. I shall not allow myself to be drawn intoa discussion of general subjects as the honorable member for Werriwa did, but I propose rather to deal with the merits of the Bill. I should like, however, to say that for some of the reasons to which the honorable member himself alluded, I am one of those who are in favour of an effective system of anti-trust legislation being enforced. I believe that those who are opposed to the introduction or the realization of socialistic ideals will find themselves compelled ultimately to grapple with the undoubted evil and danger which, under our modern conditions, results in the aggregation of very large amounts of capital, massed together for certain purposes. Therefore it is essential that those who look into the future and the future developments of social and political life, not merely in countries like America, but in young countries like Australia, should pay attention to the dangers when they are in a nascent condition, and not wait until they have developed in the way they have in older countries. I am quite in sympathy with those who desire to have effective legislation - not too drastic, but as effective as necessary - for the purpose of preventing the growth of associated capital in such form as is likely to be ultimately dangerous to the social and political freedom of the community. But, of course, in this, as in everything else, we must prescribe the medicine with some degree of proportion to the disease. And the only question, I take it, with which the House is now concerned is whether this particular measure is or is not unnecessarily drastic, having regard to the present conditions of Australia.
– Legislation is always too drastic according to honorable members opposite.
– The honorable member makes general observations of that kind, but one might say, with at least equal reason, that legislation is usually too drastic if it emanates from the party to which the honorable member belongs.
– We did not suggest this legislation.
– In most of the cases when legislation emanates from the Government which derives its life’s spirit from the party which the honorable member lately led, we have usually to reiterate the complaint that it is too drastic. I should like to say that the Attorney-General - whom I should be the. last to accuse of doing anything intentionally to mislead the House - pressed on our attention an analogy which is no analogy, in referring to some recent American legislation. Let me for one moment ask the attention of honorable members while I refer shortly to the history of American legislation on this subject. Honorable members know that in 1890 or 1892, I forget which year, the United States. Congress passed what, is known as the Sherman Act, which is the -origin of the Australian Industries Preservation Act. The Sherman Act was very wide in its scope, just as is the Australian Act of 1906. The first section of the Sherman Act indicates the general lines on which it proceeds -
Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations, is hereby declared to be illegal.
Then the section goes on to say -
Every person who shall make any such contract, or engage in any such combination or conspiracy, shall be deemed guilty of a misdemeanour.
That Act was not limited to any one particular trade, but was intended to meet cases of conspiracy in restraint, or - as was ultimately held - in injurious restraint of trade- It did not necessarily mean all restraint, but restraint injurious to the public j and it made such combination illegal in any kind of trade or business. That, of course, is very wide ; and the Act was brought into existence at a time when all kinds of combination in America had reached the point which many thoughtful men considered was becoming dangerous to the freedom of individual citizens engaged in ordinary industries. That Act was followed in the Australian legislation, the more drastic provisions being, to some extent, curtailed. The Australian Act of 1906 was not limited in its application - just as the Sherman Act was not - but it regarded as an essential in its operations that some combination or conspiracy should be shown, the effect of which was necessarily detrimental to the interests of the public. I think the Attorney-General will agree with ma that the words “ to the detriment of the public “ are really the controlling words of the Act which we are now amending. That is one line of legislation universal in its application, so far as all industries are concerned, but it is rigidly limited, because the fact can be ascertained only after full proof has been brought be- fore the Courts called on to deal with the matter - namely, that the combination is to the detriment of the public. The AttorneyGeneral referred to some recent American legislation, giving, as he said,, equally drastic powers) of inquisition, the terms of which have been followed in the Bill. Let me remind honorable members that the class of American legislation to which the Attorney-General referred ran along totally different lines, and was for totally different purposes. In 1887, before the Sherman Act, there was passed in America an Act to. regulate trade and commerce between the States, and the conduct of particular classes of persons or corporations, who were conducting the great carrying operations between the States - in other words, the great railway corporations and monopolies throughout the whole of the States. It was then becoming apparent - as it has become more and more apparent since- that these great and powerful corporations had risen to such a point that their operations threatened, not only the liberty of individuals, but the liberty, and even the integrity, of some of the constitutional institutions upon which they had to depend. That was the great danger. That was the danger created by these powerful corporations which had been invested with enormous monopolies by the States - either by the individual States or bv the United States through their legislative channels. These monopolies were often used for the purpose of carrying on an internecine war between great capitalistic organizations in which the interests of - the individual citizen were absolutely ignored, leading, as we all know, to disaster in the liquidation of stocks and shares in which the leaders of these organizations sometimes engaged. That was the great evil which had to be coped with - an evil which had reached dimensions far beyond those attained by ordinary trade and business corporations, and to cope with which Parliament thought it necessary to provide some special machinery. What took place? In 1887 Congress passed an Act to regulate commerce. That Act, I think, deals entirely with the operations of carriers. T have not had the opportunity of reading through every portion of it, but the AttorneyGeneral will correct me if I am wrong. It opens with the words -
Be it enacted, That the provisions of this Act shall apply to any corporation or any person or persons engaged in the transportation of oil or other commodity, except water.
– The Inter-State Act originally applied to carriers engaged in Inter- State commerce.
Mr.W. H. IRVINE. - That is so. Subsequently it was enlarged specially to meetthe case of the Standard Oil Trust and other bodies similarly situated. But the whole object of this legislation was to deal with these great paramount corporations, which had been invested with vast power owing to the growth of population in the United States of America. It was confined to them. We must always recollect that. Any legislation introduced to meet such special and vast dangers as were then apprehended - dangers which have not yet been met - can scarcely be safely accepted as a precedent which should guide us in framing a general law relating to such trusts when they do not exist.
– A trust exists in the carrying trade around Australia.
– There is no monopoly of the ocean.
– In practice there is.
– In one sense there may be - in the sense that the aggregation of capital always tends to create a certain kind of monopoly. But the establishment of the class of monopolies dealtwith by this legislation in America was due to the fact that a comparatively limited number of powerful corporations controlled - necessarily so from the powers granted to them by Parliament - the whole of the carrying trade. By means of their vast capital, and by direct and indirect means employed upon legislators and private individuals, they were able to obtain a control which almost amounted to a universal tyranny.
– A condition of things which happily cannot obtain here.
– It obtains around our coast.
– The honorable member is referring to the Shipping Ring. Assuming that such a ring does exist - and I dare say that it does–
– The shipping companies themselves admit it.
– Assuming that such a combination exists, it merely falls within the class of combinations which derive their power from the aggregation of a number of persons possessed of capital who agree to be bound by certain rules. I have said before that we ought to have some legislation to control, such monopolies. But to adopt the forms of legisla tion which were introduced in America, to administer the powerful medicine that was at the last stage administered by the United States to cope with the terrible disease which had developed, and which still remains uncured, can hardly be accepted as a safe guide by this Parliament- in dealing with the comparatively immature disease with which we have to cope.
– Is it not a fact that that “powerful medicine” failed to cure in those cases because it was not strong enough ?
-I have said that the power of the railway corporations in America was so immense that even this legislation was not strong enough to effect its purpose, and that it had to be reinforced by the legislation to which I have referred. In 1906, it was so reinforced. We ought not to accept such legislation as a guide to us in the legislation which we are now asked to enact. But let us see what was the character of the legislation passed by the United States Congress. Did it give to an official under political control the power to enter into any man’s house, to inspect any man’s, business, to take possession of any man’s books, and to apply an inquisitorial scrutiny into a man’s private affairs without any kind of judicial inquiry? Nothing of the kind. In the first place, Congress created an InterState Commerce Commission. Instead of a Comptroller-General of Customs - an irresponsible official, or, rather, an officer who is responsible only to his political chief - being vested with this enormous power, a strong judicial tribunal was created, which, by the very terms of its constitution, was absolutely freed from all political influence. That is the first point that has to be noted.
– I referred to the creationof the Inter-State Commerce Commission.
– But the AttorneyGeneral did not tell us how it was constituted, how vastly it differed in its character from the proposal under this: Bill to invest a single officer with power to discharge similar functions. That, judicial tribunal was composed of men who were appointed for a period of six years, who were to be absolutely removed from political influence, and who were placed in such a position that they could discharge their judicial functions as a Court should’ do, without fear or favour, and without political bias of any kind. That is the- first distinction which I draw between the American legislation and that which we are now asked to enact .
– I referred to the fact that a Bureau of Corporations was constituted, and that the Commissioner was vested with the same powers as the Inter-State Commission.
– I think that the Attorney-General did. But I wish to refer to the particular part of the Act of 1906 which the honorable and learned gentleman cited as a precedent, with a view to show that the powers granted by Congress at that time were vested in a Commission which was purely a judicial body. When I come to analyze those powers, I find that they were not anything like so wide - although they were granted under circumstances of extreme emergency to a judicial tribunal specially created for the purpose -as are the powers which we are asked to grant under this Bill.
– Probably the moderation of that law accounted for its failure.
– It has not yet had time to be a failure, seeing that it was only passed in 1906. I have already pointed out that our circumstances are totally different from those which obtained in the United States. The law to which I have referred relates to a particular class of persons whose vast monopoly rendered it necessary to subject them to control. Now let us look at the powers themselves. They are set out in section 20 of the Act of 1906, which says -
The Commission is hereby authorized to require annual reports from all common carriers - that is, all carriers engaged in Inter-State traffic, which practically means the railways only - subject to the provisions of this Act, and from the owners of all railroads engaged in the interState commerce as defined in this Act, to prescribe the manner in which such reports shall be made, and to require from such carriers - this is the point upon which the AttorneyGeneral relied - specific answers to all questions upon which the Commission may need information.
It then goes on to enumerate the matters which they are entitled to investigate. It says -
Such annual reports shall show in detail the amount of capital stock issued, the amounts paid therefor, and the manner of payment for the same ; the dividends paid, the surplus fund, if any, and the number of stock-holders; the funded and floating debts, and the interest paid thereon ; the cost and value of the carrier’s property, franchises, and equipments; the num ber of employés, and the salaries paid each class; the accidents to passengers, employés, and other persons, and the causes thereof; the amounts expended for improvement each year, how expended, and the character of such improvements; the earnings and receipts from each branch of business, and from all sources; the operating and other expenses; the balances of profit and loss ; and a complete exhibit of the financial operations of the carrier each year, including an annual balance-sheet.
The provision is thus limited to many matters which would appear in the balance-sheet of any public company under our Companies Act. Probably it includes a few others, but these are clearly defined. The questions into which even this judicial tribunal was authorized to inquire were clearly restricted to certain specified matters upon which it was considered necessary that it should have knowledge in order that effective control might be exercised over these great organizations.
– But the next paragraph has reference to contracts and agreements.
– Yes. It reads-
Such reports shall also contain such information in relation to rates or regulations concerning fares or freights, or agreements, arrangements, or contracts affecting the same as the Commission may require ; and the Commission may, in its discretion, for the purpose of enabling it the better to carry out the purposes of this Act, prescribe a period of time within which all common carriers, subject to the provisions of this Act shall have, as near as may be, a uniform system of accounts, and the manner in which such accounts shall be kept.
It must give statistical information as to all the freights and fares which are charged, because these were specially made subject to the control of the Inter-State Commission, and as to all contracts made in connexion with their business, because they were contracts for carriage.
– That is more than is ordinarily required.
– I think that it is. In a few matters of that sort the Act does go a little further than does our own Companies Act. But can it be urged that that is any precedent for the kind of legislation that we are now asked to enact? Under this Bill we are invited to allow the ComptrollerGeneral of Customs, who is directly under political control, to ask any question of any individual that he chooses. He is limited only by his own discretion as to the questions which he shall put to any person whether he be one of the principals of a firm, a manager, a clerk, or an office boy, or whether he be an entire stranger to the particular business that is being carried on. He is at liberty to ask anything that he may think in any way relevant to a crime of which he has not yet even sufficient primâ facie evidence to put before a judicial tribunal. That is the kind of legislation before us. Whatever may be urged in favour of it, the circumstances under which the American Acts were passed make them no precedent for us. Let me shortly examine a few of the provisions of the Bill. The Attorney-General told us that it is a machinery Bill. Torquemada, when putting before the Spanish Inquisition a newly-invented thumb-screw or improved boot, might have commended it as the introduction of more effective machinery, and in that sense only can this be termed a machinery Bill. The means adopted might be justified in some great national emergency which made if necessary to go beyond the ordinary British methods of getting information, and to adopt more drastic steps. I do not attach as much weight as some honorable members have done to the provision regarding the onus of proof, though it introduces a principle repugnant to British instincts of fair play, and adopted only in certain classes of legislation, such as the acts relating to insolvency and Customs administration. I do not complain of its introduction here, because of the saving clause that an averment of intent in an information shall not be deemed to prove such intent, and if we refer to the Act we find that intent is the substantial thing to be proved. The effect of the provision is to avoid some formal proofs which might otherwise be necessary.
– And it might save a technical nonsuit.
– Yes. The provision may be a convenient one, and I do not take much objection to it, seeing that intent has to be proved.
– Would it not have been enough to use the word ‘ ‘ evidence ‘ ‘ instead of the word “proof”?
– I do not think that that matters. It is evidence which, if uncontradicted, will amount to proof.
– That was the interpretation of the New South Wales Court ; that, in the absence of evidence from the defendant, it should be evidence against him.
– Coming to another part of the Bill, I may say that I have never seen a provision such as the proposed new section 15b, sub-sections1 and 2. It enacts that -
If the Comptroller-General believes- that is, without evidence, with or without reason, for any cause, on any hint given by any person - that an offence has been committed against this Part of this Act, he may by writing under his hand require any person- .
Any person whom he believes to be capable of giving any information. There is no limit to the person or class of persons who may be asked, or to the kind of questions that may be asked. They are not required to be relevant’ to the as yet unproved and unfounded charge, and are to be left entirely to the discretion of the official. The provision continues- whom he believes to be capable of giving any information in relation to the alleged offence to answer questions and to produce documents to him or to some person named by him.
Any person refusing or failing to answer questions or produce documents when required to do so becomes a criminal in the eye of the law, and is liable to a penalty of £50.
– Can the ComptrollerGeneral summon a man to the Customs House to answer questions?
– He can compel him to come and bring his books, although he may have received no complaint from any person on oath, and no evidence of any kind. Thesuggestion of the acting leader of the Opposition, if adopted, would provide a rational safeguard to this provision, while leaving it effective. I understand it to be this : The Comptroller-General, or other officer, intrusted with the carrying out of the law, shall, if he has ground for believing that there is a case for investigation, bring it on affidavit before a County Court Judge, a Police Magistrate, or some other judicial person, and if the Court is convinced that there is a prima facie case to warrant an inquiry, itshall authorize such interrogatories as may seem reasonably necessary to elucidate the truth. That is a power now possessed in civil cases. Surely, if the law does not think it fit that without safeguards one man shall dive into the recesses of another man’s mind, or have access to his papers or business secrets, for the enforcement of a civil right, it will be at least as careful in regard to a criminal obligation ?
– Would the honorable member allow an accused person to be so interrogated ?
– I would allow him to be interrogated if the ComptrollerGeneral had satisfied a judicial authority that there were grounds for believing that an offence had been committed ; but the interrogatories to be delivered should be such as the Judge might determine as reasonable. As a matter of practice, interrogatories are not submitted to a Judge unless the other side objects to answer them ; but where they are directed to the ascertainment of facts which may render a man liable to the criminal law, the person charged should have an opportunity to argue before the Judge that the questions sought to be put to him werenot fair. If a man is allowed to be interrogated under the civil law, he has the opportunity to show that the right to interrogate is being pressed beyond fair limits, and it should be so in this case.
– Similar powers are given under the Customs Act.
– As a number of honorable members have pointed out, that is a totally different measure. In this case, it is proposed that an official who may choose to say on any evidence which to his mind may seem sufficient, “ I believe that the accused is a party to a conspiracy, and guilty of an offence,” may search into the man’s conscience, go through his business, investigate his books and private records, to make out a case against him. That is a totally different power from that given under the Customs Act, and, if given at all, should be fettered with safeguards at least as great as those attaching to the ordinary interrogations of civil procedure. I hope that the House will not,by pressing this kindof machinery to absurd extremes, deprive the whole legislation of practical effect.
– During the debate honorable members have raised objections, find asked questions in regardto the principles of the measure, which I wish to answer before going into Committee. The honorable member for Flinders said that legislation should always be appropriate to the evil that exists, and should provide a sufficient remedy to cope with it. It is for that reason that the Bill has been introduced. He stated that my analogy is not complete ; that, in the United States, combinations of railway companies and carry ing companies monopolized the highways of commerce, on which the trade and foodstuffs of the country had to be carried. He therefore justified the stringency of the powers conferred by the Inter- State Commerce Act. But the evils aimed at’ were not solely connected with great carrying corporations; it was found necessary in America to pass laws dealing with corporations of all kinds.
– I pointed that out.
– In 1890, the Sherman anti-trust law was given general application, its purpose being to prohibit every contract or combination in restraint of trade or commerceamong the several States, or with foreign nations, whether made by carriers, manufacturers, producers, or shippers.
– I mentioned that. My argument was that although Congress found it necessary to apply the general Act, it never dreamt of applying such drastic machinery provisions under that Act.
– That is the point to which I am coming. In 1894, what is known as the Wilson Act, was passed. That Act contains anti-trust provisions forbidding unlawful restraints and monopolies by and between importers, or persons, or corporations engaged in importing any articles from any foreign country into the United States, when designed to operate in restraint of lawful trade or free competition in lawful trade or commerce, or to increase the market price in any part of the United States, of imported articles, or of any manufacture into which such imported article enters or is intended to enter. Up to that time, proceedings taken against various corporations had not been altogether successful. The problem then before Congress and the people was in what way the necessary evidence could be obtained to secure a successful prosecution in’ respect of not only railway corporations, but other great combines. In 1903 a Bureau of Corporations was established as a subdepartment of the Department of Commerce. It was decided that there should be at its head a Commissioner to be appointed by the President, and to receive a salary of 5,000 dollars per annum. A Deputy Commissioner and certain other officers were also to be appointed, and the Commissioner was to have power and authority to secure information in regard to the organization, conduct, and management of the business of any corporation, joint-stock company, or corporate combination, excepting common carriers subject to the Commerce Act engaged in Inter-State or foreign commerce. It was also provided that, in order to accomplish the purposes mentioned, the Commissioner should have and exercise the same power and authority in respect of corporations, joint-stock companies, and combinations, subject to the provisions of the Act, as were conferred on the Inter-State Commerce Commission.
– That was in 1903.
– Yes. The honorable member’s point was that when the United States of America was called upon to deal with powers of this inquisitorial nature, it determined to constitute a Commission. I am pointing out, as I did the other day, that an individual Commissioner was appointed, and was intrusted with the powers that were possessed by theInterState Commission.
-What they did in 1903 was to give to the Bureau the powers that were then possessedby the Inter- State Commission. That Commission then possessed none of the powers which the honorable member takes as precedents for the proposals now before us. They were first conferred in 1906.
– I think that the statement made by the honorable member is scarcely correct. I think he will find that section 20, in the Act of 1903, which he read, was practically complete.
– At all events, it related only to big corporations.
– Combines were rapidly forming in the United States of America, and as they were paralyzing trade and commerce within the States, it became necessary to give these wider powers. Combinations having harmful effects upon producers and consumers sprang up, and it became necessary to deal effectively with them. In the latest report I have of the Attorney-General of the United States of America - whose Department is intrusted with the administration of this law - it is stated that -
The Department of Justice is without organization for the investigation of suspected offences, though the general appropriation for the enforcement ofthis and laws of like character made by Congress in 1903 has to some extent supplied this deficiency.
The report is for the year 1906. It is then pointed out that notwithstanding this difficulty, lengthy inquiries were made, and a series of prosecutions were conducted. Figures are given showing up to the year 1901 the result of the prosecutions -
From the date of the enactment of the law to the beginning of President Roosevelt’s Administration in 1901, 16 proceedings were begun and have been concluded - 5 of them were indictments, in all of which the Government failed, and11 of them were petitions in equity, in which the Government prevailed in 8, and failed in 3.
The report then goes on -
Since the beginning of President Roosevelt’s administration, twenty-three proceedings have been begun under this law, seven of which have been concluded, and sixteen are pending.
A statement then appears as to the proceedings which have been concluded. The honorable member for Parramatta requested me to give him an instance where in later years a prosecution in the United States of America had been successful. The Attorney-General here deals with seven individual cases in which proceedings were successfully taken. In one case -
A combination between two competing interState railways, whereby a majority of the stock of each was taken over by a holding company in exchange for shares of its own stock at an agreed valuation, with the purpose and effect that the two railways should come under common control and management, and that competition between them should be suppressed, was held to be unlawful, and dissolved by the Supreme Court.
That was the case of the Northern Securities Company v. United States. The next prosecution was in respect of a combine dealing with fresh meat. That combine was also declared unlawful, and an injunction was issued. In another case a combination for the manufacture of paper was declared unlawful and enjoined by the Circuit Court in the same way.
– The honorable member is proposing that a medicine which is suitable for a man in a raging fever shall be taken by a man who wishes to avoid a cold in his head.
– No. But we all know that prevention is much better than disease. The honorable member’s contention is that we should leave combines alone. He says in effect of a combine, “ It is only a little chap. Give him a hiding and that will cure him. After he grows up you can, if you like, put him in gaol.” We know that the evils exist in the United States-
– All these trusts are still sailing on despite the prosecutions.
– Is that so? One has been dissolved.
– But the Paper Trust is still in existence. The question is now being discussed in New York whether the duty on paper should not be removed.
– In the cases cited orders we’re made and any one whodisobeyed them would be guilty of contempt of Court. At pages 973-4 of the volume to which I have referred details of other prosecutions will be found. The Attorney-General of the United States of America is now in a better position than he was to obtain information to enable him to prosecute combines.
– Can the honorable member point to a single case where legislation in America has prevented trusts from exercising a harmful control ?
– I can show that legislation there has created offences in respect of which prosecutions have been successful.
– And what has happened ?
– In one case, as I have shown, a corporation was declared illegal and was dissolved. In other cases corporations were declared unlawful, and those who took part in them were enjoined not to carry on their operations.
– In another case the members of a combine had to disgorge.
– And we have learned by cable that in addition to that an injunction has been obtained and heavy penalties imposed in some instances.
– My impression is that those trusts are still going on.
– There may be attempts to evade the law. It is true that legislation has not rooted out trusts in America, but my reading goes to show that it is acting as a preventive. If we cannot root out an evil that is no reason why we should not attempt to deal with it as far as we can. The honorable member for Laanecoorie and others have asked whether the wider powers for which we ask are really necessary. My answer is that they are. The Crown Solicitor was instructed to investigate the operations of various trusts in Australia.
– What trusts?
– I am prepared to mention them. There is for instance the Confectionery Combine, the Oil Combine, the Brick Combine, the Coal Combine, and several combines dealing with machinery.
– And the Shipping Combine?
– Not the Shipping Combine. I have mentioned quite sufficient to show that action has been taken.
– What about rebates ?
– they were inquired into. The Crown Solicitor went fully into the matter, and there are in the possession of the Department complete confidential reports, which I could not be expected to disclose. The position is this : Combine A is alleged tobe in restraint of trade. We know from the documents that have been filed that there is an agreement in existence. We approach those whom we know to be members of the combine, but they decline to show us a copy of the agreement. We know that from the effects of the combine on industry it is acting in restraint of trade, and that persons are being injured.
– Suppose the Department took proceedings against them, would not the Judge direct them to supply the information sought?
– Not in a case for penalties. Under the existing Act. it is open to persons who enter into a lawful combine to file with the Attorney-General a copy of their agreement, and, by doing so. they are protected subject to the provisions of the Act. But let us take the case that I was citing when interrupted. There is an agreement within the knowledge of the individuals concerned, and we know by its operation what is its effect upon trade and the public generally. But as soon as we attempt to prosecute that combine in a Court, we are faced with the fact that we cannot prove the existence of an agreement. Where the agreement is lawful, what harm will be involved in an officer of the Department being allowed to inspect it, seeing that he must treat it as confidential ?
– If the averment of the Department were made evidence in proof, would not that be sufficient ?
– No, the averment of the Department that an agreement exists is only deemed to be proved in the absence of proof to the contrary. The defendant is entitled to go into the box and say the agreement is perfectly innocent. We ask that the Comptroller-General shall, before instituting proceedings, have a right to go to the parties and say, “ We have a complaint on oath that you are engaged in an unlawful combine. I am satisfied from the inquiries made by the officers of the
Department that a combine exists. I now ask you to produce your agreement.” If the parties concerned are engaged in a lawful business, what harm can be done them by requiring them to produce the agreement to the Comptroller-General, who is under an obligation of secrecy. He dare not disclose the contents of the agreement, but if the agreement is unlawful, the parties can be called upon to disclose its contents.
– Are these agreements secret?
– They are.
– And, therefore, are not binding except in honour?
– That is anothermatter. In one particular instance we got a copy of a written agreement ; but when the parties were confronted with it, they said that it was not the agreement under which they were working. In another case we were successful enough to get the agreement in so far as it related to trade within the State, but it was ascertained that there was another agreement which extended beyond the States - a verbal agreement.
– What is there to stop the parties from giving a “ cooked “ agreement ?
– They are under an obligation to give the proper agreement.
– Could any party to the agreement claim damages under law for a breach ?
– I do not think so. If an agreement is made the parties are bound under the Bill to disclose it. No agreement can be made contrary to the law of the land.
– The original Act makes all such agreements invalid.
– In many cases, under the original Act, not agreements but acts are required to prove an. offence.
– In one or two instances, such as an attempt to ‘monopolize. It is provided that any person who, as principal or agent, enters into any contract or becomes a member of any combination with intent to restrain and so forth, may be proceeded against ; so that the case depends entirely on the fact of a combination being in existence. I do not think that the provision in regard to the onus of proof is very drastic. We cannot go into Court, and, on a simple production of a declaration, call upon a man to defend himself: we have to prove intent on positive evidence. We do not desire to go into Court, and have the decision given against us because there is no proof of an agreement on which the charge is based.
– Intent has to be proved?
– Then to what do the words “ shall be deemed to be proved “ refer ?
– I shall give an illustration. A person is charged with having entered into a contract, and so forth, with intent to restrain trade. In such case, under the proposed provision, it will not be necessary to prove that he entered into a contract, or that the contract was in relation to trade and commerce with other countries or amongst the States, because the averment will be sufficient proof . But we shall have to go further, and establish by positive evidence that the agreement alleged is made with intent to restrain trade.
– Then the words “shall be deemed to be proved.” do not relate to the intent?
– They relate to the agreement.
– The averment should be deemed to be proof that there is an agreement?
– Yes, or of any other allegation that is made.
– Asto the detriment of trade ?
– Intent has to be proved.
– Then proof of the intent of the agreement has to be given?
– Proof of intent of the parties ; we give all the proof that we can obtain ; and intent is judged from the acts and surrounding circumstances. I can assure honorable members that the powers are asked for by the SolicitorGeneral, who, after the most careful investigation of concrete instances, is satisfied’ that without them the Act cannot be effectively administered.
Question resolved in the affirmative.
Bill read a second time.
In Committee :
Clause 1 agreed to.
Clause 2 -
Section three of the Principal Act is amended by adding at the end thereof the following words : - “Answer questions” means that the person on whom the obligation of answering questions is cast shall to the best of his knowledge information and belief truly answer all questions on the subject mentioned that the ComptrollerGeneral, or the person named by him shall ask. “ Produce documents “ means that the person on whom the obligation to produce documents is cast shall to the best of his power produce to the ComptrollerGeneral or to the person named by him all documents relating to the subjectmatter mentioned.
– There is a difference between the wording of the definition of “ Answer questions “ and the wording of proposed new section 15BV In the definition the questions ‘ must be “on the subject mentioned/’ which is most vague, whereas, in the proposed new section, the questions must be “in relation to the alleged offence.” It will be seen that, according to the interpretation clause, the ComptrollerGeneral is in no way limited as to the questions he may ask, whereas he is limited in the proposed new section. 1 move-
That the words “on the subject mentioned,” lines 8 and 9, be left out, with a view to insert in lieu thereof the. words in relation to the alleged offence.”
– - I ask the honorable member not to press the amendment. The drafting of this definition is exactly the same as that of the corresponding clause in the Customs Act. Section 38 of that Act provides -
Any person making any entry shall, if required by the Collector, answer questions relating to the goods referred to in the entry.
The words in the definition clause do not in any way extend the powers of the ComptrollerGeneral, but merely cast upon the person the obligation to truly answer the questions, which must be in relation to the alleged offence.
– Then why not say so.
– I submit that the definition clause does say so. The “ subject mentioned” is the subject-matter of .the questions, which can only be “in relation to the alleged offence.” This drafting has stood the. test of six years’ operation in the Customs Act.
– The effect of the amendment is that an offence would have to be charged before a person could be called upon to answer any questions. I ask the . Attorney-General whether it is intended that a trader shall not be called upon to answer any questions until a charge has been laid against him?
– Under the proposed new section 15B, the Comptroller-General, having received information of an alleged offence which he believes to be true, may desire information, perhaps from manypersons, retail traders and others, some of whom might not wish to give it; and he is empowered to go to any one of ‘ those individuals and ask questions.
– There must be an “ alleged offence.”
– There must be an offence, but not necessarily an offence by the person to whom the questions are addressed.
– Under the proposed section 15c, there must be. a complaint on oath made to the Comptroller-General before he can apply the provisions of the proposed section. 15b.
– The provisions of 15s are intended to allow of preliminary inquiries being made. It is designed to deal with persons who can give information. Let us suppose that a question arose as to whether a combination existed, and was operating in restraint of trade through a number of retailers. We should be able to ascertain the object of the trust only by securing information from the retailers.
.- The AttorneyGeneral reads the words “ alleged offence” as meaning the offence to which reference is. made in line 1 of the proposed section 15B?
– The Attorney-General will find that the Court will attach importance and meaning to the words “ alleged offence.” I take it that, an “-alleged offence “ must be one which is initiated upon the allegation of a third party. I feel confident that the Court will interpret those words as relating to a different offence from that referred to in line 1 of the proposed section 15B.
.- The proposed .section 15B reads; -
If the Comptroller-General believes that an offence has been committed against this part of this Act, he may by writing, under his hand require any person whom he believes to be capable of giving any information in relation ito the alleged offence to answer questions, and to produce documents to him or to some person named by him.
Obviously the words “ alleged offence “ can refer only to the offence which has been previously alluded to.
– What is the difference between the proposed section 1 5b and the proposed section 15c?
– The proposed section 35b gives the Comptroller-General of Customs power to obtain information from certain individuals in respect of an alleged offence. It is intended to be used only against persons who can give that information, whereas the proposed section 15c is intended to be used against corporations which have agreements within their possession.
.- I inderstand the Attorney-General to say that the words proposed to be inserted, by the honorable member for North Sydney will not alter the real effect of the clause?
– Oh, no.
– Does the AttorneyGeneral believe that the questions put by the Comptroller-General of Customs under this provision will relate only to the offence with which the person is charged?
– Then we ought to make, the meaning of the’ provision plainer. I can scarcely see any need for a definition of “ answer questions.”
– An exactly similar provision is incorporated in the Customs Act.
– But I do not hold that two wrongs necessarily make a right, and 1 do not think that we ought to hold tenaciously to the wording of any particular Act. If it is necessary to define what “ answer questions “ means, I really think that we ought to make it quite clear that in the proposed section 15B the questions to bo put by the Comptroller-General to any person must have relation to the offence alleged to have been committed. An Act which requires so many legal minds to determine its meaning can scarcely be regarded as perfection. As a layman I should prefer to incorporate in this provision language which will clearly show what we mean.
– There is nothing in the proposed section 15B which limits the questions to be put by the Comptroller-General to an “ alleged offence,” though it is quite evident from the wording of the provision as a whole that his interrogations should be so limited. Under the clause in its present form the Comptroller-General might question the member of a combine regarding his private ‘ income. There is nothing in the provision which limits his questions to the “ alleged offence.” He might interrogate any person as to his private affairs.
– Under those circumstances he would not lie entitled to an answer.
– Let the honorable member read the definition clause, which says - “Answer questions” means that the person on whom the obligation of answering questions is cast shall to the best of his knowledge, information, and belief, truly answer all questions on the subject mentioned that the ComptrollerGeneral or the person named by him shall ask.
– Let the honorable member read the whole of that definition into the proposed section- 15b, and he will understand its full meaning.
– The proposed section 15B. fails to limit the questions put. by the Comptroller-General to the “ alleged offence,” just as it fails to limit the production of documents to the “ alleged offence.” Under its operation that officer would be at liberty to roam all over the kingdom for the purpose of ascertaining what was the private income of a member of a combine with a view to discovering whether or not he was engaged in legitimate business.
Mr. DUGALD THOMSON (North Sydney) [9.38J. - I have followed the AttorneyGeneral’s reference to’ the Customs Act, and I find that the definition section in that Statute has a different relationship to the provisions which it governs from the definition clause in this Bill.
– Under the Customs Act the provision is limited to the Collector of Customs, and does not extend to any person named by him.
– The words “ subject mentioned “ used in that Act have reference to the right of the Customs authorities to question - a right conferred under several provisions of that Statute.’ The words ‘.’ alleged offence “ could not be used because the right to question extends to. many different matters. Consequently the words ‘ ‘ subject mentioned “ were employed, meaning the subject mentioned in t the. section where the necessity, to answer questions is imposed. When we turn to the section of the
Customs Act quoted by the Attorney General we find that it definitely specifies the matter to which the questions must relate.
– Look at paragraph g of section 234 of the Customs Act. That goes much further.
-“ Refuse or fail to answer questions or to produce documents.” Questions are there confined by the definition to questions on the subject mentioned in any clause enforcing the answering of questions. Proposed new section 15B (I) provides that any person whom the Comptroller-General believes to be capable of giving information in relation to the alleged offence may be summoned by him to answer questions. But it does not say that the questions shall be in relation to the alleged offence. The Minister says that the provision means that the questions shall be in relation to the alleged offence.
– That isthe intention.
– If the Minister will, when we come to clause 4, make that clear, I shall be satisfied to allow this clause to pass.
– I promise to consider it.
– If the Minister says that it is intended that the questions shall be in relation to the alleged offence, he should not object to making that clear. To the ordinary reader, it does not now appear clear.
Amendment, by leave, withdrawn.
Clause agreed to.
Clause 3 (Amendment).
– What are the offences excluded from the jurisdiction of the High Court?
– The Bill creates three new offences. Under proposed new section 15B it is an offence to refuse or fail to answer questions ;. under proposed new section 15c, it is an offence to fail to produce or hand over books; and under proposed new section 15E it is an offence to disclose information gained in the exercise of powers conferred- by the measure. Section 13 provides that no offence against this part of the Act which is an indictable offence shall be tried before a Justice of the High Court, indictable offences going into the State Courts, where there is the machinery for trying them. The three offences which I have named being minor offences are to be prosecuted in any State Court, so that the time , of the High Court may not be taken up in dealing with minor matters.
Clause agreed to.
Clause 4 -
Part II. of ‘the Principal Act is amended by inserting therein after section fifteen the following sections : - 15A. In any prosecution for an offence against sections four, five, seven, eight, or nine of this Act the averments ofthe prosecutor contained in. the information declaration or claim shall be deemed to be proved in the absence of proof to the contrary, but so that-
the averment in the information of intent shall not be deemed sufficient to prove such intent, and
in all proceedings for an’ indictable offence the guilt of the defendant must be established by evidence”. .
– It might be convenient to deal separately with each of the proposed new sections in this clause.
– It is not customary to divide a clause.
SirJOHN QUICK (Bendigo) [9.51].- I invite the attention of the AttorneyGeneral to an omission from proposed new section 15B (I) of the preliminary requirement of a complaint on oath made in writing; provided for in proposed. new section 15c (I). I submit that there is no reason for this omission. The Comptroller-General ‘ of Customs, as a public officer, ought not to be required to move on his own motion against any private individual. As a preliminary to requiring any person to answer questions relating to a supposed offence, his informant should be called upon to swear an information . on oath. The ComptrollerGeneral cannot go to a firm or individual and say, “ I demand to see your books,” unless some one has taken the responsibility of making a complaint on oath in writing. The power to call upon persons to answer questions in writing is more extraordinary than the power to order the production of documents, and should be stirrounded with safeguards to protect individuals or firms from harassing, unnecessary, and unjustifiable investigations. A public Department should not be called upon to make fishing inquiries until some person has accepted the responsibility of setting the law in motion. If a private individual says “ I believe that there is a conspiracy in restraint of trade, and I wish you to move in the matter,’’ the ComptrollerGeneral of’ Customs may fairly reply, “ I shall do so if you will take the responsibility of swearing an information.” Why should the Comptroller-General be called upon to compel persons to answer questions before some person has stated upon oath that he has reasonable grounds for believing that an offence has been committed ? It must be presumed that some one has supplied him with information, because he could not move unless he believed that an offence had been committed. How could he believe that an offence had been committed unless he had received some private information? If he had, he should call upon the informant to record oh oath his belief. That would be a justification for departmental action. It seems to me that top big an onus and responsibility is thrown upon a public officer by requiring him to launch what is, so to speak, a criminal proceeding - calling upon persons to appear before him to answer questions - unless he has some protection in the shape of an information on oath. I think, therefore, that the Attorney- Genera] ought to agree to insert in proposed section 1.5B the words -
Whenever a complaint on oath has been made in writing to the ComptrollerGeneral that any person or any foreign corporation, or any trading or financial corporation formed within the Commonwealth, has been guilty of any offence against this part of this Act, the Comptroller-General, if he believes the complaint to be well founded, may by writing under his own hand require any person whom he believes to be capable of giving information in relation to the alleged offence to answer questions.
That would make the foundation of jurisdiction in both cases similar, and prevent the exercise of these two powers being anomalous, by, in the one case, casting the onus upon the Comptroller-General, and in the other requiring him to equip himself with sworn information. I do not think that the amendment I suggest would in anyway impair the operation of this power. I desire to support the power, and to make it thoroughly effective, but I do not see why the Comptroller-General should require sworn information iri one case, and not in the other. I hope the AttorneyGeneral will make this law appear just and well founded by associating* the exercise of the first power with the same conditions precedent as are associated with th?. exercise of the second power.
.- Before the amendment suggested by the honorable member for Bendigo is proposed, I wish to move an amendment of the proposed section 15A. There has been a good deal of comment upon it, and it has been pointed out that the provision that the averment of the prosecutor contained in the information shall be deemed to be proved in the absence of proof to the contrary is un-British. I propose to move -
That the words “ to be proved in the absence of proof to the contrary “ be left out, with a view to insert in lieu thereof the words “ prima facie evidence of the statements therein contained.”
– What is the practical difference?
– The result of my amendment would be that every accused person would be bound to answer the charge. As the clause now stands, the averments of the prosecutor are to be taken as absolute” proof against the accused person in the absence of proof to the contrary, but under my proposal every accused person would be bound to answer the charge. If he did not, he would be convicted on the averments contained in the information. If we determine that those averments shall be deemed prima facie evidence against the accused if he does not answer them, the. Judge before whom the case is brought will be absolutely free to consider the case on its merits as submitted to him.
– The clause as it stands provides that an accused person shall be deemed guilty in the absence of proof to the contrary. I fail to see in what respect the amendment would vary that position.
– I merely wish to give, an accused person full opportunity to have his case stated before a Judge, so that it may be dealt with on its merits. The. provision as it stands is contrary to all that we have been accustomed to.
– I am afraid that the Committee will not realize the distinction which the “honorable and learned member is trying to make. The clause as it stands is in keeping with the view expressed by Mr. Justice Owen in the decision of the Full Court of New South Wales in the case of ex parte Healy, that-
If the accused gives no evidence, his guilt must be taken to be established -, but if the accused does give evidence, and the magistrate upon the whole of the evidence before him has any doubt as to the guilt of the accused, it is his duty to give him the benefit of the doubt, and acquit him.
– Why not insert those words ?
– Because the clause is in itself sufficient. We simply provide that where a person is charged with an offence and declines to give evidence of a matter absolutely within his own knowledge, the case against him shall be deemed to be proved.
– Supposing that he could not give evidence?
– It is impossible to conceive of such a case, if he has any defence.
– Such a case occurred in New South Wales.
– I have before me the report of that case, and the facts are notas the honorable member suggests. The magistrate who heard the case made a mistake, and the Full Court overruled his decision.
– What is the objection to the use of the words “prima facie evidence “ ?
– The clause as it stands is in keeping with provisions embodied in several other Acts that have proved satisfactory. We have been told that this provision is unusual. In a judgment given by Chief Justice Marshall, in a similar case, we find this statement -
The Act under which this seizure was made declares that “ in actions, suits, or informations to be brought, where any seizure shall be made pursuant to this Act, if the property be claimed by any person, in every such case the onus frobandi shall be upon such claimant. SeeI Story, Laws, c. 128, 71, p. 633 (I Stat. 678, c. 22). In this case, then, the U.S. arenot required to establish guilt, but the claimants must prove innocence. It is not the duty of the Judge to justify the Legislature, but surely, if, in any case, such a legislative provision be proper, it is in this. The fact is generally premeditated, and is perpetrated under all the precautions and in all the secrecy which ingenuity cansuggest, and the means of proving innocence, at least, to a reasonable extent, which is all that can be required,are in possession ofthe accused’. In such a case, he may, without a violation of principle, be requiredto prove his innocence. In such a case, the absence of testimony, clearly in the power of theclaimants, if not supplied by other equivalent testimony, must be ratal.
Those words are absolutely in point when we consider thesubject-matter with which we are dealing.
– Would not the same argument apply to every criminal charge?
– The provision applies only to a particular case where the information is within the knowledge of the person charged. In many criminal proceedings, the onus of proof is, in specified matters, thrown upon the accused. There is, for instance, such a provision in the Foreign Enlistment Act.
– This is not the ordinary procedure in criminal cases. Why is the procedure laid down in this Bill different from that adopted in a case of felony ?
– In such cases, the facts are easily capable of proof by the prosecution, but this Bill deals with a class of cases where the defendant should have no difficulty in calling rebutting evidence. There is a similar provision in the Customs Act and the Excise Act, as well as in the English Consolidated Customs Act of 1870, which provides that in any information, certain matters shall be deemed to be sufficiently proved on averment, unlessthe defendant in such case can bring proof to the contrary.
– The instances cited are in connexion with the Customs.
– But there are similar cases, for instance in connexion with the diseases of animals. In such cases, the defendant is presumed to have known of the disease until he shows to the satisfaction of the Court that he has not- that is, he is presumed to bequilty unless he proves the contrary. In that, as in the cases immediately under discussion, the contrary is easy of proof. This is not an unusual provision, as is shown by the following extract from a decision by Mr.Justice Owen in the New South Wales Court -
The view I take of s. 144 is simply this, that it. relieves the Crown from the necessity of proving their case in the first instance by oral evidence, and allows the averment of the prosecution contained in the information, declaration, or claim, to beprima facie proof of the charge preferred against the accused. But when the information has been put in, and all the. evidence produced is before the tribunal, then it appears to me that the tribunal has to determine upon the whole of the evidence before it, whether the Crown has established the guilt of the accused or not.
The section referred to in that judgment is in the very words proposed in the Bill before us. Further, it is an advantage to have the same phraseology throughout the Statutes.
– I rise to a point of order. As to the procedure upon this clause, I suggest that the proposed new sections contained in it should be submitted to the Committee separately, although you, Mr. Chairman, have ruled that the clause must be taken as a whole. It must be admitted that the circumstances are somewhat unusual, seeing that we have three proposed new sections all contained within the one clause. If we decide, in regard to the amendment of the honorable member for Illawarra, that the words are to stand, those, of us who desire to have proposed new section 15A omitted, will be deprived of an opportunity of voting to that end.
– No matter how the clause may be divided with a view to suiting the convenience of the Committee, it will still be clause 4 of the Bill. There is nothing to prevent an honorable member from moving any amendment he thinks proper in the proposed new sections as they come under review in the ordinary course.
– But if the Committee decided that part of the proposed new section 15A shall stand, can we vote that the proposed new section be struck out altogether ?
– Even if we divided the clause as suggested, and we amended any part of proposed new section 15A, that proposed new section’ would still have to stand as part of clause 4 ; we could not go back and omit it ; so that we should arrive at exactly the same position that we are now in. If in Committee we commenced to divide up a proposed clause we might possibly be led into difficulty, because then it would be open to honorable members to divide proposed new subclauses, so that there would be no finality.
.- My desire is to move that the proposed new section 15A be struck out.
– We desire first to deal with the amendment of the honorable member for Illawarra.
– If we strike out the proposed section there will be no necessity for an amendment.
– I rise to a point of order. I understand that the honorable member for Illawarra has moved an amendment.
– No, amendment has been moved up to the present. The honorable member for Illawarra suggested an amendment but he didnot formally move it.
– To my mind the proposed new section15a is neither more nor less than a lazy man’s way of proving a case. Ever since the Magna Chartait has been assumed that a man is innocent until he is proved to be guilty. But the AttorneyGeneral now desires us to take a contrary view. This is to establish a very bad precedent. In the case of the unfortunate woman who was murdered at Ballarat, the departure proposed in this Bill would, if extended, mean that any person seen in her company before her death might bepre- sumed to be guilty, and find it impossible to prove his innocence. The proposed interrogation is following the system of the French, although there is not the slightest objection to the suggestion of the honorable member for Flinders to have interrogatories on the order of a Judge, as in a civil proceeding. But to say that a person must be assumed to be guilty on the averment of the Crown is un-English and unprecedented. In the case of mining accidents the averment or complaint isprima facie evidence, but that is a civil and not a criminal proceeding. Under the Bill, however, any person who cannot prove his inno cence may be fined or imprisoned.
– No ; if it be an indictable offence everything must be proved.
– But if a person is unable to pay a fine he must go to prison, and have a black mark against him all the rest of his life, so that the result is the same as- in a criminal charge. Why should the Crown say that it is too much trouble to get up the evidence and prove a case?
– I explained that sometimes it is not possible to obtain the agreement.
– There may be cases without an agreement, as the AttorneyGeneral mentioned. There is the case of theconfectionary trade.
– I did notmention any trade by name.
– The Attorney-General indicated that there were cases brought before him.. In this House I produced a copy of the Confectionery Combine’s agreement, bearing the name of the solicitor who prepared it, and it seems to me there ought not to be any great difficulty in subpoenaing the people associated therewith, seeing that there were copies of their signatures. I am not in favour of trusts, butI do not desire to see punishment inflicted on innocent men who may not be able to prove their innocence, as must be the case in many instances.
– The amendment of the honorable member for Balaclava will preclude any amendment of the proposed newsection. If the amendment be put and negatived it will mean that the proposed new section must stand, and therefore cannot be amended.
– I shall be happy to withdraw the proposal I have indicated if any honorable member desires toplace an amendment before the Chair.
– If the honorable member for Balaclava submits his amendment now, and it is agreed to, it will preclude any further amendment in this proposed new section. I suggest that he could attain his object by moving as a test ques.tion that the first words “ In any prosecution “ be omitted. Any subsequent amendment it was desired to move would then not lie interfered with.
.- A number of honorable members might :.>e quite prepared to see the proposed new section pass with the amendment of the honorable member for Iiia: warra, but would not be -prepared to accept it unamended. Consequently I suggest that the best time to test the feeling of the Committee would be after that amendment has been dealt with. I suggest that course because a number of honorable members’ would support the proposed new section if it can be made to read in the way that they desire.
Motion (by Sir William Lyne) agreed to-
That the House at its rising adjourn until 3 o’clock to-morrow afternoon.
House adjourned at 10.28 p.m.
Cite as: Australia, House of Representatives, Debates, 17 March 1908, viewed 6 July 2017, <http://historichansard.net/hofreps/1908/19080317_reps_3_44/>.