4th Parliament · 1st Session
Mr. Speaker took the chair at 10.30 a.m., and read prayers.
– A cablegram was published in the newspapers a day or two ago to the effect that a Copyright Bill, based on the recommendations of a Conference at which Australia was represented by Lord Tennyson, is to be introduced into the Imperial Parliament. Has the Minister of External Affairs received a report of the Conference, and, if so, will he state the effect of the Bill upon the Copyright Act which is on our statute-book?
– Lord Tennyson has cabled an outline of the measure recommended by the Conference, and I understand from the cablegram that the Bill to be introduced has been framed in accordance with those recommendations. The measure is not to be pushed on with until this Government has had an opportunity of reading it. Until the Bill comes to.hand we cannot say what action will be taken in regard to it.
MINISTERS laid upon the table the following papers : -
Lands Acquisition Act. - Disposal of land as part compensation to H. S. Bliss for lands acquired at Enoggera, Queensland. Manufactures Encouragement Act. - Return of bounty paid during the year 1009-10.
Mr.HIGGS asked the Minister of Home Affairs, upon notice -
Whether the officials employed to conduct the recent Federal election have received all payments due to them ?
If any electoral officers have not been paid, will the Minister expedite such payment?
– The answer to the honorable member’s questions is -
The Divisional Returning Officers were provided with funds for the purpose of meeting expenses in their respective divisions such as payment of persons employed. I am not aware of any officials who have not been paid. Accounts for the special fee gTanted to Divisional Returning Officers for conducting the election have been either paid or forwarded for payment as those officers adjusted their advances. The advances in six divisions are still unadjusted.
asked the PostmasterGeneral, upon notice -
In reference to a statement made by a member of a recent deputation to him that employes in the delivery and despatch rooms, General Post Office, Sydney, work up to100 hours, and in some cases 114 hours per fortnight - will he cause a return of the hours worked to be prepared and placed on the table of the House ?
– Yes. Instructions have been given for the preparation of the desired return.
Motion (by Mr. Fisher) proposed -
That this Bill be now read a third time.
– I intend to say but few words in expressing my regret that the Bill has been made to date from 1st July last, instead of from 1 st January next. Had the amendment which I had proposed been agreed to, the financial arrangement would not have been interfered with, except, perhaps, to this extent, that its duration would have had to be for nine and a-half years, unless it terminated on the 31st December, instead of the 30th June, 1920. The sum available for expenditureby the Commonwealth during the current financial year would have been the same as it will be under the Bill as worded. Sub-clause 2 of clause 4 provides that -
If, in order to comply with section eightyseven -
– I cannot allow the honorable member to refer in detail to the clauses of the Bill. The discussion of the clauses should have taken place in Committee. He will be in order in discussing the general principles of the measure.
– I have no wish to discuss details. I was merely, going to support my view that the amendment which I proposed would have made no difference to the financial arrangements of the Government. But it would have prevented the appearance of an attempt to invade the Constitution, whereby no good object is served. Consequently, my proposed amendment would have made the measure unobjectionable from the point of’ view of the Constitution. It is well to “ be off with the old love before you’re on with the new,” and we should remember that we cannot evade the constitutional responsibilities which are imposed upon us till 31st December next. I have been told by the Prime Minister that it is my desire to embarrass the financial business of the country, but I had no intention or thought to do that. Having protested against the provision which makes the Bill seem to operate six months sooner than we have a right to interfere with the financial arrangement, under section 87 of the Constitution, I shall content myself with expressing my regret that the advice of myself and others on this side has not” been followed.
– I welcome the statement of the right honorable member for Swan, an exTreasurer, that he has no desire to embarrass the Government in any way.
– Had the honorable member’s “amendment been agreed to, the financial position of the Commonwealth under the Bill would have been affected to the extent of a loss of£1,400,000.
– Not if the Bill had not been amended except as to its date.
– Had the Bill been made to commence on 1st January next, the sum available for expenditure by the Commonwealth would have been reduced by £ 1, 400,000. It would be out of order to go into this question again. The arguments which support my position, which are obviously sound, have escaped the honorable member’s recollection. I am glad that he does not desire to embarrass the Government, or to give back to the States more than the Commonwealth should give away.
Question resolved in the affirmative.
Bill read a third time.
– I move -
That this Bill be now read a second time.
This is a very short and simple measure. The Surplus Revenue Bill provides for the allotment among the States of a deficit of £450,000, which is practically the sum expended by the Commonwealth in excess of its revenue during the last financial year. iThe Treasurer had no authority to spend a penny more than the revenue of the year. Finding himself face to face with a deficit, he had no legal authority to raise money by means of a loan, an overdraft, or in any other way, and in these circumstances the duty devolved upon him to take some course to overcome the difficulty. The Government considered that the wisest policy to pursue, more especially having regard to the large increase of revenue during the last financial year, was simply to delay until this month the adjustment of the accounts. Fortunately there is in the Trust Funds of the Commonwealth a sum in excess of £500,000 which can be temporarily appropriated by Parliament for this purpose and used for the first six months of the year, on the understanding that it shall be repaid before the financial year closes. The whole principle of this Bill is that the Treasury shall be authorized to use £500,000 of these trust moneys towards the extinction of the deficit, and that it shall be refunded to the trust accounts prior to 30th June, 191 1. No other principle is involved in the Bill, and the discussion, to my mind, can only range round the question of whether it is advisable to take this course towards making good the deficit, and providing sufficient money to enable the Commonwealth Government to carry on during the first six months of the present financial year.
– What is the amount to the credit of the Trust Funds ?
– Taking into consideration all the trust accounts there is approximately nearly £790,000.
– Including the amounts to the credit of the naval defence trust account ?
– Yes; but there are Trust Funds amounting to£600,000 which can be drawn upon without embarrassing those accounts in any way.
– Leaving the naval defence funds quite free?
– Two-thirds of the amount to the credit of the trust accounts - between £500,000 and £600,000 - could be used in this way without embarrassing the transactions that are properly financed by them.
– When didthese difficulties arise?
– On 30th June last.
– The honorable member knew that they were going to occur.
– We saw the difficulty coming.
– Why did not the honorable member get this authority before?
– I say frankly, and 1 hope that I shall always be frank, that to have convened Parliament a month earlier than we did would have been to call together a moribund Legislature.
– This authority is to extend only to the last day of June?
– Yes, this Bill is to cover the whole deficit. I do not wish to go into the question of the £37,000 taken from the Trust Funds, to which reference was made on a former occasion, and in connexion with which there may have been a technical breach of the Audit Act. That amount is included in the total of £450,000, and the one is as bacl as the other.
– That is a queer recommendation for this Bill.
– It is a legacy from the honorable member.
– I venture to say that, had the honorable gentleman found himself in the position that confronted me as Treasurer, he would have had no legal authority to raise money by any means whatever, save that to which I resorted.
– Does the honorable member mean to say that lie could not have obtained an overdraft by asking for it?
– That would have been just as much unauthorized as that which I did.
– But the honorable member would not have broken a law actually in existence.
– We had no authority to obtain an overdraft.
– And the Government broke the law.
– I will concede the technical point; but does the honorable member contend that there was a more serious breach of the law than we should have committed by obtaining an overdraft?
– Why did not the honorable member call Parliament together earlier than he did ?
– Had we done so, nearly one-third of the members of another place, who had been defeated at the recent general election, would have been entitled to sit, and no one who respects our representative institutions would justify that, except, perhaps, in case of war, or some dire necessity.
– There would have been two sets of senators - the defeated senators and those elected in their stead.
– The newly - elected senators could not have sat had we called Parliament together before 1st July, and we should have had defeated senators legislating. The finances of the Commonwealth are unnecessarily embarrassed by the fact that the Treasurer has no authority at .present to spend a penny after the 30th’ June of each year.
– It is intended that the Treasurer should meet, before that date, the expenses of the current financial year.
– I would remind the honorable member that the Federal Parliament is in a different position in this respect from that occupied by any other Legislature. If a general election takes place before the 30th June, the newlyelected senators cannot take their seats until the 1st July. If the Parliament were to meet, after a general election, before the 1st July, then defeated senators would still be sitting members, and entitled to legislate.
– That occurs’ under the Constitution of the United States.
– The position there is very different from the position in Australia. Here we have responsible government; but I do not think the honorable member will allege that the system of executive government in the United States is the same as ours.
– The reason is that in the United States the State Parliaments have to elect the senators.
– But the basis of executive government is entirely different.
– Not necessarily.
– The head of the Executive is elected by the people.
– But that does not affect this issue.
– I think it does, because the whole assumption of responsible government is executive control.
– I am referring merely to the question of the Trust Funds.
– In passing, I put it to the right honorable member for Swan whether it would not be advisable so to amend the Audit Act as to bring our practice into conformity with the practice of some Parliaments, and so give the
Commonwealth Government one month’s supply as from the beginning of each financial vear.-
– Where is that done?
– In all the States, I think.
– Not in Western Australia.
– I think it is so in Queensland, and I think that two months’ Supply is granted in Victoria.
– As long as it is based on the previous expenditure authorized by Parliament.
– Some of the Audit Acts of the States authorize the Government of the day during the first month of the financial year to incur expenditure on the basis of the Estimates for the previous year. Such an authority would overcome the present difficulty.
– Either do that, or change the financial year.
– Once in three years we could grant an additional month’s Supply at the close of the session.
– We could do it, but would it be advisable? Would it be a sensible amendment of the law, and one which would not take the control of the finances entirely from the representatives of the people? I think I have dealt with the principal points involved, but I shall be glad to supply any further information.
– What is the Treasury going to do with this money?
– As a matter of fact, we ask under this Bill for £500,000. The “deficit amounts to £450,000. This Bill simply provides for a temporary loan from the Trust Funds from 30th June last to 30th June next. It does not authorize the Commonwealth Treasurer to carry the obligation any further. In short, it may be described as a proposal for a temporary loan of our own money, to meet the difficulty that has arisen. I have the responsibility of meeting that difficulty at the present time, but it came down to me from my predecessors.
– What has the Government saved by refraining from obtaining a temporary overdraft from the bank?
– The saving has been considerable, but I do not wish to go into details. It is only fair to say that the States, without exception, have not raised a serious objection to what has been done, and, after all, it is really their money.
– The closing remark made by the Treasurer supports the contention which I have put forward from the first, namely, that this money belongs to the States, and that it has been withheld or taken from them. But my regret in this regard does not relate so much to what the Treasurer has done, because, if a Government makes a clear statement of its actions, accepts responsibility for them, and does not attempt to shield itself by any play of words, then the House can deal with it as it thinks right. My objection to the whole transaction is that the Prime Minister has not been candid in regard to it. Had he told us that there was a certain deficit on current account, and that he had had to invade the Trust Fund to the extent of £500.000, but was going to ask us on the first day we met to give him this indemnity, we should have accepted his statement as a straightforward one, and should have known exactly where we were. He endeavours to excuse his action by saying that he has only “ delayed the adjustments to the States this month.” How can there be “ adjustments “ to the States in the matter of such a large sure as £450,000? Surely it is not fair to use the word “ adjustments “ in that connexion? In the past, adjustments which have been made to the States have been in respect of small sums when there has been no deficit to face. When the accounts have been closed on the 30th June, which is the end of the financial year, it has sometimes been found that a small amount requires to be debited or credited to a particular State. That is what I call an “ adjustment.” The Budget papers reveal that in the past adjustments have had to be made of a few thousand pounds, but not on account of any deficit. That, however, is a very different position from that which the Prime Minister has disclosed. Had he taken this House into his confidence,- by frankly acknowledging that he had committed a breach of the law, because he thought it better to take money from the Trust Funds, and to ask the Parliament to indemnify his action, than to borrow from the banks, we should not have said that he had done any very great wrong.
– The honorable member would have said a great deal more.
– I would not have said half as much as would the hon- orable member if he were not sitting where he is. He is not particular about the political weapons which he employs when he desires to attack anybody. I do not know of any person who is more politically unscrupulous than is the honorable member.
– Order ! The honorable member must withdraw that remark.
– I withdraw it. We have been told that this money is required in order to pay the States until 30th June last. For the last financial year, the States were entitled to be paid under the Constitution £8,491,521, but they have received only £8,084,627, so that there still remains a balance of £406,894 to be returned to them. We are now informed that that amount will be paid out of the Trust Funds so soon as the authority of Parliament for that step has been obtained. To me the most extraordinary feature is that the Government should have adopted the course which they have followed, because it was clearly their duty to pay to the States the full three-fourths of the net Customs and Excise revenue to which the latter were entitled for the financial year ended 30th June last. They were bound to do that under the Constitution itself. Why they have withheld this money from the States I cannot comprehend. They have, however, paid this £406,894 to somebody else. We have not been informed in what way this £406,894 has been expended. It must have been expended by the Commonwealth, otherwise it would be in the Treasury chest, and available for payment to the States. But the Prime Minister has informed me, in answer to a question, that the Commonwealth, has not applied more than its one-fourth share of the net Customs and Excise revenue towards its expenditure. What, then, has become of this 406,894? To have violated the Constitution is the greatest wrong which the Government could commit. During the past financial year the Treasurer received , £11,322,028 from Customs and Excise, of which sum threefourths had to be held in trust for the States. That money - three-fourths- did not belong to the Commonwealth. Not more than one-fourth of it could constitutionally be applied by the Commonwealth to its expenditure ; the balance was returnable to the States. That balance has not been returned to them. What has become of it ? Under the Constitution not more than £2, 830, 507 should have been applied by the Commonwealth towards its expenditure. The Prime Minister has committed the greatest wrong that he could commit by violating, not a law made by this Parliament, but the law under which it was created - the Constitution itself - and by using funds held by him in trust for the States.
– When the Prime Minister did not bring down a Bill asking Parliament to indemnify his action the honorable member condemned him, and when he does present such a measure the honorable member also condemns him.
– I do not think that the honorable member understands the question. I know how difficult it is for him to explain anything. I wish to know what has become of this shortage of money that does not belong to the Commonwealth.
– The Prime Minister carries it about with him.
– What would the honorable member for Herbert say if he had a trustee of certain funds, whose duty it was to pay him three-fourths of all the money he collected, and if that trustee withheld from him the portion which legally belonged to him and used it for his own purposes?
– I would have him locked up if I could.
– That is the treatment which the Prime Minister deserves, because he has broken the greatest law of all, namely, the Constitution. He has violated its provisions in preference to obtaining the money he required in some other way.
– And he is asking Parliament to indemnify him for having taken that money.
– He has denied having taken it. He does not deny that he received , £1 1,322,028 during the last financial year, and that he had no title to spend more than one-fourth of that amount. Yet he says that he has not the other threefourths.
– A portion of it has been appropriated to meet the deficiency in the general accounts:
– Is that justifiable? Does the honorable member suggest that it is not imperative that three; fourths of the net Customs and Excise revenue should be returned to the “States under the Constitution? No “ Government which had not a concrete majority behind it, such as the present Ministry has, would dare to defy the provisions of the Constitution in the way that has been done. The late Government, which had as large a majority behind it as has the present Ministry, would not have dared to do such a thing.
– They had not a concrete majority.
– No. They would not listen to the crack of the whip in a case of wrong-doing like this. The present Ministry have a concrete majority behind them, but for all that their action in taking money that does not belong to them is unfair to their supporters.
– Their majority is not merely concrete - it is reinforced.
– Had we dared to do such a thing we should have been expelled from office, and the Prime Minister would be expelled from office if he had not behind him a majority which is prepared to absolve him from responsibility for any and every act which he may perform. I again ask what has become of the sum of £406,894; it ought to have been held inviolate as it belonged to the States ? How comes it that the Prime Minister can take out of the till of the Commonwealth, money which belongs to the States under the Constitution?
.- We are now dealing practically with two “propositions. The first to cover a past appropriation obligatory by Statute, while the second, an appropriation of a considerably larger sum is, so to speak, in the future, for which authority is now asked. The past appropriation amounted to something over £30,000 and the appropriation for which authorization is now sought, but which has not yet been made, even by a book entry, makes up the deficit of £450,000. In regard to the past appropriation of £30,000 odd we have the old justification that it is “ such a little one “ ; and it has also been urged that it would have been extremely inconvenient to call together practically a defunct Parliament merely for one day. Still that course could have been followed within the law, and in one day the Government could have obtained the authorization they desired, and thus have fulfilled the requirements of the Constitution.
– It is very difficult to do anything in one day.
– I feel sure that the Prime Minister would only have had to state the circumstances of the case and the matter would have been dealt with by Parliament in a few minutes. But I am not going to press that point, because there were disadvantages associated with the adoption; of that course which had to be taken intoaccount. But. while we may be prepared to that extent to condone what has been done, it would be the worst possible precedent to allow the action of the Government to pass without challenge.
– I do not seek to justify it, and I have never done so.
– We must emphasize the fact that even in the exceptional’ circumstances of the case, and notwithstanding the small ness of the amount inquestion, this breach of the law ought not to have been committed. I should greatly have preferred that the Prime Minister had taken the alternative step of obtaining - as he could have done for the asking - the small amount of . £30,000 odd for a few days or a week in the ordinary way from a bank. The cost would have been infinitesimal. But if that course were objectionable, I think I can say - without speaking on any information whatever, but with’ entire assurance - that if the Prime Minister had intimated to the Treasurer of the State in which we are that the sum of, say, , £50,000, would have been of use to the Commonwealth Government for a week or two, he would have been accommodated for the asking, and without any difficulty. He would then have complied with the law, and would have been financed over a temporary difficulty.
– Some of the Premiers of the States would not be very willing; to accommodate the Commonwealth Government.
– I am not now speaking of other State Premiers. There is more than one State Government.
– The honorable member recollects that the books had to be closed suddenly, and in six different States.
– I know ; I recognisewhat the situation was. But in the present case Parliament is. bound to protest, and must condemn this action.
– Hear, hear.
– While listening to explanations and excuses, it is our duty to say firmly and clearly that this kind of thing is not to be done again.
– Hear, hear.
– And that on any future occasion such a breach of the law will be looked upon far more jealously than it has been in the special circumstances of the present case.
– The circumstances cannot arise again.
– I hope not. The Prime Minister’s suggestion is that such a demand cannot occur again in this form. But it may occur in some other form.
– The constitutional point cannot arise again.
– I think not, but would not say even that absolutely, because there are so many ways in which it might quite easily arise under other circumstances. All that I wish to add further is that the Prime Minister should look ahead to find the best means for providing more elasticity at the closing of the Commonwealth financial year. I pass by the£37,000, having entered the necessary protest, and taken the proper objection, with a suggestion as to how the temporary difficulty could have been met. In regard to the second proposal, which is to authorize the use of £500,000 odd, we know that £400,000 odd is required for the debt due to the demands of the States quite irrespective of anything else. No one will grudge the Prime Minister a little latitude in order to place the Treasury of the Commonwealth in a more convenient situation. In respect to this, there is little or nothing to be said in the way of comment or opinion from the merely financial side. We have this money lying idle to the credit of the Government ; we havethe assurance of the Treasurer that it will not be required for any of the particular purposes for which the Trust Fund exists ; and therefore to use this idle money - -
– Of course, only temporarily; it is to be paid back before it will be required for the uses to which it was dedicated. That is a perfectly legitimate and businesslike transaction under the circumstances. Consequently, with an assurance as to the duration of the demand and the replacement of the money, I do not think anything more need be said. The proposal is a proper one to submit to Parliament. I should not have risen to speak on this subject, were it not that having regard to the Constitution in its financial provisions in the first place, and to financial relations generally in the second place, it becomes all those who have had any experience of public life, and who realize the dangers and risks that surround the slightest departure in finance from the plain high road of accepted principle and established law, that they should not consider any lapse loo minute to note or comment upon, in order that we may avoid shipwreck. Having fully realized the seriousness of the situation, and entered our protest, I think that as an Opposition in this Parliament we have fulfilled our part.
– I think that the Prime Minister is to be congratulated for havingbrought down this Bill for the consideration of the House. When the Prime Minister mentioned the subject at the commencement of the present session, great exception to what he had done was taken by the right honorable member for Swan and others - as, of course, exception would have been taken to anything that he said or did.
– NOj no; that is out of order.
– No, it is not. Anything that the . Prime Minister said or did, I repeat, would have been taken exception to by the right honorable member. I am entirely in favour of this Bill, because I quite agree that Trust Funds should not be used by a Treasurer without the consent of this House, and without the money being borrowed, as the Bill proposes, for a certain definite term, and repaid at the end of that term. If . the Prime Minister had done such . a thing when the House first met, all would have been well and good from my point of view. But experience teaches me that there would have been a great onslaught from the right honorable member for Swan, if not from the Leader of the Opposition. Greater objection would have been taken then, and we should have been much longer in discussing the subject than we are likely to be at the present time. Therefore, the’ Prime Minister has done what was necessary in the shortest and most practical way. I think it very satisfactory that a Bill has been presented to the House in the form in which we have this measure before us.
– Where is the money ?
– The right honorable member should know very well that it has gone in paying his debts - the debts he left behind at the Treasury, very likely.
– And which I inherited from the honorable member.
– No, the right honorable member did not. He created a deficit after I left office.
– I had only a few months in office, anyway.
– And the right honorable member wanted to commence borrowing. He has borrowing on the brain. He would borrow now, if he could. I am glad that the Prime Minister has set his face against borrowing - at any rate until we are compelled through great urgency. I do not think that we should follow the example of the States in this respect. They have borrowed as much money as they could.
– And they made the country.
– They wasted some of the money. Perhaps some of the borrowing in the earlier stages of the development of the States was legitimate. I think that, probably, it was. But we do not want to create under the Federal Government a system that would not be a good one for the credit of the Commonwealth. We should certainly keep within our means if we can, and should take care that our revenue covers our debts. It is possible that the States will be a little short, and indeed I think that the Prime Minister will find himself short in a few years. If I were in his position now I would not pay so much to the States. They have had a great deal too much in the past. The consequence has been that some of them have got into extravagant ways, and now find it difficult to get out of them. It is just as well to let them feel the pinch resulting from their own action in the past. The Federal Government should look well after its own finances.
– Order. I ask the honorable member not to go into that matter.
– We are now dealing with finance, a subject which covers rather a wide range, and I am onLy referring to general finance incidentally. I rose particularly to point out, however, that the Prime Minister has followed a legitimate and proper course in bringing down this Bill. No one should raise any objection to it. I admit freely that the Trust Funds should be jealously guarded, and that nothing should be done, and no new practice instituted, which would risk their position in any way. As the Leader of the Opposition has said, the Prime Min,ister has done what he was called upon to do in bringing down this Bill and asking for the loan of money from the Trust Funds. I think that that was a much better course than going to the monetary institutions for the purpose of borrowing a sum upon which a considerable interest would have had tq be paid. That would have meant adopting a system which we should avoid as much as we can. The right honorable member for Swan wants to know where the money has gone. I do not suppose that it has been wasted. I do not suppose that it has been sunk in the sea. I do not suppose that the directions in which it has been spent are out of sight. ‘ Presumably it has gone to pay some of thedeficiencies left to the present Treasurer. Now he is asking that what he has done shall be put in legitimate form, and I think that the House should be very glad to support the Bill.
.- I heartily indorse the remarks which have fallen from the Leader of the Opposition. I consider that it is the duty of an Opposition to enter a mild protest against what has occurred in connexion with the Trust Funds. When the Prime Minister found himself short of money and could not get the sanction of Parliament for taking money from the Trust Funds that had accumulated, it appears to me that he should have gone to one of the banks and arranged for a temporary overdraft. But the Prime Minister is so anxious to avoid”, anything in the shape of borrowing that he has deliberately broken the law. I admit that it was a comparatively innocent breach. When the Prime Minister was making his statement at the opening of the present session, he quite ingenuously admitted that he had taken from the Trust Funds sums temporarily required. I am sure that no one sitting here accuses him’ of the slightest thing that is underhand, or with any intent to do wrong. But it seemed from his statement that he really did not’ appreciate the meaning of the” act that he’ had committed. I am glad that he hastaken this early opportunity of securing anindemnity. I am quite satisfied to Tet theTreasurer have the half-million that he is-, asking for, or any other sum, provided that the money is paid back when the Common-‘ wealth is in a position to repay. I am gladto see that the Bill provides for that. But at the same time what has occurred is: serious. If a Government that is embarrassed can resort to this procedure, a! great deal of money might be taken out of- the Trust “Funds before Parliament was aware of it, and it might even be difficult in circumstances that might occur in years to come, to replace the money as we should be required to do. Though I am glad that the Treasurer has brought down this Bill I am sorry that he did not provide for the temporary needs of the Commonwealth by means of an overdraft
– Would an overdraft have met the case ?
– I think it would. I am sure that if the Treasurer had gone to any of our financial institutions they would have been glad to accommodate him. A temporary overdraft would not have involved borrowing in the sense that the platform of the Labour party refers to borrowing.
– What is the difference between borrowing from the banks and making temporary use of trust money?
– Does the honorable member say that borrowing would have been the constitutionally correct way of meeting the difficulty?
– I have heard the 7Prime Minister say that he could not, under the Constitution, have borrowed from :a bank. I am not sure about that.
– Would it have met the case constitutionally even if I had borrowed ?
– I understand that the Prime Minister wanted about .£37,000. If he had got that money from a bank it seems to me that that would have met the case. I am not aware of any provision of the Constitution which would have prevented the Treasurer from making an arrangement with a bank.
– He would have had to carry an Indemnity Bill afterwards if he had done so.
– That would have -been better than to act as he did in taking money out of the Trust Funds in defiance of the Audit Act.
– Even if we did not expend more than our one-fourth.
– Our one-fourth only refers to Customs and Excise revenue.
– I know of nothing, and have heard of nothing, which would have prevented the Treasurer from going to a bank, and arranging for a temporary overdraft ; and I say further that he might have done so without in any way violating -the Labour party’s pledge not to borrow. % think the course the honorable gentle man should have followed is that which I have suggested, and had he followed it, I am sure that this House would have been prepared to ratify his actions, as I have no doubt it will now ratify the very much more serious action he did take.
– It was not so very serious.
– It might very well have been serious. It might be said that it is not a very serious thing for a man to take a few pounds from a till if he puts it back again, but we are bound to consider what that kind of thing may lead to. I am satisfied that if the Treasury officials knew what the Treasurer proposed to do, they would have directed his attention to its illegality.
– The responsibility is mine, not theirs.
– I quite understand that the Treasury officials are exculpated if they pointed out the illegality of the proposal to the Treasurer. The honorable gentleman could, no doubt, do what he did in defiance of the Treasury officials. Whilst I am sure that honorable members will pass the Bill now before the House, I think the Opposition are quite justified in directing attention to the serious nature of the action taken by the Treasurer. What has taken place will, I hope, induce honorable members generally to keep a very careful watch upon this kind of thing in the future.
. The criticism of the Opposition in dealing with this measure shows that they realize that the position of the present Government, when they took office, was a very difficult one. Every one was aware at the time that there must be a shortage and that provision to meet it must be made. Various suggestions have been made this morning as to how the difficulty might have been overcome. Some honorable members have contended that to approach the banks, and secure a loan or an overdraft, would have met the case ; but, to my mind, exactly the same objection would apply to the adoption of that course as applies to the taking of the money from the Trust Funds. I am of opinion that the Treasurer would not have been justified in approaching the banks for a loan or an overdraft without the authority of Parliament, and that if he did so, he would have been obliged, as he is doing now, to ask for an indemnity from Parliament.
– The difference is that between doing something with the authority of Parliament, and doing it without that authority.
– I understand the point. The honorable member for Ballarat has said that the Treasurer might have approached one of the State Premiers with a view to getting assistance to tide him over the difficulty. I think there would have been a very much greater outcry from the Opposition, and probably also from the Ministerial benches, if the Federal Government had’ approached a State Government with a view to getting monetary assistance to tide them over their financial difficulties. I think that that course, if adopted, would have met with much greater objection than is offered to the action which the Treasurer did take. What did he do in this instance? He took a certain sum from the Trust Funds without the authority of Parliament. I wish, as a young member of the House, to say that I realize fully that no Government is entitled to interfere with the Trust Funds without consulting Parliament, but, whilst I realize that, I must in fairness look at the position in which the present Government were placed. They came into power in May last, within less than two months of the close of the financial year. They knew that there would be a heavy deficit, and that they must meet it. Owing to the fact that a number of new men elected to the Senate could not take their places, Parliament could not be called together in time to deal with the matter. The Government, in the circumstances, had to consider what was best to do, and they committed what the Prime Minister has admitted to be a technical breach of the law in taking money from the Trust Funds. The very mild criticism we have heard from the other side shows that there is a sense of fairness amongst honorable members of the Opposition, and that they realize that the Government were compelled to face a difficult situation. The Treasurer might just as well have taken the Trust Funds, seeing that the money belonged to this Parliament, as have adopted any other course that has been suggested as open to him. I can inform honorable members that in New South Wales at one time Sir George Reid took no less than £3,000,000 from the Trust Funds, and Sir William Lyne had to ask Parliament to indemnify the right honorable gentleman. If honorable members opposite had been placed in the position in which the Prime Minister found himself on assuming office, they would have found it a very difficult one indeed, and I doubt whether they would have discovered any way out of it other than that adopted by the honorable gentleman. I believe that, in the circumstances, the Treasurer was justified in committing the technical breach of the law, and seeking the indemnification of Parliament as early as possible. I believe it was better for him to do what he did than it would have been to make a temporary arrangement with a bank to borrow money without authority of Parliament. I wish, however, to place on record my opinion that I do not approve of any interference with Trust Funds, if it can be avoided, and it is only the peculiar circumstances existing at the time that justified the Treasurer in committing the technical1 breach of the law that was committed.
– I do not intend to occupy more than a few minutes in discussing this Bill. The Government were placed in a difficult position in having to make both ends meet financially before an opportunity was’ afforded to consult Parliament. My onlyreason for speaking on the second reading of the measure is to urge that action should be taken to prevent, if possible, a similar set of circumstances again arising. The Trust Funds, even on the admission of honorable members opposite, should be held inviolate. We recognise that so far the Treasurers of the’ Commonwealth have been thoroughly honest and reliable men, but wemust look forward to what might occur in the future.
– I did not touch the TrustFunds.
– I am aware that the honorable gentleman says that he did not do so. I should like to know exactly the details of the transaction, and’ the Auditor-General’s report thereon, not that I object to what was done, because I agree that it was absolutely necessary. I invite the consideration of the Treasurer, as a fair, cautious-minded Scotsman, tothe facts before us. Clause 6 of themeasure which we discussed last night, and’ section 94 of the Constitution, provide that at the end of each year any surplus revenuein the hands of the Federal Treasurer mustbe paid over to the States, and divided per capita amongst them. The result will be that the Treasurer of the Commonwealth will always make sure that he has no such surplus. That is to say, he will: appropriate it before the end of the year. We all know what is going to happen, and Federal Governments in the future will pass any possible surplus into Trust Funds, to put it out of the reach of the State Governments. That being so, we shall possibly establish some further Trust Funds, which in the process of time may become very extensive. We should look forward to that end, and take measures for safeguarding those Trust Funds from Treasurers who might be very much less scrupulous than the present or past Treasurers of the Commonwealth. Measures are to come before Parliament for consideration which will create Trust Funds of very large amounts, running into millions of pounds. We do not know what is going to be done with them, but however they are invested they will form Trust Funds. What I urge upon the Government is that they should consider the significance of the facts before us, and frame some better method of preserving the Trust Funds in the future. There might be associated with the Treasurer some outside non-political body as trustees with him of those funds, to prevent their wrongful use.
– My fault, if any, was in mot taking them.
– I do not know whether the honorable gentleman took them or not, but in this Bill he is asking us for an indemnity for taking them.
– No, the honorable member should not say that.
– The honorable gentleman’s excuse, apparently, is that his fault was a very little one. He could not call Parliament together prior to the necessity arising for using the funds on account of the position he was in owing to our having, as it were, a double set of senators. We should remove that difficulty, and we should carry out some such amendment of the Audit Act as has been suggested, by which the Auditor-General would be authorized to consent to the payment, for a month at least, of the ordinary expenses of the Commonwealth on the basis of the previous year’s appropriation, so as to tide over the difficulties of a period during which it might be inconvenient to call Parliament together. All members of Parliament, whether sitting at the back of a strong Government, or of a weak Opposition, should be anxious to retain for Parliament the control of all moneys of the Commonwealth, whether current revenue or Trust Funds. The control should be in the hands of Parliament, . and any measures we can take to safeguard the funds, even if we think there is, as the lawyers say, an extra-abundance of caution, should be taken, and the Treasurer held to them. The fact that there are extenuating circumstances in this case ought to lead the House to pass the Bill without opposition, but it is only right to point out the possible dangers ahead, and the reasonable means that can be taken to avoid them.
.- My main regret in regard to this incident is that the calm with which the action has been . received seems to show that Parliament has overlooked, for the time being, the immense responsibility that devolves on it in regard to the custody of the public funds. The only control we exercise over Ministers- because the Ministers, although elected and directed by the caucus, are still Ministers of the Crown-
– I ask the honorable member not to follow that line of argument. He knows that it will only provoke interjections which he has no right to provoke.
– I can assure you, Mr. Speaker, that, young and inexperienced as I am, interjections are the last thing I desire. A Minister of the Crown is part of the machinery of the Crown and of this Parliament, and he ought not to be allowed to interfere with the funds that have been placed in a sacred trust, without serious protest, because otherwise Parliament is definitely parting with its only hold over the public affairs of the country.
– Indemnity Acts are as old as the hills.
– So are a number of other things which occasionally land people in the police court.
– I do not admit that this is an Indemnity Bill.
– Then why is it antedated 30th June this year?
– To meet the Constitution.
– I cannot understand the Prime Minister, who seems to say one thing in the Bill and another thing himself, although that is nothing very new. What concerns me is that we ought to be very rigorous in the matter of Trust Funds. I am not labouring the p.oint at this juncture, but I should like to say that there was a choice of alternatives before the Prime Minister, in the difficult circumstances in which he found himself, arising out of the peculiar constitution of the Senate until after 30th June. The Prime Minister had the opportunity either of meeting the Senate as it was constituted before that date, and putting the case fully before them-
– The honorable member is a very young man !
– I appeal to you, Mr. Speaker, who are so solicitous for my welfare in the matter of interjection, to enable me to. have an opportunity to continue my remarks. The Senate might have been intrusted, and this House could have been intrusted, with a simple appeal before 30th June for funds that were urgently required in the public interest. I venture to say that no member of Parliament would have abused his position to prevent the Government getting the funds, because to have taken such an attitude would have brought the utmost unpopularity and condemnation upon the party to which he belonged. We have never yet heard of a party in Parliament preventing the passing of Bills to meet the public urgency and departmental supplies. Why should not the Senate have been called together to enable the Government to avoid the necessity of putting their hands illegally and unlawfully, and, I think, though not in a personal sense, dishonestly, upon the Trust Funds of the country ?
– Order !
– I am now referring to political dishonesty.
– The honorable member must withdraw the remark.
– Well, sir, if you think that it is not dishonest to put hands on the Trust Funds I shall withdraw the words.
– It is not a question of what I think; the honorable member must withdraw the remark.
– I withdraw the words, although I carefully prefaced them by saying that no personal dishonesty was meant.
– That does not justify the honorable member’s remark, which I ask him to withdraw without any qualification whatever.
– I withdraw the words without any qualification whatever. I do say, however, that an action of the kind is one of immense importance.
– The honorable member does not understand’ it, of course !
– Why should the Prime Minister, from his place in Parliament, as chief Minister of the Government - a position that demands a certain amount of dignity - be permitted to insult an honorable member who is endeavouring to address himself to the question in a reasonable manner ?
– If the honorable member feels that he is insulted, and draws my attention to the fact, I shall see that the insulting words are withdrawn.
– I shall certainly withdraw the words.
– I am glad the Prime Minister has done so. The position I take up is that we should follow the practice of the House of Commons, which has had to wrest from the Crown the power over the public purse. In the House of Commons, the last action of the Speaker is to hand over the Appropriation Bill to the Government only after the House has risen. That is to prevent any new business being brought before Parliament after Supply has been granted ; in other words, Parliament- recognises, and the custodian of the powers and privileges of Parliament recognises, that Parliamentary control over public affairs is lost the moment Parliament parte with the control of the public purse. We may let bygones be bygones, but in thefuture it ought to be recognised that when money is placed in a trust fund, it is meant to be kept there, and not to be used for any purpose under any other set of circumstances whatsoever. The honorable member for Hunter voiced his protest, and said1 that “Trust Funds should not be invaded if: it could be avoided,” but I go a stage further, and say that honesty should be obligatory on every man, whatever difficulties and temptations may assail him. That is the best and only policy to be adopted by a democratic country in connexion with Trust Funds.
– Why does the honorablemember think that that is the best policy ?
– I have many shining examples before me of the other policy, and* I am bound to confess that honesty, afterall, even if it does not always meet its own reward, is the safer and more consistent policy to adopt.
– 1 ask the honorablemember to confine his remarks to the question before the Chair.
– The Bill, as matters stand, is one in which I thinkthe House might acquiesce. It is not much use saying anything, seeing thatthe Government have the numbers and! that the majority, apparently, are determined.But the Government would be wise if they introduced a penal clause into the Acts governing Trust Funds, imposing on Ministers a very serious responsibility beyond any. act of reparation by a subservient majority afterwards, in order to debar any persons who happen to hold Parliamentary power in the future, from dipping their hands into such funds against the law of the country and the spirit of our Constitution.
. -On the last occasion on which a question of the kind was discussed, the Government were condemned for introducing a Bill of this kind ; but, having now done so, they are subject to a certain amount of friendly criticism. I consider that the Government by their action have saved the country thousands of pounds. Had they gone to the banks for accommodation, it would very likely have been extended over a period of six or twelve months, seeing that a loan would have been contracted, and would have meant thousands of pounds for interest, although they had at their disposal funds which they were prepared to use for the time being.
– What will the Government’lose by using the Trust Funds, which, I take it are out at interest?
– The Government will lose nothing, seeing that the use of the Trust Funds is only a bookkeeping entry.
– I have not touched the Trust Funds.
– Had the Government borrowed the money from the banks, they would have had to pay about £13,000 in interest; and, surely, under the circumstances, the best has been done in the interests of the country. There is no suggestion made that a wrong use has been made of the funds, and the Commonwealth should be commended for guarding the finances of both States and Commonwealth.
.- The honorable member for Hunter put the case very mildly when he said the Prime Minister had committed a technical breach by utilizing the Trust Funds, with a view to subsequently asking Parliament to indemnify him.
– That is not correct.
– If I remember rightly, the Prime Minister informed the House that he had no intention of asking Parliament to indemnify him for any action he has taken.
– Hear, hear. This is not an Indemnity Bill.
– It is a Bill to get legal authority for what the Prime Minister has done.
– That is not it either.
– Apparently, in response to a request from this side of the House, the Prime Minister has considered it advisable to introduce this measure of indemnity - there is no doubt that is the object of the Bill.
– The Prime Minister has not spent the money yet.
– He has spent a portion of it, or he misinformed the House about a fortnight ago. I can hardly follow the reasoning of the honorable member for Wilmot, and others, who advised the Government to borrow money from the banks in order to meet current expenditure, because that, in my opinion, would be a very silly procedure when there is money of our own at their disposal. No sane person would object to Trust Funds being used to assist the Treasurer over a temporary difficulty, and, seeing that the funds are to be recouped in the next twelve months, I support the Bill most heartily. I think, however, that the Treasurer has shown very little consideration for the difficulties of the State Treasurers in delaying this measure so long. It should have been one of the first Bills placed before us so tlrat it could have been passed before the special adjournment of the Senate, and an adjustment made in regard to the State payments before the 15th of the present month. The Prime Minister should have remembered that the State Treasurers have their obligations to meet early in the financial year, and he ought to have released this money some fourteen days ago. However, as I say, I have no opposition to offer to the Bill ; and I congratulate the Prime Minister on the fact that he did not apply to the banks, though I blame him for the delay in introducing this measure.
– I should like to say a word or two in regard to the breach of law by the Prime Minister, who has either taken the money out of the Trust Funds, or has acted equally illegally under the Constitution by having an overdraft at the end of the financial year.
– But is it illegal to have a deficit?
– He either had a deficit, or he took the money out of the
Trust Funds. If the money was illegally taken out of the Trust Funds, I think as a business man, that the matter requires our severest condemnation. The Trust Funds ought to be held absolutely sacred, iand kept intact.
– Some of them are under the control of the Treasury, without parliamentary authority, but I declined to touch even those without telling Parliament.
– I recognise thatthe occasion was exceptional; but if the Trust Funds are to be of any use, and if the object of Parliament in putting the money aside is to be achieved, what has happened must not become an every-day practice, or otherwise nothing will be sacred. Any Treasurer who is hard up for the moment may do what Parliament has distinctly said he shall not do - trench upon the Trust Funds. We cannot treat that matter too seriously. If any business man trenches on trust funds, he runs a great risk of losing his liberty. I really think that Parliament is likely to pass this matter over too lightly. The honorable member for South Sydney said that the Treasurer had saved the country about £13,000 by taking this course, but surely that cannot be the case.
– Very likely he would have had to borrow the money for twelve months.
– Surely the Treasurer is a better business man than to borrow for twelve months what he could get on a temporary overdraft for a few days.
– He would require authority from Parliament for that, would he not?
– I think not. If he were forced to choose between the two, his proper course would be to call Parliamenttogether ; but I quite agree with his argument that he would have had to call together a Parliament of which one branch would not have comprised the true representatives of the people. That, of course, is an extenuating circumstance, but I think the proper course for him was to borrow the money in a straightforward way. If that would have been illegal, he would have had the alternatives of trenching on the Trust Funds, which is a very serious matter, or committing an illegal act in borrowing for a few days, and I think if he had explained that to the House no one would have had a word to say. It is not a very big matter, but I wish to register my protest, in case it becomes an every day occurrence. If we let it go now. without saying a word, some other Treasurer may regard it as a precedent. Consequently, this might lead to a serious lapse from what ought to be maintained as the strict course, and naver deviated from without the consent of Parliament.
– I should not have said anything on this measure, but for a statement made by the Prime Minister, in answer to an interjection, that the Bill is not in any shape or form an indemnity Bill, nor framed to meet any sum which has been taken from the Trust Funds.
– Nothing has been taken.
– I have a distinct recollection that in this chamber a few days ago, when the Government were asking for Supply, a definite statement was made by the. Prime Minister himself that a sum of £50,000 had already been taken out of the Trust’ Funds. I hold in my hand a report of the proceedings on that day. This is what the Prime Minister himself said-
– The honorable member must not quote from the report of a previous debate during this session.
– If honorable members turn to page 37 of Hansard, they will find that the Prime Minister states in so many words that the sum of £50,000 has been actually paid out of the Trust Funds.
– Paid “to” a Trust Fund, I think.
– I remember the Prime Minister using the words “ out of the Trust Funds.”
– I think it was “paid to a Trust Fund in London.”
– My recollection is clear, and the record of the debate stands. The Bill is dated back to the 30th June, and yet the Treasurer says now that it is not an indemnity measure.
– I think I will be able to clear that matter up when I speak.
– When the Treasurer was asking for Supply he distinctly made the statement that I have attributed to him, and when the honorable member for Flinders and others pointed out that he had deliberately broken the Audit Act, he said that if the Crown Law authorities thought it necessary he would bring down a Bill to indemnify him for his action. In dating the Bill back to the 30th June, the day on which he distinctly states that it was necessary for this payment of , £50,000’ to be made out of the Trust Funds, he clearly shows that it is intended to indemnify his action. There are the gravest reasons why the Treasurer should never use Trust Funds without the distinct authority of Parliament. Two courses were open to the Prime Minister without deliberately breaking the Audit Act. He could have called Parliament together, and I do not see why the old Parliament could not have been called together before the 1st July, if it was necessary, as it was only a question of asking for Supply, and no fresh legislation was to be introduced. The other course open to the Treasurer was to secure temporary accommodation from the banks for a few days, which in all probability would have cost nothing in the way of interest.I know of no financial institution holding trust funds that would not have given the Treasurer a temporary overdraft without charging him interest in the circumstances. He could then easily have asked Parliament to grant him that sum of money later on. It would have broken no law, and the whole question would have been perfectly simple. I think we should enter the strongest protest against the Trust Funds being invaded in any way without t-he express authority of Parliament.
– The Treasurer may congratulate himself on being very kindly and tenderly dealt with over this matter. Had the same thing been done by the Treasurer of a Government to which the Labour party were opposed, the whole of these benches would have been’ lined with members rising up to utter the most indignant protests. They would not have waited this long to do it; but the adjournment of the House would have been moved, and the whole question thoroughly threshed out.
– No; one word from us and the “gag” would have been applied.
– I guarantee that there would have been a fortnight wasted over the discussion of the matter. It is all very well for the Prime Minister, in his capacity as Treasurer, to say that no money has been taken from the Trust Funds. He informed the House most distinctly that money had been taken, as honorable members can see from Hansard, page 38. I am not allowed to quote the report of the Treasurer’s words, but my recollection of what he said was that the Government simply desired to make temporary use of surplus Trust Funds which, in his opinion, could legitimately and properly be used on such an occasion.
– Then the Treasurer simply said that the Government desired to do it?
– No; he also said that certain moneys had been paid out of the Trust Funds. It is of no use for the honorable member for Adelaide to try to distort what was said on that occasion. Unfortunately for him, and fortunately for the country, the record of Hansard stands as a complete refutation of the attitude which he now assumes. A most definite statement was made by the Treasurer as to what was done, and the reason why it was done. The “purpose of this Bill, notwithstanding anything that may be urged to the contrary, is really, to indemnify the Government for their action. Section 61 of the Audit Act says -
It shall not be lawful for the Treasurer to expend any moneys standing to the credit of the Trust Fund except for the purposes of such Fund or under the authority ot an Act.
In this case the money was not used for the purpose for which the Trust Fund was created, nor under the authority of an Act. We have, therefore, an illustration of the absolute futility of adopting the provision which the honorable member for North Sydney thought would be a wise way of safeguarding the Trust Funds from interference - that is, by passing an Act specially to protect them. Here is the Audit Act, specially passed to protect the Trust Funds, and Acts dealing with the Trust Funds themselves are supposed to be a further protection against interference. Yet simply because they have behind them an obedient majority, the Government think they can, at their own sweet will, go behind any Act of Parliament with impunity, and lay violent hands on Trust Funds which were specially created for special purposes. Parliament, unfortunately, thought that it was sufficiently protecting those funds from interference. But any Government with a majority behind them can simply say, ‘ ‘ Why need we trouble about an Act of Parliament? True, the Trust Funds are protected by the Audit Act and by other Acts, but we can brush those aside, secure in the knowledge that, even if we take the whole lot - even if our action is illegal and undemocratic and a violation of everything that ought to be held most sacred in connexion with parliamentary usage - we can get our action condoned, as we have the necessary majority behind us. That is not a proper attitude to take, and I am disappointed in the stand which the Opposition have taken over the matter. I do not agree with much that has been said on this side in condonation of the Treasurer’s action. No matter to what party we may belong, we ought to resist every attempt to encroach upon Trust Funds without authority from Parliament, and especially every attempt to use trust moneys for purposes other than those for which they were set aside. What was done by a Premier of New South Wales some years ago has been urged as an excuse for the Treasurer’s action. Even were the facts as they have been represented to be - and I am not sure that they were - they would not justify the Treasurer in following his footsteps. The attitude of the Labour party to the same Premier, because of his action in another -matter, shows how accommodating some honorable members’ consciences are. When he anticipated a legitimate claim on the Consolidated Revenue, amounting to little more than£300, for valuable services rendered to the State, the Labour party thought it a crime to pay the money in anticipation of parliamentary authority, and professed to regard the offence as so heinous that it turned him out of office for it. What has been done by our Prime Minister is infinitely more serious. He has not merely anticipated parliamentary authority, but has appropriated trust money, which Parliament intended to be secure from a Treasurer’s depredations. In the public interest Parliament must absolutely control expenditure. Of course I know that the Opposition is numerically so weak that it would be useless to call for a division on the motion by way of entering a protest. The Labour party has the country in its grip. We, who represent a minority of voters, but not a minority of the people, are, unfortunately, unable to avail ourselves of the ordinary forms of parliamentary procedure to record a protest. But I shall never sit quiet when actions such as that of which I complain are done by any Government. The fact of an Administration having a large majority behind it does not justify the setting aside of Parliament, and the ignoring of the right of the representatives of the people to control the financial administration of the country.
– I cannot complain about the tone of the debate, nor cavil at the expressions used by honorable members opposite, and by honorable members on this side, regarding the confidence placed in the Treasurer in connexion with the administration of Trust Funds. Some misapprehension, however, has arisen. That might have been expected. On assuming office, the Government knew that it was probable that on 30th June last the Commonwealth would be unable to meet all its obligations.
– That was certain; Ministers knew it.
– The last Treasurer estimated that there would be a deficiency for the year of £1,200,000. On reviewing the figures, I thought that the deficiency might be £800,000, but, happily, during the last few months of the year, revenue, increased, while the expenditure was less than was anticipated.
– At the end of last session, I said that the deficit would be less than £1,200,000.
– I am not reflecting on the honorable member’s estimate. Some of those who were returned to this House, and to the Senate, chuckled over the fact that the Government would be financially embarrassed, and the press stated that one of our difficulties would be due to the defeat of the Financial Agreement, whose rejection we had advocated. Our opponents rather enjoyed our situation, though, I think, their enjoyment of it was not very dignified.
– I did not hear any honorable member say that he enjoyed the situation.
– Did any member of the last Government say so?
– I do not know that I need give names. Newspapers which are regarded as prominent and leading, because published in the capitals of the States, were pleased that we should have this difficulty to face. One of our first acts was to consider whether the new Parliament should be convened before the end of June. I strongly invited my colleagues to set their faces against meeting at a date when a number of senators who had been rejected would still have the right to take the places of those who had defeated them. Having, then, determined that Parliament should not meet until July, we had to consider the best means of getting over the financial difficulty- We thought that it would be wise to leave the adjustment of a very large sum over from the 30th June to July. We thought that we could not meet the full claims of the States on 30th June, but were ready to adjust them next month.
– The honorable member said that it would be done on the 15th July.
– It has been found more difficult to obtain an adjustment of the accounts than was anticipated.
– “Adjust” is a very good word to use for keeping back. The Senate will net meet until 3rd August.
– The word “adjust” was that used by the High Court. We hope that this Bill will be passed on the day that the Senate meets. The circumstances were extraordinary, and such as could not recur.
– A Government might find it impossible to re-pay to the States on 30th June the 25s. per capita which they are to get under the Surplus Revenue Bill.
– That is unthinkable. The Government hopes to get Parliament to pass a measure giving every Administration a month’s credit for the new financial year, on the basis of the Estimates for the last, so that it will not be necessary to call a new Parliament together until July.
– That will not provide the necessary money.
– What the honorable member suggests will only avoid the bringing in of a Supply Bill for a month.
– It must be remembered that the Treasury has to balance in six different places. That fact must not be forgotten in connexion with the adjustment of £37,000 that is in question, and the doubt about the indemnity, which has been discussed. The wits of man would not permit of a practical adjustment of receipts and expenditure on 30th June. The sum of £37,000 was the difference between the anticipation and the actual result, and I frankly told Parliament and the people so. It could have been adjusted by the use of Trust Funds entirely at the command of the Treasury.
– What are they? .
– There is quite a number of them.
– Was that sum of .£37,000 sent to England?
– No; it was withdrawn from the Trust Funds on 30th June, and repaid on the following day.
– When it was withdrawn from the Trust Funds it went into the Consolidated Revenue?
– And was repaid the next day.
– Would it be possible to make such an adjustment in one day ?
– I did not say it was made in one day. I said that the amount was withdrawn from the Trust Funds on one day, and repaid on the following day. Some honorable members opposite appear to think that an overdraft would have met the situation, but it would not and could not have done so. The Government had no constitutional authority to ask for an overdraft.
– The Opposition know that, and they would have grumbled if the Treasurer had done what they now say he ought to have done.
– I am dealing, not with the question of policy, but with the point as to whether the Treasurer of the Commonwealth has any authority to ask for an overdraft. He has none.
– I think that he has, under the general power of the Government.
– No; I am informed that the Commonwealth Government have no legal authority to ask for an overdraft.
– But the Treasurer could take the responsibility of obtaining one.
– There are circumstances in which the Treasurer of the Commonwealth might need to take that responsibility, but the point in dispute now is as to what was the best means of overcoming a purely financial difficulty. I took a certain course, whilst, according to a number of honorable members opposite, I ought to have obtained an overdraft. I am showing now how far astray they are in making that suggestion.
– The one would be as illegal as the other.
– The one is extra legal; the other is illegal.
– But assuming that we had obtained an overdraft, . could we have paid it into the Consolidated Revenue?
– With all due respect to the honorable member, I think that we could not.
– What is there to prevent that being done?
– I am advised that we should have had no power topay the amount of an overdraft into the revenue in respect of the year in question.
– If the Treasurer could not pay into the revenue for the year an amount raised by means of an overdraft, how could he use the Trust Funds, as he says he did?
– Order ! These interjections must cease.
– I am advised that I could not have used an overdraft for the purpose. The Commonwealth Government knew very well that their one-fourth of the Customs and Excise revenue would not cover the actual expenditure, and, consequently, they could not return the threefourths to the States as provided by the Braddon section. Therefore they did not pay.
– Then the Government retained more than their one-fourth?
– I told the States frankly that we could not adjust accounts on the 30th June.
– And the Government used the money?
– Order !
– No, we did not actually spend more than our one-fourth of the Customs and Excise revenue that we were entitled to retain, for the Constitution necessarily allows us some time to make our financial arrangements. Had we done so we should have violated the Constitution. This Bill will enable the Government to settle the matter during the present financial year.
– Then where did the money go to?
– Order !
– When I inform the House that the honorable member for Swan was my predecessor in office, and that when I went into the Treasury I estimated that there would be a shortage of £800,000 in the revenue, honorable members willrecognise that he is about the last who should speak in this way.
– The existence of a deficit does not mean that the Treasurer is not to pay statutory demands.
– Order !
– I know that, but the difficulty has been met. It is rather an error to say that by this Bill we are asking for an indemnity. I do not wish to shelter myself behind any temporary excuse that I might offer, but I do not like honorable members to make the gross statement that the Government have indorsed a violation of the Constitution and of the Audit Act.
– The Bill is to validate something which the Government did.
– Or did not do. It ismore nearly correct to say that this is a Bill to justify my failure to do at a particular time something which I should have done if 1 had had the money at my disposal to enable me to do it. The money not being available I could not pay it to the States. In the circumstances, therefore, I ask Parliament for authority retake this money from a particular funci so as to enable us to pay to trie States their full three-fourths of the Customs and Excise revenue in respect to the last financial year.
– Why does not the honorable member say-
– I have repeatedly called the right honorable member for Swau to order.
– I do not think that I am interrupting very much.
– Order; the honorable member must cease these continuous interjections. The mover of a motion, in replying, is required to confine himself to points that have been raised during the debate, but the Prime Minister is now being drawn by interjections into the discussion of ether questions. In the circumstances, I did not feel justified in calling him to order, but I ask honorable members to refrain from interjecting.
– I was speaking, sir, from notes of the debate, and adhering to them as closely as I could. There are only three fundamental points of difference between the Government and the Opposition. The Opposition say that we did not act rightly; that Trust Funds have been violated, that the Constitution has not been complied with, and that a dangerous pre-, cedent has been created. It cannot be fairly said that I have created such a precedent. I have neither hidden nor attempted to justify what I have done. As Treasurer of the Commonwealth I was confronted with a difficulty, and took the best course open to me for the protection and safe government of the Federation and the States. If there is room for complaint at all, it is undoubtedly on the side of the States, and I never excuse myself from that point of view. I do not justify the carrying over from the end of the financial year to the beginning of the next an amount equal to nearly £500,000. I merely say that I made the best of a very bad job in the situation that unfortunately arose. If the Commonwealth Government had elected to take from the Trust Funds the whole of the money that was available, it could have settled with the States, but I thought it far better to leave the payment over until Parliament authorized our action. I wish to say again that I shall never view lightly the violation of any Act relating to the Trust Funds, and that the action I have taken, so far from arousing any fear in that regard, ought really to strengthen, rather than weaken, the control of those funds. I tell the House frankly that there are funds out of which we could have adjusted the amount of ,£37,000, which was simply an error in calculation; but I preferred to take the whole responsibility for that error, and to make it part of the general question of the payment to the States. I thank the Leader of the Opposition, and his party generally, for their criticism. I should have been disappointed bad they not chosen to criticise the act itself, because, after alf, it is not one of those of which one might feel proud. It can be justified only on the ground that it was that of a man who is compelled, as the representative of the Commonwealth, to do that which he’ would “otherwise abhor, in order to make the best of the situation in which he finds himself.
– An act of necessity.
– Quite so; an act of (necessity.
Question resolved in the affirmative.
Bill read a second time.
In Committee ;
Clause 1 agreed to.
Clause 2 (Advances from the Trust Fund).
– T wish again to put this position before the Treasurer, and if he can satisfy me I shall be glad. Last year the net Customs and Excise revenue amounted to ,£11,322,028, and of that amount riot more than one-fourth could be applied under the Constitution to the expenditure of the Commonwealth. The balance had to be returned to the States. “That, however, has not been done. A sum of. £406,894 due to the States has not been paid, and, therefore, it seems to me that more than one-fourth of the Customs and Excise revenue last year must have been applied to the expenditure of the Common wealth. That ,£406,894, which ought to have been returned to the States, which belonged to them and was held in trust for them, has not been paid to them, but has been paid to somebody else. It was inevitable that there would be a deficit at the close of the last financial year. All Governments have to face deficits occasionally, and I do not suppose that the Commonwealth will be exempt from what is the common experience. But the fact that a deficit existed did not jus’tify the Government in withholding from the States moneys that belonged to them. Deficits must be financed in some other way. But instead of the Treasurer meeting last year’s deficit by some other means, he took the amount out of moneys belonging to the States, and held by him in trust for them under section 87 of the Constitution. The worst feature of the whole business is that he still persists in saying that he has not done so. He appears to desire to conceal his action. 1 wish to ask him a plain question, which I hope he will answer. What did he do with the £406,894 which has not been paid to the States, and which belongs to them under section 87 of the Constitution? How does he justify his action in withholding that money from them ? We know that he has spent it in some other way. As far as I can gather, the Government have applied more than one-fourth of the net Customs and Excise revenue towards the expenditure of the Commonwealth. Otherwise this money would be available for payment to the States. The Treasurer had no right whatever to touch the threefourths of the net Customs and Excise revenue, which, under the Constitution, did not belong to the Commonwealth, and which he was bound to return to the States.
– I should be very glad to lay this money upon the table if I had ever had it. The right honorable member for Swan admits that it had disappeared before I entered the Treasury.
– Not this money. The money of which I speak is Trust money.
– When the honorable member speaks of “ Trust Funds,” he refers to the three- fourths of the net Customs and Excise . revenue, which is returnable to the States. I am quite sure that a number of honorable members have not connected his reference to Trust Funds with that revenue. When the right honorable member quitted the Treasury, he left me with a deficit equal to - in fact, more than - the sum for which I am now asking. But I brush that consideration aside. I have already told the Committee that the adjustment which requires to be made has reference to money which the Commonwealth has expended. Otherwise that money would have been returned to the States.
– Then the Government have expended more than the onefourth of the net Customs and Excise revenue to which they are entitled under the Constitution ?
– The proposed adjustment will meet our constitutional obligations, and nobody should be better pleased than the right honorable member that that adjustment is possible.
– The Prime Minister has altogether missed the point which I raised. He seems to think that because there was a deficit when he took office, he was justified in taking moneys held in trust by him for the States. Of course, there was a deficit. Everybody knew that there would be a deficit. But the fact that a deficit existed could not in any way affect the payments due to the States under the Constitution. Even if there had been a deficit amounting to millions of pounds, the Commonwealth was still bound to respect the provisions of the Constitution. What does the Treasurer mean by saying that there was a deficit when he took office? It was not a deficit on the three-fourths of the net Customs and Excise revenue to which the States are entitled. It was a deficit upon current account. The deficit might have amounted to millions, but it was still obligatory on the Treasurer to return to the States their share of the Customs and Excise revenue. All other creditors should have been provided for from other sources and by other means, in other words, the Treasurer should have found the money elsewhere with which to meet the deficit. But simply because he was faced with a deficit he has used moneys that belonged to the States, and, by so doing, has applied to the expenditure of the Commonwealth more than the one-fourth of the net Customs and Excise revenue to which it is limited under the Constitution.
Mr. DEAKIN (Ballarat) [12.5.VI.- My honorable friend has now put his point with admirable clearness. All honorable members can grasp it. Up till now - as the Prime Minister has said - it has been con fused with another issue which stands by itself. The stand-point from which he views this question is one from which it may properly be viewed by any person who takes into account the peremptory obligation imposed upon the Commonwealth by the Constitution to return three-fourths of the net Customs and Excise revenue to the States. That money is earmarked for, and dedicated to, the States. It never becomes the property of the Commonwealth in any sense. Yet that money has been applied to legitimate Commonwealth purposes for which this Parliament had no authority to make any levy whatever upon the States’ three-fourths of the net Customs and Excise revenue. The Prime Minister has replied that the fact that a deficit existed was well known to my honorable friend - that the amount of it was properly overstated rather than underestimated by him in the first instance^- and that when he vacated office he must have known that he did not leave behind any moneys outside of the one-fourth of the Customs and Excise revenue to which the Commonwealth was entitled, which could be applied to meet Commonwealth obligations, and that consequently those obligations had to be ‘met by obtaining money from some other source. To that argument the right honorable member for Swan has replied convincingly that there 2fe various methods by which the Treasurer might have obtained money for this purpose, and that, in his opinion, he ought to have secured it on the Commonwealth credit, so as to avoid a wilful breach of the peremptory obligation imposed by the Constitution upon the Commonwealth to return to the States three-fourths of the net Customs and Excise revenue within each financial year by monthly instalments. His unanswerable contention is that the mandate of the Constitution overrides all other considerations, and that, whether the operation was profitable or unprofitable, the Treasurer in order to meet the indebtedness of the Commonwealth for various undertakings authorized by the previous Parliament, should have obtained money from any other source rather than that he chose. The right honorable member for Swan is absolutely right in saying that for the time being the Government have unwarrantably and illegally applied moneys of the States to defray expenditure, not of or for the States, but for the Commonwealth. For this he had and can have no authority That is the whole point.
– Yes, and the honorable member has put it exceedingly well - much better than I could have done.
– My honorable friend put the position with sundry adornments. Mine Is a plain tale, to which he brings to bear flowers of eloquence. I think, however, that he is now satisfied.
– I am satisfied with my argument, but not with the Prime” Minister’s reply.
– -The Commonwealth is not bound to return to the States three-fourths of the net Customs and Excise revenue during the financial year.
– The High Court has declared that the payment may be adjusted later.
– That decision relates only to minor and inevitable differences. The High Court has said that the Constitution is not to be read as demanding the performance of impossibilities. In other words, when the clock strikes twelve at the end of the financial year some margin must be allowed in which to make any necessary minor adjustments. But the High Court has also said that that margin must be the smallest possible to permit of those adjustments being made.
– I quite agree with that statement of the position.
– Then I only wish to insist that this was not the case here. The Prime Minister has said that if he had obtained, say from a State Premier, a sum sufficient to meet the needs of the Commonwealth during the last financial year there was some doubt as to whether that money could have been paid into the Consolidated Revenue. I think that a question open to argument. The term “consolidated revenue” has been defined in a way intended to exclude loan moneys. But I do not think that a vital issue in this connexion. If the .prime Minister had secured .£37,000 he would have refrained from taking it out of the Trust Funds temporarily.
– I merely adduced that circumstance by way of an’ argument against alternatives.
– Be it so. Putting aside the question of legal right and practice, I still ‘submit that it would have been better for the Government to have obtained the money from some other source, which would have enabled the Trust Funds to remain intact until the Treasurer had secured the authority which he is now seeking from Parliament - in other words, it would have been better for them to do something extra legal than to do something which was illegal, and absolutely forbidden by the law.
– It was an accident.
– Surely it would have been better to do something for which the Government had no express warrant rather than do something expressly forbidden.
.- The Leader of the Opposition has said that he can tell a plain tale. I think we can all tell a plain “ tail “ when we see it, and every honorable member can see the plain tail of the cat which is now peeping out of the Ministerial bag. The Prime Minister has stated that what he. did in opposition to the law of the land was the result of “ an accident. ‘ - It would be interesting to know how that accident occurred, whether it was due to himself, as Treasurer, or to a subordinate taking upon himself responsibility.
– The responsibility is mine.
– It is only fair to his subordinates that the Prime Minister should say to whom “ the accident “ is due.
Sitting suspended from 1 to 2.15 p.m.
– Before the suspension of the sitting I was directing some inquiries into the meaning of the explanation given by the Prime Minister that a certain Government action, that has been generally deplored in this House - though the House intends to indemnify his position - was the result of “an accident.” I think the PrimeMinister will see that the use of such ai phrase may damage some officer in his Department who may be responsible for the ordinary accountancy work. The PrimeMinister should be the very last man to wish to damage a public officer, and he will be frank enough to admit that, after all, the action was taken with his full cognisance,, if not with the full cognisance of the. Cabinet. Consequently, the mistake that was. made was not “ an accident” in the ordinary sense of the term, and was not an> occurrence for which some unfortunate member of the Public Service, who is not here to defend himself, can be held accountable at the bar of public opinion. The action with regard to which this, measure has been brought in is one which,, to my mind, opens up a vista of possibilities. I am convinced, for instance, that a Treasurer of long experience, such as. the honorable member for Hume, would’ deplore such an action. He would saythat it was the duty of a Treasurer to pay his way month by month, irrespective of consequences, or immediately meet Parliament. The holding back of moneys due to the States is practically tantamount to an act of national bankruptcy. If a private individual refused to honour a bill when it was presented, what would happen? He would immediately have to submit, at the discretion of the creditor, to all the inconveniences of the Bankruptcy Court. The Commonwealth Treasurer has chosen not to honour a bill presented by the States of Australia on the 30th June, under the powers and safeguards imposed by the Constitution. He has done this, I am sure, not from any desire to do a thing which was not right and straightforward. He has acted according to his lights. But if he had had the experience of the honorable member for Hume - who, I am sure, will not stand by this particular action of the Government - that experience would have been valuable. The right honorable ex-Treasurer assures me that the honorable ex-Treasurer intended to get the banks .to finance him over a particular difficulty.
– He said so.
– I did not say that I was.
– The honorable member said that he was going to finance somehow, and I think he said he was going to apply to the banks. :Mr. KELLY. - I think that that would !have been a more advisable course -than :the course pursued by the Labour Govern.ment. The Government later on propose a :number of things in the direction of raising money without interest, and practically without proper safeguards ; and this experience will justify the people of the country and the members of this Committee in viewing with suspicion any proposed method of raising money without interest at the discretion of the Government, te wit, the note issue, when we have had such an experience as this of the Government ignoring their responsibilities under the law. I should like to ask the Prime Minister whether the States offered any objection to the action taken by him? We are here in the position of trustees of the public purse. Our Government, on behalf of the Commonwealth of Australia, without consulting us, has dishonoured bills presented to the Commonwealth. As one of the directors of this concern, called the Commonwealth of Australia, I should like to know from our managers whether any protest was offered by the creditors of the Commonwealth on the 30th June last? Did the States offer any objection to the Government refusing to hand over this money?
– The honorable member does not want an answer now, does he?
– I am afraid that I am in the same category as an unfortunately maligned person in New South Wales, called Wade, when he asked a courteous question. The Prime Minister seems to think that the overwhelming importance of his position precludes him from giving the simple information required. But when, as a member of this Parliament, I ask whether the credit of the Commonwealth was definitely attacked by the States by protests on the 30th June, I am entitled to a reply. The public and this Committee can draw their own conclusions from the murky silence of the Prime Minister.
– The public will draw their own conclusions right enough.
– I am sometimes reminded by the honorable member that the public do not always draw the correct conclusion ! The- questions that I have asked should, however, be answered by the Prime Minister in the course of die debate. It is of no use to rely merely upon brute strength and sheer numbers to cover any action which the public, through Parliament, is perfectly entitled to understand. The credit of the Commonwealth is equally dear to all members of this Parliament, whether they sit on the Ministerial or the Opposition side, and it is of vast importance to the people who sent us here that that credit should be safeguarded. I think that the Treasurer might come out of his shell, and let us know definitely what attitude the States did adopt when their dues were disregarded at the end of last month. The honorable member for Hume was perfectly correct in saying that, as something had to be done to tide us over our difficulties, the position ought to have been met by financing. It seems to me that some of my honorable friends opposite, whilst they are opposed to loans, are not opposed to taking money out of the Trust Funds, or refusing to meet their honest obligations. But the electors who sent us here will want to see the Commonwealth finances properly and straightforwardly managed) and will require the fullest possible explanation when such conduct in the management of their affairs has. been resorted to. I am sorry that I had not the privilege of listening to the honorable member for Hume this morning, but 1 am convinced that he would have been able to help the Government very materially in arriving at a solution of this question. We all know that he had considerable experience in the Treasury; and whatever else may be said of his administration - whatever tangle the Treasury may have been in before he accepted his office - at any rate, it was quite cleaned out when he left it. The Prime Minister might have given the information that I have asked for. In the first place, I ask him to clear his own officers from a suspicion which they do not deserve, but which his own interjection has involved them in. What has occurred may be called a mistake, or something more serious, but at all events, it was not due to any subordinate officer in the Treasurer’s Department. I appeal to the honorable gentleman’s manhood to clear his officers from such an unworthy stigma. I say further that we are entitled to know what action was taken by the States that had this claim against the Commonwealth on the 30th June, and what position the Treasurer laid before them in order to induce them to bide their time for payment.
– I draw attention to the wording of this clause. It is intended that £500,000 shall be advanced as on the 30th June last. The meaning of that seems to be that the Treasurer proposes to apply trust money to the purposes of the last financial year ; that is, he intends, on the authority of this Bill, to have entered somewhere or other in the books of the Treasury, as revenue, a sum not exceeding .£500,000, and credit it to last year’s finances, which sum, however, he will not legally obtain until some time in August. This is opening the door to, I fear, a dangerous precedent, because it allows the books of the Treasury for the last financial year to be kept open for an indefinite time during the present financial year, and money obtained in the present financial year to be applied to the previous year in order to balance accounts. I do not want to make any political capital out of this matter, but frankly I do not like the look of it. The payment to the States of the £400,000 that is due to them will also be entered in the Treasury books as on the 30th June last. If we are going to make entries in the Treasury Books long after the expiration of the financial year on account of funds obtained after the termination of the financial year, we shall be laying down a principle, which certainly is not good. I do not know, but I shall watch anxiously, what the Auditor- General will have to say about it. I am aware that the Audit Act provides that no money shall be available from the appropriations for thefinancial year after the 30th June. * The Treasury has to close down then, and al-, though there are practical difficulties in the way of making small adjustments, they aremade as transfers in order to balance accounts, and are clearly explained to the Auditor-General as being unavoidable. But deliberate acts of this sort, by which money is to be voted by law a month after the close of the financial year and applied tothe previous 5’ear, in order to provide for a deficit, ought not, I think, to be necessary. This Bill may override the Audit Act, but at the same time the latter is an Act of Parliament that ought to be respected.
– Read clause 4 of the Bill.
– I am afraid that I cannot take my honorable friend as my guide in this matter. Although I sometimes cross swords with the honorable member for Hume, I do not think that he, as an old Treasurer, will agree with this sort of thing. It means embarking upon a system which is not in accordance with what we have been accustomed to, -and which seems to be fraught with inconvenience and possibly with mischief.
– Let us assume that the Treasurer in the previous Government had appropriated £450,000 out of the Trust Funds to meet any contingent deficit that he anticipated during the last financial year. What would have happened? I as the succeeding Treasurer should have had to meet the deficit when it occurred. Now., the previous Treasurer made no provision whatever to meet the deficit.
– He did not expect to go out !
– Well, then, the only charge that can be brought against us is apparently that we had the audacity to goin ! The deficit not having been provided for, instead of improperly taking th’emoney out of the Trust Funds and payingit without the authority of Parliament, I preferred not to pay the States, but to come down and ask Parliament to authorize the payment of this sum of money, amounting to half-a-million, to enable the States to be paid as on the 30th June, 1910. In other words, the payment will have to be made later.
– I think the honorable gentleman might have dealt with the whole matter at the end of June.
– With all due deference to the honorable member for Wentworth, I think I took the safest course in refraining from dealing with it then and in asking Parliament to provide for the payment in this year.
– Will the honorable gentleman say whether any officer in his Department was in any way responsible
– I have already said twenty times that all the responsibility in the matter is mine and not that of any one else.
Clause agreed to.
Clause 3 -
The amount so advanced shall be credited to the several States in proportion to the numbers of their people.
.-! wish to direct the attention of the Treasurer to an aspect of the question which, I think, is raised by this clause. It provides that the amount to be advanced is to be credited to the States in proportion to the numbers of their people. Had this money been paid to the States, as it ought to have been, before the close of the last financial year it would have been credited to them on the basis of the bookkeeping system. If, as a necessary consequence of the action of the Government, they are compelled now to distribute the money on the per capita basis the alteration in the form of distribution may give rise to a serious discrepancy against one State in favour of another between the amounts which would have had to be paid under the bookkeeping system and those which will be paid in accordance with the per capita system. I should like the Treasurer to say whether he has looked at this “aspect of the question, and, if so, to tell the Committee to what extent one State will lose and another gain from the operation of the system of distribution proposed.
. -The honorable member has raised a very pertinent question, but what he has referred to is already provided for under the provisions of the Surplus Revenue Bill which we have just passed. Under that Bill the payments will necessarily be made on the per capita basis.
– But these payments were due in the previous financial year.
– These payments arerequired to cover a deficit which has to be met in this financial year, and they are payments which the States Governments agreed to meet. That is shown in the schedule to the Bill we have just passed, and the Bill deals with the distribution on a per capita basis.
– I did not understand that the amounts in the schedule to the Surplus Revenue Bill were to be dealt with on the per capita basis.
– The whole principle of that Bill is founded on the per capita basis.
.- The Treasurer’s statement does not answer the question I raised. My point is that this money should have been paid to the States during the last financial year, and not during this financial year. The schedule to the Surplus Revenue Bill to which the honorable gentleman has referred applies, not to the last financial year, but to the latter half of the. present financial year.
– The obligation is in the last half of the last financial year, but the payment is to be made in this half of the present financial year.
– That is so. The amount referred to in this Bill does not apply to the present financial year, but is money which should have been paid to the States during the last half of the last financial year. I do not yet see why the per capita system of distribution should apply to this amount. I think that it ought to be paid to the States under the bookkeeping system.
.- Let me first accept some responsibility for having assumed as a matter of course that the schedule of amounts to be deducted from the Customs revenue due to the States in the financial year ending 30th June, 191 1, attached to the Surplus Revenue Bill, was necessarily made, on the usual terms, legal and binding at the time when the money ought to have been paid. I am grateful to the honorable member for Richmond for having raised the point. This is the first intimation I have received - I hope it is erroneous - that the division of this amount between the States is not to be made under the bookkeeping section, which applied and still applies until the end of the present calendar year. Why has the basis been altered? At present I am entirely at a loss to know why it should be altered.
– I think it is just.
– Everything is to be said foi the adoption of the per capita system of distribution when we enter upon the new period with a new arrangement.
– The honorable gentleman is aware that we have the power to do this.
– I shall look into that in . a moment. I wish at present to continue my previous train of thought. Why should the Treasurer introduce, without necessity as well as without warrant, and, so far as I am concerned, without warning of the change, a new system of distribution. It will be perfectly appropriate in our new circumstances, but its application to a former period is curious. What is proposed will not alter the amount to be paid by the Commonwealth, but only its distribution amongst the States, and for that no reason whatever has been given. Honorable members recollect that while under an existing .system we went short in our payments to the States. We did not make certain returns when we should have made them, and it is proposed to make them now. If they had been made as they ought to have been made at the due date, the money would have been distributed under the system then current. Is it possible that it is intended to alter this system of distribution amongst the States, although this will not relieve or assist the Commonwealth in any way ; and, so far as I know, without any practical reason ?
– I find there is a much stronger reason than that which I have suggested. In addition to the view of the matter which I have taken as one of policy, there is a reason in fact for the proposal. This money, taken in the way in which it has been taken, is new .’revenue, and must therefore be distributed per capita.
– In what sense is it new revenue ?
– It is revenue derived from Trust Funds, and as such is new revenue. That is the legal opinion on the matter.
– Surely that could have been avoided?
– It is now, not a question of whether it could have been avoided, but a question of fact.
– I must say that this comes as a surprise to the Committee. Unless we are so bound, that we have no choice in the matter, I cannot at present see any circumstances which call upon us to deduct from the States, on a new basis, a sum which, if we had fulfilled our obligations, would have been paid to them prior to 30th June last on the basis still’ legal. What reason of policy or equity is there for the change? If paid to the States when it was due this money must have been distributed amongst them on a certain basis. It is now being paid to them after the date on which it became due owing to a default of ours, and not of the State Governments. Why, then, should we make that an occasion for bringing in a new system of distribution? There has surely been enough vexation already in connexion with this matter.
– -These are the pitfalls in dealing with matters of this kind.
– They are. I have felt hampered in these discussions from the fact that all the measures before us depend upon, or are closely related to, the Government’s whole financial policy, which we have not yet heard expounded. Until we know what that is we are unable to fit these different propositions into their places. We are obliged to deal with each independently and separately, when, as a matter of fact, they are all intimately connected. We might reasonably, not on this particular issue, but perhaps on this Bill, and some others, adopt a different attitude, if we understood how the Government propose that the whole of these proposals shall be combined and adjusted. On this particular issue I need scarcely point out that the State Treasurers, ought to have been consulted. Those among them who may be disadvantageously affected, will be certain to raise an outcry at a change in the distribution apparently uncalled for.
– When we look at it all round, I think it will be found that no injustice will be done. This is a deficit iri the revenue, is it not?
– It is our deficit, and why should some States suffer on that account ?
– Assuming that it is our deficit, how could we make it up ?
– It ought to have been made up before. The payments were due last year. We have not met our obligations.
– Assuming that it were made up by direct taxation, how should the amount be distributed?
– Does the honorable gentleman mean that if the Customs and Excise revenue had not sufficed we should have made up the revenue by direct taxation?
– It did not suffice.
– Yes, it did. If, as the honorable gentleman admitted, the Customs and Excise revenue, due to the States, which was collected on their account and belonged to them, had been preserved for them and paid to them when due, our deficiency would have been made up in some other way. It ought not to have been made up at their expense. Then this question could not have been put, because the present situation would not have arisen. The States were and are still entitled to three-fourths of the revenue from Customs and Excise, but to nothing from direct taxation. They received part of the threefourths of the Customs and Excise revenue due to them and legally distributed on the old basis. Why then should we now, when the Government’ are meeting a deficiency they themselves were responsible for in the Customs and Excise revenue actually received, propose to alter the system of distribution between the several States? I see no reason for it.
– If the Commonwealth had spent £450, 000 less, what the honorable gentleman suggests would have happened ; but if we assume that the Commonwealth had to raise£450,000 to meet a deficit in the Customs and Excise revenue they could only raise it from sources other than Customs and Excise. As matters stood, the whole of the Customs and Excise receipts were accounted for. If the Commonwealth raises revenue by any other means - by taxation, loan, overdraft, or from Trust Fund - the allotment of that revenue must be per capita.
– It is not allotted, and there is no reason why it should be.
– Because the Commonwealth have the Customs and Excise revenue to which trie States are entitled. Their claim is on the Customs and Excise revenue; and the Commonwealth cannot say that it has not received it; and, therefore, the Commonwealth must account to the States for it.
– What have we done?
– The. Commonwealth has taken this money for its own purposes, yet the Government desire to impose on the States conditions brought about in consequence of the money being derived from another source. That is not the fault of the States.
– If the Commonwealth raises any other revenue, it can only be repaid to the States by one method - that is on a per capita basis.
– Quite right.
– The Commonwealth has taken and expended- its full one- fourth. The matter is a little subtle, and apt to get one side-tracked ; but the Commonwealth had to raise £450,000 to meet its obligations, and that sum, being raised from other than Customs and Excise, it must be distributed per capita.
– This is new revenue?
– It is not new revenue. Inasmuch as the Commonwealth has taken the old revenue, the States are entitled to say that there shall not be imposed on them conditions in consequence of any action of the Commonwealth, on which the States have not been consulted, and over which they have no power. I am putting the case on the ground of equity.
– The States were allotted the whole of their three-fourths, and there was a Commonwealth deficiency which had to - be made up by means of new revenue. The States are entitled to their proportion of that new revenue, and it can be allotted only as new revenue on a per capita basis. I think that is the legal position.
.- There are not only the grounds of equity, but the more serious ground of legal obligation to be considered.
– It is a question I have gone around and around, and one on which I like to think three or four times before expressing an opinion.
– The Prime Minister has, I think, gone around and around in a vicious circle. We are under a legal obligation to each separate State to refund the exact amount of money we held over when we defaulted ; that is a constitutional obligation practically, and the obligation on which the Prime Minister is leaning.
– This money must be treated in the way proposed, because it is surplus revenue.
– It is not surplus revenue, but the revenue of last year which we misapplied.
– It was surplus revenue when placed in the Trust Fund ; but when we take it out again, we must apply it per capita.
– The Attorney-General, I understand, contends that under a Federal Act of Parliament we must so apply the money ; but in the Law Courts the States will hold that, under the Constitution, which overrides any Federal Act of Parliament, they were entitled to specific amounts on the 30th June, and, that being so, they are equally entitled to those amounts on the 21st July; in fact, strictly speaking, they are entitled, not only to the amounts, but to interest on them. I honestly believe that if we pass the Bill in its present form, legal action will be taken by the States, and the Commonwealth will lose heavily in the Law Courts, the expense being met from the Treasurer’s Advance, or some other convenient source. There is no reply to the contention of the honorable member for Richmond ; and I think the Bill might be reframed so as to give the States the exact amount to which they are entitled. It would be much easier to amend the Bill than to amend the Constitution ; but either one or the other must be done by the Government to extricate themselves from the quagmire - they must comply with the Constitution or be mulcted in law costs.
– I do not think so.
– The Prime Minister ought to make the matter sure.
– It is imperative that the allocation should be made in the way proposed, seeing that the money has come back into the Consolidated Revenue as surplus revenue.
– It is not really surplus revenue, but a deficit of last year which is being made up this year. No amount of juggling - I do not use the word offensively - with the book entries will make revenue, which ought to have been paid to the States last year, new revenue this year. It is revenue to which the States were entitled last year.
– So far as I can judge, the view of the Opposition is right. This money ought to have been paid last year; and if it had been paid then, it would have been dis tributed under the old system, no matter where it came from, because it is not ‘ ‘ new revenue ‘ ‘ in the sense in which we understand that term;. The view of the Government is that, because this money was derived from the Trust Fund, it is new revenue, and can be dealt with in a different way ; but I fail to see that that is so. I may, of course, be wrong; but. I think the States absolutely justified in asking, or, at any rate, that they will ask, the High Court to compel payment on the old basis. No alteration or financing can alter the Constitution.
.- With every desire to assist the Government, I must frankly admit that I fail to see that the course the Government intend topursue is the correct one. Some difficulty may arise from the fact that the Govern-: ment .and this House recognise, by the Bill we passed yesterday, that some of the States will be paid 2s. and others 3s. per head; and I take it that the distribution/ detailed in that previous Bill will work out on that basis. That, however, is strictly in accordance with the financial agreement as approved by the States Governments. The Government seem to have complicated the deficit with this particular payment, the former having of necessity to be paid to the States on the threefourths’ basis. I take it that we are now making a special payment to the States out of the Trust Funds; and I think that the Attorney-General’s contention is that there is an Act of Parliament to the effect that, if any payments are made out of the Trust Funds, or from surplus revenue, it has to be distributed on a -per capita basis. If we were making a special payment, that view would be correct; but, in this instance, we are paying certain moneys that were unavoidably withheld, and ought to be repaid on a threefourths’ basis, so that there is no necessity to adopt a per capita basis. Later, when there arises the necessity for deducting the deficit, it can, of course, be deducted in the terms of the proposed agreement embodied in the Bill previously passed. I donot see the necessity for this clause in the Bill ; and, if it be deleted, there will be no inconvenience to the Government, while trouble may be saved in the future.
.- I do not think the matter could be put more plainly than it has been by the Leader of the Opposition. We cannot take advantage of our own wrong, and call this news revenue, simply because we are getting the money from a particular source, in order to meet a liability which ought to have been met before the 30th June. We cannot alter the conditions of the payment; the States are entitled to this out of last year’s revenue, by virtue of the law in force at the time. We were not able to pay the States, and, as pointed out, we must have taken possession of some of the States’ three-fourths of the revenue which we now propose to pay back. What does it matter to the States where the money comes from - whether from this year’s revenue or from a temporary borrowing? It is money that was due to the States on the 30th June, and we cannot say to them, “ We paid you last year for eleven months on the basis according to law, but, because we did not pay you for the other month, we are going to alter the basis of division amongst the States.” In my opinion, the States are entitled to have this money distributed to them in the same way as if they had received it on the 30th June.
– Under the Constitution, the States, during the year 1909-10, were entitled to three-fourths of the net revenue from Customs and Excise. I should like the Treasurer to tell me whether there are kept in the Department, statements showing, on the one side, the actual receipts from Customs and Excise, and the cost of collection, and whether the net revenue is arrived at by subtracting the cost of collection from those receipts? I take it that that is so; and that the net revenue is then divided, the States being entitled to threefourths. The question arises, how that revenue ought to have been distributed amongst the States last year? The balance due to the States amounts to £450,000. Will this be paid to the States in exactly the same way as if it had been paid before the close of the financial year?
– I intend to do that.
– Is it that, inasmuch as in this particular year there is a shortage, the Government have to get new revenue from some source, and the new revenue is the , £450,000 taken from the Trust Funds ; and that that money, instead of going into the account of Customs and Excise, goes into the general expenditure of the Commonwealth - it covers the general expenditure in connexion with defence, postal matters, and so forth?
– And, because of that, it must be credited in the same way as new revenue.
– On a per capita basis?
– Precisely ; there is no violation of section 87.
– Is it the Treasurer’s intention to distribute to the States the balance of the three-fourths in exactly the same proportion as though it had been distributed before the close of the financial year ?
– And the Treasurer has no desire, by this Bill, to alter that disposition in any way whatever?
– None whatever.
.- If that is the intention, I do not see much advantage to the Government in retaining the clause, because it is already in the Surplus Revenue Act 1908. There can be no doubt that the States are entitled to the three-fourths of the net revenue from Customs and Excise collected in each State.
– They are only entitled to that in the aggregate.
– Yes ; but, as a matter of fact, apart from the technical wording of section 87 of the Constitution, each State, in practice, gets three-fourths of the net Customs and Excise revenue collected in the State.
– We may legislate at any time as to how that three-fourths is to be distributed.
– We have done that already.
– No, we are legislating now.
– My point is that the year is ended, the receipts and expenditure in the States are known, and I take it, from what the Treasurer said, that there is no intention to interfere with the receipts and expenditure in the various States.
– That is so.
– That is satis: factory as far as it goes. It occurred to me, however, that the expenditure might be more in one. State than in another, and one State might have had less than it ought to have had, or more; but so long as, up to the 30th June, the same procedure is followed as has been followed in the past - and there is no doubt that it must be, because all the work is done - I “do not think we have any cause to complain. . I have always thought the question of new revenue, and its distribution, a complicated matter, but this is not really new revenue. It is money obtained to pay . what we ought to have paid before. All this difficulty comes about through the manner in which the Treasury have dealt with the question. If they had paid the money on 30th June, and got it from some other source, we should not have had these complications or this long argument. The Government have made a great mistake in interfering with the statutory rights of the States up to 30th June, and I should advise the Treasurer, in his own interests, and the interests of everybody concerned, to strike out the clause. He could then take full time to consider the matter. I think all the power necessary is to be found in the Surplus Revenue Act 1908. I therefore see no reason to put in this clause, which is unnecessary, and may give rise to controversy.
– 1 think it would be better to leave the clause in, but if, on further consideration, it is found inadvisable to retain it, we shall have it left out in another place. We could not introduce it in another place, but we could have it omitted there. The question is full of pitfalls. I am satisfied that the Bill is correct. The Government intend to pay the States the balance of the Customs and Excise revenue on the same basis as has been followed since the beginning of Federation, and that is what will be done up to 30th June last.
.- I am satisfied that the intention of the Government is to credit the three-fourths to the States for last year, on the same basis as before. Then they introduce a new feature, when they make, by Commonwealth authority, a deduction from that three-fourths in a new ratio. The honorable member for Richmond put his finger on the spot when he asked what system had been adopted in charging that deduction. The States collectively have got their three- fourths, and their claim, so far as that is concerned, is satisfied ; but on what principle are these deductions to be made from them severally? Not, as the Treasurer points out, on the same principle as the three-fourths which he took from them and now returns to them some months after, but on the new per capita plan. That is introduced by the Treasurer because he treats his overdue payment as new revenue, which must be so dealt with. The point which attracted attention on both sides of the House still remains unsolved. Is this fair? The fair thing to dp in the circumstances, when making the returns to the States with deductions, would have been to make them on the same scale as the payments, and not to introduce a new system or new questions.
– Can we do that?
– The balance of opinion, so far, is that we can. In any case, the Government have introduced a new system without warning, apparently, because it was the system proposed under the defunct agreement. The Treasurer still retains his own extraordinary reading of that agreement, which, while leaving him free to alter his obligations as he pleases, still binds the States to the terms that they agreed upon - for considerations which he discards - with somebody else. I invite the Treasurer, when reconsidering the clause, to look again into this question. Let him ascertain whether he would not be following an easier and more correct road hy preserving the same principle in deducting from as in paying his overdue debts. I should think it would be more in consonance with the wishes of the parties, and in accord with the Constitution, to complete both transactions on the same basis.
.- The Bill, apparently, is not clear until supplemented by a statement by’ the Treasurer that the moneys due to the States will be paid to them on the three-fourths’ basis. Of course, we accept that assurance readily, but the Bill does not provide for that, and, therefore, is not perfect, because an assurance by the Treasurer can scarcely be read into the Bill. I wish to enter my protest against any Bill being allowed to go from this House in an imperfect form, with the idea that it can be put right in another place. I hope that we shall make all measures as perfect as possible before they leave this Chamber, even if it means an adjournment for further consideration.
– I wish to say again clearly that this is a matter on which, if it was put to them, a jury in the first instance would most likely give a wrong verdict. The popular view is, I think, a wrong one, and I believe the Bill is correct. Honorable members might well let it go through Committee, and we can hold it back on the third reading. The Government intend to pay, and will pay, to the States, on the basis provided by the Constitution, the total threefourths of the Customs and Excise revenue. They and their advisers think that the Bill should be passed as it now stands, as it is an important measure, dealing with the
Trust Funds, but I will ask the Committee to take it as far as the report stage, and I shall make a complete statement later on regarding the position, legal and otherwise.
Clause agreed to.
Clause 4, and title, agreed to.
Bill reported without amendment.
– I move -
That this Bill be now read a second time.
This is a short Bill, dealing with a most important subject. Last session the then Government thought it advisable to introduce a Bill to enable them to raise a loan of £3,500,000 for naval purposes. The principal purpose was to construct and equip ships.
– That was the whole purpose. It would have absorbed the entire amount.
– I believe so. In accordance with an agreement made by their representative at an Imperial Conference, the last . Government entered into a naval building programme which would practically have absorbed the whole amount they were authorized by the Act to borrow ; but they did not take steps to raise money under it, and, so far as I know, no negotiations to that end were entered into by my predecessor. Certain payments which have since fallen due have been met out of the ordinary current revenue, and it is our policy fo continue so to meet them. The objection of the Labour party to borrowing is even stronger when the borrowing is suggested for ordinary Defence purposes. We feel that the Commonwealth would not do justice to itself if its first entrance into the loan market were for the purpose of obtaining money for ordinary Defence expenditure. Even though we might be compelled to raise a loan for some other purpose during this session, I would feel it my duty, in order to carry out our pledges to our constituents, and to assert a principle, to bring in a Bill to repeal the Naval Loan Act. Only in the case of war or great national necessity should we borrow for Defence purposes. The Government will endeavour to meet the obligations respecting building entered into by its predecessors. They will be met out of current revenue, even if other services have to be dealt with differently. Underto circumstances shall we bind ourselves to spend money borrowed from other countries to provide that insurance which every well-governed people feels bound to make for the protection of life, property, and national existence.
– What about the proceeds of the note issue?
– In my opinion, it is not justifiable to borrow for the purposes of ordinary Defence. There is much I could say on this matter, But I do not wishto go back into ancient history, and there was a violent political controversy when the measure which I wish to repeal was under consideration. It was amended to provide a sinking fund to extinguish the proposed debt in fifteen or sixteen years.
– That was provided for in the Bill as introduced.
Mr.FISHER.- The honorable member was of opinion that there should be no limitation, . and the Bill, as drafted, allowed the debt to continue for forty or fifty years. Thinking it inadvisable to borrow to commence our Defence system, the Government asks Parliament to repeal the Naval Loan Act, so that we can provide, out of current revenue, for the large naval unit which is being constructed. No doubt this will embarrass our finances considerably.
– Then why do it?
– Because borrowing is bad in principle. The people should fee! that they ought not to be under an obligation to other countries for their defence preparations. If all be true that some wise persons tell us, our expenditure, during the years in which our constructional programme is being carried out, may not be much in excess of our later annual expenditure.
– The Government do not propose to curtail the programme of naval construction ?
– Nor to retard the rate of construction?
– Neither the one nor the other. We do not wish to set aside or to delay that programme. The Bill has been introduced to carry into effect our political views. I do not think that it will be possible to raise the money required in three years ; but we may be able, without borrowing, to so adjust the payments as to meet our obligations in five years.
Debate (on motion by Sir . John Forrest) adjourned.
Mr.SPEAKER reported the receipt of a message from His Excellency the GovernorGeneral, recommending an appropriation for the purposes of this Bill.
Census Heading “ Illegitimacy “ - Claremont Quarantine Station - Old-age Pensions Administration.
Motion (by Mr. Fisher) proposed -
That the House do now adjourn.
.- I wish to bring under the notice of the Minister of Home Affairs a matter to which I have given a good deal of thought. It has been my desire for many years that, as suggested by the American poetess, Ella Wheeler Wilcox, the word “illegitimate” should be wiped out of the English Dictionary, and I, as an Australian, object to future innocent citizens of the Commonwealth being stamped with a brand of infamy which they do not deserve in connexion with the approaching census enumeration. I wish to ask the Minister of Home Affairs if he will take steps to have the word “ illegitimate “ removed from the census paper. It comes from lex, legis - law, “ and may be described as merely a manufactured word. Mrs. Williams, of Brisbane, a lady whom the Prime Minister, as a representative of Queensland, would be proud to know, has declared that a child born out of wedlock should be described, not as illegitimate, but as the legitimate child of illegitimate parents.. I thank her for coining so excellent a phrase, and I ask the Minister of Home Affairs to take steps to see that the census enumeration does not stamp infamy upon hundreds of our Australian units. I do not believe there is a widely-read man in the House, from the Prime Minister to the Leader of the Opposition, who would be prepared to allow this stain of infamv to attach to any human being. Honorable members will agree with me that the Christ of 2,000 years ago would have taken these children in His arms and blessed them, and surely, if He would have thought them worthy to receive His blessing,’ we ought to remove this stigma from them. No child ever came into the world without the permission of the Almighty, and a man or woman who has the impertinence’ to insult a human being by saying that it is illegitimate can have no love or reverence for his or her Creator. I hope that the Minister of Home Affairs will grant my request.
.- According to some newspaper reports, it is the intention of the Commonwealth to establish a quarantine station at Claremont, which is situated a few miles from Hobart. If the rumour be correct, I hope that the Minister of Home Affairs will stay his hand pending an investigation, because I believe a more suitable site could be obtained for such a station in a locality where it would not be obnoxious to so many people as it would be if erected at Claremont. It would also appear, from the press reports, that the Commonwealth Government are going to proceed with this work without intimating their intention to the State Government. As a matter of courtesy, we ought to acquaint the State Government of our proposal in this regard, and should not proceed too hastily with it. I trust that the Minister of Home Affairs will take time to consider the project, so that, whatever step is taken, may be in the best interests of all concerned.
.- The Treasurer might with advantage look into the administration of the old-age pensions law. I experience great difficulty in obtaining decisions in reference to claims that I have submitted. I write to the Treasury, receive a reply, and, although further correspondence ensues, it seems impossible to obtain a definite settlement. I havo in mind the case of a man in my constituency who is over seventy years of age and has been denied a. pension. I am very reluctant to bring before the House individual cases, but. this claim has been before the officials for some months, and I have not yet been able to obtain any satisfaction. The ground on which the applicant is refused a pension is that he deserted his wife in Adelaide some seventeen years ago.
– Will the honorable member give me particulars. There is not ten per cent. of the delay that used to take place.
– I shall furnish the honorable gentleman with all particulars. This old man produced for my perusal letters couched in affectionate terms, and purporting to have been addressed to him by his. wife a little over ten years ago, although she now claims that he deserted her over seventeen years ago. He has been prospecting in the bush, and the police have apparently accepted the wife’s allegations that he deserted her, and. made no provision for her wants. As a matter of fact, she has several sons earning money, and she also keeps a boarding-house, so that she is practically independent of her husband. My complaint is that the officials should have accepted this lady’s unsupported statement and have refused to take cognisance of the man’s oath that he did not desert her, and that he has letters to prove that they were in affectionate communication with each other only ten or eleven years since. I cannot account for the feline vindictiveness which led the wife to interpose to prevent this unfortunate man obtaining a pension. He is certainly a man of herculean proportions, but is considerably past the period of life at which he ought to be expected to work for his own living. The letters to which I have referred were intrusted by him to the Deputy Registrar at Coolgardie, who acknowledges having sent them to the Sub-Commissioner at Perth. The latter, however, declines to admit that he ever received them, and denies all knowledge of their existence.
– I do not agree with that.
– The old man received from the Deputy Registrar at Coolgardie a receipt for these documents, which he requires now to prove to his relatives in other parts of the world that the charge made against him by his wife is untrue; that he repeatedly sent her money, and that he has been subjected to considerable injustice. Surely the Treasury should order its officials to send the man before a special magistrate, so that his evidence may be taken on oath as against the unsupported statement of his wife, who resides in Adelaide.
– - I can inform the Treasurer that there are hundreds of cases similar to that just brought under his notice by the* honorable member for Coolgardie. I know of a claim made by a man eighty-three years of age, who has been refused a pension because he and his wife, being unable to agree, some fifteen or eighteen years ago, decided to separate. This Parliament never intended that events which occurred ages ago should be resurrected against applicants when they are old and unable to earn a livelihood themselves. There are many women who occupy a similar position. They have found it necessary to leave their husbands. One of them recently assured me that, although she could not prove that her husband was guilty of brutal conduct towards her,, she had to leave him. Yet this woman cannot obtain a pension because she left him.
I repeat that that was never intended to be the law. I believe that the Act empowers the Commissioner to exercise a discretion in these matters, but, if not, the Statute should be so amended as to permit of all cases being dealt with upon their merits. The old man whose case I have mentioned, fought in the Crimean war, and certainly has done his share towards the building up of our civilization. If the Treasureris unable to guarantee that the Act will beadministered more sympathetically an amending measure should be introduced without delay.
.- Whilst this question is being discussed I wish tostrengthen the hands of the Treasurer by recalling another case in which an applicant for an old-age pension in Western Australia has been harshly treated. In. the matter of marital relationships in connexion with the granting of pensions, I hold that too much is being made of the letter of the law and too little of its spirit and intent. Whilst I was. in Perth recently, I was approached by an old man who stated that twenty years ago, being unable to find, employment in Victoria, he had quitted this= State for Western Australia. There, so long as he was able to do so, he maintained himself and lived a decent and sober life. But in his old age, when he was unable to work, he applied for a pension. In answering certain inquiries which were .put to him he stated that he had a wife in Victoria who was possessed of considerable means, but that during all the. years he had been in Western Australia she had refused to have anything to do with him. His story, I believe, is absolutely true; indeed, he is prepared to make an affidavit to that effect. But his application for an old-age pension has been refused on the ground that he has. not obtained a deed of separation from his wife. The old man has neither the means to secure such a separation nor the inclination to do so. He has children, and he does not desire to cast obloquy upon them by taking action in the Court; but because of the refusal of the authorities to grant him an old-age pension he has been, compelled to enter an indigent asylum. It is a crying shame that these sort of things should be tolerated by the Commonwealth.
.- In my electorate, there is a large area of leasehold land upon which a number of’ persons erected small homes some years ago. Their leases have only a few years to run, and yet when they apply for old-age pensions they are called upon to estimate the value of their properties) - which they cannot sell - and the authorities then insist upon making proportionable deductions from their pensions. I do not think it was the intention of this Parliament to penalize those who have established little homes of their own and who are living in them. Certainly the law should be amended so as to prevent that.
– I heartily agree with the remarks of the honorable member for Melbourne, who has done a great deal of work in the interests of humanity, that we ought not to cast any stigma upon infants who are born out of wedlock. There ought to be no law which brands a child as illegitimate from its cradle to its grave, and I shall do anything that lies in my power to alter existing legislation on that subject. Some years ago I introduced the first Legitimation Bill ever presented to the South Australian Parliament, and was successful in carrying it. My friend, the honorable member for Melbourne, did similar work in Victoria. I also introduced to the notice of the South Australian Parliament a measure which declared that all children who were born within the State should be legitimate. In reply to the remarks of the honorable member for Wilmot I would point out that the purchase of the land for the quarantine station of which he spoke was in negotiation before I became Minister of Home Affairs. However, I shall look into the whole subject, as ‘the Government do not wish to do anything which is calculated to provoke friction with the States.
Question resolved in the affirmative.
House adjourned at 3.43 p.m.
Cite as: Australia, House of Representatives, Debates, 22 July 1910, viewed 22 October 2017, <http://historichansard.net/hofreps/1910/19100722_reps_4_55/>.